United States Court of Appeals 

For the First Circuit 

No. 19-1212 

CLARENDON NATIONAL INSURANCE COMPANY, 

Plaintiff, Appellant, 

v. 

PHILADELPHIA INDEMNITY INSURANCE COMPANY, 

Defendant, Appellee. 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF MASSACHUSETTS 

[Hon. Leo T. Sorokin, U.S. District Judge] 

Before 

Torruella, Lynch, and Kayatta, 

 Circuit Judges. 

John W. Dennehy, with whom Dennehy Law was on brief, for 

appellant. 

David W. Zizik, with whom Sulloway & Hollis PLLC was on brief, 

for appellee. 

April 1, 2020 
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TORRUELLA, Circuit Judge. In this diversity case, 

Clarendon National Insurance Company ("Clarendon") appeals the 

district court's entry of summary judgment against its claim that 

Philadelphia Indemnity Insurance Company ("Philadelphia") breached 

its contract with Lundgren Management Group, Inc. ("Lundgren") 

when Philadelphia declined to tender a defense to Lundgren, whom 

Philadelphia had insured from 2007 to 2008. Lundgren had assigned 

these claims to Clarendon. The district court determined that 

because the property damage allegations were excluded by the prior 

policy period exclusion, the complaint did not give rise to a duty 

to defend. Furthermore, Clarendon challenges the summary 

dismissal of its additional claims for contribution and alleged 

violations of Massachusetts General Laws, chapters 93A and 176D, 

which the district court concluded should also be dismissed because 

they were premised on the incorrect notion that Philadelphia had 

breached its duty to defend. After careful consideration, we 

affirm. 

I. Background

A. Factual Background

Clarendon, a New York corporation, provided indemnity 

insurance to Lundgren, a building management corporation, from 

June 24, 2004, to June 24, 2005. Subsequently, Philadelphia, a 

Pennsylvania corporation, provided insurance for Lundgren from 
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September 1, 2007, to September 1, 2008. Philadelphia's insurance 

policy with Lundgren contained the following provision that 

excludes coverage for damage beginning prior to the inception of 

the insurance policy: 

b. This insurance applies to "bodily injury" and 

"property damage" only if: 

. . . . 

(3) Prior to the policy period, no insured listed 

. . . and no "employee" authorized by you to give or 

receive notice of an "occurrence" or claim, knew that 

the "bodily injury" or "property damage" had occurred, 

in whole or in part. If such a listed insured or 

authorized "employee" knew, prior to the policy 

period, that the "bodily injury" or "property damage" 

occurred, then any continuation, change or resumption 

of such "bodily injury" or "property damage" during 

or after the policy period will be deemed to have been 

known prior to the policy period.

On February 12, 2009, Denise Doherty ("Doherty"), a 

resident in a Lundgren-managed building, filed a complaint in the 

Superior Court for Suffolk County, Massachusetts, against the 

Admirals Flagship Condominium Trust ("Admirals"), certain named 

trustees of Admirals, Lundgren, and Construction by Design, LTD 

("CBD"). In the complaint, Doherty asserted negligence claims 

against Lundgren stemming from alleged water infiltration into her 

condominium. On April 29, 2009, Doherty filed an amended 

complaint that proffered new factual information and asserted 

additional claims of misrepresentation, nuisance, trespass, and 

breach of contract under Massachusetts law ("the Underlying 

Complaint"). 
-4- 

According to the Underlying Complaint, in February 2002, 

Doherty purchased a condominium unit in a building owned by 

Admirals. Admirals contracted with Lundgren to serve as the 

property manager of the building. In turn, Lundgren contracted 

CBD to maintain and repair the building. "During the year 2004[,] 

leaks developed in the roof above [Doherty's] unit and/or the 

exterior area of the structure just below the roof line." Doherty 

alleged that subsequent repairs to the ceiling were "not made in 

a timely or appropriate manner." In 2005, a Lundgren employee 

notified Doherty that the threshold leading to her condominium's 

deck was rotting. In February 2006, Doherty discovered a mushroom 

and water infiltration on "said threshold" and notified Lundgren. 

At that time, Lundgren asked CBD to replace the rotting threshold. 

According to Doherty, CBD "did not do this repair in a timely 

manner and left the debris exposed in [her] bedroom."

On March 10, 2006, Gordon Mycology Laboratory, Inc., 

hired by Lundgren to conduct mold testing, "issued a report 

disclosing the presence of hazardous mold in unsafe levels in 

[Doherty's] unit caused by water intrusions and chronic dampness." 

