Opinion
No. 3:97-CV-1478-L.
October 31, 2000.
MEMORANDUM OPINION AND ORDER
Before the court are Plaintiffs Motion for Summary Judgment, filed February 23, 1998 and Defendants' Cross-Motion for Summary Judgment, filed March 26, 1998. After careful consideration of the motions, responses, replies, surreplies, supplemental briefs and applicable authority, the court, for the reasons that follow, grants Plaintiffs Motion for Summary Judgment and denies Defendants' Cross-Motion for Summary Judgment. I. Factual and Procedural Background
Defendants request that the court strike Plaintiffs summary judgment motion, contending that it is defective, as Plaintiff failed to comply with Local Rule 56.1(a). Until recent amendments to the local rules, LR 56.1(a) required a moving party to list in numerical order the undisputed facts upon which the motion relies and issues of law. In its reply to Defendants' response, Plaintiff cured any such deficiency by setting forth the undisputed facts and issues of law in numerical order. Accordingly, Defendants' request is denied as moot.
This is a declaratory judgment action filed pursuant to 28 U.S.C. § 2201. Plaintiff St. Paul Guardian Insurance Company ("Plaintiff' or "St. Paul") is an insurance company with its principal place of business in St. Paul, Minnesota. Defendant Centrum G.S. Limited ("Centrum") is a Texas limited partnership. Defendant Goodyork Corporation ("Goodyork") is a Texas corporation and general partner of Centrum. Defendant Steiner Associates, Inc. (Steiner Associates) is a Florida corporation conducting business in Texas. Defendant Yaromir Steiner (Steiner) is a citizen of Florida, and Defendant Brenda Brushaber (Brushaber) is a resident of Texas. Plaintiff seeks a declaration that it has no duty to defend or indemnify its insured, Centrum G.S. Limited, or any other Defendant, in a lawsuit brought by Gerry Perdue (Perdue) against Defendants in state court.
Unless otherwise stated, the court refers to Centrum G.S. Limited, Goodyork Corporation, Steiner Associates, Inc., Yaromir Steiner and Brenda Brushaber collectively as "Defendants."
The state court action is styled Gerry Perdue v. Yaromir Steiner, Steiner Associates, Inc. d/b/a the Centrum Properly Company, d/b/a Centrum Towers and d/b/a Steiner Management, Inc., Brenda Brushaber, Centrum G.S. Ltd., Goodyork Corporation, and Steiner Management, Inc., Cause No. 95-08507-F, 116th Judicial District Court of Dallas County, Texas.
The relevant facts in this case are undisputed. In 1994, St. Paul issued its Commercial General Liability Protection Policy to Centrum, Policy No. CK09101475 (Policy). The Policy provided Centrum with property and liability insurance coverage. Specifically, the St. Paul insurance Policy provides:
What This Agreement Covers
Bodily injury and property damage liability. We'll pay amounts any protected person is legally required to pay as damages for covered bodily injury, property damage or premises damage that:
• happens while this agreement is in effect; and
• is caused by an event.
Personal injury liability. We'll pay amounts any protected person is legally required to pay as damages for covered personal injury that:
• results from your business activities, other than advertising, broadcasting, publishing or telecasting done by you; and
• is caused by a personal injury offense committed while this agreement is in effect.
Pl.'s Mot. for Summ. J. Br. in Support Thereof (Pl.'s MSJ), Exhibit A.
On August 23, 1995, Perdue filed suit against Yaromir Steiner, Steiner Associates, Inc. d/b/a The Centrum Property Company and Brenda Brushaber, asserting claims for, inter alia, breach of contract, libel, slander, invasion of privacy, and intentional infliction of emotional distress. In his Fourth Amended Original Petition (Perdue's Petition), Perdue alleged that in December 1994, Steiner, Brushaber and Steiner Associates hired Perdue to be Chief Building Engineer for the Centrum building, a property owned by Centrum and Goodyork. Perdue further alleged that on March 6, 1995, Defendants wrongfully terminated his employment contract, and that, after his termination, Defendants circulated and posted color "WANTED POSTERS" to the general public including contractors, tenants and customers in the building, and also posted a memorandum advising tenants to call security if they saw him. According to Perdue, the "Wanted Posters" included a color picture of him, his name, home address, driver's license number, social security number and car tag number. Perdue further alleged that Defendants all made defamatory statements regarding him and that, as a result of these statements, tenants inquired of one another whether Perdue had murdered someone. Perdue also alleged that Bill Jones, an agent and employee of Defendants, stated that he (Perdue) had tampered with or cut off pumps at the Centrum building.
