Powers v. Certain Underwriters at Lloyd's London as subscribed to Policy Number MPL4147217.19

• Court: District Court, D. Nevada
• Decided: August 26, 2024
• Docket: 2:23-cv-01472
• Status: Unknown

Opinion

1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 BRITTANY POWERS, et. al., 4 Plaintiffs, Case No.: 2:23-cv-01472-GMN-EJY 5 vs. ORDER ON CROSS-MOTIONS FOR 6 SUMMARY JUDGMENT CERTAIN UNDERWRITIERS AT LLOYD’S 7 LONDON AS SUBSCRIBED TO POLICY

NUMBER MPL4147217.19, et. al., 8

9 Defendants. 10 Pending before the Court is the Motion for Summary Judgment, (ECF No. 19), filed by 11 Plaintiff Brittany Powers, individually and as the assignee of rights held by American 12 Protection Group, Inc. (“APG”). Defendants Certain Underwriters at Lloyd’s London as 13 subscribed to Policy Number MPL4147217.19, and Hiscox, Inc. filed a Response, (ECF No. 14 24), which also functions as their Cross-Motion for Summary Judgment. Plaintiff filed a Reply 15 to her Motion for Summary Judgment, which is also her Response to Defendants’ Motion for 16 Summary Judgment, (ECF No. 26). Lastly, Defendants filed a Reply to their Motion for 17 Summary Judgment, (ECF No. 27). 18 Because the Court finds that the Policy’s Sexual Misconduct Exclusion is ambiguous 19 and a potential for coverage existed under the Policy, the Court GRANTS in part Plaintiff’s 20 Motion for Summary Judgment and DENIES Defendants’ Motion for Summary Judgment. 21 I. BACKGROUND 22 This case arises from an indemnity claim based on Plaintiff’s state court lawsuit against 23 her apartment complex and its security company, APG, after she was sexually assaulted while 24 walking to her apartment. (See generally First Am. Compl. (“FAC”), ECF No. 8). In her state 25 court suit, (the “Underlying Lawsuit”), Plaintiff brought claims for negligence, negligence per 1 se, and negligent hiring, training, retention, supervision, and management. (See generally State 2 Court Compl., Ex. 3 to Pl.’s Mot. Summ. J., ECF No. 19-3). APG sought defense and 3 indemnity coverage from the Defendants in this case, Lloyd’s and Hiscox, pursuant to its 4 Hiscox Pro Liability Insurance Policy number MPL4147217.19 (the “Policy”). (See Initial 5 Denial Letter, Ex. 4 to Pl.’s Mot. Summ. J., ECF No. 19-4). 6 Defendants declined to defend APG in the Underlying Lawsuit, asserting that there was 7 “no coverage available under the Professional Liability” section of the Policy because the state 8 court lawsuit was based on a sexual assault, and thus the Policy’s Sexual Misconduct Exclusion 9 applied.1 (Id.). The letter explained that the Sexual Misconduct Exclusion precluded claims 10 “based upon or arising out of any actual, alleged, or threatened abuse, molestation, harassment, 11 mistreatment, or maltreatment of a sexual nature, including the negligent employment, 12 investigation, supervision, training, or retention of a person who commits such conduct, or the 13 failure to report such conduct to the proper authorities.” (Id. at 2). The letter further 14 encouraged APG to contact the California Department of Insurance if it believed the claim was 15 wrongfully denied. (Id. at 3). When APG challenged the coverage denial with the California

16 Department of Insurance, Defendants again declined to defend APG. (Second Denial Letter, 17 Ex. 5 to Pl.’s Mot. Summ. J., ECF No. 19-5). 18 APG eventually ran out of funds to pay its counsel, so the trial court entered default 19 judgment against it and awarded Plaintiff over $20 million in damages.2 (APG Mot. Withdraw 20 as Att’y, Ex. 7 to Pl.’s Mot. Summ. J., ECF No. 19-7); (APG J., Ex. 8 to Pl.’s Mot. Summ. J., 21 ECF No. 19-8). The court also entered default judgment in favor of the other defendants and 22

