UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

_________________________________ 

NAUTILUS INSURANCE 

COMPANY, 

 Plaintiff - Appellee, 

v. 

FANTASIA HOOKAH LOUNGE, 

LLC; MOHAMMAD ZAKIE 

ALSHAMMAT; JORGE 

HERNANDEZ, 

 Defendants - Appellants, 

and 

JJG PROPERTIES, LLC, 

 Defendant. 

No. 23-5129 

(D.C. No. 4:22-CV-00064-CVE-JFJ) 

(N.D. Okla.) 

_________________________________ 

ORDER AND JUDGMENT*

_________________________________ 

Before PHILLIPS, BALDOCK, and FEDERICO, Circuit Judges. 

_________________________________ 

* After examining the briefs and appellate record, this panel has 

determined unanimously to honor the parties’ request for a decision on the 

briefs without oral argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). 

The case is therefore submitted without oral argument. This order and 

judgment is not binding precedent, except under the doctrines of law of the 

case, res judicata, and collateral estoppel. It may be cited, however, for its 

persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. 

FILED 

United States Court of Appeals 

Tenth Circuit 

October 3, 2024

Christopher M. Wolpert 

Clerk of Court

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This appeal involves a dispute about the scope of coverage under a 

commercial insurance policy that Nautilus Insurance Company issued to 

Fantasia Hookah Lounge, LLC (“Fantasia”). Nautilus sought from the 

district court a declaratory judgment that the policy did not cover the 

liability of Fantasia, its owner, Mohammed Zakie Alshammat, or Fantasia’s 

landlord, JJG Properties, LLC (collectively, “Fantasia Defendants”), for 

gunshot injuries Jorge Hernandez sustained during an exchange of gunfire 

between Fantasia’s security guards and an armed patron. The district court 

granted summary judgment in favor of Nautilus, concluding that the 

policy’s “Exclusion – All Assault or Battery” endorsement (“Exclusion”), 

Aplt. App. II at 345, excluded coverage for any claims arising out of 

Hernandez’s injuries. Fantasia, Alshammat, and Hernandez (“Appellants”) 

appeal. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm. 

I

 Fantasia operated a hookah lounge in Tulsa, Oklahoma. The lounge 

stayed open until 5:00 a.m. but did not serve alcohol. It was known as a 

popular destination for individuals to go after other bars or entertainment 

venues in the area had closed for the night. 

On June 15, 2019, at approximately 2:00 a.m., a fistfight broke out 

among patrons in the lounge’s parking lot. During the fight, a patron fired 

several gunshots into the air. Two of Fantasia’s security guards then 

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exchanged gunfire with the patron. During the exchange, the patron shot 

and killed one of the guards. Hernandez was a bystander and also shot by 

either the patron or one of the guards, sustaining serious and permanent 

injuries such as permanent paralysis and is now a paraplegic. 

Hernandez filed a lawsuit against the Fantasia Defendants in 

Oklahoma state court for damages (the “Underlying Suit”). There he 

asserted one claim, for negligence, alleging the Fantasia Defendants 

breached their duty to provide their business invitees reasonably safe 

business premises by regularly allowing after-hours crowds to gather in the 

lounge parking lot and consume alcohol, which often led to fights, and by 

failing to have sufficiently trained and qualified security personnel. 

Nautilus agreed to defend Fantasia and Alshammat but reserved its 

rights to deny coverage and to withdraw its defense should it be determined 

that the policy does not cover the claims against them. Nautilus then filed 

a complaint for declaratory judgment in federal district court and moved for 

summary judgment, arguing that the Exclusion precludes coverage for 

Hernandez’s claims. The policy provides that Nautilus “will pay those sums 

that the insured becomes legally obligated to pay as damages because of 

‘bodily injury’ or ‘property damage’ to which this insurance applies.’” 

Aplt. App. II at 322. In relevant part, the Exclusion provides: 

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Regardless of culpability or intent of any person, this insurance 

does not apply to “bodily injury”, “property damage”, “personal and 

advertising injury” or medical payments arising out of any: 

1. Actual or alleged assault or battery; 

2 Physical altercation; or 

3. Any act or omission in connection with the prevention or 

suppression of such acts, including the alleged failure to provide 

adequate security. 

This exclusion applies regardless of whether such actual or alleged 

damages are caused by any: 

1. Insured; 

2. “Employee”; 

3. Patron; or 

4. Any other person; and 

whether or not such damages occurred at any premises owned or 

occupied by any insured. 

