DISTRICT COURT GRANTS INSURER’S MOTION FOR SUMMARY JUDGMENT - INSURER OWES NO DUTY TO DEFEND OR INDEMNITY INSURED IN SHOOTING DEATH AT CONCERT VENUE

Recently, a federal district court in Tyler granted an insurer’s cross-motion for summary judgment and issued a declaratory judgment that the insurer did not owe a duty to defend or a duty to indemnity its insured in a state court action. The dispute in Penn-America Ins. Co. v. Dominguez, et al., Case No. 6:21-cv-211-JDK, 2021 WL 5578684 (E.D. Tex. Nov. 30, 2021) arose out of a state court action involving the insured (“Dominguez”) and a person who sued him for damages arising out of the death of Key’Undta Barrett at the hands of Treyvon Dewayne Maddox, who discharged a firearm at Dominguez’s music venue and killed Barrett. 

After being served with the lawsuit, Dominguez filed a claim with Penn-America under his policy’s Commercial General Liability Coverage. In response, Penn-America informed Dominguez that the insurer would not pay for his legal defense because the petition in the underlying suit alleged a “battery,” which the policy excluded from coverage.

Within a week, Penn-America filed suit in federal court seeking a declaratory judgment that it did not owe a duty to defend or a duty to indemnify Dominguez, and Dominguez filed a declaratory judgment seeking the opposite finding.

Upon review of the policy and the petition at issue (i.e., applying the Eight Corners Rule), the Court concluded that the policy’s Assault and Battery General Liability Exclusion foreclosed a duty to defend because the policy excluded from coverage “liability for damages because of ‘bodily injury’ . . . arising out of an ‘assault’ or ‘battery,” and defined battery as “any use of force against a person . .  . whether or not the actual injury inflicted is intended or expected.” Moreover, the petition only alleged that Maddox attended an event at Dominguez’s venue and, “unknown to Barrett,” “possessed and/or obtained a firearm” on the premises,” and “discharged’ the firearm, which “direct[ly] result[ed]” in “Barrett’s death.” The petition also claimed that Dominguez was negligent in failing to secure the premises and protect Barrett from injury.

In arriving at its decision, the Court dismissed Dominguez’s interpretations of the policy and petition, including Dominguez’s assertion that the term “battery” should be interpreted with its meaning in tort law, which requires intentional conduct, stating that the Court was tasked with interpreting the term as provided by the policy. Once the Court held no duty to defend existed, the Court turned to the duty to indemnify.

Applying the Griffin standard, which stands for the proposition that a declaratory judgment as to the duty to indemnify is proper before liability is established when (1) the insurer has no duty to defend; and (2) the same reasons that negate the duty to defend likewise negate any possibility the insurer will ever have a duty to indemnify, the Court concluded that no additional facts could be developed in the underlying suit to take this action out of the battery exclusion and, in fact, the allegations in the petition affirmatively foreclosed facts that could do so. As such, the Court held Penn-America also had no duty to indemnify Dominguez and granted its motion for summary judgment.