Doherty complained that although Lundgren had assured her that the 

mold problem would be resolved, the cleanup was "ineffectual." 

According to Doherty, "Lundgren . . . promised [her] that [CBD] 

would stop the leaks into the unit but it [did] not [do] so." On 
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September 2, 2008, Doherty's doctor ordered her to leave the 

condominium and not to return unless the mold was eliminated and 

the leaks were repaired. 

Doherty alleged that she suffered damages as a result of 

the defendants' actions, including adverse health effects, loss of 

personal belongings, loss of her home, loss of value to her 

condominium unit, and loss of income. 

On June 30, 2009, shortly after the Underlying Complaint 

was filed, Lundgren tendered the defense of the Underlying 

Complaint to Philadelphia. In a letter dated July 24, 2009, 

Philadelphia denied coverage. It stated that "there are no 

allegations in the complaint that occurred within our policy 

period." In addition, it stated that the "damages sought in this 

matter pertain to exposure to mold," yet, "the policy specifically 

excludes 'property damage' . . . and any damages that result from 

'fungi' as defined in the policy" 1 (hereinafter the "mold 

exclusion"). Clarendon, on the other hand, financed the defense 

of Lundgren with a Reservation of Rights to exclude mold and fungus 

damage. 

 

1 The policy defined "fungi" as "any type or form of fungus, 

including mold or mildew and any mycotoxins, spores, scents or 

byproducts produced or released by fungi." 
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On October 7, 2014, North American Risk Services, 

Clarendon's third-party claims administrator, demanded that 

Philadelphia contribute to the cost of defending Lundgren. After 

the Doherty case eventually settled, Philadelphia again denied 

Clarendon's claim for contribution in a letter dated November 3, 

2014, admitting that "potentially" the mold exclusion did not apply 

to the allegations in the Underlying Complaint, but insisting that 

"the alleged damage occurred prior to the inception of 

[Philadelphia]'s policy, . . . during the Clarendon policy period." 

On or about March 17, 2015, Clarendon received an assignment from 

Lundgren of all the claims arising from the Doherty matter.

B. Procedural Background 

On November 29, 2017, Clarendon filed suit against 

Philadelphia in the Superior Court for Suffolk County, 

Massachusetts, based upon Philadelphia's denial of coverage to 

Lundgren. Clarendon brought three claims: "Contribution" 

(Count I), "Breach of Contract" (Count II), and "93A/176D 

Violations" (Count III). In essence, Clarendon's complaint stated 

that Philadelphia breached its contract with Lundgren when it 

"improperly denied coverage for defense and indemnity," failed to 

contribute "its pro rata share for either coverage," and "failed 

to investigate the matter." On December 21, 2017, Philadelphia 

removed the case to the United States District Court for the 
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District of Massachusetts. 

The parties agreed to discovery in phases. Discovery 

Phase I was for the purpose of collecting information related to 

Philadelphia's duty to defend Lundgren, and later phases were 

scheduled for remaining issues in the case. On May 21, 2018, 

Philadelphia served its Rule 26(a)(1) initial disclosures on 

Clarendon. Clarendon did not provide its initial disclosures and 

did not conduct any discovery. Philadelphia then filed a motion 

for summary judgment on July 2, 2018, which Clarendon opposed. On 

January 8, 2019, the district court granted summary judgment for 

Philadelphia on all claims. Clarendon Nat'l Ins. Co. v. Phila. 

Indem. Ins. Co., No. 17-12541, 2019 WL 134614, at *4 (D. Mass. 

Jan. 8, 2019). Regarding the breach of contract claim -- which 

was premised on the allegations that Philadelphia breached its 

contract with Lundgren when it "improperly denied coverage for 

defense and indemnity" -- the court noted that Philadelphia's 

policy only covered damages caused by "bodily injury" or "property 

damage" that occurred during the policy period, and that did not 

result from the "continuation, change or resumption" of "bodily 

injury" or "property damage" "deemed to have been known prior to 

the policy period." Id. at *3 (citation omitted). The court 

further noted that the Underlying Complaint alleged damages that 

began in 2004, "well before the beginning of Philadelphia's policy 
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period on September 1, 2007," and continued throughout the years. 

Id. Accordingly, the court concluded that the damages were not 

covered by Philadelphia's policy. Id. 

