RONNIE L. WHITE, UNITED STATES DISTRICT JUDGE.
This matter is before the court on State Farm Fire and Casualty Company's Motion for Summary Judgment (ECF No. 32). This matter is fully briefed and ready for disposition.
Dado's Café, Inc. ("Dado's Café") is a Greek restaurant and bar in St. Louis, Missouri. (State Farm Fire and Casualty Company's Statement of Uncontroverted Material Facts in Support of its Motion for Summary Judgment ("PSUMF"), ECF No. 33, ¶1). Three former female employees of Dado's Café have filed suit against Dado's Café and Nick Avouris (referred to herein as "Defendants")
Plaintiff State Farm Fire and Casualty Company ("State Farm") filed this declaratory judgment complaint in this Court related to the underlying lawsuits for sex
The Underlying Lawsuits allege certain acts of sexual harassment, sexual assault, sex discrimination, and wrongful termination directed toward the Underlying Plaintiffs by Avouris and Dado's Café's cook staff. Specifically, the cook staff would call each of the Underlying Plaintiffs "bitch" and "sexy," and would make other sexual comments towards the women. The cook staff would rub their genitalia against the Underlying Plaintiffs' backsides. Avouris personally made offensive sexual comments and advances and refused to stop after being asked to by the Underlying Plaintiffs. The Underlying Plaintiffs allege that Avouris retaliated against them by removing them from the schedule and/or terminating them after they complained about the unwelcome sexual comments and behavior. The Underlying Plaintiffs assert that they believed the offensive conduct was intentionally committed because they all complained, and the conduct did not cease. (PSUMF, ¶8).
Under Dado Café's Policy with State Farm, the liability limited insuring agreement is as follows:
State Farm seeks a declaration that the Policy does not apply to any and all claims made by the Underlying Defendants against Dado's Café and Nick Avouris. Specifically, State Farm asks this Court to declare that State Farm's Policy provides no liability coverage, no duty to defend, and no duty to indemnify Defendants against the allegations in the Underlying Lawsuits.
The Court may grant a motion for summary judgment if "the pleadings, depositions,
A moving party always bears the burden of informing the Court of the basis of its motion. Celotex Corp., 477 U.S. at 323, 106 S.Ct. 2548. Once the moving party discharges this burden, the nonmoving party must set forth specific facts demonstrating that there is a dispute as to a genuine issue of material fact, not the "mere existence of some alleged factual dispute." Fed. R. Civ. P. 56(e); Anderson, 477 U.S. at 248, 106 S.Ct. 2505. The nonmoving party may not rest upon mere allegations or denials of his pleading. Id.
In passing on a motion for summary judgment, the Court must view the facts in the light most favorable to the nonmoving party, and all justifiable inferences are to be drawn in his favor. Celotex Corp., 477 U.S. at 331, 106 S.Ct. 2548. The Court's function is not to weigh the evidence but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249, 106 S.Ct. 2505. "`Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge.'" Torgerson, 643 F.3d at 1042 (quoting Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000)).
Fed. R. Civ. P. 56(c)(1) provides that "[a] party asserting that a fact cannot be or is genuinely disputed must support the assertion by (A) citing to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers or other materials; or (B) showing that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact."
Defendants' Response to Plaintiff's Statement of Uncontroverted Material Facts (ECF No. 41), however, does not satisfy Fed. R. Civ. P. 56(c)(1). Defendants do not support any of their denials of State Farm's Statement of Facts with any material from the record. At most, Defendants make a legal argument, which fails to controvert State Farm's statements of fact. See ECF No. 41 at 3 (citing David Kleis, Inc. v. Superior Court, 37 Cal.App.4th 1035, 1038, 44 Cal.Rptr.2d 181 (1995)). The Court finds that State Farm's Statement of Uncontroverted Material Facts have been deemed admitted by Defendants because they were not properly controverted by Defendants. See Jones v. United Parcel Serv., Inc., 461 F.3d 982, 991 (8th Cir. 2006) (district court properly deemed facts admitted that were not properly controverted); Fed. R. Civ. P. 56(e)(2) ("If a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact as required by Rule 56(c), the court may (2) consider the
State Farm asserts that Avouris is not an "insured" under the Policy. The Policy details the people who insureds in Section II:
Dado's Café is designated in the Declarations as a corporation and it is an organization other than a partnership, joint venture, or limited liability company. Therefore, Dado's Cafe is an insured under Section 1.a.(4). However, the Court holds that Nick Avouris is not an insured under the policy. Avouris is not named in the Declarations. Moreover, in Dado Café's 2018-2019 Biennial Registration with the Missouri Secretary of State, only one person, not Nick Avouris, is listed as an officer, board member, and registered agent. Avouris admits that he is not an officer or director of Dado's Café. Therefore, Avouris cannot qualify as an insured and is not entitled to coverage under the Policy.