23 1 Plaintiff is correct that the title of the exclusion, “Sexual Misconduct,” does not operate to limit coverage and is rather used 24 solely for reference. (See Resp. to Defs.’ Mot. Summ. J. 3:19–21, 11:12, ECF No. 26). The Court will use this title to refer to the exclusion in this Order. 25 2 APG also brought a separate lawsuit against Defendants but voluntarily dismissed its suit without prejudice after its counsel withdrew. (APG Compl., Ex. 8 to Defs.’ Mot. Summ. J., ECF No. 24-8); (Dismissal Stip., Ex. 10 to Defs.’ Mot. Summ. J., ECF No. 24-10). 1 awarded almost $1.5 million in damages. (Harbor Island J., Ex. 9 to Pl.’s Mot. Summ. J., ECF 2 No. 19-9). After judgment was entered against APG, the trial court assigned APG’s rights to 3 Plaintiff, and she filed the instant suit against Defendant insurers Lloyd’s and Hiscox. (See 4 Assignment Order, Ex. 11 to Defs.’ Mot. Summ. J., ECF No. 24-11). Plaintiff brings claims for 5 breach of contract, contractual breach of the implied covenant of good faith and fair dealing, 6 common law insurance bad faith, and violations of the Unfair Claims Practices Act, 7 NRS 686A.310. (FAC ¶¶ 38–119). 8 Plaintiff moves for summary judgment on her breach of contract claim only, asking the 9 Court to determine whether Defendants properly applied the Sexual Misconduct Exclusion 10 when it denied APG coverage under the Policy. (Pl.’s Mot. Summ. J. 3:1–2, ECF No. 19). 11 Defendants cross-move for summary judgment on all claims. (See generally Defs.’ Mot. 12 Summ. J., ECF No. 24). 13 II. LEGAL STANDARD 14 The Federal Rules of Civil Procedure provide for summary adjudication when the 15 pleadings, depositions, answers to interrogatories, and admissions on file, together with the

16 affidavits, if any, show that “there is no genuine dispute as to any material fact and the movant 17 is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts are those that 18 may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 19 (1986). A dispute as to a material fact is genuine if there is a sufficient evidentiary basis on 20 which a reasonable fact-finder could rely to find for the nonmoving party. See id. “The amount 21 of evidence necessary to raise a genuine issue of material fact is enough ‘to require a jury or 22 judge to resolve the parties’ differing versions of the truth at trial.’” Aydin Corp. v. Loral Corp., 23 718 F.2d 897, 902 (9th Cir. 1983) (quoting First Nat’l Bank v. Cities Serv. Co., 391 U.S. 253, 24 288–89 (1968)). “Summary judgment is inappropriate if reasonable jurors, drawing all 25 inferences in favor of the nonmoving party, could return a verdict in the nonmoving party’s 1 favor.” Diaz v. Eagle Produce Ltd. P’ship, 521 F.3d 1201, 1207 (9th Cir. 2008). A principal 2 purpose of summary judgment is “to isolate and dispose of factually unsupported claims.” 3 Celotex Corp. v. Catrett, 477 U.S. 317, 323–24 (1986). 4 In determining summary judgment, a court applies a burden-shifting analysis. “When 5 the party moving for summary judgment would bear the burden of proof at trial, it must come 6 forward with evidence which would entitle it to a directed verdict if the evidence went 7 uncontroverted at trial. In such a case, the moving party has the initial burden of establishing 8 the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. 9 Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (quotation marks and 10 citation omitted). In contrast, when the nonmoving party bears the burden of proving the claim 11 or defense, the moving party can meet its burden in two ways: (1) by presenting evidence to 12 negate an essential element of the nonmoving party’s case; or (2) by demonstrating that the 13 nonmoving party failed to make a showing sufficient to establish an element essential to that 14 party’s case on which that party will bear the burden of proof at trial. See Celotex Corp., 477 15 U.S. at 323–24. If the moving party fails to meet its initial burden, summary judgment must be