Perdue subsequently amended his petition to name Centrum G.S. Limited and Goodyork as additional defendants.
As a result of his alleged wrongful termination, Perdue asserts that he has suffered damages, including loss of salary, bonuses, benefits, commissions, medical expenses and benefits, retirement benefits, vacation, and insurance and down payment on an automobile that was financed during his employment. Perdue further asserts that as a result of Defendants' alleged libel, slander, invasion of privacy and intentional infliction of severe emotional distress, he has suffered mental distress, mental anguish, physical sickness and loss of reputation.
St. Paul was notified of Perdue's claims against its insured, Centrum, on February 26, 1997, when it received a copy of Perdue's Second Amended Petition from counsel for Defendants. On June 18, 1997, Plaintiff filed its complaint seeking declaratory judgment that it has no duty to defend or indemnify its insured, or any other Defendants, in the state court action. Both Plaintiff and Defendants have filed summary judgment motions. St. Paul contends that it has no duty to defend or indemnify Defendants in the Perdue Action because Perdue's claims are not covered under the Policy. Defendants, on the other hand, contend that Perdue's claims are covered under the Policy and St. Paul is, therefore, obligated to defend Defendants as a matter of law. H. Summary Judgment Standard
In its First Amended Complaint for Declaratory Judgment, Plaintiff asserts that Perdue's allegations do not fall within the "advertising injury" coverage provision of the policy. Plaintiff also asserts that insurance coverage of Steiner Associates, a manager of the Centrum complex, and Brushaber, the complex's General Manager, is limited by the Policy, and that it does not have a duty to defend these Defendants, as Perdue's allegations do not fall within the provisions providing coverage for them. Although Defendants did nor file an answer to Plaintiffs amended complaint, they admit in their original answer that Perdue's allegations do not fall within the advertising injury provision of the Policy. By order dated September 29, 2000, the court denied Defendants' motion for leave to file an amended answer, which would have only addressed Plaintiffs original complaint, and counterclaims. As neither of the parties' summary judgment motions addresses whether Steiner Associates or Brushaber are protected persons under the Policy and since it resolves the parties' motions on other grounds, the court determines that it need not address this issue.
Summary judgment shall be rendered when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Ragas v. Tennessee Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998). A dispute regarding a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When ruling on a motion for summary judgment, the court is required to view all inferences drawn from the factual record in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986); Ragas, 136 F.3d at 458.
Once the moving party has made an initial showing that there is no evidence to support the nonmoving party's case, the party opposing the motion must come forward with competent summary judgment evidence of the existence of a genuine fact issue. Matsushita, 475 U.S. at 586. Mere conclusory allegations are not competent summary judgment evidence, and thus are insufficient to defeat a motion for summary judgment. Eason v. Thaler, 73 F.3d 1322, 1325 (5th Cir. 1996). Unsubstantiated assertions, improbable inferences, and unsupported speculation are not competent summary judgment evidence. See Forsyth v. Barr, 19 F.3d 1527, 1533 (5th Cir.), cert. denied, 513 U.S. 871 (1994). The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his claim. Ragas, 136 F.3d at 458. Rule 56 does not impose a duty on the court to "sift through the record in search of evidence" to support the nonmovant's opposition to the motion for summary judgment. Id., see also Skotak v. Tenneco Resins, Inc., 953 F.2d909, 915-16 n. 7 (5th Cir.), cert. denied, 506 U.S. 832 (1992). "Only disputes over facts that might affect the outcome of the suit under the governing laws will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. Disputed fact issues which are "irrelevant and unnecessary" will not be considered by a court in ruling on a summary judgment motion. Id. If the nonmoving party fails to make a showing sufficient to establish the existence of an element essential to its case and on which it will bear the burden of proof at trial, summary judgment must be granted. Celotex, 477 U.S. at 322-23.
III. Analysis A. Interpretation of Insurance Contracts
The interpretation of an insurance policy is a question of law. Coker v. Coker, 650 S.W.2d 391, 393-94 (Tex. 1983). Insurance policies are contracts and are governed by the principles of interpretation applicable to contracts. Amica Mut. Ins. Co. v. Moak, 55 F.3d 1093, 1095 (5th Cir. 1995) ( citing Barnett v. Aetna Life Ins. Co., 723 S.W.2d 663, 665 (Tex. 1987)). As this is a diversity case, Texas rules of contract interpretation control. See id.; see also Potomac Ins. Co. v. Jayhawk Medical Acceptance Corp., 198 F.3d 548, 550 (5th Cir. 2000).
