In the

United States Court of Appeals

For the Seventh Circuit

No. 08-1997

HEALTH CARE INDUSTRY LIABILITY

INSURANCE PROGRAM,

Plaintiff-Appellee,

v.

MOMENCE MEADOWS NURSING CENTER, INC., and

JACOB GRAFF,

Defendants-Appellants.

Appeal from the United States District Court 

for the Central District of Illinois.

No. 07 C 02005—David G. Bernthal, Magistrate Judge.

ARGUED JANUARY 9, 2009—DECIDED MAY 20, 2009

Before MANION, ROVNER, and SYKES, Circuit Judges.

MANION, Circuit Judge. Vanessa Absher and Lynda

Mitchell sued Momence Meadows Nursing Center, Inc.,

and its owner and operator, Jacob Graff (collectively

“Momence”). They sought damages for themselves and

on behalf of the United States and the State of Illinois

for alleged violations of the federal False Claims Act
2 No. 08-1997

(“FCA”), 31 U.S.C. § 3729 et seq., and the Illinois Whistleblower Reward and Protection Act (“IWRPA”), 740 ILCS

175/1 et seq. The Health Care Industry Liability Insurance

Program (“Healthcap”) filed this action seeking a declaration that it had no duty to defend Momence in that lawsuit under a commercial general liability policy it had

issued to Momence. The district court found that

Healthcap had no duty to defend Momence, and

Momence appeals. We affirm.

I.

Vanessa Absher and Lynda Mitchell are former employees at Momence’s nursing center. In their third

amended complaint (which we will refer to hereafter as

the “underlying complaint”), Absher and Mitchell sought

treble damages for exposing thousands of false charges

Momence submitted to Medicare and Medicaid. Their

theory of recovery was predicated on the statutory requirement that Medicare and Medicaid providers may

not submit claims for services that failed to meet “professionally recognized standards of health care.” 42 U.S.C.

§ 1320c-5(a)(2). According to Absher and Miller, Momence

violated that requirement by certifying on its annual cost

reports that it was meeting the required standard of

care when, in fact, Momence’s management knew that

it was not.

The underlying complaint provides detailed allegations

of how Momence was not meeting the standard of care

for Medicare and Medicaid. It alleges, for instance, that

Momence failed to maintain the minimum staffing levels
No. 08-1997 3

for nurse and nurse assistants, failed to ensure its

residents received their medications as prescribed by

their physicians, failed to ensure residents received

adequate nutrition and assistance with meals, and failed

to provide the residents with clean and dry beds, clothes,

and regular baths. The underlying complaint devotes

several pages to further elaborating these alleged standardof-care failures. Included in those pages is a detailed

description of the resulting injuries patients suffered

from Momence’s substandard care, such as scabies,

sepsis, seizures, and death.

The underlying complaint sets forth four counts. In

count one, the plaintiffs seek statutory and treble

damages under the FCA for Momence’s submission of

false claims to the United States. In count two, they seek

statutory and treble damages under the IWRPA for

Momence’s submission of false claims to the state of

Illinois. In counts three and four, Absher and Mitchell seek

damages under the anti-retaliation provisions of the

FCA and IWRPA, respectively. Mitchell claims that

Momence terminated her in retaliation for complaining

to Momence’s management about the failures to provide

adequate care. Absher alleges constructive discharge

for the same reason.

As Absher and Mitchell’s suit proceeded, Healthcap

brought this action seeking a declaration that it had no

duty to defend or indemnify Momence in the underlying suit based on a commercial general liability policy

Healthcap issued to Momence in 2004. That policy provides Momence with multiple lines of coverage. Relevant
4 No. 08-1997

The part of the PL coverage relevant to this appeal provides: 1

We will pay those sums that the insured becomes legally

obligated to pay as “damages” because of injury to which

this insurance applies. . . . The injury must be caused by a

“medical incident.” . . . The “medical incident” must arise

out of the providing or withholding of the following

professional services: Medical, surgical, dental, or nursing

treatment to a person. . . . We will have the right and

duty to defend any “suit” seeking those “damages” . . . .

