[PUBLISH]

In the

United States Court of Appeals

For the Eleventh Circuit

____________________

No. 21-11758

____________________

CONTINENTAL CASUALTY COMPANY, 

VALLEY FORGE INSURANCE COMPANY, 

Plaintiffs-AppellantsCross Appellees,

versus

WINDER LABORATORIES, LLC, 

STEVEN PRESSMAN, 

Defendants-AppelleesCross Appellants, 

CONCORDIA PHARMACEUTICALS, S.A.R.L., 

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2 Opinion of the Court 21-11758

Defendant-Appellee.

____________________

Appeals from the United States District Court

for the Northern District of Georgia

D.C. Docket No. 2:19-cv-00016-RWS

____________________

Before WILSON, BRANCH, and LAGOA, Circuit Judges.

BRANCH, CIRCUIT JUDGE:

Continental Casualty Company and Valley Forge Insurance 

Company (collectively, “the insurers”) and Winder Laboratories, 

LLC and Steven Pressman (collectively, “the insureds”) appeal and 

cross-appeal from the district court’s judgment in this insurance

coverage dispute. In short, the parties’ insurance agreements

required the insurers to defend the insureds against certain thirdparty lawsuits. After being sued by non-party Concordia 

Pharmaceuticals Inc., S.A.R.L. (“Concordia”), the insureds sought

coverage under the policies. The insurers agreed to defend the 

insureds against Concordia, subject to a reservation of rights, 

including the right to seek reimbursement of defense costs 

incurred for claims not covered by the policies. The insurance 

agreements themselves, however, did not provide for

reimbursement.

This appeal presents two questions. The more 

straightforward question is whether the insurers had a duty to 

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21-11758 Opinion of the Court 3

defend the insureds against the Concordia action. Then, as a 

matter of first impression under Georgia law, we must decide 

whether a reservation of rights letter that includes a right to 

reimbursement entitles an insurer to reimbursement of defense 

costs even though the underlying insurance contract does not 

include such a right. The district court granted judgment on the 

pleadings to the insurers on the first issue—holding that an 

exclusion in the contract meant there was no duty to defend—but 

granted summary judgment to the insureds on the second issue—

holding that the insurers had no right to reimbursement. For the 

reasons below, and with the benefit of oral argument, we affirm

both determinations.

I. Background 

A. Facts

In 2015, Winder Laboratories, LLC (“Winder”)—a generic 

pharmaceutical manufacturer managed by Steven Pressman—

purchased two insurance policies: a Primary General Liability 

Policy from Valley Forge Insurance Company (“VFI”) and an 

Umbrella Policy from Continental Casualty Company 

(“Continental”). The materially identical policies required the 

insurers to “defend the insured[s] against any ‘suit’” seeking 

damages for “personal and advertising injury.” In pertinent part, 

“personal and advertising injury” was defined to include an injury 

“arising out of ” either “[o]ral or written publication, in any 

manner, of material that slanders or libels a person or organization 

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

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4 Opinion of the Court 21-11758

services” or “[t]he use of another’s advertising idea in [the 

insureds’] ‘advertisement.’”1 The policies also had a “failure to

conform” provision that excluded coverage for injuries “[a]rising 

out of the failure of goods, products or services to conform with 

any statement of quality or performance made in [the insureds’] 

‘advertisement.’” Notably, neither policy included a 

reimbursement provision allowing the insurers to recoup defense 

costs.2

On January 6, 2016, Concordia sued Winder and Pressman 

in the United States District Court for the Northern District of 

Georgia, asserting various claims under the Lanham Act and 

Georgia law.3

 In the Concordia action, the Fourth Amended 

Complaint became the operative complaint after a series of claim 

dismissals and amendments.4 The crux of Concordia’s Fourth 

1Advertisement is also defined in the policy: “‘Advertisement’ means a notice 

that is broadcast or published to the general public or specific market segments 

about your goods, products or services for the purpose of attracting customers 

or supporters.”

2 The policies also did not define the details of the defense. For example, the 

policies did not mention which party would choose defense counsel if the 

insureds were sued.

3 We call this lawsuit the “underlying litigation” or “Concordia action”

throughout this opinion.

4Concordia’s initial complaint included eight claims. After a series of motions 

to dismiss and several amended complaints, the operative complaint (Fourth 

Amended Complaint) asserted the following claims: false advertising in 

violation of Lanham Act § 43(a)(1)(B); contributory false advertising in 

violation of Lanham Act § 43(a)(1)(B); common law unfair competition; 

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Amended Complaint was that Winder “falsely or misleadingly 

advertised their B-Donna product, and subsequently their 

Phenohytro product, as generic [equivalents] to [Concordia’s 

product] DONNATAL directly to the pharmaceutical industry, 

including to potential purchasers.” 

In light of the Concordia action, on February 19, 2016, the 

insurers jointly sent the insureds a letter agreeing to provide their

defense—subject to a fairly standard reservation of rights to 

disclaim coverage. Importantly, however, the letter also included 

a not-so-standard reimbursement provision: “VFI specifically 

reserves its right to seek reimbursement of defense costs incurred 

on [the insureds’] behalf for all claims which are not potentially 

covered by the VFI Policy.”5 Pressman—on behalf of the 

insureds—signed and returned an “Acknowledgement of Defense 

under a Reservation of Rights,” that noted “[the insureds] elect to 

retain independent counsel6 to represent them in the Underlying 

violations of the Georgia Uniform Deceptive Trade Practices Act; and tortious 

interference with contract or business relationships.