B. Duty to Defend and Duty to Indemnify
In determining whether an insurer has a duty to defend, the court must examine the latest amended pleading upon which the insurer based its refusal to defend the action. See Canutillo Indep. Sch. Dist. v. National Union Fire Ins. Co., 99 F.3d 695, 701 (5th Cir. 1996). Texas courts follow the "eight corners" or "complaint allegation" rule, which requires the trier of fact to examine only the allegations in the underlying complaint and the insurance policy, see id.; see also Gulf Chem. Metallurgical Corp. v. Associated Metals Minerals Corp., 1 F.3d 365, 369 (5th Cir. 1993), without reference to their veracity, See Argonaut Southwestern Ins. Co. v. Maupin, 500 S.W.2d 633, 635 (Tex. 1973). In reviewing the underlying pleadings, the court must focus on the factual allegations that show the origin of the damages rather than on the legal theories alleged. American States Ins. Co. v. Bailey, 133 F.3d 363, 369 (5th Cir. 1998); National Union Fire Ins. Co. v. Merchants Fast Motor Lines, 939 S.W.2d 139, 141 (Tex. 1997) ( citing Adamo v. State Farm Lloyds Co., 853 S.W.2d 673, 676 (Tex.App.-Houston [14th Dist.] 1993, writ denied) ("It is not the cause of action alleged that determines coverage but the facts giving rise to the alleged actionable conduct.")). The allegations in the underlying petition are to be interpreted liberally, resolving any doubt in favor of the insured. National Union, 939 S.W.2d at 141. The duty to defend arises when the facts alleged in the petition, if taken as true, potentially state a cause of action within the terms of the policy. Canutillo, 99 F.3d at 701. Thus, it is the insured's burden to show that the claim against it is potentially within the policy's coverage. Id. An insurer has an obligation to defend an insured if the petition alleges at least one cause of action within the policy's coverage. Id. If, however, under the facts alleged, there is a prima facie showing that the claim is not covered under the policy, the insurer has no duty to defend. See National Union, 939 S.W.2d at 141.
Unlike the duty to defend, however, which is based on the allegations in the petition, the duty to indemnify is triggered by the actual facts establishing liability in the underlying suit. See Trinity Universal Ins. Co. v. Cowan, 945 S.W.2d 819, 823 (Tex. 1997). If there is no duty to defend, there is no duty to indemnify. See Bailey, 133 F.3d at 368.
C. Perdue's Petition
Defendants contend that St. Paul has a duty to defend pursuant to the Policy because Perdue's allegations, as asserted in his Petition, potentially trigger coverage under either the bodily injury provision or personal injury provision of the Policy. The court addresses each of these provisions in turn below.
1. Bodily Injury Provision
Defendants contend that Perdue's claims constitute a "bodily injury" under the Policy. In determining whether St. Paul has a duty to defend under the bodily injury provision, the court first examines whether Perdue has alleged a "bodily injury," as that term is defined under the policy.
Under the bodily injury provision, St. Paul provides coverage for "bodily injury," "property damage" and "premises damage" that occurs while the agreement is in effect and is caused by an "event." As Perdue does not assert a claim for "premises damage," and Defendants admit that Perdue's allegations do not constitute "property damage" under the Policy, see Defs.' Original Answer at 3, the court only addresses whether Perdue's allegations invoke St. Paul's duty to defend under the bodily injury prong of this provision.
The Policy defines "bodily injury" as "any physical harm, including sickness or disease, to the physical health of other persons. It includes any of the following that results at any time from such physical harm, sickness or disease: [m]ental anguish, injury or illness; [e]motional distress; [c]are, loss of services, or death." Pl.'s MSJ, Exhibit A. In Paragraph III of his Petition, Perdue alleges "[a]dditional damages for slander, libel, invasion of privacy and intentional infliction of severe emotional distress, including mental anguish, physical sickness and loss of reputation Pl.'s MSJ, Exhibit E at 4. Perdue further alleges in Paragraphs VI and VII that "Defendants' actions after his termination proximately caused damage, including . . . mental anguish, emotional distress and resulting physical manifestations including sickness and loss of weight." Id. at 6-7. Plaintiff maintains that Perdue's claims are purely emotional injuries, and that his generalized claims of physical sickness and weight loss are insufficient to invoke St. Paul's duty to defend. Defendants contend that Perdue has satisfied the definition of bodily injury under the Policy because he has alleged physical manifestations of his alleged mental injuries, and cite Trinity Universal Ins. Co. v. Cowan, 945 S.W.2d 819 (Tex. 1997), in support of their position.
