Court Opinion

ID: 4533071
Source: CourtListenerOpinion
Date Created: 2020-05-08 20:00:29.739364+00
Date Added: 2024-06-11T08:45:24.345704
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        MAY 8 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

CASTELLET, INC., DBA Thompson                   No.    19-55339
Building Materials, a California corporation,
                                                D.C. No.
                Plaintiff-Appellant,            8:18-cv-00582-DOC-KES

 v.
                                                MEMORANDUM AND ORDER*
LIBERTY MUTUAL INSURANCE
COMPANY, a Massachusetts corporation;
GOLDEN EAGLE INSURANCE
COMPANY, a New Hampshire corporation,

                Defendants,

and

PEERLESS INSURANCE COMPANY, a
New Hampshire corporation,

                Defendant-Appellee.

                   Appeal from the United States District Court
                      for the Central District of California
                    David O. Carter, District Judge, Presiding

                              Submitted May 5, 2020**
                                Pasadena, California

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: M. SMITH, BADE, and BRESS, Circuit Judges.

      Plaintiff-Appellant Castellet, Inc. (Castellet) appeals the district court’s grant

of summary judgment for Defendant-Appellee Peerless Insurance Co. (Peerless) in

this insurance coverage dispute. We have jurisdiction pursuant to 28 U.S.C. §§

1291 and 1332. We review a district court’s decision to grant summary judgment

de novo. Bravo v. City of Santa Maria, 665 F.3d 1076, 1083 (9th Cir. 2011).

Because we agree with the district court that Peerless properly denied coverage to

Castellet based on the unambiguous language of the insurance policy at issue, we

AFFIRM the district court. For the same reasons, we DENY Castellet’s motion

(Dkt. No. 23) for certification to the California Supreme Court.

      This coverage dispute concerns a state court lawsuit brought against

Castellet, a building materials producer, related to some allegedly defective patio

stone that it sold to homeowners who were renovating their pool area. The

homeowners brought two causes of action against Castellet and others (the

Homeowner Claims): (1) negligence; and (2) breach of implied warranties of

merchantability and fitness for a particular purpose. In the state court proceedings,

the homeowners argued that, even if the stone was not defective, Castellet failed to

investigate and determine the stone’s suitability for the homeowners’ intended use

before selling it. Castellet won the litigation, but only after Peerless had denied

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Castellet’s requests for coverage pursuant to its commercial general liability

insurance policy.

      Peerless’s denials of coverage were based upon the insurance policy’s

“Products-Completed Operations Hazard” exclusion (the PCOH Exclusion). In

pertinent part, the PCOH Exclusion excludes “all ‘bodily injury’ and ‘property

damage’ occurring away from premises you own or rent and arising out of ‘your

product’ or ‘your work.’” The policy defines “your product” to include “goods or

products” sold by Castellet, as well as “[w]arranties or representations made at any

time with respect to the fitness, quality, durability, performance or use of ‘your

product.’” The policy defines “your work” as “[w]ork or operations performed by

you or on your behalf” and “materials . . . furnished in connection with such

work,” as well as “[w]arranties or representations made at any time with respect to

the fitness, quality, durability, performance or use of ‘your work.’” Both “your

product” and “your work” include “[t]he providing of or failure to provide

warnings or instructions.”

      As a lawsuit stemming from property damage that occurred off-premises and

after the installation of Castellet’s product, the PCOH Exclusion unambiguously

excludes the Homeowner Claims. And while Castellet attempts to reframe the

Homeowner Claims in order to avoid the PCOH Exclusion, as the district court

noted, “[t]here is simply no other reason why Castellet was involved” in the state

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court litigation other than the fact that it provided allegedly unsuitable stone.

Order Granting Defendant’s Motion for Summary Judgment at 15, Castellet, Inc. v.

Golden Eagle Ins. Co., No. 8:18-cv-00582-DOC-KES (C.D. Cal. Jan. 8, 2019),

ECF No. 33. The fact that Castellet argued in the underlying suit that it was not

liable and that other parties were instead responsible for the damage does not

change this.

      Castellet argues that the language “arising out of” in the PCOH Exclusion is

ambiguous, but we agree with the district court that it is not. Castellet’s reading of

the policy contradicts California and Ninth Circuit rulings interpreting similar

policy language. See Baker v. Nat’l Interstate Ins. Co., 103 Cal. Rptr. 3d 565,

577–78 (Cal. Ct. App. 2009) (interpreting “products-completed operations hazard”

exclusion in policy as unambiguous); see also L.A. Lakers, Inc. v. Fed. Ins. Co.,

869 F.3d 795, 801 (9th Cir. 2017) (interpreting “arising from” broadly). Any

conceivable formulation of the Homeowner Claims is encompassed by the plain

language of the PCOH Exclusion.

      Finally, Castellet relies on State Farm Mutual Automobile Insurance Co. v.

Partridge, 514 P.2d 123 (1973), a California Supreme Court case that is

distinguishable. Partridge involved an accident caused by two independent and

concurrent risks, each separately insured under different policies. Id. at 125–27.

The court held that coverage was available under either policy because each policy

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covered a concurrent proximate cause of the accident. Id. at 129. In contrast, here

there is only one insurance policy at issue, and given the allegations in the

underlying state court action, the policy’s PCOH exclusion would have applied

under any conceivable theory of recovery alleged by the homeowners against

Castellet.

      AFFIRMED.

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