5 This letter did not specify a similar right to seek reimbursement for 

Continental. But, as the underlying litigation proceeded (eventually reaching 

a Fourth Amended Complaint), the insurers sent updated reservation of rights 

letters that eventually included a right to reimbursement for both insurers (not 

just VFI): “[T]he [insurers] reserve their rights to disclaim coverage and seek 

reimbursement of legal fees and costs.”

6 In the reservation of rights letters, the insurers provided the insureds this 

option:

VFI will retain counsel to represent you and Winder in the 

Underlying Suit. Alternatively, you and Winder can retain 

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Suit, subject to [VFI’s] reservation of rights . . . .”

B. Procedural History 

During the pendency of the Concordia action, on January 

17, 2019, the insurers filed suit in the Northern District of Georgia 

seeking a declaratory judgment that they had no duty to defend or 

to indemnify the insureds under the policies and were entitled to 

“reimbursement of legal costs and fees spent in providing [the 

insureds] a defense” in the Concordia suit under the reservation of 

rights. Following the insureds’ answer denying that both the 

insurers had no duty to defend and that the insurers were entitled 

to reimbursement, the insurers moved for judgment on the 

pleadings. Focusing on the duty to defend, they argued that they 

had no duty to defend the insureds against Concordia’s operative 

complaint because Concordia did not allege a “personal or 

advertising injury,” and—even if there were such an injury—the 

“failure to conform” provision excluded coverage. The district 

court granted the insurers’ motion, holding that Concordia’s

allegations were “squarely” excluded by the “failure to conform”

provision because the “operative complaint [was] based entirely 

upon allegations that [Winder] misrepresented the quality” of 

counsel of your choice to represent you in this matter. If 

Winder elects to retain its own defense counsel, please be 

advised that VFI will only agree to reimburse you or Winder 

for necessary and reasonable defense costs incurred by defense 

counsel at a rate charged by commensurate counsel typically 

retained by VFI in the Northern District of Georgia, where the 

suit is pending.

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Winder’s products.7

 The court also noted that the insurers had 

“not shown entitlement to reimbursement [for defense costs 

already paid],” and encouraged the parties to confer “in an effort to 

resolve any remaining dispute regarding the reimbursement issue.”

The insureds moved for reconsideration, which was denied. After 

this ruling, the insurers stopped paying for the insureds’ defense.

In November 2020, having not reached an agreement, the 

parties cross-moved for summary judgment on the insurers’ 

reimbursement claim. The district court denied the insurers’ 

motion and granted the insureds’. The district court noted that the 

question presented—whether an insurer had a right to 

reimbursement when that right was included only in a reservation 

of rights letter but not the parties’ insurance contract—was an open 

question under Georgia law. The district court found in favor of

the insureds, reasoning that an effective reservation of rights 

necessarily required a preexisting contract right: “[A]bsent a 

provision in the insurance policy—or some other express 

agreement—an insurer who issued an otherwise valid, unilateral 

reservation of rights cannot recoup its defense fees or costs.”

The insurers appeal the district court’s reimbursement 

decision and the insureds cross-appeal the duty to defend

determination.

7The district court did not address whether Concordia’s allegations presented 

a “personal and advertising injury” because the “failure to conform” exclusion 

was dispositive as to the insurers’ duty to defend.

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8 Opinion of the Court 21-11758

II. Standard of Review

We review a “district court’s grant of judgment on the 

pleadings de novo.” Bankers Ins. Co. v. Fla. Residential Prop. & Cas. 

Joint Underwriting Ass’n, 137 F.3d 1293, 1295 (11th Cir. 1998) (per 

curiam). Judgment on the pleadings is appropriate when “there are 

no material facts in dispute and the moving party is entitled to 

judgment as a matter of law.” Cannon v. City of W. Palm Beach, 250 

F.3d 1299, 1301 (11th Cir. 2001). “We must accept the facts alleged 

in the complaint as true and view them in the light most favorable 

to the nonmoving party.” Id.

We review a district court’s summary judgment 

determinations de novo. Great Am. All. Ins. Co. v. Anderson, 847 F.3d 

1327, 1331 (11th Cir. 2017). In this posture, “[w]e view the evidence 

and draw all reasonable inferences in favor of . . . the party 

opposing summary judgment.” Munoz v. Selig Enters., Inc., 981 F.3d 

1265, 1272 (11th Cir. 2020). The moving party must “show[] that 

there is no genuine dispute as to any material fact” so that it is 

“entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Smith 

v. Owens, 848 F.3d 975, 978 (11th Cir. 2017).

Because this federal action is premised on diversity 

jurisdiction, “Georgia’s substantive law governs.” AEGIS Elec. & 

Gas Int’l Servs. Ltd. v. ECI Mgmt. LLC, 967 F.3d 1216, 1223 (11th Cir. 

2020).

III. Discussion 

We start with the insureds’ cross-appeal on the duty to 

defend before considering the insurers’ appeal of the 

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reimbursement decision.

A. Duty to Defend

The insureds argue that because Concordia alleged a 

“personal and advertising injury,” which is a covered claim, the 

insurers were obligated to defend the insureds against the 

Concordia action. Specifically, the insureds argue that Concordia’s 

complaint alleged a “personal and advertising injury” because it 

included allegations that Winder copied Concordia’s DONNATAL 

label inserts.

8 The insurers argue that no “personal and advertising 

injury” was alleged; rather, they contend that Concordia’s 

allegations of false and misleading advertising triggered the “failure 

to conform” exclusion such that there was no coverage under the 

policies. The district court held that the allegations fell under the 

“failure to conform” exclusion, and the insurers had no duty to 

defend. We agree with the insurers and the district court.