16 denied and the court need not consider the nonmoving party’s evidence. See Adickes v. S.H. 17 Kress & Co., 398 U.S. 144, 159–60 (1970). 18 If the moving party satisfies its initial burden, the burden then shifts to the opposing 19 party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. 20 Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, 21 the opposing party need not establish a material issue of fact conclusively in its favor. It is 22 sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the 23 parties’ differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors 24 Ass’n, 809 F.2d 626, 631 (9th Cir. 1987). However, the nonmoving party “may not rely on 25 denials in the pleadings but must produce specific evidence, through affidavits or admissible 1 discovery material, to show that the dispute exists,” Bhan v. NME Hosps., Inc., 929 F.2d 1404, 2 1409 (9th Cir. 1991), and “must do more than simply show that there is some metaphysical 3 doubt as to the material facts,” Orr v. Bank of Am., 285 F.3d 764, 783 (9th Cir. 2002). “The 4 mere existence of a scintilla of evidence in support of the plaintiff’s position will be 5 insufficient.” Anderson, 477 U.S. at 252. In other words, the nonmoving party cannot avoid 6 summary judgment by “relying solely on conclusory allegations unsupported by factual data.” 7 See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). Instead, the opposition must go 8 beyond the assertions and allegations of the pleadings and set forth specific facts by producing 9 competent evidence that shows a genuine issue for trial. See Celotex Corp., 477 U.S. at 324. 10 At summary judgment, a court’s function is not to weigh the evidence and determine the 11 truth but to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249. 12 The evidence of the nonmovant is “to be believed, and all justifiable inferences are to be drawn 13 in his favor.” Id. at 255. But if the evidence of the nonmoving party is merely colorable or is 14 not significantly probative, summary judgment may be granted. See id. at 249–50. 15 III. DISCUSSION

16 The parties’ Cross Motions for Summary Judgment ask the Court to decide the correct 17 interpretation of the Policy’s Sexual Misconduct Exclusion. The entirety of Defendants’ 18 Motion is based on their argument that the Policy’s Sexual Misconduct Exclusion bars 19 coverage for the Underlying Lawsuit and the default judgment against APG. (Defs.’ Mot. 20 Summ. J. 3:17–19). Plaintiff argues that the Exclusion contains ambiguous language that 21 should be construed in favor of the insured, APG. (See generally Pl.’s Mot. Summ. J.).3 22 23 24 25 3 Plaintiff also argues that Defendants’ interpretation of the Sexual Misconduct Exclusion violates the liability insurance requirement under NRS 648.135. But because the Court construes the Exclusion in favor of Plaintiff and against Defendants, it does not adopt Defendants’ interpretation and thus need not decide this issue. 1 A. Choice of Law 2 Before addressing the parties’ substantive arguments, the Court must first determine 3 which state’s law governs. Nevada follows the Second Restatement of Conflict of Laws when 4 “determining choice of law questions involving contracts, generally, and insurance contracts, in 5 particular.” Golden Bear Ins. Co. v. Evanston Ins. Co., 564 F. Supp. 3d 922, 927 (D. Nev. 6 2021). For liability insurance contracts, the Second Restatement indicates that “the validity of 7 [such a] contract and the rights created thereby are determined by the local law of the state 8 which the parties understood was to be the principal location of the insured risk during the term 9 of the policy . . . .” Restatement (Second) of Contracts § 193 (1988); see also Progressive Gulf 10 Ins. Co. v. Faehnrich, 327 P.3d 1061, 1063–64 (Nev. 2014) (following the approach set out in 11 section 193). Here, the insured risk was an apartment complex located in Las Vegas, Nevada. 12 Thus, the Court finds that Nevada law is the relevant law for interpreting the contract. In 13 situations where Nevada law may be lacking, courts look to California for guidance. Am. Nat’l 14 Prop. and Cas. Co. v. Gardineer, 25 F.4th 1111, 1117 (9th Cir. 2022). 15 B. Breach of Duty of Defend

