24-2963-cv BP Prods. N. Am. Inc. v. ExxonMobil Corp.
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 26th day of September, two thousand twenty-five.
PRESENT: REENA RAGGI, RAYMOND J. LOHIER, JR., MICHAEL H. PARK, Circuit Judges. ------------------------------------------------------------------ BP PRODUCTS NORTH AMERICA INC.,
Plaintiff-Appellant,
v. No. 24-2963-cv
EXXONMOBIL CORPORATION,
Defendant-Appellee.
------------------------------------------------------------------ FOR PLAINTIFF-APPELLANT: JONATHAN K. COOPERMAN (Luis D. Peña-Navarro, Isabelle R. Faber, on the brief), Kelley Drye & Warren LLP, New York, NY
FOR DEFENDANT-APPELLEE: ZACHARY D. TRIPP, Weil, Gotshal & Manges LLP, Washington, DC (David J. Lender, Jennifer Brooks Crozier, Weil, Gotshal & Manges LLP, New York, NY, on the brief)
Appeal from a judgment of the United States District Court for the Eastern
District of New York (Pamela K. Chen, Judge).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the District Court is AFFIRMED.
Plaintiff BP Products North America Inc. (“BP”) appeals from an October
19, 2023 judgment of the United States District Court for the Eastern District of
New York (Chen, J.) insofar as it partially denied BP’s motion for summary
judgment prior to a jury finding that Defendant ExxonMobil Corporation
(“ExxonMobil”) had not breached its 1993 contract, as amended in 2004, with BP.
We assume the parties’ familiarity with the underlying facts and the record of
2 prior proceedings, to which we refer only as necessary to explain our decision to
affirm.
BP alleges that ExxonMobil breached a 1993 indemnity agreement between
the parties by failing to defend BP against all claims related to certain third-party
lawsuits brought in 2005. In 2004 the parties amended their 1993 agreement to
release ExxonMobil from its obligation to indemnify BP against claims for
injunctive relief related to contamination in Greenpoint, New York. In light of
the 2004 amendment, BP concedes that the 2005 lawsuits “contained a few
allegations” that fell “outside the scope” of the indemnity agreement.
Appellant’s Br. 16. BP argues that Illinois’s “complete defense” rule nevertheless
obligated ExxonMobil to pay for BP’s entire defense against these lawsuits,
including its defense against claims within the lawsuits that are not covered by
the 1993 agreement as amended (hereinafter referred to as “noncovered
claims”). 1
The District Court denied BP’s motion for summary judgment in relevant
part after concluding that ExxonMobil was obligated to defend BP only against
covered claims. At trial, the jury found that BP failed to prove that ExxonMobil
1 The parties agree that Illinois law governs the 1993 indemnification agreement.
3 had breached its duty to defend it against the covered claims. BP now appeals
the District Court’s denial of its motion for summary judgment. 2
As a threshold matter, ExxonMobil contends that we do not have
jurisdiction to review on appeal the District Court’s denial of BP’s motion for
summary judgment. It relies on the principle that “where summary judgment is
denied and the movant subsequently loses after a full trial on the merits, the
denial of summary judgment may not be appealed.” Keeling v. Hars, 809 F.3d 43,
47 (2d Cir. 2015) (quotation marks omitted). ExxonMobil’s reliance is misplaced.
“While factual issues addressed in summary-judgment denials are unreviewable
on appeal, the same is not true of purely legal issues—that is, issues that can be
resolved without reference to any disputed facts.” Dupree v. Younger, 598 U.S.
729, 735 (2023). “It is well settled in Illinois that the construction, interpretation
2 In its Notice of Appeal, BP also indicated that it was appealing from the District Court’s September 30, 2024 Memorandum and Order denying BP’s motion for a new trial. See Dkt. 1; see also Memorandum and Order, Dkt. 111, BP Prods. N. Am. Inc. v. ExxonMobil Corp., No. 19-CV-3288, at 19 (E.D.N.Y. Sept. 30, 2024) (noting that BP’s motion for new trial sought in part “to relitigate an issue that the Court resolved in its summary judgment decision prior to trial”). As BP did not raise any arguments specific to that denial in its appellate briefs, we deem the point waived except to the extent that the September 30 order also addressed arguments made at summary judgment. See Gross v. Rell, 585 F.3d 72, 95 (2d Cir. 2009) (“Issues not sufficiently argued are in general deemed waived and will not be considered on appeal.” (quotation marks and alterations omitted)).