The court also rejected Clarendon's contention that the 

Underlying Complaint could be read to suggest that the original 

leaks arising prior to the policy period were adequately repaired 

and "new leaks" had arisen during the period of Philadelphia's 

policy, reasoning that the Underlying Complaint clearly states 

that "the leaks and resulting problems were continuous throughout 

the relevant period," and "Philadelphia's policy also excludes 

coverage for damage that resumes during the policy period if the 

damage began and was known before the period." Id. Furthermore, 

the court noted that the Underlying Complaint "does not allege 

that Lundgren's repair efforts were ever successful at abating the 

leaks entirely, [or] even temporarily, such that leaks occurring 

during the policy period could have been considered new leaks." 

Id. The court concluded that, because the Underlying Complaint 

did not contain allegations "'reasonably susceptible of an 

interpretation that they state' a claim covered by Philadelphia's 

policy," Philadelphia did not have a duty to defend or indemnify 

its insured and, thus, Clarendon's breach of contract claim failed. 

Id. at *4 (quoting Cont'l Cas. Co. v. Gilbane Bldg. Co., 461 N.E.2d 

209, 212 (Mass. 1984)). 
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Finally, the court held that Clarendon's additional 

claims for contribution and under Massachusetts General Laws, 

chapters 93A and 176D also failed because they were premised on 

the incorrect notion that Philadelphia had breached its duty to 

defend and indemnify Lundgren in the Doherty case. Id. 

Accordingly, the court entered summary judgment dismissing 

Clarendon's complaint. Id. 

On January 17, 2019, Clarendon moved for 

reconsideration, which the district court denied on January 24, 

2019. Clarendon Nat'l Ins. Co. v. Phila. Indem. Ins. Co., No. 17-

12541, 2019 WL 319993, at *2 (D. Mass. Jan. 24, 2019). 

Thereafter, on February 25, 2019, Clarendon filed a timely notice 

of appeal.2

II. Discussion 

We review a district court's grant of summary judgment 

de novo, construing the record in the light most favorable to the 

nonmovant and resolving all reasonable inferences in that party's 

favor. Ocasio-Hernández v. Fortuño-Burset, 777 F.3d 1, 4 (1st Cir. 

 

2 Although Clarendon's notice of appeal included the court's 

ruling on its Motion for Reconsideration, Clarendon failed to 

meaningfully discuss that ruling in its appellate briefs. As 

such, any arguments regarding the court's ruling on its Motion for 

Reconsideration are waived. United States v. Zannino, 895 F.2d 

1, 17 (1st Cir. 1990) ("[I]ssues adverted to in a perfunctory 

manner, unaccompanied by some effort at developed argumentation, 

are deemed waived."). 
-10- 

2015); Mesnick v. Gen. Elec. Co., 950 F.2d 816, 822 (1st Cir. 1991) 

(quoting Griggs-Ryan v. Smith, 904 F.2d 112, 115 (1st Cir. 1990)). 

Summary judgment may be granted only when "there is no genuine 

dispute as to any material fact and the movant is entitled to 

judgment as a matter of law." Ameen v. Amphenol Printed Circuits, 

Inc., 777 F.3d 63, 68 (1st Cir. 2015) (quoting Barclays Bank PLC 

v. Poynter, 710 F.3d 16, 19 (1st Cir. 2013)). The party opposing 

summary judgment "bears 'the burden of producing specific facts 

sufficient to deflect the swing of the summary judgment scythe.'" 

Theidon v. Harvard Univ., 948 F.3d 477, 494 (1st Cir. 2020) 

(quoting Mulvihill v. Top-Flite Golf Co., 335 F.3d 15, 19 (1st 

Cir. 2003)). "For this purpose, [it] cannot rely on 'conclusory 

allegations, improbable inferences, acrimonious invective, or rank 

speculation.'" Id. (quoting Ahern v. Shinseki, 629 F.3d 49, 54 

(1st Cir. 2010)). 

A. Duty to Defend 

On appeal, Clarendon argues that the district court 

erred in its interpretation of Massachusetts law and its dismissal 

of Clarendon's breach of contract claim, which Clarendon contends 

was premised on the alleged breach of Philadelphia's duty to defend 

Lundgren. Specifically, citing Metropolitan Property and Casualty 

Insurance Company v. Morrison, 951 N.E.2d 662 (Mass. 2011) 

("Metropolitan"), Clarendon posits that under Massachusetts law, 
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"there is no requirement that the facts alleged in the complaint 

specifically and unequivocally make out a claim within the 

coverage." Id. at 667 (quoting Billings v. Commerce Ins. Co., 

936 N.E.2d 408, 414 (Mass. 2010)). Instead, according to 

Clarendon, a duty to defend should be found unless "the express 

language in the complaint unequivocally demonstrate[s] that the 

insurer does not owe coverage." And, here, its argument goes, the 

Underlying Complaint's generalized allegations "can be read to 

infer coverage," thus triggering Philadelphia's duty to defend 

Lundgren in the suit. 