CGL coverage A states in relevant part: 2

We 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. We will

have the right and duty to defend the insured against any

“suit” seeking those damages.

The policy further defines “bodily injury” as “bodily injury,

sickness or disease sustained by a person, including death

resulting from any of these at any time.”

The pertinent part of CGL coverage B states: 3

We will pay those sums that the insured becomes legally

obligated to pay as damages because of “personal and

advertising injury” to which this insurance applies. We will

have the right and duty to defend the insured against any

“suit” seeking those damages.

(continued...)

to this appeal are the commercial general liability coverage

(“CGL coverage”) and the professional liability coverage

(“PL coverage”). The CGL coverage has two separate

1

coverage sections, CGL coverage A, which provides 2

coverage for bodily injury and property damage, and CGL

coverage B, which addresses personal and advertising 3
No. 08-1997 5

(...continued) 3

The policy defines “personal and advertising injury” to mean an

injury, including consequential “bodily injury,” arising out

of one or more of the following offenses:

. . . .

Oral or written publication of material that slanders or libels

a person or organization or disparages a person’s or organization’s goods, products or services.

. . . .

Oral or written publication of material that violates a

person’s right of privacy.

That exclusion provides: 4

This insurance does not apply to any claim or “suit” by or on

behalf of:

A person arising out of any:

Refusal to employ that person;

Termination of that person’s employment; or

Employment-related practices, policies, acts or omissions,

such as coercion, demotion, evaluation, reassignment,

discipline, defamation, harassment, humiliation or discrimination directed at that person . . . .

injury liability. In addition, the CGL coverage contains

an employment-related practices exclusion applicable to 4

both CGL coverage A and CGL coverage B.

Approximately a year after filing suit, Healthcap moved

for summary judgment, arguing that it had no duty to

defend or indemnify Momence. In a comprehensive
6 No. 08-1997

The parties consented to proceeding before the magistrate 5

judge. See 28 U.S.C. § 636(c).

opinion, the magistrate judge held that Healthcap had 5

no duty to defend Momence. The court further held that

the issue of indemnification was not ripe for consideration because Momence had yet to incur any liability in

the underlying action. It therefore dismissed the action

without prejudice with leave for Momence to reinstate

the suit after the underlying proceedings became final

and liability had been determined. Momence appeals.

II.

On appeal, Momence asserts that the magistrate judge

erred in concluding that Healthcap had no duty to

defend it in the underlying litigation. We review the

lower court’s grant of summary judgment, as well as its

construction of the commercial general liability policy,

de novo. Lyerla v. AMCO Ins. Co., 536 F.3d 684, 687 (7th

Cir. 2008). Since this is a diversity action, state law

applies. RLI Ins. Co. v. Conseco, Inc., 543 F.3d 384, 390 (7th

Cir. 2008). The parties proceed under the assumption

that Illinois law applies; so will we.

Momence first argues that the magistrate judge’s opinion “contain[s] an inherent inconsistency requiring reversal.” According to Momence, the inconsistency is the

lower court’s granting of summary judgment on the duty

to defend while postponing judgment on the duty to

indemnify. If there really were no duty to defend,

Momence points out, then the magistrate judge would
No. 08-1997 7

have held that there was no duty to indemnify either, since

the duty to defend is broader than the duty to indemnify.

BASF AG v. Great Am. Assur. Co., 522 F.3d 813, 819 (7th Cir.

2008) (applying Illinois law). But because the lower court

left open the question of indemnification, Momence reads

the magistrate judge’s action as admitting that a possibility

still exists that the policy covers the underlying suit. And

because the possibility of coverage triggers the duty to

defend, see, e.g., Gibraltar Cas. Co. v. Sargent & Lundy, 574

N.E.2d 664, 673 (Ill. App. Ct. 1991), Momence therefore

argues that the lower court wrongly held that Healthcap

had no duty to defend.

