UNPUBLISHED

UNITED STATES COURT OF APPEALS 

FOR THE FOURTH CIRCUIT 

No. 09-1389

ADMIRAL INSURANCE COMPANY, 

 Plaintiff – Appellee, 

 v. 

ACE AMERICAN INSURANCE COMPANY; ILLINOIS UNION INSURANCE 

COMPANY, 

 Defendants – Appellants. 

Appeal from the United States District Court for the Western 

District of Virginia, at Harrisonburg. Samuel G. Wilson, 

District Judge. (5:08-cv-00055-sgw-jgw) 

Argued: December 3, 2009 Decided: January 20, 2010 

Before KING, DUNCAN, and DAVIS, Circuit Judges. 

Affirmed by unpublished per curiam opinion. 

ARGUED: John L. Williams, COZEN O’CONNOR, Seattle, Washington, 

for Appellants. Thomas Collier Mugavero, WHITEFORD, TAYLOR & 

PRESTON, LLP, Falls Church, Virginia, for Appellee. ON BRIEF: 

Thomas M. Jones, David J. Walton, COZEN O’CONNOR, Seattle, 

Washington, for Appellants. Valerie L. Tetro, WHITEFORD, 

TAYLOR & PRESTON, LLP, Falls Church, Virginia, for Appellee.

Unpublished opinions are not binding precedent in this circuit. 
PER CURIAM: 

 ACE American Insurance Company (“Ace”) and Illinois Union 

Insurance Company (“Illinois Union”) appeal from the district 

court’s judgment in favor of Admiral Insurance Company 

(“Admiral”) in this insurance coverage dispute. As explained 

below, we affirm the district court. 

I. 

A. 

 Admiral, Ace, and Illinois Union provided insurance 

coverage to American HomePatient, Inc. (“AHP”), a company 

headquartered in Tennessee that provides home medical services 

and equipment. On May 16, 2006, AHP’s employee, Brewer E. 

Hoover, Jr., shot and killed two co-employees and himself during 

business hours at AHP’s workplace in Harrisonburg, Virginia. On 

July 6, 2006, the estates of the two murdered employees, Bonnie 

Sue H. Crump and Gary A. Gibson, each brought nearly identical 

wrongful death actions in the Circuit Court for Rockingham 

County, Virginia (the “state trial court”), against both AHP and 

Hoover’s estate. Against AHP, each complaint asserted claims, 

inter alia, of negligent retention and failure to provide a safe 

workplace. The state trial court had occasion to outline the 

factual allegations of the complaints in a March 2007 decision. 

See Crump v. Morris, No. CL06-00547(L) (Va. Cir. Ct. Mar. 12, 

2 
2007) (the “State Decision”).1 As described in the State 

Decision, the complaints alleged the following: 

 [Ms. Crump, Mr. Gibson, and Mr. Hoover] all 

worked together in the AHP office, formerly located at 

182 Neff Avenue in Harrisonburg, Virginia. During 

that time, [their] immediate supervisor was Greg 

Taylor . . . , a district manager of AHP. 

 At some point, Mr. Hoover became romantically 

infatuated with Ms. Crump, and Mr. Hoover apparently 

believed that Ms. Crump and Mr. Gibson were having an 

extra-marital affair. Mr. Hoover confronted Ms. Crump 

about his belief on March 24, 2006, after entering her 

office and slamming her door. Mr. Hoover shook his 

fist and pointed in Ms. Crump’s face while shouting at 

her for lying about the affair. 

 Ms. Crump reported the assault to Mr. Taylor, the 

District Manager, by leaving telephone messages for 

him on the evening of March 24, 2006. In addition, 

Ms. Crump left another message for Mr. Taylor on March 

27, 2006, indicating that she was afraid to return to 

work. However, Mr. Taylor never contacted Ms. Crump 

regarding those telephone messages. 