8The insureds did not make this label-copying argument until their motion for 

reconsideration. Generally, parties cannot use motions for reconsideration 

“to relitigate old matters, raise argument[,] or present evidence that could 

have been raised prior to the entry of judgment.” Michael Linet, Inc. v. Vill. of 

Wellington, 408 F.3d 757, 763 (11th Cir. 2005). As the district court noted, it 

was improper for the insureds to make these arguments for the first time in 

their motion for reconsideration. Nevertheless, the district court addressed 

the merits of the new argument. Accordingly, we will consider the merits of 

this argument as well. However, because we are considering the district 

court’s ruling in the context of its denial of the insureds’ motion for 

reconsideration, we review the denial of the motion for reconsideration for 

abuse of discretion and review the underlying legal conclusions de novo. See 

Equity Inv. Partners, LP v. Lenz, 594 F.3d 1338, 1342 (11th Cir. 2010).

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Whether the insurers have a duty to defend the insureds 

against the underlying litigation hinges on whether Concordia’s 

contributory false advertising claim was based on Winder’s alleged 

label copying.9

 If so, the alleged injury arose out of “[Winder’s]

use of another’s advertising idea”—i.e., Concordia’s labels—and 

the insurers have a duty to defend under the “personal and 

advertising injury” provision. If, however, the claim rested on 

allegations that Winder actively misrepresented its drugs, then the

alleged injury arose from the “failure of goods . . . to conform with 

any statement of quality or performance made in [the insureds’] 

‘advertisement,’” and the insurers do not have a duty to defend 

under the “failure to conform” exclusion.

Georgia law treats insurance as “a matter of contract” so 

that “the parties to the contract of insurance are bound by its plain 

and unambiguous terms.” Lima Delta Co. v. Glob. RI-022 Aerospace, 

Inc., 789 S.E.2d 230, 233 (Ga. Ct. App. 2016) (quotation omitted).

“The construction of an unambiguous contract is a question of law 

for the court.” Id. (quotation omitted).

9 The series of amendments and dismissals in the underlying litigation left 

contributory false advertising as the only claim that possibly relied on 

Concordia’s label-copying allegations. To make out a contributory false 

advertising claim under the Lanham Act, plaintiffs must (1) “show that a third 

party . . . directly engaged in false advertising that injured the plaintiff,” and 

(2) “allege that the defendant contributed to that conduct either by knowingly 

inducing or causing the conduct, or by materially participating in it.” Duty Free 

Ams., Inc. v. Estée Lauder Cos., 797 F.3d 1248, 1277 (11th Cir. 2015).

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Under Georgia law, an unambiguous contract “must be 

enforced as written,” and we should not expand “the rights of the 

parties to an insurance policy . . . beyond the terms of the policy.” 

Giddens v. Equitable Life Assurance Soc’y of the U.S., 445 F.3d 1286, 

1297 (11th Cir. 2006). This principle is true even for “exclusions in 

insurance policies” that are normally “strictly construed against the 

insurer.” Fid. Nat’l Title Ins. Co. of N.Y. v. OHIC Ins. Co., 619 S.E.2d 

704, 706 (Ga. Ct. App. 2005) (quotation omitted). That is, an 

exclusion that is “plain and unambiguous binds the parties to its 

terms and must be given effect, even if beneficial to the insurer and 

detrimental to the insured.” Id. (quotation omitted). Georgia 

courts counsel against “strain[ing] to extend coverage where none 

was contracted or intended.” Id. (quotation omitted).

An insurer’s duty to defend is determined by “comparing the 

allegations of the complaint with the provisions of the policy.” Pilz 

v. Monticello Ins. Co., 599 S.E.2d 220, 221 (Ga. Ct. App. 2004) 

(quotation omitted). Under Georgia law, when the policy uses the 

broad term “suit,” the insurer has a duty “to defend the entire suit 

if any of the individual claims could be covered under the [p]olicy.” 

S. Tr. Ins. Co. v. Mountain Express Oil Co., 828 S.E.2d 455, 458 (Ga. Ct. 

App. 2019); City of Atlanta v. St. Paul Fire & Marine Ins. Co., 498 

S.E.2d 782, 784 (Ga. Ct. App. 1998) (“If the facts as alleged in the 

complaint even arguably bring the occurrence within the policy’s 

coverage, the insurer has a duty to defend the action.” (emphasis 

added)). If, however, the complaint “does not assert any claims 

upon which there would be insurance coverage, the insurer is 

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justified in refusing to defend the insured’s lawsuit.” St. Paul Fire, 

498 S.E.2d at 784. 

With Georgia law in mind, we now look to the operative 

complaint to see if Concordia’s allegations relating to its 

contributory false advertising claim (a) triggered coverage under 

the “personal and advertising injury” provision or (b) triggered the 

“failure to conform” exclusion.

10 We hold that the “failure to 

conform” exclusion applied.

In the contributory false advertising count, Concordia 

focused on Winder’s allegedly false and misleading representations 

about its products:

[Winder] actively and materially furthered such false 

or misleading, or false and misleading, advertising 

and promotion of [its] B-Donna or Phenohytro 

products by making false or misleading, or false and 

misleading, representations about the products on 

their labels and product inserts, making false or 

misleading, or false and misleading representations to 

the Drug Databases to list [its] B-Donna or 

Phenohytro products with the Drug Databases, 

listing the products with the Drug Databases, and/or 

marketing the products as “generics” that are 

10To reiterate a critical point, “personal and advertising injury” was defined to 

include “[t]he use of another’s advertising idea in [the insureds’] 

‘advertisement.’”

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comparable to and/or substitutable for [Concordia’s] 

DONNATAL.