Id. at 345 (emphasis added). The Exclusion states that it “applies to . . . [a]ll 

causes of action arising out of any assault or battery, or out of a physical 

altercation including, but not limited to, allegations of negligent hiring, 

placement, training, or supervision, or to any act, error, or omission relating to

such an assault or battery, or physical altercation.” Id. (emphasis added). The 

Exclusion further provides that Nautilus “will have no duty to defend or 

indemnify any insured in any action or proceeding alleging damages arising 

out of any assault or battery, or physical altercation.” Id. (emphasis added). 

 The district court granted Nautilus’s summary judgment motion, 

concluding that although Hernandez did not assert a cause of action in the 

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Underlying Suit based on assault or battery, his negligence claim arose out 

of the injuries he received during the shooting, and therefore the Exclusion 

unambiguously excluded those claims from coverage. The court rejected 

Hernandez’s reliance on the “concurrent proximate cause rule” because he 

had not demonstrated any injuries that arose from the alleged negligence 

other than those resulting from the shooting. This timely appeal followed. 

II

We review de novo a district court’s decision to grant summary 

judgment, applying the same standard governing the district court. Siloam 

Springs Hotel, L.L.C. v. Century Sur. Co., 906 F.3d 926, 930 (10th Cir. 

2018). A “court shall grant summary judgment if the movant shows that 

there is no genuine dispute as to any material fact and the movant is 

entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “We view all 

facts and evidence in the light most favorable to the party opposing 

summary judgment.” Craft Smith, LLC v. EC Design, LLC, 969 F.3d 1092, 

1099 (10th Cir. 2020) (internal quotation marks omitted). 

“A federal court sitting in diversity must apply the law of the forum 

state, in this case Oklahoma, and thus must ascertain and apply Oklahoma 

law with the objective that the result obtained in the federal court should 

be the result that would be reached in an Oklahoma court.” Siloam Springs 

Hotel, 906 F.3d at 930 (internal quotation marks omitted). Under 

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Oklahoma’s general choice-of-law rule, the interpretation of an insurance 

contract “is governed by the law where the contract is made.” Bohannan v. 

Allstate Ins. Co., 820 P.2d 787, 793 (Okla. 1991). The policy in this case was 

made in Oklahoma. See Aplt. App. II at 305 (showing Oklahoma addresses 

for the insured and the insurance agent, and stating that the policy was 

“Countersigned” in Oklahoma). We therefore apply Oklahoma insurance 

law to resolve the issues in this appeal.1

Under Oklahoma law, “[i]nsurance policies are contracts interpreted 

as a matter of law,” and “[w]hen policy provisions are unambiguous and 

clear, the employed language is accorded its ordinary, plain meaning.” 

BP Am., Inc. v. State Auto Prop. & Cas. Ins. Co., 148 P.3d 832, 835 

(Okla. 2005) (footnote omitted). “A federal district court’s state-law 

determinations are entitled to no deference and are reviewed de novo.” 

Siloam Springs Hotel, 906 F.3d at 931 (internal quotation marks omitted). 

III

 Appellants argue the district court erred by not applying the 

concurrent proximate cause rule. According to the primary case they rely 

on, the concurrent proximate cause rule provides that if an injury has two 

concurrent proximate causes, one that is covered by an insurance policy and 

1 The parties have given no indication that any other law applies, and 

there appears to be no choice of law provision in the policy. 

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one that is excluded, a court will construe the policy to provide coverage if 

the causes are “truly independent and distinct.” Adams v. Certain 

Underwriters at Lloyd’s of London, 589 S.W.3d 15, 29 (Mo. Ct. App. 2019). 

Appellants argue that Oklahoma follows the concurrent proximate 

cause rule stated in Adams. From that premise, they assert that Hernandez 

alleged in the Underlying Suit that the Fantasia Defendants were negligent 

in the operation of their business and that negligence is the concurrent 

proximate cause of the injuries Hernandez suffered. Therefore, they argue, 

the policy provides coverage notwithstanding the exclusion of coverage for 

assault or battery. 

Adams, however, involved application of Missouri law, not Oklahoma 

law. And we have found no case involving Oklahoma law where an 

Oklahoma court applied the concurrent proximate cause rule. Instead, 

Oklahoma appears to apply the related but distinct “efficient proximate 

cause doctrine.” See Nat’l Am. Ins. Co. v. Gerlicher Co., 260 P.3d 1279, 1286 

(Okla. Civ. App. 2011) (“The efficient proximate cause doctrine has been 

applied in Oklahoma.”) (citing Shirey v. Tri-State Ins. Co., 274 P.2d 386 

(Okla. 1954)); see also Goodwill Indus. of Cent. Okla., Inc. v. Phila. Indem. 

