N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
B R YAN GR IGGS; VALERIE GRIGGS, husba nd a nd wife , Plaintiffs - Appe lla nts,
v. ALLSTATE INSUR

ANC E C OM PANY, De fe nda

nt - Appe lle e . No. 13-35282 D.C . No. 3:12 c v-00463 M O
M EM O R ANDUM *

Appe a l from

the Unite d

Stat e s Distric t C ourt for the Distric t of Ore gon M i c ha e l W . M osm an, C hie f Distric t Judge , Pre siding Argue d a nd Subm itte d M ay 6, 2016 Portla nd, Ore gon B e fore : TASHIM A , TALLM AN, a nd HUR W ITZ, C irc uit Judge s. Pla intiffs B ry an

and Va le rie Griggs a

ppe a l the distric t c ourt’ s orde r gra nting
sum m ary judgm e nt to De fe nda

n t Allsta te Insura nc e C om pa ny (“ Allsta te ” ). W e have jurisdic tion unde r 28 U.S.C . § 1291, a nd we a ffirm
. 

# FIL ED MAY25 2016 M OLLY C. DW Y ER, CLERK U
. S
. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by 9th C ir. R . 36-3.I.

From June 2010 to June

2011, Pla i ntiffs m a inta ine d a R e nte rs Insura

n c e Polic y (“ Polic y ” ) with Allsta

te . While the Polic y

provide d prote c t ion a ga inst
una uthoriz e d use of a

c re dit c a rd, it a lso c onta i ne d a

n e xc l usion for a

ny “ l oss
arising from

any busine ss of an insure d pe rson.” B e twe e n June 2009 a

nd Nove m

be r 2010, B ry an Griggs wa s e m ploy e d a s the C hie f Fina

nc i a l Offic e r of HDM C Group LLC (“ HDM C ” ). HDM C and Adva nc e d Tra ve l Sy ste m s, Inc . (“ ATS” ) purc ha se hote l room s in bulk a nd the n re se ll the m , ty pic a lly to a tte nde e s of c onve ntions a n d tra de shows. To re se rve the hote l room s, HDM C and ATS pla c e a

c re d it c ard on file with the ve ndor. HDM C an d ATS
m a inta in va

rious c om pa ny c re dit c ards for this purpose , but the da ily c re dit limit on the se c ards is not a lwa y s suffic i e nt to c o ve r a l l of the c h arge s the y wish to inc ur. Thus, Griggs agre e d to a llow HDM C to use his pe rsona l Am e ric an Expre ss c ard to re se rve som e hote l room s. Griggs a uthoriz e d e a c h tra

n sa c tion on a
c a se -by -c a se ba s is, a

nd HDM C a gre e d

to re im burse Griggs for a

ny c ha rge s. In Se pte m

be r 2010, Griggs notic e d tha t his c re dit c ard sta

te m e nt c onta ine d transa c tions tha

t he did not re c a ll a

uthoriz ing HDM C to m ake . Griggs dispute d the
c ha rge s a nd inform e d HDM C tha

t it c o uld no longer use his c ard. A fe w m onths

2late r, HDM C te rm inate d Griggs’ s e m p loy m e nt. Griggs a lle g e s tha

t HDM C
c ontinue d to m ak e una

uthoriz e d c ha rge s on his c re dit c ard a fte r he wa s fire d. In Ja nua ry 2011, ATS a

nd HDM C sue d Pla intiffs in Ne va da sta te c ourt,
a lle ging tha

t Griggs wrongfully

dispute d c ha

rge s tha t he ha d a uthoriz e d a

nd for whic h he ha d

be e n re i m

burse d. Pla intiffs twic e te nde re d the de fe n se of the sta te
c ourt a c tion to Allsta

te . Allsta t e de nie d c ove ra ge and de c line d to providea de fe nse . In re sponse , Pla intiffs file d this fe de ra l a c tion, se e k ing da m a ge s a nd a de c la ra tion tha t A l lsta te owe d Pla intiffs a

duty to de fe nd the sta

t e c o urt a c tion. The distric t c ourt gra

nte d Allsta

te ’ s m otion for sum

m ary judgm e nt, c onc l uding tha t the b usine ss e xc l usion c l a use a pplie d. Pla i ntiffs a

ppe a l. II. W e re vie w de novo a grant of sum m ary judgm e nt on a

n insure r’ s duty

to de fe nd. Ind. Lumbe rme ns Mut. Ins. C o. v . W . Or. W ood Prods., Inc
. , 268 F.3d 639, 643 (9th C i r. 2001). “ Vie wing the e vide n c e in the light m ost fa vora ble to the
nonm o ving pa