Thus, Concordia’s contributory false advertising claim 

clearly rested on Winder’s false and misleading representations—

not its label copying. Accordingly, we conclude that the allegations 

in the complaint do not arise out of a “personal and advertising 

injury” stemming from “[t]he use of another’s advertising idea”—

i.e., Concordia’s labels—that would have required the insurers to 

defend the insureds against Concordia’s Fourth Amended 

Complaint. See Pilz, 599 S.E.2d at 221; St. Paul Fire, 498 S.E.2d at 

784 (“[W]here the complaint filed against the insured does not 

assert any claims upon which there would be insurance coverage, 

the insurer is justified in refusing to defend the insured’s lawsuit.”).

In fact, Concordia’s count-specific allegation that Winder 

made “false or misleading” representations and statements about 

its products by “marketing the products as ‘generics’ that are 

comparable to and/or substitutable for [Concordia’s] DONNATAL,” is 

a textbook example of an injury “[a]rising out of the failure of 

goods, products or services to conform with any statement of quality 

or performance made in [Winder’s] ‘advertisement.’”11 Thus, 

contrary to the insureds’ argument, Concordia’s allegation that 

11Concordia’s allegations also include that “[s]uch false or misleading, or false 

and misleading, statements about the B-Donna or Phenohytro products by 

Drug Databases, pharmacies, insurers and/or other members of the 

pharmaceutical industry have actually deceived or have the tendency to 

deceive a substantial segment of their audience as to the nature, quality, and 

characteristics of the B-Donna or Phenohytro products.”

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Winder marketed its products as comparable to Concordia’s brandname drug when it was not in fact equivalent falls squarely within 

the “failure to conform” exclusion of the insurance policy. Under 

Georgia law, we must give effect to this exclusion and cannot 

“strain to extend coverage where none was contracted or 

intended.” Fid. Nat. Title Ins. Co., 619 S.E.2d at 706.

The insureds resist our conclusion with the following 

counter-arguments.

For one, the insureds maintain that Concordia’s complaint 

involved a “personal and advertising injury” because it included 

allegations of label copying. This statement is true. In the section 

of the complaint containing factual allegations, Concordia did

reference label copying:

• “Upon information and belief, the labels and package 

inserts for [Winder’s] B-Donna products have been 

copied from the labels and package inserts for 

[Concordia’s] DONNATAL, including the 

‘Indications and Usage’ section, which claims that the 

product has been reviewed and classified by FDA.”

• “Upon information and belief, the labels and package 

inserts for [Winder’s] Phenohytro products have also 

been copied from the labels and package inserts for 

[Concordia’s] DONNATAL.”

• “Upon information and belief, [Winder’s] copying of 

[Concordia’s] drug labels and product inserts was not 

done as part of a submission to the FDA or other 

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government agency, nor was it permitted or 

contemplated under any legislative provision 

authored by Congress.”

But these factual allegations provided the foundation for 

some of Concordia’s previously dismissed claims. The only thing 

tying the label-copying allegations to Concordia’s false advertising 

count is that count’s language incorporating by reference “each 

and every allegation contained in the [preceding] paragraphs.” We 

conclude that this tangential connection—fastened through 

boilerplate language—is inconsequential because, as analyzed 

above, the actual count-specific allegations for the contributory 

false advertising claim centered on Winder’s allegedly false and 

misleading representations about its products.12

Moving forward, the insureds also argue that the “failure to 

conform” exclusion does not apply because Concordia’s false 

advertising claim stems from (1) false advertisements made by nonparty drug databases (such that Winder is not responsible), and 

(2) true statements about Winder’s products which cannot 

“fail . . . to conform with any statement of quality or 

performance . . . .”

12 This discrepancy between the count-specific allegations, on the one hand, 

and the generalized factual allegations that do not actually go toward 

Concordia’s contributory false advertising claim, on the other hand, is the 

reason the district court called the insureds’ argument an attempt to “distort” 

the Fourth Amended Complaint.

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First, we reject the insureds’ argument that the “failure to 

conform” exclusion does not apply because only the third-party 

drug databases—not Winder—made the allegedly false statements. 

Their argument must fail because Concordia clearly alleged that 

Winder’s initial misrepresentations to the drug databases were the 

“but for” cause of its injuries. See Hays v. Ga. Farm Bureau Mut. Ins. 

Co., 722 S.E.2d 923, 927 (Ga. Ct. App. 2012) (“Claims arise out of 

[t]he excluded conduct when but for that conduct, there could be 

no claim against the insured.” (quotations omitted)). Further, the 

allegations of Winder’s initial involvement were necessary to 

Concordia’s contributory false advertising claim, which required a 

showing that Winder “contributed to” the false advertising. See 

Estée Lauder, 797 F.3d at 1277.

Second, we also reject the insureds’ argument that the 

“failure to conform” provision does not apply because the

representations Winder made to the drug databases were true. At 

this juncture, our analysis looks only to the allegations in the 

complaint and the terms of the insurance agreement. See Pilz, 599 

S.E.2d at 221 (“An insurer’s duty to defend is determined by 

comparing the allegations of the complaint with the provisions of the 

policy.” (emphasis added and quotation omitted)). And 

Concordia’s complaint was littered with allegations that Winder 

misrepresented its drugs which in turn caused the drug databases 

to make misrepresentations. Accordingly, Concordia’s allegations

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(albeit not yet proven) triggered the “failure to conform”

exclusion.

13

In the end, after our close comparison of the complaint and 

insurance policies, we conclude that the “failure to conform” 

exclusion applied such that the district court properly determined 

that the insurers did not have an ongoing duty to defend the Fourth 

Amended Complaint.