The insured in Trinity worked as a photo lab clerk for H.E.B. Photo Place. When a roll of film containing somewhat revealing pictures of the plaintiff was delivered to the lab for processing, the insured made extra prints of some of the pictures and showed them to his friends. The plaintiff alleged that she suffered, inter alia, severe mental pain, mental anguish, and humiliation as a result of the insured's actions, and testified at trial that in connection with her mental anguish she experienced headaches, stomach aches, and sleeplessness. The plaintiff, however, never alleged in her pleadings these symptoms, or any physical manifestations of her alleged mental injuries. The court concluded that absent an allegation of physical manifestation of mental anguish, a claim of mental anguish was not a bodily injury as defined in the policy for purposes of invoking the duty to defend.
In this case, even though Perdue only generally avers "physical sickness" and "weight loss" as physical manifestations of his mental anguish, the court must liberally construe the allegations and resolve any doubt in favor of the insured. See Trinity 945 S.W.2d at 825. The court, therefore, finds that Perdue's allegations of mental anguish and physical manifestations of his mental anguish, including physical sickness and weight loss, are sufficient to satisfy the definition of "bodily injury" under the Policy. That the court has determined that Perdue has alleged "bodily injury," however, is only half the inquiry. Defendants must also demonstrate that the bodily injury was caused by an "event," as that term is defined under the Policy. The court now turns to that issue.
The Policy defines "event" as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." See Pl.'s MSJ, Exhibit A. Plaintiff contends that no "event" occurred under the facts of this case because the harm allegedly suffered by Perdue was not caused by an accident. Although the Policy does not define the term "accident," the Texas Supreme Court has held that "an injury is accidental if "from the viewpoint of the insured, [it is] not the natural and probable consequence of the action or occurrence which produced the injury; or in other words, if the injury could not reasonably be anticipated by [the] insured, or would not ordinarily follow from the action or occurrence which caused the injury.'" Mid-Century Ins. Co. v. Lindsey, 997 S.W.2d 153, 155 (Tex. 1999) ( quoting Republic Nat'l Life Ins. Co. v. Heyward, 536 S.W.2d 549, 557 (Tex. 1976)). An injury caused by voluntary and intentional conduct is not an accident simply because the result or injury may have been unexpected, unforeseen and unintended. Mid-Century, 997 S.W.2d at 155. On the other hand, that an actor intended to engage in the conduct giving rise to the injury does not mean that the injury was not accidental. Id. Rather, both the actor's intent and the reasonably foreseeable effect of his conduct bear on the determination of whether an occurrence, or event in this case, is accidental. Id. An effect that cannot be reasonably anticipated from the use of the means that produced it, an effect which the actor did not intend to produce and which he cannot be charged with the design of producing, is produced by accidental means. Id.
Defendants concede that while the alleged acts in Perdue's Petition were voluntary and see intentional, see Defs.' Resp. to Mot for Summ. J. and Cross Mot. for Summ. J. (Defs.' Resp.) at 14, the alleged injuries suffered by Perdue were not the natural and probable result of those acts. The court disagrees.
Because the court determines that Perdue's injuries were not the result of an event, it does not determine whether coverage would be precluded under the Policy's exclusion provision for intentional bodily injury or property damage.
According to Defendants, Perdue alleges that the following acts are the cause of his damages or injuries: 1) the Defendants' termination of Perdue as the Chief Building Engineer for the Centrum building; 2) the escorting of Perdue out of the Centrum building with security personnel; 3) the hiring of police officers to monitor the lobby and the parking garage; and 4) the circulation of fliers to the general public and a memorandum to the Centrum building's tenants regarding Perdue. See Defs. Resp. at 14. Contrary to Defendants' contention, the only damages that Perdue alleges with respect to his termination are economic in nature (lost salary, bonuses, benefits, health insurance, vacation, loss of his property/automobile and commissions). As Perdue does not allege that Defendants' acts in terminating his employment or in having him escorted out of the Centrum building by security personnel after his termination caused any physical harm, it is unnecessary to determine whether the damages resulting from his termination were caused by an event. In other words, the damages that Perdue alleges were caused by his termination do not constitute bodily injury. As such, Perdue's allegations of wrongful termination and resulting damages are not covered under the bodily injury provision of the Policy, and St. Paul has no duty to defend such claims as a matter of law.