4 or legal effect of a contract are issues to be resolved by the court as questions of
law.” Premier Elec. Constr. Co. v. Ragnar Benson, Inc., 444 N.E.2d 726, 732 (Ill. App.
Ct. 1982) (quotation marks omitted). Therefore, “the [D]istrict [C]ourt’s
purported error was purely one of law,” namely, whether Illinois contract law
requires an indemnitor to defend an indemnitee against all claims in a suit as
long as one of those claims is covered by the indemnity agreement. See Keeling,
809 F.3d at 47 (quotation marks omitted). We can therefore review the District
Court’s denial of BP’s motion for summary judgment. See Dupree, 598 U.S. at 735;
Keeling, 809 F.3d at 47.
Turning to the merits, BP argues that the District Court erred when it
concluded that Illinois’s complete defense rule does not apply to its
indemnification agreement with ExxonMobil. Illinois’s complete defense rule,
“also referred to as the ‘in for one, in for all rule,’ generally imposes an obligation
on an insurer to provide a complete defense in a suit or action against its insured
even if only one or some of the claims are potentially covered.” Findlay v. Chi.
Title Ins. Co., 215 N.E.3d 1006, 1019 (Ill. App. Ct. 2022) (quotation marks omitted).
While this rule is established in the context of Illinois insurance law, see Pekin Ins.
Co. v. Wilson, 930 N.E.2d 1011, 1015 n.2 (Ill. 2010); Gen. Agents Ins. Co. of Am. v.
5 Midwest Sporting Goods Co., 828 N.E.2d 1092, 1098 (Ill. 2005), the Illinois Supreme
Court has not addressed whether it applies to indemnity agreements between
non-insurers.
When resolving an unanswered question of state law, it is “the job of the
federal courts [to] carefully . . . predict how the highest court of the forum state
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24-2963-cv BP Prods. N. Am. Inc. v. ExxonMobil Corp.
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 26th day of September, two thousand twenty-five.
PRESENT: REENA RAGGI, RAYMOND J. LOHIER, JR., MICHAEL H. PARK, Circuit Judges. ------------------------------------------------------------------ BP PRODUCTS NORTH AMERICA INC.,
Plaintiff-Appellant,
v. No. 24-2963-cv
EXXONMOBIL CORPORATION,
Defendant-Appellee.
------------------------------------------------------------------ FOR PLAINTIFF-APPELLANT: JONATHAN K. COOPERMAN (Luis D. Peña-Navarro, Isabelle R. Faber, on the brief), Kelley Drye & Warren LLP, New York, NY
FOR DEFENDANT-APPELLEE: ZACHARY D. TRIPP, Weil, Gotshal & Manges LLP, Washington, DC (David J. Lender, Jennifer Brooks Crozier, Weil, Gotshal & Manges LLP, New York, NY, on the brief)
Appeal from a judgment of the United States District Court for the Eastern
District of New York (Pamela K. Chen, Judge).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the District Court is AFFIRMED.
Plaintiff BP Products North America Inc. (“BP”) appeals from an October
19, 2023 judgment of the United States District Court for the Eastern District of
New York (Chen, J.) insofar as it partially denied BP’s motion for summary
judgment prior to a jury finding that Defendant ExxonMobil Corporation
(“ExxonMobil”) had not breached its 1993 contract, as amended in 2004, with BP.
We assume the parties’ familiarity with the underlying facts and the record of
2 prior proceedings, to which we refer only as necessary to explain our decision to
affirm.
BP alleges that ExxonMobil breached a 1993 indemnity agreement between
the parties by failing to defend BP against all claims related to certain third-party
lawsuits brought in 2005. In 2004 the parties amended their 1993 agreement to
release ExxonMobil from its obligation to indemnify BP against claims for
injunctive relief related to contamination in Greenpoint, New York. In light of
the 2004 amendment, BP concedes that the 2005 lawsuits “contained a few
allegations” that fell “outside the scope” of the indemnity agreement.
