United States District Court, D. Massachusetts
NATIONAL UNION FIRE INSURANCE CO. OF PITTSBURGH, PA, Plaintiff,
MARITIME TERMINAL, INC., Defendant.
MEMORANDUM AND ORDER
J. CASPER UNITED STATES DISTRICT JUDGE.
National Union Fire Insurance Co. of Pittsburgh, PA
(“National Union”) has filed this lawsuit against
Defendant Maritime Terminal, Inc. (“Maritime”)
seeking a declaratory judgment that it is not obligated to
defend and indemnify Maritime under Warehouse Legal Liability
Policy No. 051766034 (“the Policy”) in connection
with two civil actions in Bristol Superior Court (the
“Underlying Actions”). D. 4; D. 50; D. 51 at 1
n.1; D. 54 at 1 n.1. National Union has moved for summary
judgment. D. 50. For the reasons discussed below, the Court
DENIES the motion without prejudice.
Standard of Review
Court grants summary judgment where there is no genuine
dispute as to any material fact and the undisputed facts
demonstrate that the moving party is entitled to judgment as
a matter of law. Fed.R.Civ.P. 56(a). Material facts are those
that carry the potential “to affect the outcome of the
suit under the applicable law.” Santiago-Ramos v.
Centennial P.R. Wireless Corp., 217 F.3d 46, 52 (1st
Cir. 2000) (quoting Sanchez v. Alvarado, 101 F.3d
223, 227 (1st Cir. 1996)). The movant bears the burden of
demonstrating the absence of a genuine issue of material
fact. Carmona v. Toledo, 215 F.3d 124, 132 (1st Cir.
2000); see Celotex Corp. v. Catrett, 477 U.S. 317,
323 (1986). “If he does so, the burden shifts to the
nonmovant to establish that a genuine material dispute
exists.” Harley-Davidson Credit Corp. v.
Galvin, 807 F.3d 407, 411 (1st Cir. 2015). That is, the
nonmoving party “must, with respect to each issue on
which she would bear the burden of proof at trial,
demonstrate that a trier of fact could reasonably resolve
that issue in her favor.” Borges ex rel. S.M.B.W.
v. Serrano-Isern, 605 F.3d 1, 5 (1st Cir. 2010). In
conducting this inquiry, the Court “constru[es] the
record in the light most favorable to the non-movant and
resolv[es] all reasonable inferences in that party's
favor.” Prescott v. Higgins, 538 F.3d 32, 39
(1st Cir. 2008).
Factual Background and Procedural History
Union issued the Policy to Maritime for the period of April
1, 2013 to April 1, 2014 via a renewal certificate of a
previously issued insurance policy. D. 51-1 at 2, 23-24. The
Policy provides coverage from National Union to Maritime for
liability resulting from “loss or damage to personal
property owned by customers in the care, custody or control
of [Maritime] for storage, under bills of lading, shipping or
warehouse receipt” for specific locations operated by
Maritime including 276 MacArthur Drive, Whalers Wharf, New
Bedford, MA. D. 51-1 at 4, 7. Pursuant to the Policy,
National Union agreed to “pay on behalf of [Maritime]
all sums, not exceeding the limit of liability . . . which
[Maritime] shall become legally obligated to pay as
damages” as a result of the loss or damage to
Maritime's customers' personal property. D. 51-1 at
5. As part of the Policy, National Union agreed to
“[d]efend any suit against [Maritime] alleging such
damage or destruction and seeking damages on account
thereof” as well as pay “all costs taxed against
[Maritime] in any such suit and all interest accruing after
entry of judgment until [National Union] has paid, tendered
or deposited in court such part of such judgment as does not
exceed the limit of the Company's liability
thereon.” Id. That is to say, National Union
agreed to defend and indemnify National Union should Maritime
incur liability for losses and damages covered under the
terms of the Policy.
Policy also includes a number of exclusions from coverage. D.
51-1 at 5-6. Relevant to this litigation, exclusion (e)
provides that the Policy does not cover Maritime if the
“[l]oss, damage or expense” resulted “from
insects, inherent vice, deterioration, dampness of
atmosphere, inadequate warehouse temperature due to
overcapacity, [or] for wear and tear.” D. 51-1 at 17.
Pursuant to exclusion (s), the Policy also excludes coverage
for liability or loss resulting from “[b]reakdown of,
failure or improper operating of any refrigeration machinery
or equipment” caused Maritime's liability, unless
the legal liability resulted from “sudden and
accidental breakdown of refrigeration equipment” or
“incorrect or improper setting of temperature controls
by [Maritime] or [Maritime's] employees.” D. 51-1
at 6, 18.
2014, Kyler Seafood Inc. (“Kyler”) and Hygrade
Ocean Products, Inc. (“Hygrade”) filed the
Underlying Actions against Maritime, alleging that Kyler and
Hygrade's seafood product had been compromised and
spoiled in July and August of 2013 as a result of equipment
breakdown at Maritime's warehouse. D. 51-2 at 6-7; D.
51-3 at 6-7. Each complaint additionally alleged that
Maritime had had difficulty in maintaining proper
temperatures in the warehouse and the deep freezer containers
where the seafood product was stored. D. 51-2 at 7; D. 51-3
at 7. Accordingly, both Kyler and Hygrade sought damages from
Maritime for a number of state claims. D. 51-2 at 10, 12-13,
15, 17; D. 51-3 at 8-11.
on December 18, 2014, National Union instituted this action,
requesting that this Court determine whether National Union
was obligated under the Policy to defend and indemnify
Maritime in connection with the Underlying Actions. D. 4 at
1. Maritime moved to dismiss or stay the action on February
10, 2015. D. 12. The Court allowed the motion to stay until
December 15, 2016. D. 26; D. 34; D. 40. At a conference with
the parties shortly thereafter, the Court lifted the stay,
required initial disclosures and set a summary judgment
schedule at National Union's request. D. 44. National
Union subsequently filed a motion for summary judgment. D.
50. The Court heard the parties on the pending motion and
took the matter under advisement. D. 61.
The Court Denies National Union's Motion for Summary
The Court Denies National Union's Motion for Summary
Judgment with Respect to its Duty to Defend Maritime Under
Union first seeks a declaration stating that it is not
obligated under the Policy to defend Maritime in connection