As the court reads Perdue's Petition, the acts giving rise to Perdue's claims for bodily injury occurred after his termination. Specifically, Perdue alleges that after his termination, Defendants circulated and posted color "Wanted Posters" to the general public, which included his picture, name, home address, driver's license number, social security number and car tag number, and made defamatory statements (although he alleges no specific comments) about him. Perdue further alleged that Bill Jones, an agent and employee of Defendants, stated that Plaintiff had tampered with or cut off pumps at the Centrum. See Pl.'s MSJ, Exhibit E at 3-4. These acts, according to Perdue, resulted in injuries consisting of loss of reputation, emotional distress, mental anguish and physical manifestations thereof in the form of physical sickness and weight loss. Assuming for the moment that Perdue has alleged a cause of action for libel, slander, invasion of privacy and intentional infliction of severe emotional distress, the court finds that Perdue's alleged injuries arc the natural result of Defendants' intentional and voluntary acts. That Defendants did not intend the harm is of no consequence, as the alleged harm is a foreseeable result of the alleged acts. That one might suffer mental anguish and emotional distress as a result of another's written and oral defamatory statements about that person is certainly foreseeable. It is also foreseeable that such harm may result if one's personal and private information is posted for public viewing and potential misuse by another, and that such mental anguish and distress could manifest in physical illness, The court concludes that Defendants' conduct was voluntary and intentional and that Perdue's injuries were not caused by an accident, as one could reasonably anticipate that Perdue would suffer mental anguish and emotional distress as a result of Defendants' alleged conduct. Because Perdue's bodily injuries were not caused by an event, as that term is defined under the Policy, the court concludes that Perdue's claims for libel, slander, invasion of privacy and intentional infliction of emotional distress do no fall within the bodily injury provision of the Policy.
Defendants, however, contend that even if Perdue's mental injuries were foreseeable, it was not foreseeable that Perdue would lose property (his automobile) as a result of Defendants' tortious and intentional conduct. In his Petition, Perdue alleges property loss in four different parts. In Paragraph III of his Petition, under the heading "Background," Perdue alleges that, as a result of his wrongful termination, he has been damaged by a loss of insurance and his down payment on an automobile financed during his employment. Pl.'s MSJ, Exhibit E at 3. In Paragraph VI, Perdue alleges that Defendants' actions after his termination proximately caused damage, including the "loss of property, his automobile." Id. at 6. This same allegation is also made in Paragraphs VII and VIII of his Petition. Id. at 7. As stated before, any economic damages resulting from Perdue's alleged wrongful termination, including loss of property, are not covered under the bodily injury provision of the policy. Likewise, any loss of property resulting from Defendants' alleged tortious conduct (placing Perdue's personal and private information on "Wanted Posters" and publically displaying those posters, making written and oral defamatory statements about Perdue, and engaging in these acts with an intent to cause Perdue severe emotional distress) would not be covered under this provision of the Policy because Perdue's loss of property does not constitute bodily injury, as that term is defined in the Policy. Therefore, it is unnecessary for the court to determine whether Perdue's damage for loss of property/automobile was caused by an "event."
The court finds that Plaintiff has established that Perdue's claims for wrongful termination, libel, slander, invasion of privacy and intentional infliction of severe emotional distress are not covered under the bodily injury provision of the Policy. As Defendants have failed to raise a genuine issue of material fact that such claims are covered under the Policy, the court concludes that St. Paul has no duty to defend or indemnify Defendants against such claims under the bodily injury provision of the Policy, and that it is, therefore, entitled to judgment as a matter of law.
2. Personal Injury Provision
Defendants next contend that Perdue's claims potentially fall within the personal injury provision of the Policy. injury" as "injury, other than bodily injury or advertising injury, caused by a personal injury offense." See Pl.'s MSJ, Exhibit A. The Policy further defines "personal injury offense" as any of the following offenses: false arrest, detention or imprisonment; malicious prosecution; wrongful entry or wrongful eviction; invasion of the right of private occupancy of a room, dwelling or premises that a person occupies; libel or slander; making known to any person or organization written or spoken material that belittles the products, work or completed work of others; and making known to any person or organization written or spoken material that violates an individual's right of privacy. Id.