B. Right to Reimbursement

The duty to defend determination answers only the first of 

the two questions presented in this appeal. In other words, we have 

concluded that the insurers no longer have a duty to defend the 

Fourth Amended Complaint, but that does not mean that the 

insurers never had a duty to defend at earlier stages of the case. 

Rather, because insurers under Georgia law have a broad duty to 

defend when there is “even arguably” a covered claim, see St. Paul 

Fire, 498 S.E.2d at 784, the insurers had an active duty to defend up 

13Admittedly, we have not addressed the effect of literal truth on a “failure to 

conform” exclusion. We note, however, that the Eighth Circuit has 

considered an argument that an advertisement being “literally true” means 

that the allegations “do not fall within the scope of the failure-to-conform 

provision because they do not make a ‘statement of quality or performance.’” 

Westfield Ins. Co. v. Robinson Outdoors, Inc., 700 F.3d 1172, 1175 (8th Cir. 2012). 

In rejecting this argument, the Eighth Circuit emphasized that, no matter if

some statements were true, “[t]he underlying lawsuits allege[d] that Robinson 

misled consumers into buying hunting clothing that did not perform as it was 

advertised.” Id. That is, the truthfulness of certain statements was not 

determinative because, in aggregate, the allegations that supported the claim

were about deceit or misrepresentation.

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18 Opinion of the Court 21-11758

until the point when the district court ruled otherwise.14 Simply put, 

under the facts of this case, the insurers were under a duty to 

defend until the district court ruled that they were not.

14 The insurers point to two of our cases as well as dicta from a Georgia case 

to argue that the duty to defend either does or does not exist at the time the 

complaint was filed. These cases are not on point. First, in our cases, there 

was unquestionably no duty to defend from the outset so there was never 

“even arguably” a basis for coverage. See Mt. Hawley Ins. Co. v. Miami River 

Port Terminal, LLC, 713 F. App’x 951, 957 (11th Cir. 2017) (per curiam)

(determining that there was “no duty to defend because [d]efendant was never 

covered by the policy” (emphasis added)); Bandy v. Avondale Shipyards, Inc., 458 

F.2d 900, 904 (5th Cir. 1972) (“The insurance policy excludes coverage for 

injury caused by these cranes while being used for loading. Because the 

allegations ‘unambiguously exclude coverage,’ [e]mployers [were] not under 

a duty to defend . . . .”). The logic underlying these cases does not translate to 

this case in which an arguable duty to defend eroded into non-existence as the 

underlying litigation progressed from an initial complaint to a Fourth 

Amended Complaint with different allegations and claims. Additionally, Mt. 

Hawley, 713 F. App’x at 957, is an unpublished case that has no precedential 

value.

Similarly, we put little stock in dicta from Georgia Interlocal Risk 

Management Agency v. City of Sandy Springs, 788 S.E.2d 74, 80 (Ga. Ct. App. 

2016). That case dealt with whether an insurer had a right to reimbursement 

of defense costs after it was determined that the insurer had no duty to defend. 

Id. at 79–80. In addressing the reimbursement issue, the Court of Appeals of 

Georgia stated in passing that if the insurer “actually has a right to recoup 

defense costs in this case, then such a right would have existed [at the time the 

complaint was filed],” and because the complaint was filed four years before 

the insurer attempted to reserve its right to reimbursement, its reservation 

was not timely made. Id. at 80. Contrary to the insureds’ argument, the 

court’s statement does not establish that it did not have a duty to defend from 

the initial filing of the complaint. Moreover, the statement is dicta. See 

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This determination brings us to the second issue on 

appeal—whether, under Georgia law, asserting a right to 

reimbursement in a reservation of rights letter entitles an insurer 

to reimbursement even if the insurance contract did not 

contemplate a right to recoupment. The district court answered 

that question in the negative and held that the insurers had no right 

to seek reimbursement. The insurers argue that this determination 

was erroneous.

Following the insurers’ line of argument, we break our 

analysis into two questions. First, did the insurers’ reservation of 

rights letters create a new contract? We conclude that a new 

contract was not created and proceed to the second question that 

is novel under Georgia law: Would the Supreme Court of Georgia 

recognize a right to reimbursement absent a contractual right to 

such reimbursement? See Ga. Interlocal Risk Mgmt. Agency v. City of 

Sandy Springs, 788 S.E.2d 74, 79 (Ga. Ct. App. 2016) (“The issue of 

whether insurers are entitled to recoup defense costs where there 

is no contractual provision creating such a right is an issue of first 

impression in Georgia courts, but we need not reach that issue 

here.”). We conclude that it would not and, therefore, affirm the 

district court.

Edwards v. Prime, Inc., 602 F.3d 1276, 1298 (11th Cir. 2010) (“[D]icta is not 

binding on anyone for any purpose.”).

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20 Opinion of the Court 21-11758

i. Did the insurers’ reservation of rights letters 

including a reimbursement provision create a 

new contract? 

The insurers argue that the insureds implicitly and explicitly

agreed to the terms of the reservation of rights letters which 

included the reimbursement provision. This argument centers on 

a day-one principle of contract law: consideration. We must decide 

whether the insurers’ reservation of rights letters created a new 

contract—either explicitly (because one of the letters was signed 

by the insureds) or implicitly (because the insureds accepted the 

defense while aware of the letters’ terms).

15

Express contracts and implied-in-fact contracts are 

exceedingly similar. See Turfgrass Grp., Inc. v. Ga. Cold Storage Co., 

816 S.E.2d 716, 721 (Ga. Ct. App. 2018). The only difference is how 

the parties’ will to be bound is shown—either “expressly in some 

form recognized by law” or “by circumstances from which assent 

may be inferred as a conclusion of fact.” Id. (emphasis added). Both 

must meet the standard contract requirements. 

