United States District Court, D. Massachusetts
OPINION AND ORDER
A. O'TOOLE, JR. UNITED STATES DISTRICT JUDGE.
plaintiff, Sterngold Dental, LLC, (Sterngold) manufactures
and sells dental products. It purchased a commercial
liability insurance policy from the defendant, HDI Global
Insurance Company (HDI), providing coverage against, among
other things, “personal and advertising injury
liability.” The policy was in effect for calendar year
The Policy and Underlying Claim
to the policy, HDI agreed to “pay those sums that the
insured becomes legally obligated to pay as damages because
of ‘personal and advertising injury' to which this
insurance applies, ” and to “defend the insured
against any ‘suit' seeking those damages.”
(Compl., Ex. A, Commercial Lines Policy, 20 (dkt. no. 1-1).)
The policy defines “personal and advertising
injury” in part as follows:
“Personal and advertising injury” means injury .
. . arising out of one or more of the following offenses: . .
f. The use of another's advertising idea in your
g. Infringing upon another's copyright, trade dress or
slogan in your “advertisement”.
(Id. at 29.) The policy defines
“advertisement” as “notice that is
broadcast or published . . . about your goods, products or
services for the purpose of attracting customers or
supporters, ” including such notices “placed on
the internet or on similar electronic means of
communication.” (Id. at 27.)
is also a pertinent exception to the policy coverage. Section
I(B)(2)(i) of the policy contains an intellectual
property exclusion clause (“IP Exclusion”), which
provides that, subject to certain limited exceptions,
“This insurance does not apply to: . . .
‘Personal and advertising injury' arising out of
the infringement of copyright, patent, trademark, trade
secret or other intellectual property rights.”
(Id. at 21.)
2016, Sterngold was sued by Intra-Lock International, Inc.
(“Intra-Lock”), another company in the business
of selling dental products (the “Intra-Lock
Action”). The suit concerned Sterngold's purported
infringement of Intra-Lock's patents and trademarks.
Count III of Intra-Lock's complaint, the only claim
relevant here, alleged that “OSSEO” marks used by
Sterngold were infringing the registered “OSSEAN”
trademark that Intra-Lock used for its patented version of
the same product. Intra-Lock specifically alleged that
“Sterngold had begun using the confusingly similar
marks OSSEO™ and OSSEOs™ with osseointegrative
dental implant coatings in internet advertising, ” and
that its use of these marks “deceived third parties as
to the affiliation, connection or association of Sterngold
with [Intra-Lock] and as to whether or not [Intra-Lock] has
anything to do with the origin, sponsorship, or approval of
the goods.” Compl. ¶¶ 33- 34, Intra-Lock
Int'l, Inc. v. Sterngold Dental, LLC, No.
16-cv-80699-WJZ (S.D. Fla. May 3, 2016), ECF No. 1.
tendered defense of the Intra-Lock Action to HDI. HDI denied
coverage and refused to defend Sterngold. Sterngold and
Intra-Lock ultimately settled the case. Shortly thereafter,
Sterngold requested that HDI indemnify it for the damages it
was obligated to pay in connection with the settlement and
dismissal. HDI again refused.
commenced this action seeking a declaratory judgment that HDI
had a duty to defend or indemnify it in the Intra-Lock
Action, as well as damages. HDI has responded by moving to
dismiss the complaint for failure to state a claim.
Sterngold's claims are premised on its allegation that
HDI breached its obligations under the policy because Count
III of the Intra-Lock Action, for trademark infringement,
triggered coverage. HDI responds that the Intra-Lock action
did not allege an injury covered under the policy. The
parties here do not dispute the general facts of the case or
point to any ambiguity within the terms of the policy. Their