The “inherent inconsistency” Momence believes is

present in the magistrate’s decision is of no moment to

us. Where, as here, the duty to defend is broader than

the duty to indemnify, a finding of no duty to defend

necessarily precludes a finding of a duty to indemnify.

As the Illinois Supreme Court stated in Crum & Forster v.

Resolution Trust Corp.:

In cases such as the instant case where no duty to

defend exists and the facts alleged do not even fall

potentially within the insurance coverage, such facts

alleged could obviously never actually fall within the

scope of coverage. Under no scenario could a duty to

indemnify arise. Clearly, where there is no duty to

defend, there will be no duty to indemnify . . . .

620 N.E.2d 1073, 1081 (Ill. 1993) (internal citations omitted); see also Sokol & Co. v. Atl. Mut. Ins. Co., 430 F.3d 417,

421 (7th Cir. 2005) (“Since the claim at issue in Crum &
8 No. 08-1997

The case cited by the magistrate judge to support holding off 6

on deciding the duty to indemnify, Premcor USA, Inc. v. American

Home Assurance Co., 400 F.3d 523 (7th Cir. 2005), is not applicable

here because it is one of the rare cases where the duty to defend

and the duty to indemnify are independent of each other. The

umbrella insurance policy at issue in Premcor did not obligate

the umbrella insurer to defend the insured because the primary

insurer’s policy provided unlimited defense costs. Id. at 529.

However, the umbrella insurer was still on the hook to indemnify the insured for any liability past the primary insurer’s

insurance limits. See id. at 525. Thus, the court in Premcor

could only rule on the duty to indemnify after liability in the

underlying suit had definitively been decided. Id. at 530.

Forster did not even potentially fall within the scope of

coverage for purposes of the duty to defend, it logically

followed that the claim would not actually fall within

the scope of coverage for purposes of the duty to indemnify.”).

In this case, just as in Crum & Forster, the duty to

defend subsumes the duty to indemnify. Holding that 6

an insurer has no duty to indemnify therefore follows

inexorably from holding that an insurer has no duty

to defend. Accordingly, if the magistrate judge properly

ruled that Healthcap did not have a duty to defend,

Healthcap was likewise entitled to summary judgment on

the issue of indemnification. We need not consider the

issue any further, however, because Healthcap has not

cross-appealed. See Greenlaw v. United States, 128 S. Ct.

2559, 2564 (2008) (“[I]t takes a cross-appeal to justify a

remedy in favor of an appellee.”).
No. 08-1997 9

That brings us back to the duty to defend, the sole

issue on appeal. Illinois courts determine an insurer’s

duty to defend by comparing the allegations in the underlying complaint to the relevant provisions of the insurance policy. Outboard Marine, 607 N.E.2d at 1212. “An

insurer is obligated to defend its insured if the underlying complaint contains allegations that potentially fall

within the scope of coverage.” Lyerla, 536 F.3d at 688 (citing

Gen. Agents Ins. Co. of Am., Inc. v. Midwest Sporting Goods

Co., 828 N.E.2d 1092, 1098 (Ill. 2005)). In other words, if

any portion of the suit potentially falls within the scope

of the coverage, the insurer is obligated to defend. Valley

Forge Ins. Co. v. Swiderski Elecs., Inc., 860 N.E.2d 307, 315

(Ill. 2006) (noting that insurer has duty to defend “even if

only one of several theories of recovery alleged in the

complaint falls within the potential coverage of the policy”). An insurer may refuse to defend only if “it is clear

from the face of the underlying complaint that the allegations set forth in the complaint fail to state facts

that bring the case within, or potentially within, the

coverage of the policy.” Id.

