*1 prop evidence is not sufficient to withstand a erly supported summary judg motion for McCOSTIS, Esq., Richard M.
ment; plaintiff opposing a such a motion Plaintiff-Appellant, produce support must sufficient evidence to legitimate, finding rational nondis HOME INSURANCE COMPANY
criminatory
proffered
employ
reasons
the
INDIANA, Defendant-Appellee.
likely
er were
and that more
than not
employee’s age
the real reason
was
Docket 93-9283.
discharge.
Mary’s
Honor Ctr. v.
St.
—Hicks,
-, -,
U.S.
113 S.Ct.
States Court of
ty specifically plaintiffs), directed toward (i) employer proper has demonstrated large-scale
business motivation downsiz (ii)
ing, absence evidence that
downsizing on an basis overall was (iii)
way bias, infected that the down
sizing statistically at Watervliet evidences no (iv)
targeting employees, of older plaintiffs’ departments
selection of the
justified by ability operate their few with (v) employees, er the selection of
plaintiffs eligible from among employees departments
in their was based valid busi
ness age. considerations not on Viewing
all of the light evidence in the most favorable plaintiffs, we are convinced that no jury
rational Nashua’s deci plaintiffs
sions to terminate the were moti by age
vated bias. Liberty Anderson v. Lob Inc.,
by, 249-50, 106 S.Ct.
2510-11,
Conclusion judgment of the district court af-
firmed.
higher salary -, - - -, expensive benefits than new Biggins, - U.S. hires. See Paper Co. v. Hazen L.Ed.2d 338
HI and-WALKER, Circuit PRATT Before: Judge.* District Judges, WALKER, Judge: Circuit brought this M. McCostis Plaintiff Richard seeking a insurer, Home Insurance Com- his defendant (“Home Insurance”), had a pany of Indiana McCostis, attorney, in a duty to defend fraud- allegedly arising McCostis’s The United overbilling of a client. ulent Dis- for the Southern District (Loretta Preska, York trict of New for sum- motion Judge) denied and, following further sub- mary judgment, judgment in fa- missions, the reasons Insurance. For of Home vor follow, vacate remand.
BACKGROUND firm law partner in small McCostis was director, secretary, and outside and served (“Barr to Barr Laboratories general counsel Labs”). a client Labs became Barr September & Strawn law firm Winston complaint filed Win- According ato former Strawn, along with ston & Fox Lawrence partner & Strawn Winston fraudulently overbill engaged in a scheme $756,251.75. Of amount Barr Labs ap- allegedly received amount, desig- or his and Fox proximately $420,000. & Winston over nees received $756,251.75, Labs the repaid Barr to Winston assigned Labs in return Barr against rights and its & Strawn sub- Winston and Fox. a twelve-count sequently liability against joint and several claiming alleged violations of lawyers for two these Influ- of the Racketeer civil Act, Organizations Corrupt enced fraud, 1962(c) (d), law common & U.S.C. City York Fitzgerald, New Michael F. fiduciary duty. and breach brief), se, McCostis, (Richard pro M. liability in- professional McCostis holds plaintiff-appellant. Insurance issued surance during relevant time in effect (Merril Uniondale, Krinick, NY H. Evan policy, Home Kremer), period. Under Rivkin, Biscone, & Radler Schapiro In- against the any claim “defend agreed to defendant-appellee. York, designation. * sitting by of New Motley, Baker Honorable Constance Judge the Southern States District seeking damages sured ... to which this or restitution of legal fees.” Specifically, he applies argues allega- $755,- even that at least wrongful billing groundless, tions the suit are classified as a claim “for the “damages,” fraudulent.” The term return of or restitution as de- *3 legal fees” policy, complaint in because even the alleg- fined includes only $335,000 es that he received monetary judgement settlement, or in- scheme and possessed never obtained or cluding any judgement such or settlement more than that amount. He therefore as- personal injury, and does not include serts that a seeking more than statutory penalties, fines or or sanctions merely for the “return” or “restitu- imposed by otherwise, whether law or nor legal him, tion” of paid fees to but rather the return or legal fees, restitution must include some damages. element of Cf. added). expenses, (emphasis costs and IBT, United States v. initially assumed Cir.1992) (“The reimbursement order is not a defense, upon examining the Win- ..., traditional order of restitution in- but complaint ston & Strawn it refused to defend stead is a to [the command to trustee] reach on him the basis that the suit was one for pocket into pay his own to the Trust return fees, “the of or legal restitution of money compensate to expenses it for the he expenses.” costs and is improperly to have caused it to McCostis seeking obligation undertake. An of that sort is in that Home Insurance substance a remedy.”). damage The Win- duty had a to defend him in the Winston & ston raises numerous Ruling action. on MeCostis’s motion theories of liability, one of which charges judgment, the district court negligent McCostis with fiduciary breach of reasoned that because the essence of Win- duty. policy, Under the McCostis be would ston & Strawn’s claim was for the return of coverage entitled to Thus, for such a claim. legal fees expenses, the suit was exclud- asserts, Home Insurance has a ed coverage policy under the duty and Home to defend him in the Winston & Strawn duty Insurance therefore had no to defend. action because the return or restitution ex- Following submissions, further the district clusion apply disputed cannot to fees not court summary judgment in actually paid favor of to the insured but to third appealed Insurance. parties, to this further Winston & court. Strawn suit damages for the excess negligence on a theory cognizable under the insurance policy.
