### IN THE UNI TED STAT ES COURT OFAPPEALS FOR THE FIF TH CIRCU IT

No. 11-30466 Summary Calendar

INDIAN HARBOR INSURANCE COMPANY, Plaintiff-Appellant
v. BESTCOMP, INCORPORATED; GEORGE RAYMOND WILLIAMS, M.D., Orthopedic Surgery, A Professional Medical, L.L.C., Defendants-Appellees

Appeal from the United States District Court for the Eastern District of Louisiana

No. 2:09-CV-7327

Before DAVIS, STEWART, and CLEMENT, Circuit Judges. PER CURIAM: * George Raymond Williams, M

. D ., Orthopedic Surgery, A Professional Medical L.L.C. (“Williams L.L.C.”) filed a putative class action lawsuit in state court against BestComp, Incorporated alleging violations of Louisiana law. Indian Harbor Insurance Company subsequently filed a federal lawsuit seeking

a judgment declaring that it had no obligation to defend or indemnify BestComp U n i te d S ta te s C o u rt o f A p p ea l s

F i ft h C i rc u i t 

### F I L E D Decem ber 7 , 20 11 Lyle W . Cayce Clerk

Pursua nt to 5 T H C IR

. R. 47.5 , the cour t has d ete rm inedt hat this op inion s houldnot * be publ ish ed and is not pr ece dent excep t unde r the lim ite d cir cum st ance s se t forth in 5 T H C IR

. R. 47.5 .4. Case: 11-30466 Document: 00511688373 Page: 1 Date Filed: 12/07/2011No. 11-30466

in connection with the state court action. Indian Harbor then filed a motion for summary judgment, which was granted in part and denied in part by the district court. After the d i s t r i c t c ourt directed entry of final judgment pursuant to Federal Rule of Civil Procedure 54(b), Indian Harbor filed a t i m e l y notice of appeal. For the reasons stated below, we affi r m the district court’s judgment. I. A. The insurance policy I n July 2 0 0 9 , I n di an Harbor issued a professional liability insurance p olicy to Cannon Coch r an Management Services, CCMSI Holdings, Inc., CCSF Reinsurance, Ltd. (collec t ively “CCMSI”), and their subsidiaries. While not a named insured party, BestComp asserts that it is covered under the policy because it is a subsidiary of CCMSI. Under the policy, Indian Harbor was to provi d e insurance coverage by paying “on behalf of the Insured all sums in excess of the deductible that the Insured becomes legally obligated to pay as damages and clai m e xpenses as a result of a claim first made a g a i n s t the Insured and reported in writing to [Indian Harbor]” from July 31, 2009 to July 31, 2010. The policy also states 1 that Indian Harbor has the “right and duty to defend in the Insured’s name and

on the Insured’s behalf a claim

. . . even if any of the allegations in the claim are groundless, false or fraudulent.” The policy defin e s a “claim” as “a demand for money or services naming the Insured arising out of an act or omission in the performance of professional services. A claim also includes the se rvi c e o f s u it or the institution of an arbi t r a t i o n proceeding against the Insured.” The term “claim expenses” is defined as, inter alia , “[f]ees charged by attorneys” and “ [ a] l l other reasonable and n e c e ssary fees, costs and expenses” resulting from the defense of a claim.

The ins uranc e pol icy highlight s all wo rd s and phr ase s that it sp ecif ical ly def

ines wi th 1 boldf ont. When quot ing t he pol icy, w e w ill not rep lica te the boldf ont. 2 Case: 11-30466 Document: 00511688373 Page: 2 Date Filed: 12/07/2011No. 11-30466

The term “damag e s ” i s defined as “any compensatory sum and includes a judgment, award or settlement[.]” Notably, the policy excludes “fines, penalties, forfeitures, or sanctions” from the definition of “damages.” B. State court proceedings On September 30, 2009, Williams L.L.C. f i l e d a putative class action against BestComp in Louisiana state court (t h e “ Williams lawsuit”). In its petition, Williams L.L.C. alleged that it is BestComp’s duty to provide access to preferred provider organization (“PPO”) discounted rates in connection with Louisiana’s workers’ compe n s atio n p ay m ents. It further averred that BestComp discounted the medical bills of numerous Louisiana health care pro vi d e r s . In

ap p lying these discounts, Williams L.L.C. contended that BestCom p viol at e d th e following state statute: A preferred provider organization’s alternative rates of payment shall not be enforceable or binding upon any pro vi d e r u nless such organization is clearly identified on the benefit card issu e d by the group purchaser or other entity accessing a group purchaser’s contractual agreement or agreements and p r e s ented to the participating provider when medical care is provided.

. . . When no benefit card is issued or utilized by a group purch a s e r or other entity, written notification shall be required of any entity accessing an existing group purchaser’s contractual agreement or agreements at lea s t t h i rty days prior to accessing services through a participating provider under such agreement or agreements.