Momence argues that the allegations contained in

counts one and two of the underlying complaint—the FCA

claims and their IWRPA counterparts—potentially fall

within the scope of the PL coverage and the CGL coverage. As quoted above, the PL coverage obligates Healthcap

to defend any suit seeking damages “because of” an

“injury” that is “caused by a ‘medical incident’ ” arising

out of the providing or withholding of various professional

services, including medical or nursing treatment. Momence

points to the allegations of physical harm to the residents
10 No. 08-1997

incorporated in counts one and two as the “injury.” That

physical harm to the residents arose out of a medical

incident, Momence asserts, because (according to the

underlying complaint) it resulted from the provision of

shoddy medical and nursing treatment. Momence therefore

concludes that the underlying complaint seeks damages

“because of” the physical harm to the residents. As

Momence puts it, “[b]ut for the inadequate care and

resulting bodily injury, there would have been no lost

services and no false claim[s].”

Momence uses a similar chain of logic to place counts

one and two potentially under the umbrella of CGL

coverage A, which covers bodily injury and property

damage. CGL coverage A obligates Healthcap to pay those

sums Momence becomes “legally obligated to pay as

damages because of ‘bodily injury’ ” and to defend

Momence “against any ‘suit’ seeking those damages.”

(emphasis added). As with its PL coverage argument,

Momence claims that the injury to the residents is the

essential foundation of counts one and two of the underlying complaint. Without such injury, Momence contends,

the FCA claims and the companion state-law IWRPA

claims would not have been brought. Momence asserts

that any damages that may result from counts one and

two are therefore “because of” the “bodily injury” suffered

by Momence residents, thus triggering Healthcap’s duty

to defend.

Rather than triggering the duty, that line of argument

effectively bypasses it. The injuries to the residents as

alleged by the plaintiffs relate back to Momence’s cost
No. 08-1997 11

Momence contends that the underlying complaint is really not

7

a qui tam action because the FCA and IWRPA claims in the

underlying suit are without merit. Specifically, Momence

argues that the underlying complaint fails to set forth the

specific false claims that were submitted. We take no position

on the merits of the underlying suit’s FCA and IWRPA claims.

We merely note that even if those claims were meritless, that

would not affect the analysis of the duty to defend. See, e.g.,

(continued...)

reports to the government where it certified that it provided quality services and care. Plaintiffs claim Momence

knew that was false. The statutory damages they seek

result from those allegedly false filings, and not from

any alleged bodily injury to the residents. Although the

allegations in the underlying complaint detailing the

injuries suffered by Momence residents put a human

touch on the otherwise administrative act of false

billing, they need not be proven by the plaintiffs to

prevail. Under the FCA and the IWRPA, the plaintiffs

do not have to show that any damages resulted from the

shoddy care. See Horizon W. Inc. v. St. Paul Fire & Marine

Ins. Co., 214 F. Supp. 2d 1074, 1077-79 (E.D. Cal. 2002)

(citing 31 U.S.C. § 3729(a)) (“Liability under the FCA is

based solely upon the creation or presentation of false

claims to the government, not upon the underlying conduct used to establish the falsity of such a claim.”), aff’d,

45 Fed. Appx. 752 (9th Cir. 2002). Instead, all the plaintiffs need to show is that Momence billed the government for services and a level of care that it knew it was

not providing. See United States ex rel. Fowler v. Caremark 7
12 No. 08-1997

(...continued) 7

Valley Forge Ins. Co., 860 N.E.2d at 315 (noting that groundless,

false, or fraudulent allegations in the underlying suit do not

affect the duty to defend).

See, e.g., Zurich Am. Ins. Co. v. O’Hara Reg’l Ctr. for Rehab., 529 8

F.3d 916, 921-22 (10th Cir. 2008) (noting in a similar FCA case

that “[t]he government’s injury was not caused by [the nursing

home’s] failure to provide professional services, but instead

resulted from [the nursing home’s] submission of false and

fraudulent claims for reimbursement. . . . [T]he problem was

not the actual level of services provided . . . but rather that [the

nursing home] billed for services it did not provide—namely,

enhanced services.”); Horizon W. Inc. v. St. Paul Fire & Marine

Ins. Co., 45 Fed. Appx. 752, 754 (9th Cir. 2002) (unpublished)

(affirming the district court’s holding that insurer had no duty

to defend insured in FCA suit under professional liability

(continued...)