16 Plaintiff alleges that Defendants breached the Policy by wrongfully denying coverage 17 for the Underlying Lawsuit and wrongfully failing to defend APG. (FAC ¶¶ 38–58). “The duty 18 to defend is broader than the duty to indemnify.” Benchmark Ins. Co. v. Sparks, 254 P.3d 617, 19 620–21 (Nev. 2011). “As a general rule, an insurer’s duty to defend is triggered whenever the 20 potential for indemnification arises, and it continues until this potential for indemnification 21 ceases.” Benchmark Ins. Co. v. Sparks, 254 P.3d 617, 620–21 (Nev. 2011) (internal citations 22 and quotation marks omitted). When facts are not in dispute, contract interpretation is a 23 question of law for the court. Lehrer McGovern Bovis, Inc. v. Bullock Insulation, Inc., 197 P.3d 24 1032, 1041 (Nev. 2008). Facts are not in dispute in this case; rather, the parties disagree on the 25 interpretation of the Policy’s Sexual Misconduct Exclusion, which is a question of law properly 1 determined on summary judgment. See Farmers Ins. Exch. v. Neal, 64 P.3d 472, 473 (Nev. 2 2003). 3 “An insurance policy is a contract that must be enforced to its terms to accomplish the 4 intent of the parties.” Id. Courts interpret any ambiguity in an insurance policy against the 5 insurer and in favor of the insured. Neumann v. Standard Fire Ins., 699 P.2d 101, 104 (Nev. 6 1985). An insurance policy may restrict coverage only if the policy’s language “clearly and 7 distinctly communicates to the insured the nature of the limitation.” Vitale v. Jefferson Ins. Co., 8 5 P.3d 1054, 1057 (Nev. 2000). “While clauses providing coverage are interpreted broadly so 9 as to afford the greatest possible coverage to the insured, clauses excluding coverage are 10 interpreted narrowly against the insurer.” Nat’l Union Fire Ins. v. Reno’s Exec. Air, 682 P.2d 11 1380, 1383 (Nev. 1984). “An insurance policy is to be judged from the perspective of one not 12 trained in law or in insurance, with the terms of the contract viewed in their plain, ordinary and 13 popular sense.” Id. at 1382. The question of whether an insurance policy is ambiguous turns on 14 whether it creates reasonable expectations of coverage as drafted. Bidart v. American Title, 734 15 P.2d 732, 734 (Nev. 1987).

16 Here, the Court finds the Sexual Misconduct Exclusion ambiguous in two ways: whether 17 sexual assault by a third party is excluded, and whether the exclusion applies to sexual assault 18 at all. The Professional Liability section of the Policy disclaims any obligation to pay any sum, 19 including any damages or claim expenses, for any claim “based upon or arising out of any 20 actual, alleged, or threatened abuse, molestation, harassment, mistreatment, or maltreatment of 21 a sexual nature, including the negligent employment, investigation, supervision, training, or 22 retention of a person who commits such conduct, or the failure to report such conduct to the 23 proper authorities.” (Policy at 14, 16, Ex. 1 to Defs.’ Mot. Summ. J., ECF No. 24-1) (emphasis 24 added). 25 1 Plaintiff interprets the “including” clause as precluding coverage for only the “‘rogue’ 2 security officer” that sexually harasses or abuses those they are employed to protect. This is a 3 reasonable reading of the clause. The Ninth Circuit has noted that “including” is “ordinarily 4 defined as a term of illustration, signifying that what follows is an example of the preceding 5 principle.” Ariz. State Bd. for Charter Schs. v. U.S. Dep’t of Educ., 464 F.3d 1003, 1007 (9th 6 Cir. 2006). The first illustration provided by the Sexual Misconduct Policy is the conduct by an 7 employee of the insured. This illustration is reasonably interpreted as an example of what type 8 of claim will be excluded: only those arising out of sexual misconduct by an insured’s 9 employee. 10 Plaintiff’s expert provides further support for the idea that Sexual Misconduct exclusions 11 apply only to the conduct of the insured. Professor Stempel testified that sex-based exclusions 12 became commonly used in the 1980s and 1990s in response to liability claims arising out of 13 abuse by daycare or educational staff, or misconduct of security personnel, hotel staff, and 14 others in a position to prey upon those they should be caring for. (Stempel Report ¶ 16, Ex. 4 to 15 Resp. to Defs.’ Mot. Summ. J., ECF No. 26-4). Because insurers seek to provide coverage for