La. Rev. Stat. § 40:2203.1. According to the petition, BestComp failed to comply with the notice requirements of section 40.2203.1 of t h e L ouisiana Revised Statutes when applying discounts to workers’ compensation medical bills. As a result of this failure, Williams L.L.C. and its putative class sought statu tory damages in the form of “double t h e f a i r market value of the medical services provided, but, in no event, less than the greater of $50 per day of non-compliance

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or $2000, to g e t h e r w i th attorney fees to be determined by the Court as is provided under [state law].” See id. § 40:2203.1G. C. Federal court proceedings On November 12, 2009, Indian Harb o r filed a federal lawsuit seeking a “judgment declaring that it has no duty to defend or to indemnify BestComp, or to pay any proceeds under the Pol i c y , for the claims asserted against it.” In August 2010, Indian Harbor filed a motion for s u m m a ry judgment in which it argued that because the statutory damages requested in the state court action

are properly considered p e n a l t i e s, they are not the type of damages covered under the terms of the policy. Accordingly, it contended that it had no duty to defend o r indemnify BestComp in the Williams lawsuit. In response to this motion, BestComp argued that while Indian Harbor may not be responsible for paying statutory damages under section 40.2203.1, it w a s ob li gat ed to defend the Williamslawsuit and cover claim expenses incurred as a result of this suit. In November 2010, the district court i ssued an order resolving Indian Harbor’s motion. In its order, the district court granted Indian Harbor’s motion in part when it concluded that damages under section 40.2203. 1 , a long with

cer t a i n a t torneys’ fees, were not covered by the policy. The district court did, however, partially deny Indian Harbor’s motion by determining that not only did Indian Harbor still have a duty to defend BestComp, but was also re s p o nsible for paying claim expenses arising out of the Williams lawsuit. On November 8, 2 2011, the district court granted Indian Harbor’s motion to certify its denial of Indian Harbor’s motion for summary judgment as a final judgment pursuant to Federal Rule of Civil Procedure 54(b). This appeal ensued.

The dis tri ct cour t al s o d e n i ed a mo tio n for sum mar y judgm ent that wa s fil ed by 2 Willi ams L. L.C. 4 Case: 11-30466 Document: 00511688373 Page: 4 Date Filed: 12/07/2011No. 11-30466 II. A. Standard of Review We review the district court’s grant or denial of summ a ry j u dgment de
novo, applying the same standard as the district court. Holt v. State Farm Fire & Cas. Co. , 627 F.3d 188 (5th Cir. 2010) (citation omitted). Summary judgment is appropriate if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). A district court’s interpretation of an insurance contract is a question of law subject to de

novo review. Travelers Lloyds Ins. Co. v. Pacific Emp’rs Ins. Co. , 602 F.3d 677, 681 (5th Cir. 2010). B. Analysis “When, as here, jurisdiction is based on diversity, we apply th e s ub s t antive law of the forum state.” Holt , 627 F.3d at 191 (citing Erie R. v. Tompkins , 304 U.S. 64 (1938)). Louisiana is the forum state in this case; we therefore look to its law for guidance in resolving this dispute. On appeal, Indian Harbor solely argues that the district court erred in conclud i n g that it had a duty to defend BestCom p i n the Williams lawsuit. Because this appeal turns on the interpretation of an insurance policy, we begin our analysis with a consideration of the interpretive tools provided by Louisiana law. “An insurance policy is a contract between parties an d sho uld be construed by using the general r u l e s o f i nterpretation of contracts in the Civil Code.” In

re Katrina Canal B re a c h e s Litig. , 63 So. 3d 955, 963 (La. 2011). The judicial responsibility in interpreting insurance contracts is to determ i n e the parties’

common intent. La. Ins. Guar. Ass’n v. Interstate F ire and Cas. Co. , 630 So. 2d 759, (La. 1994) (citing La. Civ. Code art. 2045). “The parties’ intent as reflected by the words in the p o l i c y determine the extent of coverage.” Id. (citation

o m i t t ed). “Such intent is to be determined in accordance with the gen e r a l , ordinary, plain and popular meaning of the words used in the policy, unless the

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words have acquired a technical meaning.” Id. (citing La. Civ. Code art. 2047). Where a policy of insurance contains a definition of any w o r d o r p h r ase, this definition is controlling. E.g., Cangelosi v. Allstate Ins. Co. , 680 So. 2 d 1358, 1362 (La. Ct. App. 1 Cir. 1996). “If the words o f t h e p o l icy are clear and explicit and lead to no absurd
consequences, no further interpretation may be made in search o f the parties’ intent and the agreement must be enforced as written.” Crabtree v. State Farm I n s . Co . , 6 3 2 So. 2d 736, 741 (La. 1994). “The policy should be construed as a whole and one portion thereof should not be construed separately at the expense of disregarding another.” Id. (ci t a t i o n omitted). “If after applying the other general rules of construction an ambiguity remains, the ambiguous contractual
p rovision is to be construed against the insurer who issued the policy and i n favor of the insured.” Id. (citation omitted). With th e s e g eneral interpretive tools in mind, we turn to the specific legal issue presented on appeal. Under Louisiana law, an “insurer’s duty to defend laws u i t s a g ainst its i n s u r e d is broader than its liability for damage claims.” Mossy Motors, Inc. v . Cameras Am. , 898 So. 2d 602, 606 (La. Ct. App. 4 Cir. 2005) (citing Steptore v. Masco Constr. Co., Inc. , 643 So. 2d 1213, 1218 (La. 1994)). “The issue of whether

