Court Opinion

ID: 2803755
Source: CourtListenerOpinion
Date Created: 2015-05-27 19:01:27.039476+00
Date Added: 2024-06-11T11:51:26.869164
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                              No. 14-1972

PROTECTION STRATEGIES, INC.,

                Plaintiff - Appellant,

          v.

STARR INDEMNITY & LIABILITY CO.,

                Defendant - Appellee,

          v.

JOSEPH RICHARDS; DAVID LUX; DAVID SANBORN; KEITH HEDMAN,

                Third Party Defendants.

Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.   Liam O’Grady, District
Judge. (1:13-cv-00763-LO-IDD)

Submitted:   April 30, 2015                   Decided:   May 27, 2015

Before KEENAN, WYNN, and DIAZ, Circuit Judges.

Affirmed by unpublished per curiam opinion.

John A. Gibbons, DICKSTEIN SHAPIRO LLP, Washington, D.C., for
Appellant.   Cara Tseng Duffield, Mary Catherine Martin, WILEY
REIN LLP, Washington, D.C., for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

        Protection    Strategies,    Incorporated,        (PSI)     appeals      the

district    court’s    order   granting      Starr     Indemnity      &    Liability

Company (Starr)’s Fed. R. Civ. P. 59(e) motion to alter or amend

the court’s prior order granting Starr summary judgment in PSI’s

civil     action.      We   conclude       that   PSI    fails     to      establish

reversible error in the district court’s judgment and affirm.

      In 2012, PSI and its officers were the subjects of criminal

and     civil   investigations      relative      to    the      Small      Business

Administration’s Section 8(a) program, a program designed to aid

businesses owned by certain socioeconomic groups in accessing

the federal procurement market.              In 2013, PSI’s former chief

executive officer, former chief financial officer, former vice

president, and former president pled guilty in the United States

District Court for the Eastern District of Virginia to criminal

charges for fraud or conspiracy to commit fraud in connection

with the Section 8(a) program.

      Through a civil action filed in the district court, PSI

sought reimbursement under insurance policies (the 2011 policy

and the 2012 policy) issued by Starr of certain costs expended

in    connection     with   these   investigations.           Starr       ultimately

reimbursed to PSI $846,483.34.             After the officers pled guilty,

however, Starr sought recoupment of the amount paid through a

counterclaim.        The district court granted summary judgment in

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Starr’s favor, concluding that the 2011 policy controlled, each

of   the   four    coverage       exclusions        on    which    Starr      relied       (the

exclusions for profit, fraud, and prior knowledge and based on a

warranty    letter)       barred    coverage         under   the    policy,         and    that

Starr was entitled to recoupment of costs reimbursed to PSI.

Starr later moved pursuant to Rule 59(e) to alter or amend the

district     court’s       judgment       to       reflect   it     was       entitled      to

recoupment of the $846,483.34 sum, plus pre- and post-judgment

interest.     The district court granted Starr’s motion, awarded it

judgment    in     the    amount    of    $846,483.34        and    awarded         pre-    and

post-judgment interest.            PSI appeals and challenges the district

court’s grant of summary judgment in Starr’s favor.

      We review de novo the district court’s award of summary

judgment and view the facts in the light most favorable to the

non-moving    party.        Woollard          v.   Gallagher,      712 F.3d 865,   873

(4th Cir. 2013).          “Summary judgment is appropriate only if the

record     shows    ‘that    there       is    no    genuine      dispute      as    to    any

material fact and the movant is entitled to judgment as a matter

of law.’”     Id. (quoting Fed. R. Civ. P. 56(a)).

      The relevant inquiry on summary judgment is “whether the

evidence      presents       a     sufficient            disagreement         to     require

submission to a jury or whether it is so one-sided that one

party must prevail as a matter of law.”                           Anderson v. Liberty

Lobby,     Inc.,    477 U.S. 242,       251-52     (1986).         To   withstand      a

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summary     judgment      motion,      the     non-moving          party        must    produce

competent    evidence          sufficient    to       reveal       the     existence         of   a

genuine    issue    of     material     fact      for       trial.        See     Thompson        v.

Potomac    Elec.    Power       Co.,   312 F.3d 645,    649       (4th       Cir.    2002)

(“Conclusory or speculative allegations do not suffice, nor does

a   mere   scintilla       of    evidence      in     support        of    [the      non-moving

party’s] case.” (internal quotation marks omitted)).                                    We will

uphold the district court’s grant of summary judgment unless a

reasonable jury could return a verdict for the non-moving party

on the evidence presented.             See EEOC v. Cent. Wholesalers, Inc.,

573 F.3d 167, 174-75 (4th Cir. 2009).

       We conclude after review of the record and the parties’

briefs     that    the    district      court         did    not     reversibly         err       in

granting summary judgment to Starr.                     We reject as without merit

PSI’s contention that the exclusion for prior knowledge in the

2011   policy     is     not    applicable       to    bar    coverage          in    this    case

because the 2012 policy controls.                     Contrary to PSI’s suggestion,

Starr did not waive its right to rely on and is not estopped

from   relying     on    the    coverage     exclusions            in     the   2011    policy.

See Ins. Co. of N. Am. v. Atl. Nat’l Ins. Co., 329 F.2d 769,

775-76 (4th Cir. 1964); State Farm Fire & Cas. Co. v. Mabry,

497 S.E.2d 844, 846 (Va. 1998); Stanley’s Cafeteria, Inc. v.

Abramson, 306 S.E.2d 870, 873 (Va. 1983).                               We also reject as

unsupported by the record PSI’s contention that the warranty

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letter bars coverage in this case because the district court

impermissibly          resolved       issues         of        fact      regarding        the

circumstances under which the letter was executed to find it was

part of the 2011 policy.               We further reject as without merit

PSI’s contention that the coverage exclusions relative to profit

and fraud do not apply to bar coverage with respect to PSI’s

general counsel and two employees because the exclusions were

applicable to bar coverage for these individuals as a result of

the guilty pleas of PSI’s former chief executive officer and

chief financial officer.              Additionally, as it is clear from the

undisputed evidence of record that there were not Claims under

the     2011   policy     with    respect       to    these          individuals,      PSI’s

contention      that    the   district        court       improperly      resolved      fact

issues to reach this conclusion is without merit.                              Finally, we

reject as both unsupported by the record and otherwise without

merit     PSI’s       arguments       challenging           the        district       court’s

determination         that    Starr     was     entitled          to     the   remedy      of

recoupment under the terms of the 2011 policy.

      Accordingly, we affirm the district court’s judgment.                               We

dispense       with    oral    argument       because          the     facts    and     legal

contentions      are    adequately      presented         in    the     materials      before

this court and argument would not aid the decisional process.

                                                                                  AFFIRMED

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