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Acosta, Inc. v. Nat'l Union Fire Ins. Co.

Acosta, Inc. v. Nat'l Union Fire Ins. Co.

Court of Appeal of Florida, First District

July 30, 2010, Opinion Filed

CASE NO. 1D09-3215

Opinion

 [*567]  ON MOTION FOR REHEARING

LEWIS, J.

We deny Appellants' motion for rehearing. On our own motion, we withdraw our previous opinion and substitute the following for it.

This appeal arises from a final summary judgment issued in favor of Arrowood Indemnity Co. f/k/a Royal Indemnity Co. ("Arrowood") against Acosta, Inc. and Acosta Sales, LLC (collectively "Acosta"). In the order granting Arrowood's motion for summary judgment, the trial  [**2] court held that Arrowood, a liability insurer for Acosta, properly denied coverage for a lawsuit ("the underlying suit") brought against Acosta by the Trustee of the Creditors' Trust of Marketing Specialists ("the Creditors' Trust"). In the same order, the trial court granted partial summary judgment for National Union Fire Insurance Co. ("National Union"), another liability insurer for Acosta. Acosta argued below, as it does here, that National Union and Arrowood were obligated to indemnify it in the underlying suit. The trial court determined that National Union and Arrowood properly denied coverage under a "prior litigation" exclusion due to the relationship between the underlying suit and a suit brought by Marketing Specialists Sales Co. ("Marketing Specialists") against Acosta in 2001 ("the turnover suit"). Both Arrowood and National Union defend that decision in this appeal. 1 For the reasons explained below, we agree with the trial court's decision, and accordingly, we affirm.

I.  [**3] Factual and Procedural Background

A. The Policies

There are two policies at issue in this case: a Directors, Officers and Private Company Liability Insurance Policy issued to Acosta by National Union ("the National Union Policy"); and an Excess Directors and Officers Liability and Company Reimbursement Coverage Policy issued to Acosta by Arrowood ("the Arrowood Policy"). The effective period of the National Union Policy was November 1, 2002, to November 1, 2003. The Arrowood Policy provided for liability coverage in excess of the limits of the National Union Policy, and by its terms, it was subject to the same warranties, terms, conditions, and exclusions as the National Union Policy.

The prior litigation exclusion of the National Union Policy ("Exclusion 4(e)"), which is incorporated by reference into the Arrowood Policy, 2 provides as follows:

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39 So. 3d 565 *; 2010 Fla. App. LEXIS 11109 **; 35 Fla. L. Weekly D 1712

ACOSTA, INC., a Delaware corporation, and ACOSTA SALES, LLC f/k/a ACOSTA SALES CO., INC. d/b/a ACOSTA SALES and MARKETING COMPANY, a Delaware limited liability corporation, Appellants, v. NATIONAL UNION FIRE INSURANCE COMPANY of PITTSBURG, PA., a foreign corporation, ARROWOOD INDEMNITY COMPANY f/k/a ROYAL INDEMNITY COMPANY, a foreign corporation, NORTH RIVER INSURANCE COMPANY, a foreign corporation, UNITED STATES FIRE INSURANCE COMPANY, a foreign corporation, and AMERICAN INSURANCE COMPANY, a foreign corporation, Appellees.

Subsequent History: Released for Publication July 30, 2010.

Subsequent appeal at, Costs and fees proceeding at, Remanded by Arrowood Indem. Co. v. Acosta, Inc., 2011 Fla. App. LEXIS 1915 (Fla. Dist. Ct. App. 1st Dist., Feb. 16, 2011)

Review denied by, Motion granted by Acosta, Inc. v. Nat'l Union Fire Ins. Co., 2011 Fla. LEXIS 859 (Fla., Apr. 7, 2011)

Prior History:  [**1] An appeal from the Circuit Court for Duval County. L. Haldane Taylor, Judge.

Acosta, Inc. v. Nat'l Union Fire Ins. Co., 2010 Fla. App. LEXIS 5887 (Fla. Dist. Ct. App. 1st Dist., Apr. 29, 2010)

CORE TERMS

turnover, underlying suit, prior litigation, coverage, summary judgment, trial court, employees, insurer, complaints, allegations, files, cause of action, wrongful act, laptops, duty to defend, genuine issue of material fact, proprietary, intangible, insurance policy, applicability, indemnify, cases, suits, allegation of the complaint, physical property, circumstances, Competitor, transition, ambiguous, contracts

Civil Procedure, Summary Judgment, Entitlement as Matter of Law, General Overview, Contracts Law, Contract Interpretation, Appeals, Summary Judgment Review, Standards of Review, Insurance Law, Policy Interpretation, Ambiguous Terms, Construction Against Insurers, Claim, Contract & Practice Issues, Coverage Favored, Exclusions, Plain Language, Evidence, Burdens of Proof, Allocation, Obligations of Parties, Insurers, Allegations in Complaints