rty , we m

u st de c ide whe the r the re are any ge n uine issue s of m a te ria l fa c t and whe the r the distric t

c ourt c orre c tly

a pplie d the pe rtine nt substa ntive la w.” Id. a 644 (c ita tion om itte d). III. 3“ Unde r Ore gon la w, a c o urt a sse sse s a

n insure r’ s duty

to de fe nd a

n a c tion
a ga inst its insure d by

re vie wing the c om

pla int a nd the insura

nc e polic y .” Id. (c iting Le dford v . Gutosk

i , 877 P.2d 80, 82 (Or. 1994) (e n ba nc )). “ In e va luating whe the r an insure r ha s a

duty to de fe nd, the c ourt looks only a t the fa c t s a lle ge d in the c om pla i nt to de te rm ine w h e the r the y provide a ba sis for re c o ve ry

tha t c ould be
c ove re d by

the polic y .” Le dford, 877 P. 2d a t 82. “ The insure r ha s a

duty to de fe nd if the c om

pla int provide s any

basis for whic h the insure r provide s c ove ra ge .” Id. a t 83. The distric t c ourt c o rre c tly c onc lude d tha

t Allsta te did not ha

ve a duty to de fe nd unde r Ore gon la

w. The Polic y

e xpre ssly e x c lude s c ove ra ge for c re dit c ard losse s “ arising from

any busine ss of a

n insure d pe rson.” In the c onte xt of insura nc e polic ie s, Ore gon c ourts ha ve broa d ly

c onstrue d the phra se “ arising out of” to indic a t e “ a

c a usa l c onne c tion, ra

the r tha n a proxim a te c a

usa l c onne c tion.” Ristine v . Hartford Ins. C

o . of Midw e

st , 97 P.3d 1206, 1208 (Or. C t. App. 2004) (c ita tion om itte d); se e also Oak ridge C mty . Ambulanc e Se rv ., Inc . v . U.S. Fid. & Guar. C o. , 563 P.2d 164, 166–67 (Or. 1977) (e n ba nc ). The Polic y

de fine s

“ busine ss” a s “ any

full or pa rt-tim e a c tivity

of a ny kind e n ga ge d

in for e c onom ic ga in.” Although the

Polic y doe s not furthe r de fine “ e c onom ic ga in,” Pla intiffs

4c onc e de tha

t a princ ipa l form

of e c onom ic ga in re c o gniz e d in the c a se la w is sa la ry or c om pe nsation e arne d

through e m

ploy m e nt. the sta te c o urt c om

pla int a lle ge s tha

t Pla intiffs’ c la im e d c re dit c ard losse s
arose from

Griggs’ e m

ploy m e nt a t HDM C . Those a lle gations fa l l squa re ly within the Polic y ’ s busine ss e xc lusion c la u se . Tha t c om pla int a l so a l le ge s tha

t Griggs
wa s e m ploy e d full-tim e a s the C FO of HDM C . The c om pla int e xpla ins tha

t HDM C and ATS a

re hote l room

whole sa l e rs tha

t, “ [a ] s pa rt of the ir norm a l c ourse of doing busine ss,” pla c e a c re dit c ard on file with the ve ndor to re se rve hote l
room s. Furthe r, it a lso a lle ge s tha t, at Griggs’ sugge s tion, HDM C and ATS use d Griggs’ s “ pe rsona l Am e ric an Expre ss c a rd to m ak e pa

ym e nt due from

HDM C or ATS to va

rious hote l a

nd tra ve l whole sa le rs, a s those ve ndors re quire d im m e diate pa ym e nt by c re dit c ard for room s be i ng purc h a se d by HDM C .” Pla intiffs we re sue d, in the Ne va da sta te c ourt a c tion, in c onne c tion with a c ts Griggs took in furthe

ra nc e of a for-profit ve nture . Any losse s Griggs susta i ne d from HDM C ’ s una

uthoriz e d use of Griggs’ s c re dit c ard arose from – tha t is, we re c a usa lly c onne c te d to – his full-tim e , pa id e m

ploy m e nt a t HDM C
. B e c a use the Polic y ’ s busine s s e xc lusion provision pre c lude s c ove ra ge , the distric t c o urt did not e rr in gra nting sum m ary judgm e nt in fa

vor of Allsta

t e . AFFIRM E D. 5