15 On summary judgment at the district court, the insurers did not contend 

that the reservation of rights letters constituted an express contract. Rather, 

the insurers focused on an implied contract theory. As such, there is support 

for waiving the insurers’ express contract argument that was “raised for the 

first time on appeal,” see Finnegan v. Comm’r of Internal Revenue, 926 F.3d 1261, 

1271 (11th Cir. 2019), but because it fails for the same reason as their implied 

contract argument (lack of consideration), we do not undertake a waiver 

analysis.

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21-11758 Opinion of the Court 21

“To constitute a valid contract, there must be parties able to 

contract, a consideration moving to the contract, the assent of the 

parties to the terms of the contract, and a subject matter upon 

which the contract can operate.” O.C.G.A. § 13-3-1 (emphasis 

added). There is consideration when “a performance or a return 

promise [is] bargained for by the parties to a contract.” Id. § 13-3-

42(a). To be “bargained for,” the performance or return promise 

must be “sought by the promisor in exchange for his promise and 

[] given by the promisee in exchange for that promise.” Id. § 13-3-

42(b). Importantly, “a promise to perform a preexisting contractual 

obligation does not constitute consideration for a new agreement.” 

Glisson v. Global Sec. Servs., LLC, 653 S.E.2d 85, 87 (Ga. Ct. App. 

2007); see also, e.g., Codner v. Siegel, 271 S.E.2d 465, 466 (Ga. 1980) 

(discussing the need for “new consideration”). 

The original insurance contracts between the parties 

provided that insurers had the “duty to defend the insured[s]

against any ‘suit’ seeking [] damages” for “‘personal and advertising 

injury.’” The policies did not expound on the details of the defense. 

For example, the policies did not mention which party would 

choose defense counsel if the insureds were sued.

In a series of reservation of rights letters that the insurers 

sent to the insureds after Concordia brought the underlying 

litigation, the insurers included terms that were not part of the 

original insurance contract. Critically, the first letter specified that: 

“VFI specifically reserves its right to seek reimbursement of 

defense costs incurred on [the insureds’] behalf for all claims which 

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22 Opinion of the Court 21-11758

are not potentially covered by the VFI Policy.”16 These letters also 

included more particulars for the legal defense, including that: 

“[The insurers] will retain defense counsel to represent [the 

insureds] in the Georgia Suit. Alternatively, [the insureds] can 

retain counsel of [their] choice.” Pressman—on behalf of the 

insureds—signed and returned to the insurers an 

“Acknowledgement of Defense under a Reservation of Rights” in 

October 2018.

For the insurers’ implicit and explicit contract arguments, 

the issue of consideration is dispositive. The insurers argue that 

there was adequate consideration stemming from the reservation 

of rights letters in two ways: (1) the insureds were provided a 

defense and (2) the insureds were able to choose their defense 

counsel. We hold that because the parties’ contracts already 

required the insurers to defend the insureds against certain thirdparty lawsuits, there is no new consideration forthe reimbursement 

provision in the reservations of rights letters and thus no new

contract under Georgia law.

The insurers’ first argument is easy to reject. The 

underlying contract required the insurers to defend the insureds

against certain third-party lawsuits. The reservation of rights 

letters also provided for such defense. That is, the letters were the 

quintessential “promise to perform a preexisting contractual 

16 This reimbursement language was also “incorporate[d] [] by reference” in 

the later reservation of rights letters, and the second insurer (Continental) 

eventually claimed the right to seek reimbursement as well.

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21-11758 Opinion of the Court 23

obligation” that “does not constitute consideration for a new 

agreement.” Glisson, 653 S.E.2d at 87; see also Codner, 271 S.E.2d at 

466 (discussing the need for “new consideration”).

The insurers’ second argument is colorable—but still 

inadequate. The underlying contract did not contemplate which 

party would select legal counsel for the promised defense, but the 

reservation of rights letters gave the insureds the ability to either 

(a) choose their legal representation or (b) have it chosen for them 

by the insurers. Boiled down, the insurers went from having to 

provide a defense (under the underlying contract) to having to 

provide a defense through counsel of their own choosing or 

counsel chosen by the insureds (under the reservation of rights). 

Either way, however, the insurers were obligated to provide a 

defense. In other words, because the insurers did not have the 

explicit right to choose counsel for the insureds under the original 

contract, the insurers did not give anything up to reach the new 

arrangement wherein the insureds have the option of selecting

their own counsel. As such, there is no consideration under 

Georgia law. See O.C.G.A. § 13-3-42(b).

ii. Unjust Enrichment

Alternatively, the insurers contend that the insureds were 

unjustly enriched because they retained the benefit of an expensive 

defense to which they knew they were not entitled. See Campbell v. 

Ailion, 790 S.E.2d 68, 73 (Ga. Ct. App. 2016) (“[A] claim for unjust 

enrichment exists where a plaintiff asserts that the defendant 

induced or encouraged the plaintiff to provide something of value 

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24 Opinion of the Court 21-11758

to the defendant; that the plaintiff provided a benefit to the 

defendant with the expectation that the defendant would be 

responsible for the cost thereof; and that the defendant knew of the 

benefit being bestowed upon it by the plaintiff and either 

affirmatively chose to accept the benefit or failed to reject it.”). 