a liability insurer ha s t h e d u t y to defend a civil action against its insured is determined b y application of the ‘eight-corners rule,’ under which an insurer must look to the ‘four corners’ of the plaintiff’s petition and the ‘four corners’ of its policy to determine whether it owes that d u t y . ” Id. “The duty to defend is determined by the allegations of the plaintiff's petition, with the insurer being obligated to furnish a d e f ense unless the petition unambiguously excludes coverage.” Id. at 606-07 (citations omitted). “The duty to defen d a rises whenever the pleadings against the ins ur e d disclose even a possibility of liability under the policy.” Id. at 607. To determine whether Indian Harbor has a duty

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to defend Bes t C o m p in the Williams lawsuit, we must therefore compare the policy language with Williams L.L.C.’s state court petition. The policy states that Indian Harbor “has the right and duty to defend any claim against [BestComp] even if any o f t he allegations of the claim are groundless, false or fraudulent.” As stated above, the policy defines a claim as

“ a d e m a nd for money or services naming [BestComp] arising out of an act or omission in the performance of professional services.” Here, it is evident that Williams L.L.C.’s state court petition is properly considered a claim as that term is defined by the policy. In its petition, Williams L.L.C. names BestComp and demands money as a result of BestComp’s alleged failure to abide by state notice requirements in performing its professional services, namely, “providi n g PPO discounted rates in connection with Louisiana workers’ compensation payments.” Because the allegations in the state court petition qualify as a claim under the policy, Indian Harbor has a duty to defend BestComp in the Williams lawsuit. Ac c o r d ingly, we conclude that the district court did not commit legal error in so holding. Not only d o e s I n d ian Harbor have a duty to defend BestComp, but it is also required to cover claim expenses. The policy is unambiguous with respect to Indian Harbor’s contractual obligation to pay claim expenses: “[Indian H a rb or] will pay on behalf of [BestComp] all sums in excess of the deductible that [BestComp] becomes l egally obligated to pay as damages and claim
expenses as a result of a claim” made against BestComp. As thi s language makes clear, any claim expenses that arise as a result of the claims made in the

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state court action are therefore also covered by the plain terms of the policy. The district court therefore did not err in arriving at the same conclusion. 3 In its brief, Indian Harbor contends that its duty to defend terminated “on November 12, 2010 when the [d]istrict [c]ou r t ruled that [its] policy unambiguously excludes from c overage the claims asserted in the underlying putative class action[.]” Throughout its brief, it relies heavily upon this premise in constructing its arguments. This premise, however, mischaracterizes the district court’s decision. Contrary to what Indian Harbor suggests, the district court did not hold that the claims in the Williams lawsuit were outside the scope of the policy’s coverage. Rather, it unequivocally held that “the plain language of Indian Harbor’s policy specifically precludes recovery for da m a ges incurred under section 40.2203.1(G).” Put simply, the district court’s holding addressed Indian Harbor’s legal obligation to pay damages, not its duty to defend claims brought against Be s t C o m p . Because they are predicated on a faulty premise, Indian Harbor’s arguments fail t o p r ovide a basis for unsettling the district court’s judgment. 4 III. Finding no error, we AFFIRM the district court’s judgment. We also GRANT Williams L.L.C.’s pending motion to be removed as appellee. 5

At various point s in its wri tte n subm iss ions , IndianH arbo r cas ually sugges ts that 3 the ter ms “d ama ges” and “ c l a im expe nse s” are “ine xtric ably tie d toget her” and that , as a res ult, the dis tri ct cour t’s judgm ent regar ding dam ages als o extingui she d a ny duty to pay clai m expe nse s. Becaus e this argum ent is pr es ente d in a conc lus ory f a s h i o n , w e wi ll not cons ide r it. E.g. , Uni ted States v. Staln ake r . 571 F.3d 428, 440- 41 (5t h Cir. 2009) (c oncl udin g that unde velop ed argum ents that lack ed cit atio ns to rele vant law we re wa ived for inad equat e brie fing)

.

Not only are Indian Ha rbor ’s argum ents bas ed on a faul ty pr em ise , but they als o pay 4 sho rt shrift to an im por tant por tio n of any dis put e regar ding the inte rp ret a t i on of an ins uranc e p olic y: the act ual language of the ins uranc e c ontr act

.

In its brie f, Best Com p ask s for dam ages unde r Fede ral Rule of App ellat e Proc edur e 5 38. Altho ugh Indian Ha rbor ’s app eal bord ers on fr ivolous , we do not belie ve it is san cti onable

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