United States District Court, D. Massachusetts
MEMORANDUM AND ORDER REGARDING WILLIAM H. COSBY'S
MOTION TO DISMISS OR. IN THE ALTERNATIVE. FOR JUDGMENT ON THE
PLEADINGS. AND PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
(DKT. NOS. 104 AND 110)
G. MASTROIANNI United States District Judge.
action, AIG Property Casualty Company ("AIG") seeks
a declaration that it has no duty to defend or indemnify
William H. Cosby, Jr. under two insurance policies in
relation to three defamation cases which are or were also
pending in this court: Green v. Cosby, Case No.
14-cv-30211- MGM, Ruehli v. Cosby, Case No.
15-cv-13796-MGM, and McKee v. Cosby, Case No.
15-cv-30221- MGM. AIG contends the insurance policies
provide no coverage as to the defamation cases because of
exclusions for expenses "arising out of sexual
misconduct. After AIG amended its complaint, Cosby filed a
motion to dismiss or, in the alternative, for judgment on the
pleadings, asserting the sexual misconduct exclusions do not
unambiguously apply to the defamation cases so as to bar
coverage. AIG, for its part, has filed a motion for
summary judgment, arguing it is entitled to affirmative
relief as a matter of law based on the sexual misconduct
exclusions. For the following reasons, the court will grant
Cosby's motion in part and deny AIG's motion.
Background and Procedural History
following facts come from AIG's amended complaint,
attachments thereto, and official public records in the form
of judicial documents. See Grajales v. Puerto Rico Ports
A.uth., 682 F.3d 40, 44 (1st Cir. 2012). AIG issued
Massachusetts Homeowners Policy No. PCG 006004261
("Massachusetts Policy") and Personal Excess
Liability Policy No. PCG 006235889 ("Excess
Policy") to Cosby. (Dkt. No. 95, Am. Compl. ¶¶
16, 20.) Both policies were in effect from January 1, 2014 to
January 1, 2015. (Id. ¶¶ 17, 21.) The
policies require AIG to "pay damages [Cosby] is legally
obligated to pay for personal injury or property damage
caused by an occurrence covered by this policy anywhere in
the world." (Id. ¶¶ 19,
The policies define "personal injury" as including
"[b]odily injury"; "[s]hock, emotional
distress, mental injury"; [i]nvasion of privacy";
and "[d]efamation, libel, or slander."
(Id., Exs. A and B, at pt. I.) The Massachusetts
Policy also requires AIG to "pay the costs to defend
[Cosby] against any suit seeking covered damages for personal
injury or property damage, even if the suit is false,
fraudulent, or groundless." (Id. ¶ 19.)
And the Excess Policy states AIG "will defend [Cosby]
against any suit seeking damages covered by Excess Liability
. . . under this policy and where . . . [f]he underlying
insurance has been exhausted by payment of claims [or] [n]o
underlying insurance applies. . . even if the allegations of
the suit are groundless, false, or fraudulent."
(Id., Ex. B., at pt. IV.A.)
Massachusetts Policy contains an exclusion which states that
it "does not provide coverage for liability, defense
costs or any other cost or expense for . . . [p]ersonal
injury arising out of any actual, alleged, or threatened by
any person: (a) sexual molestation, misconduct or
harassment;... or (c) sexual, physical or mental abuse."
(Id. ¶ 19.) Similarly, the Excess Policy
contains an exclusion stating it "does not provide
coverage for liability, defense costs or any other cost or
expense . . . [a]rising out of any actual, alleged or
threatened: a. Sexual misconduct, molestation or
harassment... or c. Sexual, physical or mental abuse."
(Id. ¶ IV, Ex. B, at pt. V.B.3.) The court will
refer to these two exclusions as the "sexual misconduct
December 10, 2014, Tamara Green filed a complaint against
Cosby for defamation. (Am. Compl. ¶ 26; Green v.
Cosby, Case No. 14-cv-30211-MGM, Dkt. No. 1.) An amended
complaint, which added Therese Serignese and Linda Traitz as
plaintiffs along with Green, was filed on January 5, 2015,
and a second amended complaint was filed on April 21, 2015.
(Am. Compl. ¶ 27; Green v. Cosby, Case No.
14-cv-30211-MGM, Dkt. Nos. 13, 48.) On June 26, 2015, AIG
commenced this declaratory judgment action directed at the
Green case and the allegations contained in the
second amended complaint therein. (Dkt. No. 1, Compl.)
November 9, 2015, Kristina Ruehli filed a complaint against
Cosby for defamation. (Am. Compl. ¶ 92, Ex.
On November 13, 2015, a third amended complaint was filed in
the Green case, adding as plaintiffs Louisa Moritz,
Barbara Bowman, Joan Tarshis, and Angela Leslie, and adding
claims for invasion of privacy (false light) and intentional
infliction of emotional distress on behalf of all the
plaintiffs. (Am. Compl. ¶ 28, Ex. C.) And on December
21, 2015, Katherine Mae McKee filed a complaint against Cosby
for defamation. (Am. Compl. ¶ 100, Ex. E.) The underlying
plaintiffs in the Green, Ruehli, and McKee
cases alleged that many years ago Cosby sexually assaulted
them and they subsequently disclosed the assaults to the
public. The underlying plaintiffs further allege that in
Cosby, directly or through spokespeople, falsely and publicly
denied the accusations, thereby defaming them and, as to the
Green plaintiffs, placing them in a false light and
intentionally inflicting emotional distress. (Am. Compl.
