Court Opinion

ID: 19228
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:22:31+00
Date Added: 2024-06-11T12:32:36.117751
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                       FOR THE FIFTH CIRCUIT

                       ____________________

                           No. 99-30176
                         Summary Calendar
                       ____________________

     SPECIALTY FOOD SYSTEMS INC,

                                    Plaintiff-Appellant,

     v.

     RELIANCE INSURANCE COMPANY OF ILLINOIS,

                                    Defendant-Appellee.

_________________________________________________________________

           Appeal from the United States District Court
               for the Eastern District of Louisiana
                            (98-CV-2595)
_________________________________________________________________

                         November 3, 1999

Before KING, Chief Judge, and Higginbotham and Stewart, Circuit
Judges.

PER CURIAM:*

     Plaintiff-Appellant Specialty Foods, Inc. appeals from the

district court’s grant of summary judgment in favor of Defendant-

Appellee Reliance Insurance Company of Illinois.     We affirm.

               I. FACTUAL AND PROCEDURAL BACKGROUND

     Plaintiff-Appellant Specialty Food Systems, Inc.

(“Specialty”) contracted with Defendant-Appellee Reliance

Insurance Company of Illinois (“Reliance”) for the provision of

employment practices liability insurance.     Reliance provided

     *
      Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
coverage in the form of an annual “claims first made and

reported” policy.   Under this type of policy, coverage is

triggered by the making of a claim, rather than the occurrence of

a covered event, within a specified policy period.   Two Reliance

policies covering Specialty are at issue in this appeal: one with

a policy period running from November 17, 1996, to November 17,

1997 (the “1996-97 Policy”); and another with a policy period

running from November 17, 1997, to November 17, 1998 (the “1997-

98 Policy”).   In all respects important to this appeal, the

policies differed only in their respective coverage periods.

     Generally, each policy covered claims that were first made

during the policy period and reported to Reliance no later than

sixty days following the termination of the policy period.     Both

policies defined a “claim” as:

     any written demand or notice received by an Insured from a
     person or any administrative agency advising that it is the
     intention of a person to hold the Insured responsible for
     the consequences of a Wrongful Employment Practice and
     includes any demand received by an Insured for damages
     and/or the service of suit.

Brief for Appellant at 11.

     Specialty terminated an employee, Louise Davis (“Davis”), in

1997, and Davis filed a complaint with the EEOC.   On November 7,

1997, Specialty received a Notice of Charge of Discrimination

from the EEOC (the “EEOC Notice”), which notified Specialty of

Davis’s age discrimination complaint and requested information.

Davis then filed an age discrimination suit against Specialty in

federal district court on December 22, 1997, and Specialty

notified Reliance of the suit on January 20, 1998.   The case

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eventually settled, but not before Reliance refused coverage.

Specialty brought suit against Reliance in state court for

denying coverage, and, claiming diversity, Reliance removed the

action to federal court.   Their dispute centers around the

definition of the term “claim.”

     Specialty contends that the definition provided in both

policies, especially when read in conjunction with other policy

language, is ambiguous.    Citing Louisiana law, Specialty asserts

that this ambiguity should be resolved in its favor and insists

that the institution of Davis’s suit on December 22, 1997,

constituted the first “claim” made against Specialty.   Under this

theory, the claim was first made and reported during the 1997-98

Policy period and should, therefore, be covered.

     Reliance counters that the term “claim” is unambiguously

defined in each policy and that it includes agency notification

of the type received by Specialty in this case.    Under Reliance’s

theory, a claim was first made on November 7, 1997, during the

1996-97 Policy period, when Specialty received the EEOC Notice.

However, Specialty did not report the claim to Reliance until

January 20, 1998, more than sixty days after the expiration of

the 1996-97 Policy on November 17, 1997.   Therefore, Reliance

asserts, coverage was properly denied.

     The parties filed cross motions for summary judgment.    The

district court found that no ambiguity existed in the contract

language and, applying that language, found that the EEOC Notice

constituted a claim.   Summary judgment was granted in favor of

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Reliance, and Specialty now appeals.

                       II. Standard of Review

     “We review the granting of summary judgment de novo,

applying the same criteria used by the district court in the

first instance.”   Norman v. Apache Corp., 19 F.3d 1017, 1021 (5th

Cir. 1994).   First, we consult the applicable law to ascertain

the material factual issues.    See King v. Chide, 974 F.2d 653,

656 (5th Cir. 1992).   We then review the evidence bearing on

those issues, viewing the facts and inferences to be drawn

therefrom in the light most favorable to the nonmoving party.

See Lemelle v. Universal Mfg. Corp., 18 F.3d 1268, 1272 (5th Cir.

1994).

     Summary judgment is proper “if the pleadings, depositions,

answers to interrogatories, and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as to

any material fact and that the moving party is entitled to

judgment as a matter of law.”   FED. R. CIV. P. 56(c).   “A fact is

‘material’ if its resolution in favor of one party might affect

the outcome of the lawsuit under governing law.    An issue is

‘genuine’ if the evidence is sufficient for a reasonable jury to

return a verdict for the non-moving party.”     Ginsberg 1985 Real

Estate Partnership v. Cadle Co., 39 F.3d 528, 531 (5th Cir.1994)

(internal citations omitted).

                          III. DISCUSSION

     The only issue of material fact in this case is whether the

definition of the term “claim” contained in the two policies is

                                 4
ambiguous.   If the definition is unambiguous, then the EEOC

Notice constitutes a claim that was reported to Reliance outside

the period allowed by the 1996-97 Policy, and Reliance correctly

denied coverage.

     The district court clearly addressed this issue and held

that the term “claim” was unambiguously defined and encompassed

the EEOC Notice.   Because this sole issue was not genuine, the

district court granted summary judgment in favor of Reliance.     We

have carefully reviewed the record, the parties’ briefs, and the

district court order, and we agree with the judgment entered by

the district court.   Having determined that Judge Vance correctly

disposed of the case, we see no value in simply rephrasing the

bulk of her well-reasoned Summary Judgment Order.

                          IV. CONCLUSION

     For the foregoing reasons, we AFFIRM the judgment of the

district court.

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