Goose Ridge LLC v. The Ohio Casualty Insurance Company
2:24-cv-01058
W.D. Wash.May 19, 2025Background
- Goose Ridge, LLC and Goose Ridge Vineyards, LLC (“Goose Ridge”) entered into a winemaking and grape purchase agreement with K Vintners to produce wine, including the 2020 Substance Cabernet Sauvignon.
- K Vintners accused Goose Ridge of producing defective wine and sought over $50 million in arbitration, alleging fault in Goose Ridge’s vinification process as well as overcropping of grapes.
- Goose Ridge disputed liability, identifying alternative causes for the wine defect (damaged grapes, required bottle closure) and ultimately settled the arbitration without admitting fault.
- Goose Ridge's primary insurer (Eagle West) provided coverage for the settlement, but the excess insurer (Ohio Casualty) denied indemnification, invoking several policy exclusions.
- Goose Ridge filed suit against Ohio Casualty, alleging breach of contract and related claims, and Ohio Casualty moved for partial summary judgment, arguing that policy exclusions bar coverage for the settlement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| "Your Product" Exclusion | Damage was caused by factors outside Goose Ridge’s control (defective grapes, required closure) | Defect arose out of the wine that Goose Ridge made, so exclusion applies | Disputed facts about causation preclude summary judgment; exclusion may not apply |
| Care, Custody, & Control Exclusion | Harm may have occurred before Goose Ridge had control or after, due to factors outside its control | Damage to wine occurred while in Goose Ridge’s custody, barring coverage | Dispute of fact as to when damage occurred; exclusion inapplicable at this stage |
| Ongoing Operations Exclusion | Exclusion is for real property, not crops; not applicable to grapes on the vine | Initially argued exclusion applies to overcropping claims | Both parties agree exclusion does not apply |
| Products-Completed Operations Exclusion | Dispute of fact as to whether any work was incorrectly performed; wine cannot be replaced or restored | Faulty work caused the need to replace product, therefore exclusion applies | Dispute of fact and unique nature of wine make exclusion inapplicable at this stage |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard and burden shifting)
- Hayden v. Mut. of Enumclaw Ins. Co., 141 Wn.2d 55 (duty to indemnify arises from actual coverage and liability under Washington law)
- Stuart v. Am. States Ins. Co., 134 Wn.2d 814 (policy exclusions must be construed strictly against the insurer)
- Toll Bridge Auth. v. Aetna Ins. Co., 54 Wn. App. 400 (scope of "arising out of" exclusions)
- Krempl v. Unigard Sec. Ins. Co., 69 Wn. App. 703 (interpretation of broad policy exclusion language)