¶¶ 30-105.) AIG filed its amended complaint in this
action, seeking declaratory relief as to its duty to defend
and indemnify Cosby regarding the three defamation cases, on
March 31, 2016.
on June 26, 2015 (the same day AIG commenced this action),
AIG brought a separate declaratory judgment action in the
United States District Court for the Central District of
California, AIG Prop. Cas. Co. v. Cosby, Case No. CV
15-04842-BRO (RAOx) ("California Action"),
regarding its insurance obligations as to a similar
defamation case filed against Cosby in California state
court, Dickinson v. Cosby, case no. BC58090. The
California Action involves the same Massachusetts Policy and
Excess Policy as in this case, as well as a California
Homeowners Policy. (Dkt. No. 19, Ex. C.) Moreover, the
plaintiff in Dickinson also claimed that Cosby
sexually assaulted her years ago and that Cosby's public
denial of that accusation renders him liable for defamation,
false light, and intentional infliction of emotional
distress. (Dkt. No. Ill. Ex. A.) AIG claimed in the
California Action, as it does here, that the sexual
misconduct exclusions preclude coverage because the allegedly
defamatory statements which form the basis of the claims in
Dickinson "aris[e] out of sexual misconduct.
(Dkt. No. 19, Ex. C.)
court granted Cosby's motion to dismiss in the California
Action, holding AIG has a duty to defend Cosby in
Dickinson because the sexual misconduct exclusions
do not unambiguously bar coverage. AIG Prop. Cas. Co. v.
Cosby, 2015 WL 9700994 (CD. Cal. Nov. 13, 2015).
Notably, the court applied California law to the coverage
dispute. It reasoned as follows:
Here, the policies arose in both California and
Massachusetts. However, where the applicable rules of law of
the potentially concerned jurisdictions do not materially
differ, the Court may proceed to apply the law of the forum.
. . . The party arguing that foreign law governs has the
burden to identify the applicable law.... [AIG] asserts that
Massachusetts and California law ought to govern this case,
but represents that the laws of those states do not conflict.
Therefore, the Court will apply California law, the law of
the forum here.
Id. at *3 n.2 (internal citations and quotation
marks omitted). The court explained that under California
law, "both [AIG's] broad interpretation and
[Cosby's] narrow interpretation of 'arising out of
are reasonable." Id. at *5. Under Cosby's
narrow interpretation, which the court found supported by a
line of California cases, "the injuries Dickinson
allegedly suffered originate from [Cosby's] statements,
which have only an attenuated factual connection with sexual
misconduct. Sexual misconduct may be the subject matter of
[Cosby's] statements, but [Cosby's] statements, not
his alleged sexual misconduct directly caused the injury for
which Dickinson now seeks relief." Id. at *6.
The court also noted that a separate sexual misconduct
exclusion in the Excess Policy applicable to "Limited
Charitable Board Directors and Trustees Liability" bars
coverage for damage "arising out of, or in any way
involving, directly or indirectly, any alleged sexual
misconduct." Id. at *5 (emphasis added).
Accordingly, the court explained, if AIG "wished to
exclude a claim 'in anyway involving' sexual
misconduct, " which "language is unquestionably
broader" than the exclusions at issue, "it could
have included such language, " and AIG's
"decision not to do so suggests that a narrow
interpretation" is reasonable. Id. Because the
"arising out of language in the sexual misconduct
exclusions is "reasonably susceptible to [Cosby's]
narrow interpretation, and thus, ambiguous, " and
"[a]ny ambiguous terms are interpreted in favor of
finding coverage, " the court concluded AIG had a duty
to defend Cosby in the Dickinson case. Id.
at *4, 5-6.
Standard of Review
as now, a motion for judgment on the pleadings under Federal
Rule of Civil Procedure 12(c) is employed as a vehicle to
test the plausibility of the complaint, it must be evaluated
as if it were a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6)." Grajales, 682 F.3d at 44.
"[T]o survive a Rule 12(b)(6) motion (and, by extension,
a Rule 12(c) motion), a complaint must contain factual
allegations that 'raise a right to relief above the
speculative level, on the assumption that all the allegations
in the complaint are true . . . .'"
Perez-Acevedo v. Rivero-Cubano, 520 F.3d 26, 29 (1st
Cir. 2008) (quoting Bell Atlantic v. Twombly, 550
U.S. 544, 555 (2007)). That said, the pertinent facts are not
disputed, and under both California and Massachusetts law
(the substantive law the parties assert governs this
dispute), interpretation of an insurance policy is a question
of law for the court. See Encompass Ins. Co. v. Coast
Nat'l Ins. Co., 764 F.3d 981, 984 (9th Cir. 2014);
Certain Interested Underwriters at Lloyd's, London v.
Stolberg, 680 F.3d 61, 65 (1st Cir. 2012).
argues this action should be dismissed because the sexual
misconduct exclusions do not apply to the underlying claims
in the defamation cases or, at least, are ambiguous, in which
case the policy language must be construed against the
drafter (AIG) and in favor of coverage. AIG opposes
Cosby's motion to dismiss, and seeks summary judgment on
its own behalf, on the ground that the sexual misconduct
exclusions clearly bar coverage.
preliminary matter, the parties disagree as to which law
should apply. Cosby asserts California law governs because
judicial estoppel bars AIG from asserting Massachusetts and
California law are in conflict since, in the California
Action, the court relied on AIG's representation to the
contrary. Cosby also argues application of California law is
appropriate under applicable choice-of-law principles. AIG
counters that judicial estoppel does not apply because the
conditions for invoking the doctrine are not met. Moreover,
AIG argues Massachusetts law governs this dispute because
Cosby's primary residence (covered by the Massachusetts
Policy) is in Massachusetts and the underlying defamation
cases are pending here as well.