Ins. Co., 21 F.4th 704, 714 (10th Cir. 2021) (recognizing that Oklahoma 

“embraced” the efficient proximate cause doctrine in Shirey). Unlike the 

“independent and distinct” requirement of the concurrent proximate cause 

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rule, see Adams, 589 S.W.3d at 29, the efficient proximate cause doctrine 

“applies when at least two identifiable causes combine to form a single 

property loss, and one is covered under the policy while the other one is 

excluded under the policy,” Gerlicher, 260 P.3d at 1286 (emphasis added). 

But like the concurrent proximate cause rule, the efficient proximate cause 

doctrine provides that “[i]f the insured successfully demonstrates that the 

proximate cause of the loss is covered under the policy, the entire loss is 

covered notwithstanding the fact that an event in the chain of causation 

was specifically excluded from coverage.” Duensing v. State Farm Fire & 

Cas. Co., 131 P.3d 127, 133 (Okla. Civ. App. 2005) (italics omitted). 

Nonetheless, for purposes of argument, we will assume Oklahoma 

would apply the concurrent proximate cause rule in this case rather than 

the efficient proximate cause doctrine. And we will further assume that the 

alleged negligence by the Fantasia Defendants was a proximate cause of 

Hernandez’s injuries. But as we explain, even with such assumptions, the 

concurrent proximate cause rule is inapplicable because the Exclusion 

precludes coverage for the negligence alleged in the Underlying Suit.2

Again, the premise of Appellants’ argument is that the Fantasia 

Defendants’ alleged negligence with respect to the parking lot conditions 

2 The result would be the same under the efficient proximate cause 

doctrine because it too requires at least one covered proximate cause. 

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and security is a proximate cause of Hernandez’s injuries and is covered 

under the policy. A close reading of the Exclusion, however, reveals 

otherwise.3

The Exclusion uses three relevant phrases in defining its scope: 

“arising out of,” “in connection with,” and “relating to.” Aplt. App. II at 345. 

Oklahoma broadly construes such phrases when used in an insurance 

policy. The Oklahoma Supreme Court has described the phrase “‘arising out 

of . . . use’ in a liability policy” as being “broad, general and comprehensive,” 

and has observed that like Oklahoma courts, courts in other jurisdictions 

construing “‘arising out of’” have understood it to mean “‘originating from,’ 

‘having its origins in,’ ‘growing out of,’ or ‘flowing from.’” Ply v. Nat’l Union 

Fire Ins. Co. of Pittsburgh, Pa., 81 P.3d 643, 649 (Okla. 2003). 

Furthermore, in Federal Insurance Co. v. Tri-State Insurance Co., 

157 F.3d 800 (10th Cir. 1998), this court considered the Oklahoma Court of 

Appeals’ holding that “‘arising out of’ merely requires causation-in-fact.’” 

3 We need not decide if Appellants bear the burden to establish 

coverage for the negligence claim under the policy or if Nautilus bears the 

burden to show it is excluded; we reach the same result regardless of who 

shoulders the burden. Compare U S. Fid. & Guar. Co. v. Briscoe, 239 P.2d 

754, 756 (Okla. 1951) (“The insurer is, of course, entitled to stand upon its 

contract, as written and the [plaintiff] must bring himself within the terms 

of the policy, before he can establish insurer’s liability thereon.”), with 

Fehring v. Universal Fid. Life Ins. Co., 721 P.2d 796, 799 (Okla. 1986) 

(explaining that the insurer has the burden to prove an exclusion applies).

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Id. at 803 (quoting Wallace v. Sherwood Constr. Co., 877 P.2d 632, 633 

(Okla. Civ. App. 1994)). We viewed that holding as “consistent with the 

general consensus that the phrase ‘arising out of’ should be given a broad 

reading such as ‘originating from’ or ‘growing out of’ or ‘flowing from’ or 

‘done in connection with’—that is, it requires some causal connection to the 

injuries suffered.” Id. at 804 (emphasis). But “proximate cause in the legal 

sense” is not required. Id. Although we have found no case on point, there 

appears to be no reason to think Oklahoma courts would construe less 

broadly the phrase “relating to.” 