In support of the contention that the Underlying 

Complaint is reasonably susceptible to an interpretation entailing 

coverage, Clarendon argues that the Underlying Complaint specifies 

the date for only one leak: a "leak near a roofline," which 

occurred "in 2004." It emphasizes that there is no "specific 

information as to the time and the location of other leaks," and 

that the Underlying Complaint fails to provide information about 

"when each leak occurred, what measures were taken to repair them, 

and whether any of the repairs were effective." Thus, in 

Clarendon's view, the Underlying Complaint's assertion of "several 

leaks" suggests that there were multiple issues over time. 

Accordingly, this assertion is reasonably susceptible to an 

interpretation in which "a new leak occurr[ed] during 
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Philadelphia's policy period." It further argues that even if the 

exact same 2004 leak resumed after CBD repaired it, "[a] reasonable 

inference is that Lundgren would anticipate the repairs to be 

corrected and would not know that they would reoccur after repairs 

were undertaken." 

In addition, Clarendon posits that Philadelphia, as an 

insurer, had an independent duty to investigate the "claim or loss" 

regardless of the language in the Underlying Complaint. To comply 

with that duty, Clarendon asserts that Philadelphia should have 

"take[n] steps to obtain a copy of the [original] complaint" and 

should have "sp[oken] to its insured." According to Clarendon, 

Philadelphia's failure to investigate, to file an interpleader 

action, and to draw inferences in favor of the insured, together 

warrant a "remand[] in its entirety" because each of those failures 

amounts to a breach of the duty to defend.

Finally, Clarendon argues that Philadelphia should be 

estopped from denying coverage by relying on the "known loss" 

justification -- the policy provision establishing that damages 

occurring during the policy period are not covered if they result 

from the "continuation, change or resumption," of damages known 

prior to the policy period -- because, according to Clarendon, 

Philadelphia did not rely on those grounds to deny coverage in 

2009 when it initially considered Lundgren's claim. Clarendon 
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posits that, because Philadelphia denied coverage in 2009 based on 

the "mold exclusion" and improperly induced reliance on this 

exclusion, Philadelphia cannot now shift its denial justification 

to an "entirely new" "known loss" justification in its 2014 letter. 

According to Clarendon, Philadelphia should have initially 

defended its insured and then sought a declaratory judgment on its 

lack of coverage claim. We address each argument in turn. 

The parties agree that Massachusetts law governs. Under 

Massachusetts law, an insurer's duty to defend "is determined based 

on the facts alleged in the complaint, and on facts known or 

readily knowable by the insurer that may aid in its interpretation 

of the allegations in the complaint." Metropolitan, 936 N.E.2d 

at 667; Bos. Symphony Orchestra, Inc. v. Commercial Union Ins. 

Co., 545 N.E.2d 1156, 1160 (Mass. 1989). To establish an insurer's 

duty to defend and investigate allegations against an insured, a 

plaintiff must demonstrate that the "allegations in [the 

underlying complaint] are reasonably susceptible of an 

interpretation that states or roughly sketches a claim covered by 

the policy terms." Metropolitan, 951 N.E.2d at 667 (quoting 

Billings, 936 N.E.2d at 414). The underlying complaint need not 

"unequivocally make out a claim within the coverage," but rather, 

"need only show, through general allegations, a possibility that 

the liability claim falls within the insurance coverage," 
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Billings, 936 N.E.2d at 414 (quoting Sterilite Corp. v. Cont'l 

Cas. Co., 458 N.E.2d 338, 341 (Mass. App. Ct. 1983)), regardless 

of "the possibility that the underlying claim may ultimately fail, 

or that the merits of the claim are weak or frivolous." Holyoke 

Mut. Ins. Co. in Salem v. Vibram USA, Inc., 106 N.E.3d 572, 576 

(Mass. 2018). Where there is uncertainty "as to whether the 

pleadings include or are reasonably susceptible to an 

interpretation that they include a claim covered by the policy 

terms," the uncertainty "is resolved in favor of the insured," and 

the insurer's duty to defend will attach "until [the insurer] 

obtains a declaratory judgment of no coverage." Deutsche Bank 

Nat'l Ass'n v. First Am. Title Ins. Co., 991 N.E.2d 638, 642 (Mass. 