Assuming the insurers’ unjust enrichment argument does not

immediately fail due to the existence of a written contract, it

nonethelessfails on the merits. Cf. Bogard v. Inter-State Assurance Co., 

589 S.E.2d 317, 319 (Ga. Ct. App. 2003) (“[T]he existence of the 

contract between the parties precludes [appellant’s] unjust 

enrichment claim.”). Simply put, there is nothing “unjust” about 

requiring the insurers to fulfill their contractual obligations and

imposing such a requirement would not confer a “windfall” on the 

insureds.

17

17 Further, there is no one-sided enrichment here. The insurers benefit from 

fulfilling their contractual obligations and following Georgia insurance law to 

avoid a lawsuit and maintain their reputation, among other things. To borrow 

applicable language from another state’s supreme court: “[W]e cannot say that 

an insured is unjustly enriched when its insurer tenders a defense in order to 

protect its own interests, even if it is later determined that the insurer did not 

owe a defense.” Gen. Agents Ins. Co. of Am., Inc. v. Midwest Sporting Goods Co., 

828 N.E.2d 1092, 1103 (Ill. 2005); see also Terra Nova Ins. Co. v. 900 Bar, Inc., 887 

F.2d 1213, 1220 (3d Cir. 1989) (holding that, in a similar situation, the insurer 

provided a defense “at least as much for [its] own benefit”). And, while the 

insureds undoubtedly benefit from an expensive legal defense, that benefit is 

precisely the bargain the parties agreed to. There is no reason that the insureds

should “return” or “compensate for” receiving the benefit of their bargain. See 

Wachovia Ins. Servs., Inc. v. Fallon, 682 S.E.2d 657, 665 (Ga. Ct. App. 2009)

(“Unjust enrichment is an equitable concept and applies when . . . the party 

sought to be charged has been conferred a benefit by the party contending an 

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21-11758 Opinion of the Court 25

iii. Predicting Georgia Law on Reimbursement 

The final question we face is whether, under Georgia law, an 

insurer can recoup defense costs when such a right is provided for 

in a reservation of rights letter but not the parties’ operative 

insurance contract. Georgia courts have not addressed this 

question.18 See Ga. Interlocal, 788 S.E.2d at 79.

Without any state court guidance, we attempt to “predict 

state law” without “creat[ing] or modify[ing] it.” Salinero v. Johnson 

& Johnson, 995 F.3d 959, 969 (11th Cir. 2021) (internal citations 

omitted); see Bravo v. United States, 577 F.3d 1324, 1325 (11th Cir. 

2009) (per curiam) (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64 

(1938)). As part of this inquiry, we “consider whatever might lend 

[us] insight, including relevant state precedents, analogous 

decisions, considered dicta, scholarly works, and any other reliable 

unjust enrichment which the benefitted party equitably ought to return or 

compensate for.” (emphasis added)).

18 Federal district courts applying Georgia law have reached different, 

competing results. We note only in passing that most district courts have held 

that insurers do not have a right to reimbursement in these situations. See, 

e.g., Am. Fam. Ins. Co. v. Almassud, 522 F. Supp. 3d 1263, 1269 (N.D. Ga. 2021) 

(adopting a “no-recoupment default rule” because in cases where the contract 

does not allow for recoupment but the reservation of rights letter inserts such 

a right, “the insurer should not be able to unilaterally alter the terms of an 

insurance policy”). Only one district court has held that insurers do have a 

right to reimbursement. See Ill. Union Ins. Co. v. NRI Constr. Inc., 846 F. Supp. 

2d 1366, 1377 (N.D. Ga. 2012) (“A right of reimbursement is justified under 

either an unjust enrichment or implied in fact contract theory.”). 

Nevertheless, these decisions do not bind us.

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26 Opinion of the Court 21-11758

data tending convincingly to show how the [Supreme Court of 

Georgia] would decide the issue at hand.” SA Palm Beach, LLC v. 

Certain Underwriters at Lloyd’s London, 32 F.4th 1347, 1357 (11th Cir. 

2022) (quoting GuideOne Elite Ins. Co. v. Old Cutler Presbyterian 

Church, Inc., 420 F.3d 1317, 1326 n.5 (11th Cir. 2005)). We “presume 

that [state] courts would adopt the majority view on a legal issue 

in the absence of indications to the contrary.” Id. at 1358. 

The duty to defend is extremely broad under Georgia law.19 

See, e.g., Landmark Am. Ins. Co. v. Khan, 705 S.E.2d 707, 710 (Ga. Ct. 

App. 2011) (“[I]f the facts as alleged in the complaint even arguably 

bring the occurrence within the policy’s coverage, the insurer has a 

duty to defend the action. Indeed, to excuse the duty to defend the 

petition must unambiguously exclude coverage under the 

policy . . . .” (quotation omitted)); St. Paul Fire, 498 S.E.2d at 784. 

An insurer “may be obligated to defend, even though it [may not 

be] ultimately liable for any judgment . . . .” Penn-Am. Ins. Co. v. 

Disabled Am. Veterans, Inc., 490 S.E.2d 374, 376–77 (Ga. 1997); see also 

Elan Pharm. Rsch. Corp. v. Emps. Ins. of Wausau, 144 F.3d 1372, 1375 

(11th Cir. 1998) (“[U]nder Georgia law . . . [a]lthough an insurer 

need not indemnify an insured for a liability the insured incurs 

19 Under Georgia law, the “duty to defend and the duty to indemnify . . . are 

separate and independent obligations.” Nationwide Mut. Fire Ins. Co. v. Somers, 

591 S.E.2d 430, 433 (Ga. Ct. App. 2003) (quotation omitted); see also Colonial 

Oil Indus. Inc. v. Underwriters Subscribing to Pol’y Nos. TO31504670 &

TO31504671, 491 S.E.2d 337, 339 (Ga. 1997). The broad duty to defend is 

“broader than [the insurers’] duty to indemnify.” Shafe v. Am. States Ins. Co., 

653 S.E.2d 870, 873 (Ga. Ct. App. 2007).

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21-11758 Opinion of the Court 27

outside the terms of the insurance contract, an insurer must 

provide a defense against any complaint that, if successful, might 

potentially or arguably fall within the policy’s coverage.”). 