We start with the exclusions of coverage for any “‘bodily injury’ . . . 

arising out of any . . . assault or battery” or “[p]hysical altercation,” and for 

“[a]ll causes of action arising out of any assault or battery” or “physical 

altercation.” Aplt. App. II at 345. Hernandez’s bodily injuries and the 

resulting negligence cause of action he asserted in the Underlying Suit 

clearly arose out of (i.e., originated from, had its origin in, grew out of, or 

flowed from) an assault or battery—being shot. 

In civil actions, Oklahoma employs the definitions of “assault” and 

“battery” found in the Restatement (Second) of Torts. See Brown v. Ford, 

905 P.2d 223, 229 n.34 (Okla. 1995), overruled on other grounds by Smith v. 

Pioneer Masonry, Inc., 226 P.3d 687, 689 (Okla. 2009). The Restatement 

defines assault to include intentionally causing “a harmful or offensive 

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contact with the person of the other or a third person,” Restatement 

(Second) of Torts § 21 (1965), and it defines battery to include intentionally 

causing “a harmful or offensive contact with the person of the other or a 

third person” and such a contact “directly or indirectly results,” id. § 13. 

Under Oklahoma law, “‘intent . . . denote[s] that the actor desires to cause 

consequences of his act, or that he believes that the consequences are 

substantially certain to result from it.’” Parret v. UNICCO Serv. Co., 

127 P.3d 572, 577 (Okla. 2005) (quoting Restatement (Second) of Torts § 8A 

(1965)); see also Wells v. Okla. Roofing & Sheet Metal, L.L.C., 457 P.3d 1020, 

1025 (Okla. 2019) (“It is well-settled that the common law divides actionable 

tortious conduct into two categories: (1) accidental and (2) willful acts that 

result in intended or unintended harm.”). 

Applying these definitions, all shots fired during the shootout were, 

indisputably, intentional acts; none were accidental.4 Thus, Hernandez’s 

bodily injuries and his negligence cause of action arose out of an assault or 

battery. It is equally true that Hernandez’s bodily injuries and his 

negligence cause of action arose out of a “physical altercation,” Aplt. App. II 

at 345—the fist fight progressed to an exchange of gunfire, resulting in his 

4 We acknowledge that the Exclusion applies “[r]egardless of 

culpability or intent of any person,” Aplt. App. II at 345, but in an 

abundance of caution, we consider intent as part of determining whether an 

assault or battery occurred here. 

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injuries. Hernandez did not allege that he sustained any injuries other than 

those resulting from being shot, so Hernandez’s bodily injuries and his 

negligence cause of action necessarily arose out of the assault, battery, or 

physical altercation. 

If this were not enough to bring Hernandez’s bodily injuries and 

negligence cause of action within the Exclusion, we readily conclude that 

the bodily injuries arose out of “act[s] or omission[s] in connection with the 

prevention or suppression of” an assault, battery, or physical altercation, 

id. (emphasis added). Moreover, the Exclusion similarly emphasizes that it 

applies “to any act, error, or omission relating to . . . an assault or battery, 

or physical altercation.” Id. (emphasis added). The allegations that the 

Fantasia Defendants’ negligence fomented the conditions that led to 

Hernandez’s injuries (be they viewed as arising from an assault, a battery, 

or a physical altercation) fall within the meaning of this portion of the 

Exclusion, too. Finally, the Exclusion states that Nautilus “will have no 

duty to defend or indemnify any insured in any action or proceeding alleging 

damages arising out of any assault or battery, or physical altercation.” Id.

(emphasis added). We fail to see how the damages at issue in Hernandez’s 

negligence cause of action escape the reach of this provision. 

In sum, we agree with the district court that the Exclusion denies 

coverage under the insurance policy for any liability the Fantasia 

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Defendants may have for Hernandez’s negligence claim. Nautilus has no 

duty to defend or indemnify its insured in the Underlying Suit.5

 AFFIRMED. 

Entered for the Court 

Richard E.N. Federico 

Circuit Judge 

5 Our conclusion that the Exclusion applies is in accord with at least 

two other cases applying Oklahoma law: Event Security, LLC v. Essex 

Insurance Co., 715 F. App’x 853, 855–56 (10th Cir. 2017), where this court 

reached the same result when faced with a similar exclusion and a 

negligence claim, and Great Lakes Insurance SE v. Bank of Eufaula, 

391 F. Supp. 3d 1060, 1065 (E.D. Okla. 2019), where the district court held 

that a similar exclusion extended to claims that a bank was negligent in not 

hiring enough security and in having too many entrances. 

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