Appellant’s Br. 16. BP argues that Illinois’s “complete defense” rule nevertheless
obligated ExxonMobil to pay for BP’s entire defense against these lawsuits,
including its defense against claims within the lawsuits that are not covered by
the 1993 agreement as amended (hereinafter referred to as “noncovered
claims”). 1
The District Court denied BP’s motion for summary judgment in relevant
part after concluding that ExxonMobil was obligated to defend BP only against
covered claims. At trial, the jury found that BP failed to prove that ExxonMobil
1 The parties agree that Illinois law governs the 1993 indemnification agreement.
3 had breached its duty to defend it against the covered claims. BP now appeals
the District Court’s denial of its motion for summary judgment. 2
As a threshold matter, ExxonMobil contends that we do not have
jurisdiction to review on appeal the District Court’s denial of BP’s motion for
summary judgment. It relies on the principle that “where summary judgment is
denied and the movant subsequently loses after a full trial on the merits, the
denial of summary judgment may not be appealed.” Keeling v. Hars, 809 F.3d 43,
47 (2d Cir. 2015) (quotation marks omitted). ExxonMobil’s reliance is misplaced.
“While factual issues addressed in summary-judgment denials are unreviewable
on appeal, the same is not true of purely legal issues—that is, issues that can be
resolved without reference to any disputed facts.” Dupree v. Younger, 598 U.S.
729, 735 (2023). “It is well settled in Illinois that the construction, interpretation
2 In its Notice of Appeal, BP also indicated that it was appealing from the District Court’s September 30, 2024 Memorandum and Order denying BP’s motion for a new trial. See Dkt. 1; see also Memorandum and Order, Dkt. 111, BP Prods. N. Am. Inc. v. ExxonMobil Corp., No. 19-CV-3288, at 19 (E.D.N.Y. Sept. 30, 2024) (noting that BP’s motion for new trial sought in part “to relitigate an issue that the Court resolved in its summary judgment decision prior to trial”). As BP did not raise any arguments specific to that denial in its appellate briefs, we deem the point waived except to the extent that the September 30 order also addressed arguments made at summary judgment. See Gross v. Rell, 585 F.3d 72, 95 (2d Cir. 2009) (“Issues not sufficiently argued are in general deemed waived and will not be considered on appeal.” (quotation marks and alterations omitted)).
4 or legal effect of a contract are issues to be resolved by the court as questions of
law.” Premier Elec. Constr. Co. v. Ragnar Benson, Inc., 444 N.E.2d 726, 732 (Ill. App.
Ct. 1982) (quotation marks omitted). Therefore, “the [D]istrict [C]ourt’s
purported error was purely one of law,” namely, whether Illinois contract law
requires an indemnitor to defend an indemnitee against all claims in a suit as
long as one of those claims is covered by the indemnity agreement. See Keeling,
809 F.3d at 47 (quotation marks omitted). We can therefore review the District
Court’s denial of BP’s motion for summary judgment. See Dupree, 598 U.S. at 735;
Keeling, 809 F.3d at 47.
Turning to the merits, BP argues that the District Court erred when it
concluded that Illinois’s complete defense rule does not apply to its
indemnification agreement with ExxonMobil. Illinois’s complete defense rule,
“also referred to as the ‘in for one, in for all rule,’ generally imposes an obligation
on an insurer to provide a complete defense in a suit or action against its insured
even if only one or some of the claims are potentially covered.” Findlay v. Chi.
Title Ins. Co., 215 N.E.3d 1006, 1019 (Ill. App. Ct. 2022) (quotation marks omitted).
While this rule is established in the context of Illinois insurance law, see Pekin Ins.
Co. v. Wilson, 930 N.E.2d 1011, 1015 n.2 (Ill. 2010); Gen. Agents Ins. Co. of Am. v.
5 Midwest Sporting Goods Co., 828 N.E.2d 1092, 1098 (Ill. 2005), the Illinois Supreme
Court has not addressed whether it applies to indemnity agreements between
non-insurers.
When resolving an unanswered question of state law, it is “the job of the
federal courts [to] carefully . . . predict how the highest court of the forum state
would resolve the uncertainty.” Glob. Reinsurance Corp. of Am. v. Century Indem.