It is undisputed that Perdue's Petition generally alleges legal theories that potentially fall within the personal injury provision of the Policy, those being libel, slander and invasion of privacy. Plaintiff, however, contends that Perdue's claims do not invoke its duty to defend because his injuries do not result from its insured's business activity. Although not raised by the parties, the court must first address whether Perdue has even stated a cause of action for those claims that do potentially fall within the applicable provision. See Cornhill Ins. PLC v. Valsamis, Inc., 106 F.3d 80, 85 (5th Cir. 1997).
Libel, which is written defamation, is defined by Section 73.001 of the Texas Civil Practice Remedies Code as follows:
A libel is a defamation expressed in written or other graphic form that tends to blacken the memory of the dead or that tends to injure a living person's reputation and thereby expose the person to public hatred, contempt or ridicule, or financial injury or to impeach any person's honesty, integrity, virtue, or reputation or to publish the natural defects of anyone and thereby expose the person to public hatred, ridicule, or financial injury.
Tex.Civ.Prac. Rem. Code § 73.001 (Vernon 1986). Slander, the spoken form of defamation, is not codified by statute, but has been recognized at common law to be "a defamatory statement that is orally communicated or published to a third person without legal excuse." See Randall's Food Markets, Inc. v. Johnson, 891 S.W.2d 640, 646 (Tex. 1995).
Although Perdue alleges that Defendants made defamatory statements about him, he does not allege any specific written defamatory statements that were made against him by Defendants. At a minimum, to state a cause of action for defamation Perdue needs to identify the alleged defamatory statements, the maker of the statements, the approximate dates the statements were made, and to whom the statements were made. Without these basic and fundamental allegations, Perdue's claim for libel becomes nothing more than a conclusory statement, which cannot be used as a basis to decide whether Plaintiff has a duty to defend. See Cornhill, 106 F.3d at 85 ( citing Adamo v. State Farm Lloyds Co., 853 S.W.2d 673 (Tex.App. — Houston 1993, writ denied)). Based on the allegations contained in his Petition, the court concludes that Perdue has failed to state a cause of action for libel under Texas law, and that St. Paul has no duty to defend Defendants against any such claim as a matter of law.
With respect to Perdue's claim for slander, the only specific allegation contained in the Petition that might be construed as slander is Perdue's allegation that "Bill Jones, an employee of Defendants, stated that [Perdue] had tampered with or cut off pumps at the Centrum." Although it is questionable that Perdue has stated sufficient facts that he has been slandered, the court concludes that, under a liberal reading of this allegation, one could conclude that this allegation, if true, is sufficient to establish a cause of action for slander under Texas law.
With respect to the tort of invasion of privacy, Texas law recognizes three distinct instances that may constitute such tort: an intrusion upon the plaintiffs seclusion or solitude, or into his private affairs; public disclosure of embarrassing private facts about the plaintiff; and appropriation of the plaintiffs name or likeness. See Cornhill, 106 F.3d at 85 (5th Cir. 1997) (interpreting Texas law). Perdue alleges that Defendants' disclosed his social security number to the general public. Construing this allegation liberally, the court determines that it comes closest to fitting the cause of action for invasion of privacy where there has been public disclosure of one's private affairs, which is actionable when publication would be highly offensive to a reasonable person and there is no legitimate public concern meriting disclosure. See Cantu v. Rocha, 77 F.3d 795, 809 (5th Cir. 1996) ( citing Industrial Foundation of the South v. Texas Indus. Accident Bd., 540 S.W.2d 668, 682-83 (Tex. 1976), cert. denied, 430 U.S. 931 (1977)). In such a case, the information disclosed must have been confidential, in the sense that it was previously "secret" and that disclosure would cause harm. Cantu, 77 F.3d at 809. Under a liberal reading of his Petition, the court concludes that one could conclude that Perdue has alleged facts sufficient to state a cause of action for invasion of privacy. Having determined that Perdue has stated at least two claims that fall within the Policy's definition of personal injury offense (slander and invasion of privacy), the court next determines whether Perdue's personal injuries were the result of Defendants' business activities.