 Mr. Hoover continued to act in a threatening 

manner towards Ms. Crump, which prompted Ms. Crump to 

keep a cane at her desk for protection. In addition, 

Ms. Crump was afraid to visit the restroom unless 

accompanied by another employee. Several other 

employees reported Mr. Hoover’s strange behavior to 

Mr. Taylor in emails and voiced their concerns in 

weekly office meetings attended by Mr. Taylor. 

However, Mr. Taylor and AHP did not take any 

responsive action. 

 On May 16, 2006, Mr. Hoover reported to work with 

.38 and .40 caliber handguns. Mr. Hoover first shot 

Mr. Gibson, killing him with a single shot to the 

 1

 The State Decision is found at J.A. 510-18. (Citations 

herein to “J.A. ” refer to the contents of the Joint Appendix 

filed by the parties in this appeal.) 

3 
head. Ms. Crump and two of her coworkers were in the 

front of the office preparing for their workday when 

they heard this gunshot. Mr. Hoover then came from 

the rear of the office and began shooting at Ms. 

Crump, who was hit several times. One of her 

coworkers pulled Ms. Crump into an office and closed 

the door. However, Mr. Hoover shot through the door, 

and then entered the office, executing Ms. Crump, 

shooting her at point-blank range in the head. Mr. 

Hoover committed suicide shortly after the shootings 

when the police officers entered the building. 

State Decision 2-3. Additionally, each complaint alleged that 

Hoover’s “conduct towards [Crump and Gibson] was based upon his 

personal jealousy and did not arise from any known employment 

issues with either [Crump, Gibson, or AHP].” J.A. 73, 82. 

 The state trial court and the Virginia Workers’ 

Compensation Commission (the “state commission”) both determined 

that, based on workers’ compensation law, the deaths of Crump 

and Gibson did not arise out of their employment with AHP. In 

the state trial court, AHP initially demurred to both wrongful 

death actions, arguing that they were barred by Virginia’s 

workers’ compensation exclusivity provision, see Va. Code Ann. 

§ 65.2-307, because the deaths arose out of and in the course of 

Crump’s and Gibson’s employment, see id. § 65.2-300(A) 

(providing that workers’ compensation covers “personal injury or 

death by accident arising out of and in the course of the 

employment”). By its State Decision, the state trial court 

overruled AHP’s demurrers, explaining that, although the deaths 

had occurred “in the course of” Crump’s and Gibson’s employment, 

4 
they did “arise out of” such employment, in that the shootings 

were “not directed against [Crump and Gibson] as employees or 

because of their employment.” State Decision 5. 

 Following the State Decision, AHP sought a ruling from the 

state commission that it had exclusive jurisdiction over the 

wrongful death actions. On July 18, 2007, the state commission 

determined that, for workers’ compensation purposes, the deaths 

of Crump and Gibson did not arise out of their employment with 

AHP. Next, back in the state trial court, AHP filed pleas in 

bar, again asserting that the workers’ compensation exclusivity 

provision barred the wrongful death actions. The state trial 

court conducted an evidentiary hearing and subsequently 

overruled AHP’s pleas in bar on July 31, 2007. 

B. 

 Admiral had issued AHP a “Commercial General Liability 

Policy” (the “Admiral Policy”) in which it agreed to pay “those 

sums that the insured becomes legally obligated to pay as 

damages because of ‘bodily injury.’” J.A. 293. The Admiral 

Policy explicitly excludes coverage, however, for “[a]ny 

obligation of the insured under a workers’ compensation . . . 

law,” and for “‘[b]odily injury’ to . . . [a]n ‘employee’ of the 

insured arising out of and in the course of . . . [e]mployment 

by the insured.” Id. at 294 (emphasis added). The Admiral 

5 
Policy has an “Each Occurrence Limit” of $1 million. Id. at 

289. 

