Erie Insurance Property & Casualty Company v. James Cooper

140 F.4th 608

• Court: Court of Appeals for the Fourth Circuit
• Decided: June 24, 2025
• Docket: 22-1129
• Status: Published

Opinion

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PUBLISHED

UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

No. 22-1129

ERIE INSURANCE PROPERTY & CASUALTY COMPANY,

Plaintiff - Appellant,

v.

JAMES SKYLAR COOPER,

Defendant - Appellee,

------------------------------

WEST VIRGINIA INSURANCE FEDERATION,

Amicus Supporting Appellant.

Appeal from the United States District Court for the Southern District of West Virginia, at Charleston. Irene C. Berger, District Judge. (2:20−cv−00321)

Argued: September 19, 2023 Decided: June 24, 2025

Before HARRIS and QUATTLEBAUM, Circuit Judges, and KEENAN, Senior Circuit Judge.

Vacated and remanded with instructions by published per curiam opinion.

ARGUED: Matthew James Perry, BURNS WHITE LLC, Huntington, West Virginia, for Appellant. Jill Rice, DINSMORE & SHOHL LLP, Morgantown, West Virginia, for USCA4 Appeal: 22-1129 Doc: 66 Filed: 06/24/2025 Pg: 2 of 11

Amicus Curiae. R. Chad Duffield, FARMER, CLINE & CAMPBELL, PLLC, Charleston, West Virginia, for Appellee. ON BRIEF: J. Jarrod Jordan, Jill E. Lansden, LAMP BARTRAM LEVY TRAUTWEIN PERRY & POWELL, PLLC, Huntington, West Virginia, for Appellant. Jennifer D. Roush, FARMER, CLINE & CAMPBELL, PLLC, Charleston, West Virginia, for Appellee. David R. Stone, DINSMORE & SHOHL LLP, Morgantown, West Virginia, for Amicus Curiae.

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PER CURIAM:

In this appeal involving an insurance dispute, we certified a question of law to the

West Virginia Supreme Court of Appeals (the West Virginia court), which now has

answered our question. Applying the law as stated by that court and as explained below,

we conclude that James Cooper is not an “insured” for purposes of West Virginia Code

§ 33-6-31 and therefore is ineligible to receive underinsured motorist benefits under the

automobile insurance policy issued to Pison Management, LLC (Pison) by Erie Insurance

Property & Casualty Company (Erie). We therefore vacate the judgment of the district

court and remand with instructions to enter judgment in favor of Erie.

I.

In August 2019, James Cooper was injured in a car accident while riding as a

passenger in a car owned by Rick Huffman. When the accident occurred, Cooper and

Huffman, both employees of Pison, were driving to a jobsite while working for Pison.

Because Cooper’s injuries and resulting damages exceeded the third-party driver’s

insurance limits, Cooper sought underinsured motorist (UIM) coverage under Pison’s

commercial automobile policy (the policy) issued by Erie.

The policy provided $1 million in liability coverage for bodily injury and property

damage for two particular vehicles owned by Pison (owned vehicles), as well as a class of

“non-owned” vehicles associated with 1-to-25 employees. The policy also provided $1

million in UIM coverage only for the owned vehicles. Erie did not provide Pison with an

option to purchase UIM coverage for the class of non-owned vehicles.

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The policy described “non-owned” vehicles as “Employer’s Non-Ownership

Liability,” and included vehicles owned by Pison’s employees while being used in Pison’s

business. The parties agree that Huffman’s car qualified under the policy as falling within

the class of non-owned vehicles.

Based on the policy’s terms, Erie denied Cooper’s claim for UIM coverage and filed

suit in federal district court seeking a declaration that the policy did not provide the UIM

coverage sought by Cooper. Cooper filed an answer and counterclaims seeking, in relevant

part, a declaratory judgment that Erie violated West Virginia Code § 33-6-31. According

to Cooper, that statute required Erie to provide Pison with the opportunity to elect UIM

coverage for the class of non-owned vehicles. Cooper asserted that because Erie failed to

make such an offer, UIM coverage existed by operation of law to cover Cooper as a

passenger in Huffman’s car. W. Va. Code § 33-6-31(b); see also Thomas v. McDermitt,

751 S.E.2d 264, 265 (W. Va. 2013) (explaining that when an insurer is “required by statute

to offer optional coverage, it is included in the policy by operation of law when the insurer

fails to prove an effective offer and a knowing and intelligent rejection by the insured”).

The parties filed cross-motions for summary judgment, and the district court

awarded judgment in favor of Cooper. The court held that the statute requires that an

insurer make a commercially reasonable offer of UIM coverage “to all vehicles covered

by [a liability] policy,” including the class of non-owned vehicles. Accordingly, the court

issued a declaratory judgment that Cooper was entitled to receive UIM coverage equivalent

to the liability coverage limit, $1 million. Erie filed a timely appeal in this Court.