2013). 

However, where the allegations within the underlying 

complaint "lie expressly outside the policy coverage and its 

purpose," an insurer is relieved of its duty to defend and 

investigate. Metropolitan, 951 N.E.2d at 668 (quoting Herbert A. 

Sullivan, Inc. v. Utica Mut. Ins. Co., 788 N.E.2d 522, 531 

(Mass. 2003)). Additionally, "[e]ven where the allegations in the 

complaint state or roughly sketch a claim covered by" an insured's 

policy, no duty to defend and investigate arises if "there is 

'undisputed, readily knowable, and publicly available information' 

in court records that demonstrates that the insurer has no duty to 
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defend" and if "there is 'an undisputed extrinsic fact that takes 

the case outside the coverage and that will not be litigated at 

the trial of the underlying action.'" Id. (quoting Billings, 

936 N.E.2d at 200 n.8, 205). Moreover, although an initial 

complaint may contain allegations which give rise to a duty to 

defend, the duty no longer exists when the complaint is amended to 

remove the triggering allegations. See Herbert A. Sullivan, Inc., 

788 N.E.2d at 531. 

A close read of the Underlying Complaint and the record 

shows that the district court did not err by granting summary 

judgment for Philadelphia on the duty to defend issue. Examined 

according to Massachusetts law, the allegations in the Underlying 

Complaint are not "reasonably susceptible of an interpretation 

that states or roughly sketches a claim covered" by Philadelphia's 

policy. Metropolitan, 951 N.E.2d at 667 (quoting Billings, 

936 N.E.2d at 414). The parties do not dispute that Philadelphia's 

policy expressly excludes coverage for property damage known prior 

to Philadelphia's period of coverage. To establish that the 

Underlying Complaint "roughly sketches" a potentially covered 

event, Clarendon points to small differences in grammatical 

structure between paragraphs and ambiguities arising from missing 

information about the time and place of various leaks. Neither 

of these assertions give rise to a rough sketch of a covered claim. 
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Clarendon's reliance on the use of the word "leak" (in 

singular) in paragraph seventeen of the Underlying Complaint to 

suggest that the use of the term "leaks" in other paragraphs3 could 

reasonably be interpreted as referencing new distinct leaks 

arising from different structural problems is inconsistent with a 

reading of the Underlying Complaint as a whole. Paragraph sixteen 

of the Underlying Complaint clearly states that "[d]uring the year 

2004 leaks developed in the roof above [Doherty's] unit and/or the 

exterior area of the structure just below the roof line." 

(Emphasis added). The Underlying Complaint then goes on to discuss 

the water infiltration problems caused by these "leaks" that 

started in 2004, including the fact that "[t]he roof leak caused 

ceiling cracks and loosening plaster in [Doherty's] unit," as 

stated in paragraph seventeen. Contrary to Clarendon's 

contentions, the fact that the Underlying Complaint does not 

mention the precise location, time, and repairs undertaken is 

insufficient to show that Doherty's claim "possib[ly] . . . falls 

within the insurance coverage." See Billings, 936 N.E.2d at 414. 

The Underlying Complaint unambiguously indicates that the 2004 

repairs were not made in an "appropriate manner," and that Doherty 

had continued to request "complete repair of all leaks . . . to no 

 

3 See Underlying Complaint at ¶¶ 16, 24, 26, and 27 ("leaks"); 17 

("leak"); 28 ("all leaks"). 
-17- 

avail." See Underlying Complaint at ¶¶ 17 and 28. Further, it 

references "chronic dampness" occurring at least as early as 

March 10, 2006, before the inception of Philadelphia's policy. 

See Underlying Complaint at ¶¶ 23 and 28. Nothing in the Underlying 

Complaint is reasonably susceptible to an interpretation in which 

the leaks were resolved prior to the inception of Philadelphia's 

policy. Clarendon, therefore, has failed to show that the 

Underlying Complaint provides the "rough sketch" of a covered event 

necessary to trigger the duty to defend. Metropolitan, 951 N.E.2d 

at 667.4

Furthermore, contrary to Clarendon's contentions, 

Philadelphia did not have an independent duty to investigate claims 

 