 Meanwhile, Ace had issued AHP a “Workers Compensation and 

Employers Liability Insurance Policy” (the “Ace Policy”). Under 

the “Workers Compensation Insurance” portion of the Ace Policy, 

Ace agreed to pay “the benefits required of [AHP] by the workers 

compensation law.” J.A. 387. Under the “Employers Liability 

Insurance” portion of the Policy, Ace agreed to pay for 

“[b]odily injury includ[ing] resulting death,” on the condition 

that “[t]he bodily injury must arise out of and in the course of

the injured employee’s employment by [AHP].” Id. at 388 

(emphasis added). The limit of Ace’s liability under its 

“Employers Liability Insurance” coverage for “Bodily Injury by 

Accident” is $1 million for “each accident.” Id. at 393. 

 Finally, Illinois Union had issued AHP an “Excess Umbrella 

Policy” (the “Illinois Union Umbrella Policy”), providing 

coverage in excess of the Admiral and Ace Policies. The 

Illinois Union Umbrella Policy’s “Excess Liability” coverage is 

“subject to the same terms and conditions as the ‘underlying 

insurance.’” J.A. 439. The Umbrella Policy has a “General 

Aggregate Limit” of $10 million. Id. at 412. 

 Admiral denied coverage to AHP for the Crump and Gibson 

suits by letter of December 13, 2006, and Ace provided a defense 

to AHP under a reservation of rights confirmed by letter to AHP 

6 
of August 2, 2007. Before trial in either matter, AHP and the 

plaintiffs engaged in unsuccessful mediation efforts. The Crump 

suit proceeded first to trial, in September 2007, and the jury 

returned a verdict against AHP in the sum of $3.1 million. 

Thereafter, the parties again attempted mediation before trial 

of the Gibson suit. Because Ace and Illinois Union required 

Admiral’s contribution before they would offer their coverage 

limits, Admiral participated in the mediation. Ultimately, the 

parties were able to reach a global settlement of both suits for 

the aggregate sum of $3.6 million. Admiral paid $1 million, Ace 

paid $1 million, and Illinois Union paid $1.6 million. As a 

condition thereof, the three insurers reserved the right to 

pursue indemnification and contribution claims against each 

other. 

C. 

 On June 30, 2008, Admiral filed a complaint in the Western 

District of Virginia, invoking subject matter jurisdiction under 

28 U.S.C. § 1332, and seeking indemnification and/or 

contribution from Ace and Illinois Union as the primary and 

excess insurers for the losses at issue. On July 25, 2008, Ace 

and Illinois Union filed counterclaims against Admiral, seeking 

indemnification and/or contribution, plus other relief. Ace 

sought, inter alia, recovery of its costs in defending AHP —

approximately $383,500 after AHP’s payment of its $250,000 self7 
insured retention under the Ace Policy. For its part, Illinois 

Union sought, inter alia, recovery of $1 million of its $1.6 

million settlement payment on the theory that Admiral was liable 

for a $2 million share of the settlement (not just the $1 

million it paid) because the shootings of Crump and Gibson 

constituted two “occurrences.” 

 The parties filed cross-motions for summary judgment on 

October 31, 2008. In its Memorandum Opinion of March 24, 2009, 

the district court carefully assessed the parties’ contentions, 

and ultimately determined to grant Admiral’s summary judgment 

motion and deny those of Ace and Illinois Union. See Admiral 

Ins. Co. v. ACE Am. Ins. Co., No. 5:08-cv-00055 (W.D. Va. Mar. 

24, 2009) (the “District Court Opinion”).2 Admiral’s primary 

contention was that it was entitled to summary judgment “because 

the deaths of Crump and Gibson arose out of and in the course of 

their employment with AHP and are therefore covered under Ace’s 

‘Workers Compensation and Employer Liability Policy’ and 

excluded from coverage under Admiral’s ‘Commercial General 

Liability Policy.’” District Court Opinion 5-6. Ace and 

Illinois Union maintained, however, that the phrase “arising out 

of” employment in the Admiral and Ace Policies holds “the same 

‘well-defined’ meaning it has under workers’ compensation law”; 

 2

 The District Court Opinion is found at J.A. 614-29. 