Co., 22 F.4th 83, 101 (2d Cir. 2021) (quotation marks omitted). Certification to the
State’s highest court, when that mechanism is available, may sometimes be the
best course. The Illinois Supreme Court, however, “does not permit our Court to
certify questions of Illinois state law” to it. Parmalat Cap. Fin. Ltd. v. Bank of Am.
Corp., 639 F.3d 572, 580 n.8 (2d Cir. 2011) (citing Ill. Sup. Ct. R. 20). We therefore
are left to discern and follow the decisions of Illinois’s intermediate appellate
courts unless we are “convinced by other persuasive data that the [Illinois
Supreme Court] would decide otherwise.” DiBella v. Hopkins, 403 F.3d 102, 112
(2d Cir. 2005) (quotation marks omitted).
The weight of Illinois case law as articulated by Illinois’s intermediate
appellate courts confirms that the complete defense rule does not apply to the
indemnification agreement here. “When dealing with indemnification clauses
6 between noninsurers, [Illinois] courts do not apply laws that govern insurance
contracts.” 933 Van Buren Condo. Ass’n v. W. Van Buren, LLC, 61 N.E.3d 929, 945
(Ill. App. Ct. 2016). Whereas insurance policies “are subject to a general rule of
liberal construction in favor of the insured” because insurers are “professional
‘seller[s]’ of protection against loss,” Ervin v. Sears, Roebuck & Co., 469 N.E.2d 243,
249–50 (Ill. App. Ct. 1984), an “indemnity agreement is to be construed as any
other contract,” Charter Bank v. Eckert, 585 N.E.2d 1304, 1310 (Ill. App. Ct. 1992).
For that reason, the complete defense rule under Illinois law generally does not
apply to indemnification agreements between non-insurers. See 933 Van Buren
Condo. Ass’n, 61 N.E.3d at 945 (rejecting the proposition that when a non-insurer
has a “duty to indemnify one claim” in a third-party complaint, it has “a duty to
defend all of the” claims in the complaint). Even when a third-party lawsuit
contains some claims that fall within the scope of an indemnification agreement,
the indemnitor “d[oes] not breach” the agreement “when it refuse[s] to defend”
the indemnitee “against . . . those claims [that] f[a]ll outside the scope of” the
agreement. Id. at 942. Illinois courts have also rejected the complete defense rule
in the insurance context where, as here, the contractual language “describe[s] . . .
defense obligations in terms of defending a particular cause of action, rather than
7 in terms of defending ‘suits’ or ‘actions.’” Findlay, 215 N.E.3d at 1020–21. We
thus affirm the District Court’s holding that ExxonMobil was not obligated to
defend BP against noncovered claims.
Faced with this difficulty, BP tries another tack under Illinois law. It insists
that ExxonMobil is estopped from disclaiming a duty to defend noncovered
claims because it failed to bring a declaratory action against BP to define the
scope of its duty or defend BP pursuant to a reservation of rights. Under Illinois
law, however, for the reasons already explained, “laws that govern insurance
contracts” are inapplicable to “indemnification clauses between noninsurers.”
933 Van Buren Condo. Ass’n, 61 N.E.3d at 945. We see no other basis in Illinois
law to impose a contractual duty on ExxonMobil that is not contained in the
parties’ agreement. See Ervin, 469 N.E.2d at 247, 249–50 (concluding that an
insurer breached its duty when it “refused to defend” the insured without first
asserting a “reservation of rights or s[eeking] a declaratory judgment,” while
reaching the opposite conclusion with respect to a non-insurer indemnitor). In
any event, the parties stipulated at trial that ExxonMobil offered to defend BP
subject to specified limitations, and BP refused. See Joint App’x 1072–73.
8 Last, BP argues that the District Court erred in determining how damages
for ExxonMobil’s breach should be calculated. Because the District Court did not
err in determining the scope of ExxonMobil’s duty to defend, and because the
jury concluded that ExxonMobil did not breach that duty, we need not address
this issue.
We have considered BP’s remaining arguments and conclude that they are
without merit. For the foregoing reasons, the judgment of the District Court is
AFFIRMED.
FOR THE COURT: Catherine O’Hagan Wolfe, Clerk of Court