Case: 11-15246   Date Filed: 08/22/2013   Page: 1 of 6


                                                         [DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT
                       ________________________

                             No. 11-15246
                       ________________________

                 D.C. Docket No. 2:07-cv-00258-CEH-SPC

MID-CONTINENT CASUALTY COMPANY,

                                                      Plaintiff - Appellee
                                                      Counter - Defendant,


                                   versus


AMERICAN PRIDE BUILDING COMPANY,
LLC, a Florida limited liability company,
AMERICAN PRIDE BUILDING CO., LLC,
a Florida limited liability company,
AMERICAN PRIDE BUILDER, LLC,
a Florida limited liability company,
GROFF CONSTRUCTION, INC.,
a Florida corporation,

                                               Defendants - Appellants
                                               Counter - Claimant.
                     ___________________________

                Appeal from the United States District Court
                     for the Middle District of Florida
                    ____________________________
                             (August 22, 2013)
                Case: 11-15246       Date Filed: 08/22/2013      Page: 2 of 6


Before DUBINA, JORDAN, and BALDOCK, * Circuit Judges.

PER CURIAM:

       Following oral argument and a review of the record, and for the reasons

which follow, we affirm.

       This case arises from a dispute between a homebuilder, American Pride, and

its insurer, Mid-Continent. In May 2006, Groff Construction sued American Pride,

alleging that American Pride had infringed its copyrighted home designs and

building plans.      Mid-Continent defended American Pride pursuant to a full

reservation of rights for over a year, and eventually filed this declaratory action

against American Pride, alleging that it had no duty to defend or indemnify

American Pride against Groff Construction’s copyright claims. Shortly thereafter,

American Pride entered into a consent judgment with Groff Construction for $1.7

million, under which it was protected from all liability. See Coblentz v. Am. Surety

Co., 

, 1062-63 (5th Cir. 1969); Chomat v. Northern Ins. Co., 

. 535, 537 (Fla. 3rd DCA 2006). Settlement agreements between a claimant and

an insured, when the insurer rejects coverage and refuses to indemnify, have

become known as Coblentz agreements after the Fifth Circuit’s decision in 1969.

       The district court granted summary judgment to Mid Continent on its lack of

cooperation claim against American Pride. On appeal, we reversed and remanded

*
 Honorable Bobby R. Baldock, United States Circuit Judge for the Tenth Circuit, sitting by
designation.
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for further proceedings, finding genuine issues of material facts as to whether

American Pride informed Mid-Continent of its proposed settlement agreement and

settled the underlying litigation after properly rejecting Mid-Continent's

conditional defense. See Mid-Continent Casualty Co. v. Am. Pride Bldg. Co., LLC,

(11th Cir. 2010).

      After trial, the jury answered “no” to the question of whether the settlement

“was reasonable in amount and not tainted by bad faith, fraud, collusion or without

any effort to minimize liability.” Doc. 191 at 2. Accordingly, the district court

entered judgment in favor of Mid-Continent, finding the consent judgment

unenforceable under Florida law.

      We begin by addressing the central and dispositive issue raised by American

Pride on appeal: the propriety of the jury instructions and verdict form. “We will

reverse a refusal to give a requested instruction only if: (1) the requested

instruction correctly stated the law, (2) the instruction dealt with an issue properly

before the jury, and (3) the failure to give the instruction resulted in prejudicial

harm to the requesting party.” Bearint ex rel. Bearint v. Dorell Juvenile Grp., Inc.,

, 1350 (11th Cir. 2004) (citation omitted). Because we find that

American Pride’s requested jury instruction−which separated the issues of

reasonableness and bad faith and allowed the jury to determine the reasonable

amount     of    a   consent     judgment       after   first     finding      the   amount


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unreasonable−constitutes an incorrect statement of Florida law, we need not

address the other requirements. As we explain, the instructions and interrogatories

the district court gave to the jury were correct and complete statements of Florida

law, and the requested instruction was not.

      American Pride takes issue with, in particular, Jury Instruction No. 3 and

Special Verdict Form Interrogatory No. 4. Jury Instruction No. 3 states: “If you

decide Defendants [i.e., American Pride] met their burden, Mid-Continent must

prove, by the preponderance of the evidence, that the consent judgment was not

reasonable in amount or tainted by bad faith, fraud, collusion, or without effort to

minimize liability.” Doc. 190 at 12 (emphasis added). As the district court noted,

the Florida courts have definitively spoken on what must be proven to prevent

enforcement of a Coblentz agreement. Steil v. Fla. Physicians’ Ins. Reciprocal,

, 592 (Fla. 2d DCA 1984) (“Thus, we hold that in a case such as

this, a settlement may not be enforced against the carrier if it is unreasonable in

amount or tainted by bad faith.”) (emphasis added). In light of cases like Steil, for

an insurer to win, only one of two conditions (i.e., unreasonable settlement or bad

faith) must exist. For an insured to prevail, it must have both issues resolved in its

favor. See, e.g., Chomat, 

. at 537. (“Where an injured party wishes to

recover under a Coblenz agreement, the injured party must bring an action against

the insurer and prove coverage, wrongful refusal to defend, and that the settlement


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was reasonable and made in good faith.”) (emphasis added). Jury Instruction No.

3 is an accurate statement of Florida law, and provides no basis for reversal.

      Special Verdict Form Interrogatory No. 4 asked the jury to answer the

following question: “Do you find the consent judgment entered into by American

Pride was reasonable in amount and not tainted by bad faith, fraud, collusion or

without any effort to minimize liability?” Doc. 191 at 2 (emphasis added). The

jury answered “no.” As noted above, Florida law could not be clearer as to the

elements necessary to enforce a consent judgment. “Subsequent to the entry of the

agreement, the injured party must bring an action against the insurer and prove

coverage, wrongful refusal to defend, and that the settlement was reasonable and

made in good faith.” Quintana v. Barad, 

, 1301 n.1 (Fla. 3d DCA

1988) (emphasis added). Special Verdict Form Interrogatory No. 4 is also an

accurate statement of Florida law.

      Whether addressing what an insurer must prove to prevent enforcement of a

consent judgment−an unreasonable amount or bad faith−or what an insured must

prove to enforce a consent judgment−a reasonable amount and the absence of bad

faith−the district court’s jury instructions and verdict form accurately reflected

Florida law.    In Florida, it is, as Mid-Continent contends, an all or nothing

proposition. A consent judgment will only be enforced if both elements are met.

See Quintana, 

. If an insurer can prove that either element is


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unsatisfied, the consent judgment cannot be enforced. See Steil, 

.

      We also reject American Pride’s argument that the jury, even if it found the

settlement to be unreasonable, should be allowed to fix a reasonable settlement

amount. Even if this argument made “common sense,” as suggested by American

Pride, it is not the law in Florida. American Pride concedes that no court applying

Florida law has ever held that after a jury determines that the amount of a consent

judgment is unreasonable it is then allowed to determine a lower reasonable

amount. We decline to be the first.

      As to the other issues raised on appeal, including the district court’s denial

of America Pride’s motion for judgment as a matter of law on the issue of bad faith

and the district court’s inclusion of a purportedly inapplicable insurance policy

exclusion in the jury instructions, as well as Mid-Continent’s renewed motion for

judgment as a matter of law as to American Pride’s breach of cooperation, we

affirm without further discussion.

      AFFIRMED.




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