518 F.Supp.3d 551
D. Mass.2021Background
- Atain issued a commercial general liability (CGL) policy to Davester LLC d/b/a Embargo effective Aug. 3, 2017–Aug. 3, 2018.
- On March 17, 2018, patron Newman Galati, allegedly highly intoxicated at Embargo, was sent toward a Town Taxi; the taxi reportedly let him out in the street and Hudson Aguiar then struck him with a car, causing serious injuries.
- Galati sued Aguiar, Embargo, and Town Taxi in Massachusetts state court for negligence arising from those injuries.
- Atain filed this federal declaratory-judgment action seeking a ruling that it has no duty to defend or indemnify Embargo under the policy’s Aircraft, Auto or Watercraft exclusion (the “auto exclusion”).
- The auto exclusion bars coverage for bodily injury "arising out of or in connection with any ‘auto.’" The parties agreed to decide only Count I (the auto exclusion) on summary judgment.
- The district court granted Atain summary judgment, holding the auto exclusion unambiguously bars coverage because Galati’s injuries originated from and are connected with an automobile.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the CGL policy’s auto exclusion bars Atain’s duty to defend/indemnify Embargo for Galati’s bodily-injury claims | The exclusion applies: Galati’s injuries arose out of and are connected with an auto, so no duty to defend or indemnify | The claim concerns Embargo’s pre-transport conduct at its premises (failure to summon police/medical help); the injury claim "has nothing to do with an auto" and thus should be covered | Held for Atain: injuries originated from and were sufficiently connected to the car, so the exclusion unambiguously bars coverage |
Key Cases Cited
- Allmerica Fin. Corp. v. Certain Underwriters at Lloyd's, London, 449 Mass. 621 (2007) (insurer bears burden proving applicability of an exclusion)
- Bagley v. Monticello Ins. Co., 430 Mass. 454 (2000) (coverage depends on source from which the injury originates, not merely pleaded theories)
- Rischitelli v. Safety Ins. Co., 423 Mass. 703 (1996) (an intervening source can break the causal link to an excluded activity)
- Ruggerio Ambulance Serv., Inc. v. Nat'l Grange Ins. Co., 430 Mass. 794 (2000) (injury must have a sufficiently close relationship to excluded conduct)
- Metro. Prop. & Cas. Ins. Co. v. Fitchburg Mut. Ins. Co., 58 Mass. App. Ct. 818 (2003) ("in connection with" has broader meaning than "arising out of")
- Sabatinelli v. Travelers Ins. Co., 369 Mass. 674 (1976) (injury while in car from a non-auto source held not related to auto)
- Anderson v. Liberty Lobby, 477 U.S. 242 (1986) (summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment burdens and proof)