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Because we did not find any West Virginia authority that definitively answered the

issue presented, we certified the following question to the West Virginia court:

Does West Virginia Code § 33-6-31 require an insurer, who issues a commercial automobile insurance policy to a named insured providing liability coverage for particular owned vehicles and a class of non-owned vehicles, to offer underinsured motorist coverage for the class of non-owned vehicles?

As explained in greater detail below, the West Virginia court answered, “no.” Erie Ins.

Prop. & Cas. Co. v. Cooper, 2025 WL 1232887 (W. Va. 2025). With the benefit of this

decision by the West Virginia court, we turn to apply its analysis to the present appeal.

II.

A.

We review the district court’s decision granting summary judgment de novo.

Berkenfeld v. Lenet, 921 F.3d 148, 153 (4th Cir. 2019). A party is entitled to summary

judgment if “there is no genuine dispute as to any material fact and the movant is entitled

to judgment as a matter of law.” Fed. R. Civ. P. 56(a).

B.

Subsection (a) of West Virginia Code § 33-6-31 addresses required liability

coverage and states, in relevant part, that automobile insurance policies “covering liability

arising from the . . . use of any motor vehicle[,] . . . issued . . . in this state to the owner” of

the motor vehicle, or issued “upon any motor vehicle” titled in West Virginia, must

“contain[] a provision insuring the named insured and any other person . . . using the motor

vehicle with the consent . . . of the named insured.” W. Va. Code § 33-6-31(a).

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Regarding UIM coverage, subsection (b) of Section 33-6-31 states that any insurer

offering a liability policy as defined in subsection (a):

shall provide an option to the insured with appropriately adjusted premiums to pay the insured all sums which he or she is legally entitled to recover as damages from the owner or operator of an uninsured or underinsured motor vehicle up to an amount not less than [the liability coverage provided in the policy.]

Id. § 33-6-31(b). In other words, when an insurer issues a liability policy as defined in

subsection (a), subsection (b) requires that an insurer make an offer of UIM coverage “to

the insured” at least equivalent to the amount of the liability coverage. Id.

Subsection (c) of the same statute defines “insured,” as used in the statute, to

include:

the named insured and, while resident of the same household, the spouse of any such named insured and relatives of either, while in a motor vehicle or otherwise, and any person . . . who uses, with the consent, expressed or implied, of the named insured, the motor vehicle to which the policy applies.

Id. § 33-6-31(c) (emphasis added). The West Virginia court has explained that this

definition of “insured” provides for two classes of insureds: (1) the named insured, and the

named insured’s spouse and resident relatives, who enjoy broad UIM protection because

their coverage is not limited to the use of a particular vehicle, and (2) any person authorized

by the named insured to use “the motor vehicle to which the policy applies” (Class II

insured). See Progressive Max Ins. Co. v. Brehm, 873 S.E.2d 859, 864 (W. Va. 2022)

(citing Starr v. State Farm Fire & Cas. Co., 423 S.E.2d 922, 927 (W. Va. 1992)).

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In the present case, Cooper contends that he qualifies as an “insured” entitled to

UIM coverage under Section 33-6-31. * According to Cooper, he is a “Class II insured

entitled to UIM coverage because he was injured by an underinsured motorist while he was

using, with Pison’s consent, a non-owned vehicle to which the liability policy applies.”

Erie, 2025 WL 1232887, at *8. The West Virginia court disagreed with Cooper’s position.

Id.

The West Virginia court first explained that the purpose of UIM coverage under

West Virginia law is to “‘enable the insured to protect himself’” against losses arising from

underinsured third parties. Id. at *7 (citing Brehm, 873 S.E.2d at 865 (quoting Deel v.

Sweeney, 383 S.E.2d 92, 95 (W. Va. 1989))). The court further explained that West

Virginia Code § 33-6-31(b) “contemplates recovery . . . from one’s own insurer.” Id.

(quoting Alexander v. State Auto Mut. Ins. Co., 415 S.E.2d 618, 625 (W. Va. 1992)

(explaining that UIM coverage “is intended to benefit the person who bought the policy”)).

Thus, the “‘first step’” in determining entitlement to coverage is whether the person

seeking coverage is an “‘insured person.’” Id. at *9 (quoting Brehm, 873 S.E.2d at 862).

To determine whether Cooper qualifies as a Class II insured, the West Virginia court

analyzed the language of West Virginia Code § 33-6-31(c), specifically, whether “the

motor vehicle to which the policy applies” refers only to the motor vehicles owned by the

named insured or, as Cooper contends, to all motor vehicles, both owned and non-owned,

* We rejected Cooper’s alternative argument that the policy language was ambiguous regarding whether UIM coverage extended to non-owned autos. Erie Ins. Prop. & Cas. Co. v. Cooper, 2023 WL 8439753, at *1-2 nn.2-3 (4th Cir. 2023) (unpublished).

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covered under the policy for liability purposes. Id. at *8. The West Virginia court

explained that, critically, the language “the motor vehicle to which the policy applies”

appears after the modifying language: “uses” “with the consent, expressed or implied, of

the named insured.” Id. (quoting W. Va. Code § 33-6-31(c)).