It is well-settled "[u]nder Missouri law, an insurance policy which covers bodily injury and property damage does not cover punitive damages unless other language in the policy provides for payment of punitive damages." Union L.P. Gas Sys., Inc. v. Int'l Surplus Lines Ins. Co., 869 F.2d 1109, 1111 (8th Cir. 1989); Schnuck Markets, Inc. v. Transamerica Ins. Co., 652 S.W.2d 206, 209-10 (Mo. Ct. App. 1983) ("Since punitive damages are never awarded merely because of a `bodily injury' or `personal injury' but only when the actor's conduct displays the requisite malice, we find they are not in the category
The Underlying Plaintiffs agree that they have not suffered any "property damage" or "personal and advertising injury." See ECF No. 11, ¶31. Therefore, the only possible basis for a claim under the Policy is for "bodily injury." The Policy defines "bodily injury":
Missouri courts have concluded that the common meaning of the phrase "bodily injury" "refers to physical conditions of the body and excludes mental suffering or emotional distress." Citizens Ins. Co. of Am. v. Leiendecker, 962 S.W.2d 446, 454 (Mo. Ct. App. 1998) (citing cases); American Family Mut. Ins. Co. v. Wagner, No. 05-4394-CVC-NKL, 2007 WL 1029004, at *3 (W.D. Mo. Mar. 29, 2007) ("emotional injuries are not considered bodily injuries within the meaning of the policy unless they arise from bodily injuries; i.e., unless the emotional distress was caused by some physical injury"). The Policy refines the definition of the term "bodily injury" to specifically include "mental anguish or other mental injury" only if it is caused by the "bodily injury." "From this definition, a reasonable person placed in the position of the insured would have understood the term "bodily injury" to exclude coverage for any and all emotion type injuries, including any physical symptoms that might be cause by or tied to the emotional injury, unless the emotional injury was caused by actual physical bodily contact." Heacker v. Am. Family Mut. Ins. Co., No. 09-4270-CV-W-GAF, 2011 WL 124301, at *8 (W.D. Mo. Jan. 14, 2011), aff'd sub nom. Heacker v. Safeco Ins. Co. of Am., 676 F.3d 724 (8th Cir. 2012).
Defendants argue in their response that the Underlying Plaintiffs allege that they were subjected to "unwelcome physical contact" and "where the claimant alleges sexual harassment involving physical contact, `bodily injury' may be involved." (ECF No. 45 at 1-2). The Underlying Plaintiffs, however, admit that they have not suffered any tangible, physical injury. (PSUMF, ¶16). The Court holds that the Underlying Plaintiffs have not suffered "bodily injury" under the Policy because the Policy's definition of "bodily injury" does not extend to emotional or mental injuries that were not cause by a physical injury. Therefore, Defendants cannot be covered under the Policy and they are not entitled to defense and indemnity. The Court enters judgment in favor of State Farm.
Even if a bodily injury is alleged, the bodily injury still must have been caused by an "occurrence" as defined by the Policy in order to satisfy the insuring agreement of the Policy. (ECF No. 34 at 21). The Policy defines an "occurrence" to mean an "accident." An accident is defined as "an unforeseen and unplanned event or circumstance." See https://www.merriam-webster.com/dictionary/accident (last visited October 17, 2019). The Court holds that
State Farm asserts that, even if insuring agreement were satisfied, the following exclusions would apply: (1) the injuries are excluded from coverage because the injuries would be expected or intended by a reasonable person; (2) because the Underlying Plaintiffs' injuries would be covered by Worker's Compensation, the Worker's Compensation exclusion applies; (3) the Employer's Liability exclusion bars injuries sustained by the Underlying Plaintiffs; and (4) the Employment-Related Practices exclusion would similarly apply. Defendants have not addressed these arguments in their response.