4 Although its arguments are not a model of clarity, Clarendon 

also seems to suggest that Lundgren could rely on CBD to resolve 

the leaks, negating its knowledge of a problem, and thus each 

resumption would be a "new leak" or new "property damage" under 

the policy. This argument, however, is not consistent with the 

plain terms of the insurance policy, which provides in relevant 

part: "If such a listed insured or authorized 'employee' knew prior 

to the policy period, that the 'bodily injury' or 'property damage' 

occurred, then any continuation, change or resumption of such 

'bodily injury' or 'property damage' during or after the policy 

period will be deemed to have been known prior to the policy 

period." There is no dispute that the Underlying Complaint 

alleges that Lundgren initially knew about the property damage and 

made representations about their repair. See Underlying Complaint 

at ¶¶ 18, 24. Regardless of its reliance on CBD to effectuate 

repairs and whether Lundgren knew or reasonably believed them to 

be effective, under the plain terms of the policy, the damages 

would be a "resumption of such 'property damage'" of which Lundgren 

was initially aware. 
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that were not reasonably susceptible of an interpretation that 

states or roughly sketches a claim covered by its policy. See id. 

at 667-68 ("[W]hen the allegations in the underlying complaint 

'lie expressly outside the policy coverage and its purpose, the 

insurer is relieved of the duty to investigate.'" (quoting 

Billings, 936 N.E.2d at 414)); see also Nascimento v. Preferred 

Mut. Ins. Co., 513 F.3d 273, 277 (1st Cir. 2008). While Clarendon 

is correct that Massachusetts law does look to facts "known or 

readily knowable by the insurer" as well as to the underlying 

complaint to determine whether a duty to defend has been triggered, 

information that is "readily knowable" is distinct from the duty 

to investigate. Metropolitan, 951 N.E.2d at 667-68 (quoting 

Billings, 936 N.E.2d at 414, 417). This Court has held that 

information known or readily knowable does not independently 

trigger the duty to defend under Massachusetts law when the 

complaint does not "adumbrate a claim." Open Software Found., 

Inc. v. U.S. Fidelity & Guar. Co., 307 F.3d 11, 15-16 (1st Cir. 

2001) (internal quotation marks omitted) ("Massachusetts courts 

generally use extrinsic facts . . . to aid interpretation of the 

complaint, and not as independent factual predicates for a duty to 

defend. . . . We do not consider them as independent grounds for 

a duty to defend."); accord Bos. Symphony, 545 N.E.2d at 1160-61. 

Philadelphia therefore did not breach either its duty to 
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investigate or its duty to defend Lundgren. 

Finally, we refuse to address, on waiver grounds, the 

merits of Clarendon's argument that Philadelphia is estopped from 

relying on the "known loss" justification to deny coverage because, 

according to Clarendon, Philadelphia changed its grounds for 

denial of coverage between 2009 and 2014. Contrary to its 

contentions, Clarendon did not properly raise that claim in the 

district court. While Clarendon may have flagged discrepancies 

between the 2009 and 2014 denial-of-coverage letters in the 

district court, it never affirmatively linked these discrepancies 

to an estoppel argument nor explained how they resulted in 

Lundgren's reliance. A litigant's mere mentioning of facts that 

could potentially make up a claim is insufficient to effectively 

raise the argument. United States v. Slade, 980 F.2d 27, 30 

(1st Cir. 1992) ("Passing allusions are not adequate to preserve 

an argument in either a trial or appellate venue."). 

B. Claims for contribution and for alleged violations of 

Massachusetts General Laws, chapters 93A and 176D 

Next, Clarendon challenges the district court's entry of 

summary judgment dismissing its contribution claim (Count I) and 

its claim for alleged violations of Massachusetts General Laws, 

chapters 93A and 176D (Count III).5 Despite mentioning in its 

 

5 Clarendon interchangeably refers to "consumer protection claim" 
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opening brief's statement of the case that it was seeking appellate 

review of the dismissal of its contribution claim, Clarendon did 

not discuss this elsewhere in its briefs. We thus deem the 

contribution claim waived. See United States v. Zannino, 895 F.2d 

1, 17 (1st Cir. 1990). Even if not waived, Clarendon's challenge 

to the summary dismissal of its contribution claim would fail 

inasmuch as it was premised on the incorrect notion that 

Philadelphia had breached its duty to defend and to indemnify 

Lundgren in the Doherty case and thus needed to proportionately 

contribute to Clarendon, who had satisfied an obligation common to 

both Clarendon and Philadelphia. See Ins. Co. of the State of Pa.

v. Great N. Ins. Co., 45 N.E.3d 1283, 1286 (Mass. 2016) ("Under 

the doctrine of equitable contribution, where multiple insurers 

provide coverage for a loss of an insured, an insurer who pays 

more than its share of the costs of defense and indemnity may 

require a proportionate contribution from the other coinsurers."). 