According to the West Virginia court, in order for a person to use a motor vehicle

with the “consent expressed or implied, of the named insured,” the named insured must

either own the vehicle, or otherwise have an interest in the possession and control of the

vehicle that allows the insured to give permission to another to use the vehicle. Id. (citing

Keystone Ins. Co. v. Fidelity & Cas. Co. of N.Y., 260 A.2d 275, 277-78 (Md. 1970)). As

the West Virginia court observed, Pison, the named insured, did not own the vehicle in

which Cooper was riding; that vehicle was owned by Hamilton. Id. Hamilton’s vehicle

was covered by the policy as a “non-owned vehicle” for liability purposes, because it was

being used for Pison’s business. But that fact did not provide Pison any right of possession

and control of Hamilton’s vehicle and, thus, did not permit Pison to “consent” to Cooper’s

use of, or occupancy in, that vehicle for purposes of Section 33-6-31(c). Id.

Instead, the West Virginia court concluded that Pison could only provide its consent

for use of the two vehicles owned by Pison and designated as “owned vehicles” in the

policy. Id. Because Cooper was not a passenger in one of those two vehicles, the West

Virginia court concluded that Cooper did not qualify as a Class II insured for purposes of

UIM coverage and Erie was not required to offer such coverage to Pison under West

Virginia Code § 33-6-31. Id.

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In reaching this conclusion, the West Virginia court found persuasive a decision by

the Supreme Court of Virginia (the Virginia court), in which the Virginia court analyzed

similar statutory language found in Virginia insurance law, Stone v. Liberty Mutual

Insurance Co., 478 S.E.2d 883 (Va. 1996). Erie, 2025 WL 1232887, at *7-8. In that case,

the Virginia court considered Virginia Code § 38.2-2206B, which contains language

similar to West Virginia Code § 33-6-31(c) and defines a Class II insured as one who “uses

the motor vehicle to which the policy applies, with the expressed or implied consent of the

named insured.” Stone, 478 S.E.2d at 885-86.

In Stone, the party seeking UIM coverage was a pizza delivery driver who used his

own vehicle when making deliveries. Stone v. Liberty Mut. Ins. Co., 105 F.3d 188, 190

(4th Cir. 1997) (applying the Virginia court’s answer to a certified question). While

working in the scope of his employment, the driver was injured in an accident caused by a

third party who lacked sufficient insurance coverage. Id. The delivery driver sought UIM

coverage under his employer’s commercial business automobile policy, which named the

pizza company as the insured and only covered for UIM purposes two of the company’s

owned vehicles. Id. at 191-92. But, as in the present case, the delivery driver’s vehicle

was covered under the policy for purposes of liability protection. Id. at 191.

The Virginia court concluded that the delivery driver was not using his vehicle “with

the expressed or implied consent of the named insured,” as required by Virginia Code

§ 38.2-2206B, because the pizza company did not own the delivery driver’s vehicle or

otherwise have controlling authority over the driver’s use of that vehicle. Stone, 478 S.E.2d

at 886 (citing Nationwide Mut. Ins. Co. v. Cole, 124 S.E.2d 203, 206 (Va. 1962)). The

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Virginia court further observed that, like the West Virginia statute here, the Virginia statute

defining Class II insureds referred to permitted use of “the motor vehicle to which the

policy applies” rather than “‘a,’ ‘any,’ ‘every,’ or ‘all’” motor vehicles to which the policy

applies. Id. (emphasis added). The Virginia court observed that the delivery driver was

not using either of “the” owned vehicles covered by the policy but was using his personally

owned vehicle. Id. Thus, the Virginia court held that the delivery driver was not entitled

to UIM coverage under his employer’s policy. See Stone, 105 F.3d at 192 (summarizing

the Virginia court’s conclusion in the certified answer).

Here, the West Virginia court found the Stone rationale persuasive and similarly

concluded that a passenger in a non-owned vehicle was not entitled to UIM coverage under

his employer’s policy. Erie, 2025 WL 1232887, at *9. We now apply the West Virginia

court’s conclusion that West Virginia Code § 33-6-31 did not require Erie, which issued a

policy with liability protection for both owned and non-owned vehicles, to offer UIM

coverage for the non-owned vehicles. And so, the policy at issue in the present case, which

excluded UIM coverage for the class of non-owned vehicles, was not subject to reformation

as a matter of law. See W. Va. Code § 33-6-17 (providing that when an otherwise valid

insurance policy “contains any condition or provision not in compliance with the

requirements of” Chapter 33, it will be construed to contain the coverage required by West

Virginia law); see also Gibson v. Northfield Ins. Co., 631 S.E.2d 598 (W. Va. 2005).

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III.

Because the West Virginia court concluded that Cooper was not an insured under

the policy that Erie issued to Pison, we vacate the district court’s judgment in favor of

Cooper and remand the case with instructions to enter final judgment in favor of Erie.

VACATED AND REMANDED WITH INSTRUCTIONS