8 
as such, the district court was “constrained to conclude,” as 

the state trial court and the state commission had ruled, “that 

Crump’s and Gibson’s deaths did not arise out of their 

employment.” Id. at 6. According to Ace and Illinois Union, 

Admiral was thus obliged to defend and indemnify AHP. 

 In assessing the parties’ contentions, the district court 

first recognized that, because the Admiral Policy “was delivered 

to AHP’s Tennessee headquarters, Tennessee law governs the 

interpretation of its policy language.” District Court Opinion 

7 & n.5 (citing Seabulk Offshore, Ltd. v. Am. Home Assurance 

Co., 377 F.3d 408, 418-19 (4th Cir. 2004)). The court then 

observed that, under Tennessee law, “courts must give policy 

language its ‘common and ordinary meaning,’” id. at 8 (citing 

Tata v. Nichols, 848 S.W.2d 649, 650 (Tenn. 1993)) — without 

giving controlling force to definitions in workers’ compensation 

law that have not been expressly incorporated into the policy, 

id. at 8-10 (citing Blue Diamond Coal Co. v. Holland-Am. Ins. 

Co., 671 S.W.2d 829 (Tenn. 1984); Tenn. Farmers Mut. Ins. Co. v. 

Cherry, No. W2007-00342COAR3CV, 2008 WL 933479 (Tenn. Ct. App. 

Apr. 7, 2008); Am. Indem. Co. v. Foy Trailer Rentals, Inc., No. 

W2000-00397COAR3CV, 2000 WL 1839131 (Tenn. Ct. App. Nov. 28, 

2000)). The court concluded that the “arising out of” 

employment language in the Admiral Policy exclusion “is plain 

and unambiguous,” and that workers’ compensation law, having not 

9 
been explicitly referenced in the exclusion, “is irrelevant to 

its meaning.” Id. at 8. The court further concluded that the 

deaths of Crump and Gibson “arose out of” their employment — as 

that phrase is commonly and ordinarily understood — in that 

“both employees were killed on AHP’s premises, during working 

hours, by a co-employee, and both wrongful death suits sought to 

hold AHP liable for its failings as an employer.” Id. at 6. 

 Based on this analysis, the district court rejected Ace and 

Illinois Union’s contention that Admiral was required to 

indemnify AHP. See District Court Opinion 15. Furthermore, the 

court rejected Ace and Illinois Union’s assertion that Admiral 

was yet obligated to defend AHP in light of the allegations in 

the Crump and Gibson complaints that Hoover’s “conduct towards 

[Crump and Gibson] was based upon his personal jealousy and did 

not arise from any known employment issues with either [Crump, 

Gibson, or AHP].” See id. at 12-13 (recognizing that, under 

Tennessee law, “[a]n insurer owes its insured a duty to defend 

unless ‘it is plain from the face of the complaint that the 

allegations fail to state facts that bring the case within or 

potentially within the policy’s [coverage]’” (quoting Drexel 

Chem. Co. v. Bituminous Ins. Co., 933 S.W.2d 471, 480 (Tenn. Ct. 

App. 1996))). In rejecting the duty-to-defend contention, the 

court explained that 

10 
it was plain from the face of the Crump and Gibson 

complaints that their deaths arose out of and in the 

course of their employment with AHP. Both wrongful 

death actions asserted that AHP, as Crump and Gibson’s 

employer, failed to provide a safe workplace and 

failed to exercise reasonable care in retaining a 

subordinate. Each complaint alleged that Hoover, a 

co-employee, shot and killed Crump and Gibson during 

working hours at AHP’s workplace, even after Crump and 

other AHP employees placed AHP’s manager on notice 

about Hoover’s prior threatening behavior. Each 

complaint sought to hold AHP liable as an employer

because its negligence proximately caused Crump and 

Gibson’s deaths. It is therefore clear that the 

complaints alleged that Crump and Gibson’s deaths 

resulted from their employment relationships with AHP 

and therefore arose out of and in the course of their 

employment for the purposes of Tennessee law. The 

lone allegation that Hoover’s conduct “did not arise 

from any known employment issues with either [Crump, 

Gibson, or AHP]” does not change this result. 

