Court Opinion

ID: 9440116
Source: CourtListenerOpinion
Date Created: 2023-08-03 07:21:32.062017+00
Date Added: 2024-06-11T17:27:12.504802
License: Public Domain

LOURIE, Circuit Judge
(dissenting).
I respectfully dissent from the majority’s conclusion that the business enterprise exclusion does not apply to Count VI. That provision defines a pecuniary or beneficial interest as existing if an insured or anyone in his immediate family owns at least 10% of the outstanding stock of that business. The second sentence of that provision states that “ownership or shares in a corporation shall not be considered a ‘pecuniary or beneficial interest’ unless one Named Insured or members of the immediate family ... own(s) 10% of the ... shares of [the] corporation.” (Emphasis added.) Contrary to the views of the majority, I believe that the “unless” language makes all the difference.in the meaning of that provision. It means that if there is a pecuniary interest on the part of his then-wife greater than 10%, then the insured (Keiter) is considered to have a pecuniary interest. There is no ambiguity in that language.
In my view, the reference to a member of the immediate family clearly applies to Keiter’s then-wife. The fact that it is framed in the negative does not make it ambiguous or mask its clear meaning, viz., that ownership of 10% of stock in the corporation by Keiter’s wife is a “pecuniary or beneficial interest” in Keiter. Accordingly, I consider the beneficial interest analysis under Maine law to be irrelevant. It is a pecuniary interest that the then-wife possessed, not a mere beneficial interest. And it is not a beneficial interest in Keiter that matters, but the pecuniary interest possessed by the “member[s] of the immediate family.”
I recognize that the policy of Maine favors an insurer’s duty to defend. However, I cannot see that that policy overcomes language that the parties to an in*21surance contract agreed to that negates such coverage.
Whether the exclusion also applies to Counts I V involves analyses that the majority did not need to get to, but, under my analysis of Count VI, needs to be decided. I make no comment on the merits of those issues, except to state that, in my view, they need to be addressed in order to determine whether American Guarantee had a duty to defend.