State Farm Fire and Casualty Company v. Gerrard

Background

Anita Gerrard sued Matthew LaBine in Minnesota state court. She alleged that LaBine assaulted and battered her, injected her with a syringe, and attempted to rape her. The amended state-court complaint asserted claims for assault and battery, negligence, intentional infliction of emotional distress, false imprisonment, sexual battery, and negligent infliction of emotional distress.

LaBine asked State Farm Fire and Casualty Company to defend and indemnify him under two policies: a Homeowner’s Policy and a Personal Liability Umbrella Policy. State Farm filed this federal declaratory-judgment action seeking a ruling that it had no duty to defend or indemnify LaBine. State Farm then moved for judgment on the pleadings, a motion asking the court to decide the case from the pleadings when no material factual dispute exists and the moving party is entitled to judgment as a matter of law.

Personal Liability Umbrella Policy

The court denied State Farm’s motion as to the Personal Liability Umbrella Policy. State Farm sent LaBine a June 2020 letter apparently reserving its right to challenge coverage, later stated in January 2021 that a defense could be provided under the policy without mentioning a continuing reservation, and then sent another reservation-of-rights letter in February 2021.

The court concluded that this sequence created a factual dispute about whether State Farm had preserved its right to contest coverage. The court could not determine from the record what State Farm intended its communications to mean, including whether the January letter communicated that State Farm no longer reserved those rights. The question of whether State Farm must provide coverage under the Personal Liability Umbrella Policy was therefore left to proceed to discovery. The court did not decide the parties’ other arguments about that policy, including issues involving the policy’s definition of an occurrence, exclusions, and the effect of the negligence claim.

Homeowner’s Policy

The court granted State Farm’s motion as to the Homeowner’s Policy. That policy covered bodily injury resulting from an “occurrence,” which the policy defined as an accident. Under Minnesota law, an accident is an unexpected event without intention or design.

The court held that the alleged conduct—biting Gerrard twice, injecting her with a syringe, showing her pornographic images, and chasing and grabbing her—was nonconsensual sexual conduct and showed an intent to injure, or at least that LaBine knew or should have known harm was substantially certain to result. The court held that the alleged bodily injury therefore did not result from an accident or covered occurrence. The negligence and negligent-infliction-of-emotional-distress claims did not change the result because they were based on the same alleged intentional conduct.

Disposition

Judge John R. Tunheim ordered that State Farm’s motion for judgment on the pleadings was granted in part and denied in part: it was denied as to State Farm’s duty to defend and indemnify under the Personal Liability Umbrella Policy, and granted as to that duty under the Homeowner’s Policy. The court held that State Farm owed no duty to LaBine under the Homeowner’s Policy.