As an initial matter, we disagree with the insurers’ argument 

that there is a clear “majority” rule favoring recoupment across the 

nation. See SA Palm Beach, 32 F.4th at 1357 (“We therefore consider 

whatever might lend [us] insight, including . . . analogous 

decisions . . . scholarly works, and any other reliable data tending 

convincingly to show how the [Supreme Court of Georgia] would 

decide the issue at hand.” (quotations omitted)). This description 

of a “majority rule” may have been correct in the past, but it is not 

an accurate depiction of the current case law, which appears to be 

more-or-less in equipoise with the recent trend favoring the “no 

recoupment” rule. See Gen. Star Indem. Co. v. Driven Sports, Inc., 80 

F. Supp. 3d 442, 461 n.14 (E.D.N.Y. 2015) (“Although the parties 

dispute which is the majority rule in other jurisdictions, both 

parties referred to an article published by the American Bar 

Association in 2011, noting that ‘[t]here is a fairly even split among 

state and federal courts’ concerning recoupment. However, . . . 

there has been a recent trend toward courts rejecting claims for 

recoupment.” (internal citation omitted)); Westchester Fire Ins. Co. v. 

Wallerich, 563 F.3d 707, 715 (8th Cir. 2009) (“[T]he most recent 

decisions reflect the [no recoupment] position.” (quotations 

omitted)). The Restatement of the Law of Liability Insurance 

confirms this switch in trend:

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28 Opinion of the Court 21-11758

Over the past few decades, the pro-recoupment cases 

have been viewed as stating the majority position, 

while anti-recoupment cases have been labeled the 

minority. But in recent years, several state courts, 

including several state high courts, have faced 

recoupment of defense costs as an issue of first 

impression and have rejected a right of recoupment 

for the insurer, unless that right is established 

expressly by contract. 

Restatement of the Law of Liability Insurance § 21, cmt. a (Am. L. 

Inst. 2019). Jurisdictions not allowing recoupment tend to focus on 

the deleterious effect that such a rule would have on the distinction 

between the duty to defend and the duty to indemnify. See, e.g., Am. 

& Foreign Ins. Co. v. Jerry’s Sport Ctr., Inc., 2 A.3d 526, 544 (Pa. 2010)

(“[P]ermitting reimbursement . . . would amount to a retroactive 

erosion of the broad duty to defend in Pennsylvania by making the 

right and duty to defend contingent upon a court’s determination 

that a complaint alleged covered claims, and would therefore 

narrow Pennsylvania’s long-standing view that the duty to defend 

is broader than the duty to indemnify.”). We are persuaded by the 

recent trend of state high courts holding that there is no right to 

reimbursement in similar cases.

The most important consideration in our predictive analysis, 

however, is the structure of Georgia’s insurance law. See SA Palm 

Beach, 32 F.4th at 1357 (“We therefore consider whatever might 

lend [us] insight, including relevant state precedents . . . and any 

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21-11758 Opinion of the Court 29

other reliable data . . . .”). The broad duty to defend is 

foundational. See, e.g., Landmark Am., 705 S.E.2d at 710. If we were 

to adopt a rule allowing for broadscale reimbursement without any 

contractual provision securing that right, the duty to defend would 

collapse into the duty to indemnify. That is, if the duty to defend 

required insurers to mount a defense but the defense was widely 

reimbursable upon a court’s determination that no ongoing duty 

to defend exists, the duty to defend would simply become the duty 

to indemnify. Simply put, wide-ranging reimbursement is 

necessarily inappropriate in a system—like Georgia’s—that is 

predicated on a broad duty to defend and a more limited duty to 

indemnify. See Shafe, 653 S.E.2d at 873; Penn-Am., 490 S.E.2d at 376–

77. We find the logic of the “no recoupment” cases that illustrate 

this point persuasive, and we predict that the Supreme Court of 

Georgia would follow that logic to adopt a “no recoupment” rule 

to protect its insurance system.20 See, e.g., Jerry’s Sport Ctr., 2 A.3d 

at 544.

We think it clear based on Georgia’s substantive law as well 

as its general insurance framework that the Supreme Court of 

Georgia would not allow an insurer to recoup its expenses based 

on a reservation of rights letter without any contractual provision 

allowing for reimbursement. This position comports with the 

national trend that disfavors recoupment in similar circumstances. 

20Because we find that there is no right to reimbursement under Georgia law 

in these situations, we need not address the insureds’ additional argument that 

the insurers did not adequately reserve their rights in the first place.

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30 Opinion of the Court 21-11758

While insurers can certainly contract for a right to reimbursement, 

they cannot do so in a subsequent reservation of rights after a 

reimbursement-less bargain has been struck.

IV. Conclusion

We affirm both of the district court’s holdings. First, we 

agree that the insurers did not have a duty to defend the insureds

in the underlying action. To supplement this analysis, we hold that 

the duty to defend was extinguished when the district court’s ruling 

was issued. Second, we agree that the insurers do not have a right 

to reimbursement because the reservation of rights letters did not 

create a new contract, the insurers’ unjust enrichment argument is 

untenable, and we do not believe the Supreme Court of Georgia

would upend the State’s insurance law framework by establishing 

a right to reimbursement for an insurer who has no contractual 

right to recoupment.

AFFIRMED.

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