DISCUSSION Examining language of the insurance Under controlling law, New York contract, we believe does not duty insurer’s to defend is “exceedingly provide a clear question to answer separate broad” and is expan from and more whether the return legal or restitution of fees sive than the covenant to indemnify. See exclusion would applicable disputes Co., Colon v. Aetna Casualty Ins. Life concerning paid parties. fees to third 6, 8-9, 66 N.Y.2d 688, 689, 494 N.Y.S.2d provision mean, exclusion as the dis- N.E.2d 1040 An escape insurer can trict effectively concluded, court that all only defend legal if there is no billing client controversies are excluded from factual basis in complaint upon which the coverage. hand, On the other the use of the might insurer eventually indemnify have to words “return” and “restitution” seems Bronte, the insured. See Villa Charlotte Inc. indicate that pertain the exclusion only would Co., v. Commercial Union 64 N.Y.2d to situations where the insured received the 846, 848, 314, 315, 476 N.E.2d disputed funds and repay is forced to monies to the Accordingly, client. we find contends Home Insur the return or legal restitution of fees ance must defend him because the Winston ambiguous exclusion to McCos- & Strawn suit seeks more than “the return of tis in this case.
H3 ambiguity faced with When N.A., BANK, reviewing should court MELLON policy, by the Plaintiff-Appellee, submitted evidence consider determining their assist parties Indem. See, v. Home e.g., State intent. 969, 971, 669, 671, 495 N.Y.S.2d 66 N.Y.2d BANK CORPORATION UNITED (mem.); (1985) Ostrager & Employee YORK; Subsidiaries NEW Coverage Newman, Handbook Trust, Ownership Bank Stock 1.03[a], 5-6, § at 10-12 1.01[b], at York; Michael Corporation New 1991). does (4th evidence If the extrinsic ed. Defendants-Appellants. Jacobs, *4 par answer as a conclusive yield not court to intent, appropriate for it is ties’ 1752, 93-9358. Docket construction, includ rules of other resort rule, states ing the contra-insurer policy should any ambiguity Circuit. Second insured. See in favor be resolved 27, 1994. 154 Cent. v. American Matthews (1897); 751, 752 48 N.E. N.Y. Aug. Cover on Insurance generally Handbook see 1.03[b][1], This at 12-16. ambi applicable when especially rule is exclusionary clause. guity is found in Am., N.Y.2d N. 46 Co.
Breed v. Insurance Milling Mach. Ingersoll also see Bodena, F.2d
v.Co. M/V policies
Cir.1987) (“The that insurance rule insured is in favor construed are construing the rigorously
most incorporated into
meaning of exclusions seeking to
policy of insurance denied, liability.”), cert. the insurer’s narrow 98 L.Ed.2d policy exclusion
Because court’s district vacate the
ambiguous, we no had
judgment that to allow and remand
to defend MeCostis evidence, any,
court to consider contracting intent
determine in accor- interpret
parties, and to de- of construction rules with the
dance above.
scribed costs. remanded. No
Vacated Judge,
dissenting: affirm and would respectfully
I dissent opinion below.