We now turn to the remaining claim. Clarendon first 

argues that the district court improperly dismissed its claim for 

alleged violations of Massachusetts General Laws, chapters 93A and 

176D because "Philadelphia's Motion for Summary Judgment did not 

seek dismissal of [that] claim" and, thus, "Clarendon was not 

 

and "bad faith claim" to describe Count III. 
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afforded an opportunity to oppose [its] dismissal." In addition, 

Clarendon claims that if Philadelphia had conducted an 

investigation, "it would have learned that Lundgren did not 'know' 

of an ongoing loss at the time [that] the [Underlying] Complaint 

was filed because CBD had undertaken repairs and abated several 

issues." It asserts that the Underlying Complaint "includes 

allegations of personal property damage caused by water alone, 

which would not result in the personal property damage being 

excluded by the mold exclusion." It maintains that both the 

failure to investigate and the 2009 denial on the basis of the 

mold exclusion constitute bad faith that survives regardless of 

whether Philadelphia had a duty to defend. We address Clarendon's 

procedural and substantive challenges in turn. 

Contrary to Clarendon's contentions, in its motion for 

summary judgment, Philadelphia did request the dismissal of 

Clarendon's claim for alleged violations of Massachusetts General 

Laws, chapters 93A and 176D.6 Specifically, it stated: 

"Phase 1" is intended to focus on the duty to defend 

issue. However, because [Philadelphia] had no duty 

to defend the insureds in the underlying Suffolk 

Superior Court action, Clarendon's claims against 

[Philadelphia] in the other two counts (for equitable 

contribution and alleged violations of Chapter 

93A/176D) fail as a matter of law, and should also be 

dismissed. 

 

6 So did Philadelphia request the dismissal of Clarendon's 

contribution claim. 
-22- 

Philadelphia also briefed the issue in its memorandum of law in 

support of summary judgment. There, Philadelphia stated that if 

the district court were to grant summary judgment as to the duty 

to defend issue, then: 

[A]s a matter of law Clarendon cannot prove that it 

is entitled to "contribution" as alleged in Count I, 

or that [Philadelphia] violated M.G.L. ch. 93A or 176D 

[ ] as alleged in the third count . . . of Clarendon's 

Complaint. The Court should therefore grant summary 

judgment and dismiss the Plaintiff's Complaint in its 

entirety.

Philadelphia then proceeded to discuss why those two claims failed 

as a matter of law. The issue was thus squarely before the 

district court, and Clarendon had the opportunity to address it. 

In fact, Clarendon did address Philadelphia's arguments in its 

opposition to summary judgment, including the merits of its claim 

for alleged violations of chapters 93A and 176D.7 Accordingly, 

Clarendon's contention that the district court abused its 

discretion in dismissing Count III without giving it an opportunity 

to oppose such dismissal lacks merit. 

We now turn to Clarendon's substantive challenge. 

Massachusetts General Laws chapter 176D, section 2 prohibits 

insurance providers from engaging in "an unfair method of 

 

7 Clarendon also addressed the merits of its contribution claim, 

stating that "[t]he contribution claim [Count I] survives the 

Motion because the defense is based upon Philadelphia's [duty to 

defend] argument succeeding, and that argument fails." 
-23- 

competition or an unfair or deceptive act or practice in the 

business of insurance," while section 3(9) provides specific 

instances of conduct that violate this mandate.8 Mass. Gen. Laws 

ch. 176D, §§ 2, 3(9). Massachusetts General Laws chapter 93A, the 

Massachusetts Consumer Protection Law, prohibits "[u]nfair methods 

of competition and unfair or deceptive acts or practices in the 

conduct of any trade or commerce," Mass. Gen. Laws ch. 93A, § 2(a), 

and "provides a cause of action for business plaintiffs injured by 

unfair trade practices," Brazas Sporting Arms, Inc. v. Am. Empire 

Surplus Lines Ins. Co., 220 F.3d 1, 9 (1st Cir. 2000); Mass. Gen. 