The Policy's expected or intended injury exclusion reads as follows:
Applicable to Coverage L—Business Liability, this insurance does not apply to:
Applying this exclusion to the present case, the Underlying Plaintiffs' Petitions allege repeated, uninvited and unwelcome sexual advances, inappropriate physical contact, humiliating and offensive comments and photographs by Avouris and his male staff. (ECF No. 34 at 17 (citing the Underlying Petitions and the Underlying Plaintiffs' Answers to Interrogatories, Responses, #17 and 18)). The Court holds that a reasonable person engaging in this sort of abusive and deleterious behavior would expect his behavior to harm his victim, including causing emotional distress. (ECF No. 34 at 18). In addition, Avouris and Dado Café's staff continued to harass the Underlying Plaintiffs even after they asked Avouris and Dado Café's staff to stop. (PSUMF, ¶8). These continued harassing behaviors provide evidence to support Avouris and Dado Café's staff's actions were intentional and not merely negligent. State Farm Fire & Cas. Co. v. Caley, 936 S.W.2d 250, 254 (Mo. Ct. App. 1997) ("we find that the conduct which caused the emotional distress was intentional, not negligent" and therefore, "he is held to have intended the natural and probable consequences of his acts"). The Court infers the intent to harm from the nature of the conduct and Defendants' continued actions, even after the Underlying Plaintiffs' protestations. The Court finds that a "reasonable person" would expect or intend any injuries Underlying Plaintiffs may have suffered. Thus, the Court holds that the Policy's expected or intended injury exclusion applies and grants State Farm's Motion for Summary Judgment.
State Farm's general liability Policy distinguishes itself from a Worker's Compensation policy through the exclusion for "any obligation of the insured under a workers' compensation, disability benefits or unemployment compensation law or any similar law." Missouri's Worker's Compensation Law, Section 287.120.9 explains "[a]
Additionally, the Court grants summary judgment in favor of State Farm because the Employer's Liability exception applies. The Employer's Liability exclusion in State Farm's restaurant policy states:
Applicable to Coverage L—Business Liability, this insurance does not apply to:
5. Employer's Liability
The Court finds that, to the extent that the Underling Plaintiffs allege that any "bodily injury" may have occurred, then it arose out of or in the course of the employee's employment by the insured or while performing duties related to the insured's business. Thus, the Court holds that the employer liability exclusion applies, and no coverage is available under this Policy for Defendants. See State Farm Fire & Cas. v. One Stop Cellular, Inc., No. 4:05-CV-00067, 2006 WL 2583408, at *3 (W.D. Va. Sept. 6, 2006) ("Numerous other courts have found similar exclusions precluded coverage for an employee's sexual harassment claims."). Thus, even if any "bodily injury" is `alleged and caused by an occurrence,' that injury is excluded under the employer's liability exclusion because any such injury would have resulted out of the employee's employment at Dado's Café.
Finally, the Policy's Employment-Related Practices exclusion reads:
Applicable to Coverage L—Business Liability, this insurance does not apply to:
Under this exception, if the bodily injury occurred to a person and it arose out of the termination of that person's employment or out of employment-related practices, policies, acts, or omissions (including but not limited to harassment, humiliation, or discrimination), then the employment-related practices exclusion applies, and the employee has no coverage. The Court holds that the Underlying Plaintiffs' claims of sexual harassment, hostile work environment, discrimination and wrongful termination all arise out of their employment relationship and all involved "coercion, demotion, evaluation, malicious prosecution, reassignment, discipline, defamation, harassment, humiliation, or discrimination" related to the Underlying Plaintiffs' employment. Therefore, the Court holds that the employment-related practices exclusion applies, and Defendants are afforded no coverage under the Policy. See Ins. Com'r v. Golden Eagle Ins. Co., No. A111416, 2007 WL 908519, at *5 (Cal. Ct. App. Mar. 27, 2007) ("[W]e cannot conceive of how the bookkeeper's claims do anything but `aris[e] out of ... employment-related practices, policies, acts or omissions.' All of the claims alleged in the cross-complaint concern "[c]oercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation [or] discrimination" related to the bookkeeper's employment."). The Court grants State Farm's Motion for Summary Judgment on this basis as well.
Accordingly,
An appropriate Judgment is filed herewith.