16 losses arising out of accidents, they avoid coverage for the insured’s intentional infliction of 17 injury. (Id. ¶ 18). He also opines that sexual misconduct exclusions were not intended to negate 18 coverage merely because a third-party’s intentional acts include sexual misconduct when other 19 intentional acts like assault and battery would be covered. (Id. ¶¶ 23–24). 20 Defendants’ interpretation that the Exclusion also precludes claims arising out of third- 21 party conduct is likewise reasonable because the Sexual Misconduct Exclusion does not 22 expressly limit the exclusion to the insureds’ misconduct, but rather includes the insureds’ 23 misconduct. The exclusion is written broadly, perhaps intentionally, to leave open the 24 possibility that a third party’s sexual misconduct would be excluded. Defendants rely on 25 district court opinions in California and Nevada for the proposition that absence of a reference 1 to a specific tortfeasor, whether insured or uninsured, makes a sexual misconduct exclusion 2 broad and unambiguous and reflects that the exclusion applies to anyone. (See Defs.’ Mot. 3 Summ. J. 11:4–14:10). But these cases involve distinguishable policy types, language, and 4 circumstances. The majority of Defendants’ cited cases involve instances in which the 5 perpetrator of the sexual assault was an insured and the policy was for homeowners or general 6 liability insurance. See, e.g., Universal N. Am. Ins. Co. v. Colosi, No. 2:17-cv-00113-JAD- 7 GWF, 2018 WL 3520118, at *2 (D. Nev. July 20, 2018) (finding that a homeowner policy 8 excluded sexual battery by the son of the insured policyholder); Liberty Mut. Fire Ins. Co. v. 9 Shaibaz S., No. 15-CV-03943-JD, 2017 WL 2118312, at *3 (N.D. Cal. May 16, 2017) 10 (excluding sexual molestation by son of a homeowner policyholder); Flores v. AMCO Ins. Co., 11 No. CVF07-1183LJODLB, 2007 WL 3408255, at *8 (E.D. Cal. Nov. 15, 2007), aff’d, 323 F. 12 App’x 587 (9th Cir. 2009) (excluding insured homeowner’s rape of 15-year-old girl at his 13 home). Defendants do not present any cases involving a policy similar to the one in this case, 14 which is a specialty lines policy for a security company that covered the negligent performance 15 of services and includes occurrences arising out of “bodily injury.” (Policy at APG0010, Ex. 1

16 to Pl.’s Mot. Summ. J.). 17 Thus, while the Exclusion could be read broadly to pertain to the actions of third parties, 18 under controlling Nevada law, the Court must read it narrowly against the insurer. See Nat’l 19 Union Fire Ins., 682 P.2d at 1383. It is certainly reasonable, if not intuitive, to read the 20 Exclusion as applying to actions of the insured’s employees only, particularly when the history 21 of the Sexual Misconduct Exclusion is considered. Therefore, even assuming Defendants’ 22 broad interpretation is reasonable, it cannot prevail because Defendants did not establish that 23 their interpretation was the only reasonable one. See MacKinnon v. Truck Ins. Exch., 73 P.3d 24 1205, 1218 (Cal. 2003). Further, because the coverage portion of this policy would lead a 25 reasonable security company to expect coverage for instances of third-party sexual assault in 1 the same way it provides coverage for other intentional torts such as assault and battery leading 2 to bodily injury, the exclusion must be particularly “conspicuous, plain, and clear.” See State 3 Farm Mut. Auto. Ins. Co. v. Jacober, 514 P.2d 953, 958 (Cal. 1973). It is not. 4 While that ambiguity alone is enough to find that Defendants breached their duty to 5 defend APG, the Court further notes that a second ambiguity exists in the exclusion’s described 6 conduct: “abuse, molestation, harassment, mistreatment, or maltreatment of a sexual nature . . . 7 .” (Policy at 14, 16, Ex. 1 to Defs.’ Mot. Summ. J.). Notably, the exclusion does not mention 8 sexual assault and rape. And Plaintiff points out that many of the exclusion’s terms are defined 9 in Nevada law as pertaining to children. (See Pl.’s Mot. Summ. J. 21:5–21). The insured could 10 reasonably believe that sexual assault and rape of an adult would not be covered under the 11 exclusion, but the insurer could also reasonably argue that sexual assault and rape are included 12 under the broadly used terms. Defendants again failed to employ clear language 13 communicating the nature of this exclusion. See Nat’l Union Fire Ins., 682 P.2d at 1382. In 14 light of the exclusion’s ambiguity, we must interpret the provision to effectuate the insured’s 15 reasonable expectations: that bodily injury resulting from sexual assault is covered under the