RX, L.L.C., 496 F.3d 730, 740-41 (7th Cir. 2007) (providing

elements of FCA claim); see also Scachitti v. UBS Fin. Servs.,

831 N.E.2d 544, 557 (Ill. 2005) (noting the similarity between the FCA and the IWRPA and finding case law on

the FCA “instructive” regarding the interpretation of the

IWRPA).

Other courts have recognized this distinction between

the proof required for the FCA claim and the conduct

underlying the false claims. They uniformly hold that

an insurer is not obligated to defend a qui tam suit merely

because the insurer would have to defend the insured

against a suit for damages resulting from the insured’s

conduct underlying the qui tam action. The case upon 8
No. 08-1997 13

(...continued) 8

policy); Jenkins v. St. Paul Fire & Marine Ins. Co., 8 Fed. Appx. 573,

574 (8th Cir. 2001) (unpublished) (same); M/G Transp. Servs., Inc.

v. Water Quality Ins. Syndicate, 234 F.3d 974, 978 (6th Cir. 2000)

(holding, in suit to determine insurer’s duty to defend FCA

suit seeking recovery of government funds paid after the

insured allegedly submitted false records of Clean Water Act

compliance, that insured’s arguments in favor of a duty to

defend were “thinly disguised attempts to bootstrap liability

for FCA violations into the coverage provided by the environmental pollution policies”). 

which Momence principally relies, Watts Industries, Inc. v.

Zurich American Insurance Co., 18 Cal. Rptr. 3d 61 (Cal. Ct.

App. 2004), does not hold to the contrary. Although the

underlying suit in Watts began as a qui tam action on

behalf of southern California municipalities, the municipalities themselves soon intervened. Id. at 64. They asserted

claims for damages on their own behalf against

water systems manufacturers who allegedly sold the

municipalities below-grade parts. In deciding that the

manufacturers’ insurer had a duty to defend the suit

under the “property damage” portion of the CGL policy,

the court focused exclusively on the damages the municipalities sought: the cost of replacing the substandard parts

and the costs of future water quality monitoring. Id. at

68. No mention was made of the qui tam claims; they

did not enter into the court’s analysis.

Despite the lack of supporting precedent and a long line

of cases holding to the contrary, Momence nevertheless

persists in pressing its position that the FCA and IWRPA
14 No. 08-1997

claims are at least potentially covered. Momence points

out that the factual allegations of the underlying complaint control, not the legal theory alleged. The underlying complaint contains a plethora of factual allegations

detailing the residents’ personal injuries. Based on those

allegations, Momence asserts that the suit must be

covered by Healthcap’s policy.

Momence is correct that the factual allegations in the

complaint, and not the legal labels a plaintiff uses, control.

See, e.g., Lexmark Int’l, Inc. v. Transp. Ins. Co., 761 N.E.2d

1214, 1221 (Ill. App. Ct. 2001). But factual allegations are

only important insofar as they point to a theory of recovery. See, e.g., USF&G v. Wilkin Insulation Co., 578 N.E.2d

926, 932 (Ill. 1991) (“[A]n insurer has a duty to defend its

insured if any theory of recovery alleges potential coverage.” (second emphasis added)); Ill. Emcasco Ins. Co. v. Nw.