Laws ch. 93A, § 11.9 "For a consumer plaintiff, a violation of 

 

8 Neither party specifically points to a provision in chapter 

176D, section 3, for the purpose of this appeal. Presumably, 

Clarendon's claims arise under sections 3(9)(a) (prohibiting 

"misrepresenting pertinent facts or insurance policy provisions 

relating to coverages at issue") and 3(9)(n) (prohibiting "failing 

to provide promptly a reasonable explanation of the basis in the 

insurance policy in relation to the facts or applicable law for 

denial of a claim"). 

9 Mass. Gen. Laws ch. 93A, § 11 states that: 

Any person who engages in the conduct of any trade or 

commerce and who suffers any loss of money or 

property, real or personal, as a result of the use or 

employment by another person who engages in any trade 

or commerce of an unfair method of competition or an 

unfair or deceptive act or practice declared unlawful 

by section two or by any rule or regulation issued 

under paragraph (c) of section two may, as hereinafter 

provided, bring an action in the superior court . . . 

whether by way of original complaint, counterclaim, 

cross-claim or third-party action for damages and such 

equitable relief, including an injunction, as the 
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chapter 176D, section 3(9) constitutes a violation of chapter 93A," 

whereas "a plaintiff engaged in 'trade or commerce,' [such as 

Clarendon,] may only use a violation of chapter 176D as evidence 

of a chapter 93A violation." River Farm Realty Tr. v. Farm Family 

Cas. Ins. Co., 943 F.3d 27, 37 (1st Cir. 2019) (citing Polaroid 

Corp. v. Travelers Indem. Co., 610 N.E.2d 912, 917 (Mass. 1993)). 

Under both chapter 176D and chapter 93A, insurers are "held to the 

duty of good faith and fair dealing." McGovern Physical Therapy 

Assocs., LLC v. Metro. Prop. & Cas. Ins. Co., 802 F. Supp. 2d 306, 

315 (D. Mass. 2011). To establish a claim of bad faith, a plaintiff 

must produce factual evidence of the defendant's knowledge and 

intent. O'Leary-Alison v. Metro. Prop. & Cas. Ins. Co., 752 

N.E.2d 795, 797 (Mass. App. Ct. 2001). Although an insurer's 

denial of coverage based on an unreasonable interpretation of 

policy terms may constitute bad faith, "plausible, although 

ultimately incorrect" interpretations of an insured's policy 

coverage do not. See Bos. Symphony, 545 N.E.2d at 1160. 

Clarendon's claim is premised on Philadelphia's alleged 

failure to investigate the allegations in the Underlying Complaint 

and to adequately inform its insured of the basis for the denial. 

We have already rejected Clarendon's failure to investigate claim. 

We now similarly reject Clarendon's contention that Philadelphia 

 

court deems to be necessary and proper.
-25- 

failed to adequately inform its insured of the basis for its denial 

of coverage. We note that in its 2009 letter, Philadelphia 

grounded its denial not only on the mold exclusion, but also on 

the fact that the allegations included in the Underlying Complaint 

had occurred outside of the coverage period. It advised that 

"there are no allegations in the complaint that occurred within 

our policy period." That, by itself, dooms Clarendon's contentions 

that Philadelphia violated Mass. Gen. Laws chs. 93A and 176D. See 

Manganella v. Evanston Ins. Co., 700 F.3d 585, 589-90, 595 (1st 

Cir. 2012) (holding -- where the insurer had denied coverage on 

one ground, but the denial letter "also adverted, without 

elaboration," to a policy exclusion -- that because the 

"[insurer's] denial of coverage was justified by the [policy] 

[e]xclusion, [plaintiff's] claims [for alleged violations of Mass. 

Gen. Laws chs. 93A and 176D could] not proceed under the theory 

that the denial of coverage was wrongful"); Bos. Symphony, 545 

N.E.2d at 1160 (no 93A violation where disclaimer of coverage was 

incorrect but not "unreasonable," nor in "bad faith" or for 

"ulterior motives"); Gulezian v. Lincoln Ins. Co., 506 N.E.2d 123, 

127 (Mass. 1987) ("An insurance company which in good faith denies 

a claim of coverage on the basis of a plausible interpretation of 

its insurance policy is unlikely to have committed a violation of 

[Mass. Gen. Laws ch.] 93A"); see also Brazas Sporting Arms, 
-26- 

220 F.3d at 10 ("Where . . . the insurer properly denied coverage, 

there can be no violation of chapter 176D."). Accordingly, the 

district court did not err in granting summary judgment against 

Clarendon on its claim for alleged violations of chapters 93A and 

176D. 

III. Conclusion 

For the foregoing reasons, we affirm the district 

court's summary judgment order. 

Affirmed.