United States District Court, D. Minnesota
ORDER GRANTING PLAINTIFF'S MOTION FOR JUDGMENT ON
THE PLEADINGS AND DENYING DEFENDANT'S MOTION FOR PARTIAL
JUDGMENT ON THE PLEADINGS
WILHELMINA M. WRIGHT UNITED STATES DISTRICT JUDGE
the Court are Plaintiff Selective Insurance Company of
America's motion for judgment on the pleadings, (Dkt.
13), and Defendant Community Living Options Inc.'s
cross-motion for partial judgment on the pleadings, (Dkt.
22). For the reasons addressed below, Plaintiff's motion
is granted and Defendant's motion is denied.
Selective Insurance Company of America (Selective Insurance)
provides insurance for Defendant Community Living Options
Inc. (CLO), a facility for in-home foster care services for
adults with behavioral, cognitive, and medical challenges.
Defendants Alexis A. O'Brien and Erin M. Lundblad were
employed by CLO as caretakers during the relevant time
period. Selective Insurance and CLO dispute whether Selective
Insurance is required to defend and indemnify CLO in an
underlying Minnesota state court case.
about August 24, 2017, the County of Sherburne and Minnesota
Department of Human Services placed Nathaniel Luke Chambers
into one of CLO's facilities. During Chambers's
introduction into the facility, CLO created a file with
Chambers's mental health and medical history. Although
CLO omitted information about Chambers's prior violent
and sexual behaviors, CLO implemented several policies with
respect to Chambers's supervision. These policies
included requirements that female employees wear
loose-fitting clothing when around Chambers and supervision
of Chambers by two employees.
engaged in a series of aggressive acts that escalated in
severity between August 24, 2017, and October 14, 2017.
Chambers threw batteries, a remote control, and a bottle at
Lundblad, threatened Lundblad with a butter knife, and
punched O'Brien in the face. And Lundblad alleges that on
the evening of October 14, 2017-while she was the only
employee assigned to supervise Chambers-Chambers violently
and Lundblad brought a lawsuit against CLO in state court for
failure to take reasonable precautions to protect them;
failure to use reasonable care to provide a safe work
environment; discrimination on the basis of sex based on
CLO's terms, conditions and requirements of employment;
failure to take remedial measures to prevent sexual
harassment and discrimination; creation of a hostile work
environment; and allowing unwelcomed sexual
sought insurance coverage by Selective Insurance to defend
against these claims. Selective Insurance initially refused
to defend CLO, contending that the claims were excluded by
the insurance policy. But, after a workers' compensation
ruling in Minnesota state court on related matters, Selective
Insurance acknowledged that one of the claims could
“potentially trigger coverage outside the
exclusion.” In its agreement to defend CLO, Selective
Insurance reserved the right to withdraw its defense after
additional investigation of the claims and facts. Selective
Insurance now seeks to withdraw its defense.
issue here is whether the state-court claims against CLO are
covered under its insurance policy. Selective Insurance
maintains that it has no duty to defend or indemnify CLO in
the state-court action and seeks a declaratory judgment to
that effect. In its counterclaim, CLO asserts that Selective
Insurance breached its contract with CLO. CLO also filed a
cross-motion for partial judgment on the pleadings, arguing
that Selective Insurance at least has a duty to
defend CLO in the Minnesota state-court action.
Selective Insurance and CLO seek declaratory judgment in
their respective motions for judgment on the pleadings. When
there is a “case of actual controversy within its
jurisdiction, ” a federal court has the authority to
“declare the rights and other legal relations of any
interested party seeking such declaration.” 28 U.S.C.
may move for judgment on the pleadings “[a]fter the
pleadings are closed- but early enough not to delay
trial.” Fed.R.Civ.P. 12(c). Accepting as true all facts
pled by the non-moving party and drawing all reasonable
inferences in the non-moving party's favor, a court shall
grant a motion for judgment on the pleadings when “the
moving party has clearly established that no material issue
of fact remains and the moving party is entitled to judgment
as a matter of law.” Potthoff v. Morin, 245
F.3d 710, 715 (8th Cir. 2001). Here, the material facts are
undisputed for the purpose of the present motions.
state law governs the substantive issue of insurance coverage
in this case. See Corn Plus Coop. v. Cont'l Cas.
Co., 516 F.3d 674, 678 (8th Cir. 2008) (applying
Minnesota substantive law to an insurance case based on
diversity jurisdiction). And under Minnesota law, principles
of contract law govern the construction of insurance
policies. Nathe Bros., Inc. v. Am. Nat. Fire Ins.
Co., 615 N.W.2d 341, 344 (Minn. 2000). The
interpretation of an insurance policy presents a question of
law, requiring a court to construe the policy “as a
whole with all doubts concerning the meaning of language
employed to be resolved in favor of the insured.”
Haarstad v. Graff, 517 N.W.2d 582, 584 (Minn. 1994)
(internal quotation marks omitted). When an insurance policy
is unambiguous, the “usual and accepted meaning”
prevails. Lobeck v. State Farm Mut. Auto. Ins. Co.,
582 N.W.2d 246, 249 (Minn. 1998).