16 policy in the same way that bodily injury resulting from another type of battery would be. See 17 Powell v. Liberty Mut. Fire Ins. Co., 252 P.3d 668, 672 (Nev. 2011); see also Granite Mgmt. 18 Corp. v. Aetna Cas. & Sur. Co., 37 F. App’x 262, 265 (9th Cir. 2002) (“An insurer has a duty to 19 defend when the policy is ambiguous and the insured would reasonably expect the insurer to 20 defend him or her against the suit based on the nature and kind of risk covered by the policy. . . 21 .”). 22 The Nevada Supreme Court recently established a three-part test to determine whether 23 coverage is properly precluded: “an insurer must (1) draft the exclusion in obvious and 24 unambiguous language, (2) demonstrate that the interpretation excluding coverage is the only 25 reasonable interpretation of the exclusionary provision, and (3) establish that the exclusion 1 plainly applies to the particular case before the court.” Powell, 252 P.3d at 674. Defendants fail 2 to satisfy this test. If they intended to exclude coverage for sexual assault and rape or intended 3 for the exclusion to apply to third parties, they should have drafted a more explicit exclusion. 4 Because Plaintiff has sufficiently demonstrated a potential for coverage under the Policy’s duty 5 to defend, the Court GRANTS Plaintiff’s Motion for Summary Judgment to the extent she 6 alleges a breach of the duty to defend.4 7 C. Damages 8 “In a case where the duty to defend does in fact arise, and the insurer breaches that duty, 9 the insurer is at least liable for the insured’s reasonable costs in mounting a defense in the 10 underlying action.” Century Sur. Co. v. Andrew, 432 P.3d 180, 184 (Nev. 2018). As far as 11 whether the insurer may be liable for an entire judgment that exceeds the policy limits in the 12 underlying action, “damages for a breach of the duty to defend are not automatically limited to 13 the amount of the policy; instead, the damages awarded depend on the facts of each case.” Id. 14 Thus, “[a] party aggrieved by an insurer’s breach of its duty to defend is entitled to recover all 15 damages naturally flowing from the breach.” Id. These damages include the amount of the

16 judgment against the insured plus interest, costs and attorney fees incurred by the insured, and 17 any additional costs naturally resulting from the breach. Id. However, the Nevada Supreme 18 Court was “not saying that an entire judgment is automatically a consequence of an insurer’s 19 breach of its duty to defend; rather, the insured is tasked with showing that the breach caused 20 the excess judgment and ‘is obligated to take all reasonable means to protect himself and 21 mitigate his damages.’” Id. (quoting Thomas v. W. World Ins. Co., 343 So.2d 1298, 1303 (Fla. 22 Dist. Ct. App. 1977)). 23

24 4 Plaintiff’s Motion for Summary Judgment requests judgment on her entire breach of contract claim, but her breach of 25 contract claim includes breaches not discussed in her Motion, such as the duty to indemnify and act in good faith. (See FAC ¶¶ 42–43). Because Plaintiff’s Motion for Summary Judgment provides argument on only the breach of the duty to defend, this Order is limited to granting her breach of contract claim as applied to Defendants’ breach of the duty to defend. 1 Plaintiff’s Motion for Summary Judgment states that Defendants’ breach of the duty to 2 defend resulted in damages in excess of $20,000,000. (Pl.’s Mot. Summ. J. 30:8–9). At a 3 minimum, she requests that Defendants be found liable for payment on the judgments against 4 APG by Powers and Harbor Island. (Id. 30:9–11). While the Court is able to determine that 5 Defendants are liable for the insured’s reasonable costs, Plaintiff does not provide sufficient 6 evidence allowing the Court to determine exactly how much Defendants are liable for. See Fed. 7 R. Civ. P. 56(d)(2) (“An interlocutory summary judgment may be rendered on liability alone, 8 even if there is a genuine issue on the amount of damages.”); see also Thoresen v. Lumbermens 9 Mut. Casualty Co., 351 F.2d 573 (7th Cir. 1965) (affirming grant of partial summary judgment 10 against insurer, which the trial court found liable for legal expenses it should have incurred to 11 defend its insured, although the sum was not initially adjudicated). Because this issue was not 12 fully briefed, and Plaintiff did not provide sufficient evidence, the Court cannot currently 13 determine the proportion of Plaintiff’s expenses that Defendant must contribute as a matter of 14 law. This issue remains for trial. 15 ///

16 /// 17 /// 18 /// 19 /// 20 /// 21 /// 22 /// 23 /// 24 25 1 CONCLUSION 2 IT IS HEREBY ORDERED that Defendants’ Motion for Summary Judgment, (ECF 3 || No. 24), is DENIED. 4 IT IS FURTHER ORDERED that Plaintiff's Motion for Summary Judgment, (ECF > 19), is GRANTED in part. 6 IT IS FURTHER ORDERED that the parties will have thirty days from the date of this 7 |! Order to file a jointly proposed pretrial order pursuant to LR 16-3(b) using the form provided in 8 16-4. 9 DATED this 26 day of August, 2024. 10 11 12 Gloria avarro, District Judge 4 UNITH ATES DISTRICT COURT

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