Nat’l Cas., 785 N.E.2d 905, 908 (Ill. App. Ct. 2003) (noting

that duty to defend arises “if the insurance covers the

liability on any set of facts consistent with the allegations needed to support recovery on any theory raised in

the complaint”) (emphases added). And it is impossible

to construe the underlying complaint as raising any

theory of recovery based on bodily injury. Neither of the

plaintiffs in the underlying suit seeks damages for

personal injury caused by substandard medical care. Nor

could they—Absher and Mitchell were employees of

Momence, not residents, and they lack standing to sue on
No. 08-1997 15

Momence suggests that Absher “may have standing” to 9

bring a claim against Momence on behalf of her mother, who

was a resident of Momence and died there a few weeks before

Absher left Momence’s employ. (Emphasis added.) But the

underlying complaint is absolutely devoid of any factual

allegations suggesting such a claim. See E.E.O.C. v. Lee’s Log

Cabin, Inc., 546 F.3d 438, 443-44 (7th Cir. 2008) (“Federal pleading rules require the plaintiff to ‘give the defendant fair notice

of what the . . . claim is and the grounds upon which it rests.’”

(quoting Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1964 (2007)).

The underlying complaint does not mention Absher’s mother.

Nor does it contain any allegation suggesting that Momence was

at fault for her death. Indeed, it does not even list the estate of

Absher’s mother as a party to the suit. While an insurer certainly

has a duty to defend its insured against any complaint that

leaves open the possibility of coverage, Ill. Emcasco Ins. Co., 785

N.E.2d at 907, that duty is premised on the facts the parties to

the underlying complaint actually alleged in their complaint, not

on those facts that a nonparty to the suit could have alleged had it

decided to sue as well.

the residents’ behalf. See BASF AG, 522 F.3d at 820-21; 9

Kittay v. Allstate Ins. Co., 397 N.E.2d 200, 203 (Ill. App. Ct.

1979).

Momence makes two other arguments in favor of coverage, both of which lack merit. Momence maintains that

Absher’s and Mitchell’s claims of emotional distress in

counts three and four (the retaliation claims) are properly

classified as claims for “bodily injury” under CGL

coverage A, which defines “bodily injury” as “bodily

injury, sickness or disease sustained by a person.”

Momence attempts to sidestep Illinois case law clearly
16 No. 08-1997

See SCR Med. Transp. Servs., Inc. v. Browne, 781 N.E.2d 564, 571 10

(Ill. App. Ct. 2002) (collecting cases restricting term “bodily

injury” in insurance policy to “actual physical injury,” as

opposed to broadening it to include mental anguish and

mental distress).

holding to the contrary by contending that the policy 10

itself classifies such claims as “bodily injury.” We need not

describe in detail the tortured interpretation of the policy

Momence presents to support that assertion. For even

if Momence is correct that the policy counts emotional

distress as “bodily injury”—and it does not—the

employment-related practices exclusion forecloses coverage of any claims for damages arising from counts

three and four of the underlying complaint.

Specifically, that exclusion provides that the CGL

coverage does not extend to “any claim” by a “person

arising out of any . . . [t]ermination of that person’s employment[ ] or [e]mployment-related practices, policies, acts or

omissions, such as coercion, . . . defamation, harassment,

humiliation or discrimination directed at that person.”

(Emphases added.) In counts three and four, Mitchell and

Absher allege that Momence retaliated against them

because they had attempted to call to the attention of

Momence’s management the failure to provide the requisite level of care. They also allege that the retaliation

culminated in Momence terminating Mitchell’s employment and constructively discharging Absher. Those

allegations fall squarely within the employment-related

practices exclusion.
No. 08-1997 17

Absher stated in the letter that she was “taking an emergency 11

mental health leave of absence.”

Momence’s arguments against the application of the

exclusion are unconvincing. Momence contends that

Absher’s allegations of constructive discharge do not

amount to an “employment practice” because she left

Momence on her own. But a constructive discharge is

the legal equivalent of a formal termination, Pa. State

Police v. Suders, 542 U.S. 129, 141 (2004), and a termination

is unambiguously within the employment exclusion.

Moreover, constructive discharge is an allegation concerning an employer’s “[e]mployment-related practices,

policies, acts or omissions” and thus falls within the

ambit of the employment-related practices exclusion.