Contextually, this allegation simply characterizes 

Hoover’s personal motivation. Irrespective of 

Hoover’s personal motivation, the other circumstances 

alleged in the complaints by themselves support only 

one conclusion: Crump and Gibson’s deaths arose out 

of their employment with AHP. 

Id. at 13-14 (citation omitted). Finally, the court agreed with 

Admiral that, “because the deaths of Crump and Gibson arose out 

of and in the course of their employment, Ace was obligated to 

provide coverage under its ‘Employers Liability Insurance.’” 

Id. at 15. “Accordingly,” the court explained, “because Ace has 

paid its policy limit, and Illinois Union’s excess coverage 

mirrored Ace’s underlying coverage, Admiral is entitled to 

11 
indemnification in the amount of $1 million from Illinois 

Union.” Id. at 16.3

 Ace and Illinois Union have timely noted this appeal, and 

we possess jurisdiction pursuant to 28 U.S.C. § 1291. 

II. 

 On appeal, Ace and Illinois Union maintain that the 

district court erred in awarding summary judgment to Admiral and 

in denying such judgment to them.4 We review de novo the 

 3

 On the day of its summary judgment decision (March 24, 

2009), the district court issued a Final Order entering judgment 

in favor of Admiral and against Ace and Illinois Union. The 

Final Order specified that Admiral “shall recover from Illinois 

Union . . . in the amount of $1 million, plus interest and 

costs.” J.A. 630. Thereafter, on April 7, 2009, Admiral filed 

a motion to correct the judgment to allow prejudgment interest. 

On May 1, 2009, the court issued an Amended Final Judgment 

specifying that Admiral “shall recover from Illinois Union . . . 

in the amount of $1 million, plus prejudgment interest at a rate 

of 6% accruing from December 10, 2007 until March 24, 2009, and 

postjudgment interest and costs accruing from today’s date.” 

Id. at 676. 

4

 More specifically, Ace and Illinois make six appellate 

contentions: (1) that Admiral breached its duty to defend AHP, 

because it was evident from the face of the complaints in the 

Crump and Gibson suits that the Admiral Policy exclusion does 

not bar all possibility of coverage; (2) that the district 

court’s broad construction of the Admiral Policy exclusion 

contravened basic policy interpretation rules; (3) that the 

Admiral Policy exclusion is inapplicable; (4) that Admiral is 

estopped from denying its duties to defend and indemnify AHP; 

(5) that an additional exclusion in the Admiral Policy does not 

bar coverage; and (6) that Ace and Illinois Union are entitled 

to judgment on their counterclaims for recovery of defense costs 

(Continued) 

12 
13 

district court’s award of summary judgment to Admiral, viewing 

the facts in the light most favorable to Ace and Illinois Union, 

as the nonmoving parties. See Lee v. York County Sch. Div., 484 

F.3d 687, 693 (4th Cir. 2007). We must vacate the summary 

judgment award unless “‘there is no genuine issue as to any 

material fact and [Admiral] is entitled to a judgment as a 

matter of law.’” Id. (quoting Fed. R. Civ. P. 56(c)). 

Furthermore, if warranted by the uncontroverted facts, “we are 

free to enter an order directing summary judgment in favor of” 

Ace and Illinois Union. Monahan v. County of Chesterfield, Va., 

95 F.3d 1263, 1265 (4th Cir. 1996) (internal quotation marks 

omitted). 

 Having fully and carefully considered the contentions of 

the parties, we agree with the district court that Admiral was 

not obliged to defend or indemnify AHP. We therefore affirm the 

court’s judgment in favor of Admiral and against Ace and 

Illinois Union, essentially for the reasons explained in the 

District Court Opinion of March 24, 2009. 

AFFIRMED

 

(Ace) and $1 million of its $1.6 million settlement payment 

(Illinois Union).