The term "business activity" is not defined in the Policy. The terms used in an insurance policy are given their ordinary and generally accepted meaning, unless the policy shows that the words are meant in a technical or different sense. Canutillo, 99 F.3d at 700. The mere absence of a policy definition does not give rise to a finding of ambiguity. Potomac, 198 F.3d at 551 n. 3 ( citing Harris Methodist Health Sys. v. Employers Reinsurance Corp., No. 3:96-CV-0054, 1997 WL 446459 at *5 (N.D. Tex. July 25, 1997)). A contract is ambiguous if it is reasonably susceptible of two different meanings. See Canutillo, 99 F.3d at 700; Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). Any ambiguity in a contract is resolved in favor of the insured. See Travelers Indem. Co. v. Citgo Petroleum Corp., 166 F.3d 761, 769 (5th Cir. 1999); Potomac, 198 F.3d at 550. When the terms of an insurance policy are clear and unambiguous, the court may not vary those terms. Canutillo, 99 F.3d at 700.
Relying on Webster's Ninth New Collegiate Dictionary (1989), Defendants assert that the term "business," as defined in Webster's, typically means a "commercial or mercantile activity engaged in as a means of livelihood," or a "commercial or sometimes an industrial enterprise." See Defs.' Resp. at 9. Defendants further assert that the term "activity" is defined in Webster's as "the quality or state of being active," or a "natural or normal function." Id. Thus, Defendants contend, the term "business activity" should be interpreted as "any normal function of a commercial enterprise." Defs.' Resp. at 9. Defendants further contend that the term "business activity" is quite broad, and is generally known to mean any activity which is not personal in nature. Id. Defendants contend that the term "business activity" is unambiguous. Plaintiff contends that Perdue's claims resulted from Defendants' employment practices, not from any business activity.
The court need not decide this dispute between the parties. Even accepting Defendants' definition of "business activity," the court concludes that Perdue's claims would not be covered under the personal injury provision of the Policy. First, while the damages resulting from Perdue's termination would be covered tinder the definition of personal injury, as that term includes any injury other than bodily injury, those damages were not caused by any of the personal injury offenses alleged by Perdue (libel, slander, invasion of privacy), or specifically enumerated in the Policy. Second, with respect to those injuries alleged to have been caused by a personal injury offense (slander and invasion of privacy), they were not the result of Defendants' business activities. Defendants concede that, at the very least, Centrum and Goodyork are enterprises engaged in the business of owning and managing property. See Defs. Resp. at 9. While Defendants contend that the circumstances surrounding and subsequent to the termination of an employee constitute "business activities," the court finds this contention unpersuasive. The court simply does not see how the posting of an employee's personal and private information around that employee's former place of employment, for public view and possible misuse by others, is consistent with the nature of Defendants' business activities (owning and managing property), as that term is commonly understood. For these reasons, the court concludes that the allegations contained in Perdue's Petition do not invoke St. Paul's duty to defend or indemnify under the personal injury provision of the Policy. IV. Conclusion
Because the parties' motions for summary judgment have been disposed of on other grounds, the court does not decide whether St. Paul's employer's liability and contract liability exclusions preclude coverage for Perdue's claims, or whether Defendants' delay in providing St. Paul with timely notice of Perdue's claims precludes any recovery under the Policy.
For the reasons previously stated, the court concludes that Defendants have failed to demonstrate that Perdue's claims are covered under St. Paul's Commercial General Liability Policy. Moreover, Defendants' have failed to raise a genuine issue of material fact that such claims are potentially covered under the policy. Plaintiffs Motion for Summary Judgment is therefore granted. Consequently, the court declares that St. Paul has no duty to defend or indemnify Defendants for the claims asserted against them in the underlying state action styled Gerry Perdue v. Yaromir Steiner, Steiner Associates, Inc. d/b/a the Centrum Property Company, d/b/a Centrum Towers and d/b/a Steiner Management, Inc., Brenda Brushaber, Centrum G.S. Ltd., Goodyork Corporation, and Steiner Management, Inc., Cause No. 95-08507-F, 116th Judicial District Court. As the court has granted Plaintiffs Motion for Summary Judgment, a favorable ruling on Defendant's Cross-Motion for Summary Judgment would be wholly inconsistent with what the court has concluded with respect to Plaintiffs Motion for Summary Judgment. Accordingly, Defendants' Cross-Motion for Summary Judgment is denied. This action is hereby dismissed with prejudice. Judgment will be entered by separate document.
It is so ordered this 31st day of October, 2000.