Momence also argues that the following allegation

in count three falls outside of the employment-related

practices exclusion: “Momence Meadows[’s] management

faxed Plaintiff Absher’s letter of resignation to potential

employers in an effort to prevent her from finding other

employment.” The exclusion does not cover that allega11

tion, Momence asserts, because Absher was no longer

a Momence employee when the alleged faxing occurred.

The exclusion, however, is not limited to alleged wrongs

occurring during the employment relationship. Rather,

the exclusion bars any claim “arising out of” any

“[e]mployment-related . . . acts,” including discrimination. Cf. Am. Alliance Ins. Co. v. 1212 Rest. Group, L.L.C.,

794 N.E.2d 892, 900 (Ill. App. Ct. 2003) (“Posttermination

acts of defamation or other employment-related practices
18 No. 08-1997

The underlying complaint alleges that Momence “filed 12

fabricated charges against both Plaintiffs with the Illinois

Department of Professional Regulation.”

can reasonably arise directly and proximately from the

termination.”).

The retaliation alleged here is unequivocally

“employment-related.” It was Momence’s alleged attempt

to “settle the score” with Absher for actions she took

during their employment relationship. Indeed, the only

reason Momence was in possession of Absher’s resignation letter was by virtue of its employment relationship

with her. The exclusion therefore applies to that allegation of retaliation.

That brings us to Momence’s final argument in favor

of a duty to defend. Momence claims that the allegations

of retaliation based on its use of Absher’s resignation

letter, its termination of Mitchell for speaking out against

the deficiencies in resident care, and its wrongful

reporting of both Absher and Mitchell to the Illinois

Department of Professional Regulation are potentially 12

covered under the PL coverage. The PL coverage

contains no exclusion for employment-related practices,

so the only issue is whether those allegations potentially

fall within the scope of the PL coverage. To show that they

potentially are within the scope of that coverage, Momence

turns to the PL coverage’s definition of “injury.” That

definition includes “personal injury.” Because “personal

injury” is not specifically defined in the PL coverage,

Momence imports the definition of “personal and ad-
No. 08-1997 19

vertising injury” from CGL coverage B. The definition of

“personal and advertising injury” found there includes

publishing oral or written statements that either

disparage a person’s services or violate a person’s right to

privacy. According to Momence, the above allegations

concern either disparagement (in the case of Mitchell’s

termination and the wrongful reporting of Mitchell and

Absher to the Illinois nursing regulators) or invasion of

privacy (in the case of Absher’s resignation letter, which

contained details about her mother’s death). Therefore,

Momence concludes, those allegations fall within the

scope of the PL coverage.

A glaring problem with this argument is that injury is

defined in the PL coverage to include “personal injury,” not

“personal and advertising injury.” But even if we except

Momence’s grafting of “advertising injury” into the PL

coverage’s definition of “injury,” Momence’s argument is

still a loser—it runs aground on the plain text of the PL

coverage. The PL coverage does not cover just any

personal injury. It states that an injury, personal or otherwise, “must be caused by a ‘medical incident.’ ” The

“medical incident,” in turn, “must arise out of the providing or withholding of the following professional

services: [m]edical, surgical, dental, or nursing treatment

to a person.” Nowhere has Momence explained how

Mitchell’s and Absher’s alleged injuries arise from the

“providing or withholding” of “professional services.” So

even if it is true that the retaliation Absher and Mitchell

experienced was an “injury” as the PL coverage defines

that term, it was not an injury caused by a “medical

incident”—and thus not covered under the PL coverage.
20 No. 08-1997

III.

The wrongdoings for which the plaintiffs in the underlying suit attempt to hold Momence liable are the filing

of false claims and the unlawful employment actions

taken against Absher and Mitchell, not the injuries

suffered by the Momence residents. Because none of the

policy provisions cover such claims, Healthcap does not

have a duty to defend Momence in the underlying suit.

We AFFIRM.

5-20-09