Essex Insurance Company v. Foley et al

Filing 64

Order denying 58 Renewed MOTION for Summary Judgment filed by Essex Insurance Company, denying 61 MOTION to Strike filed by Michael E. Foley, Susan M. Foley. Water's Edge is ordered to Show Cause by 11/10/2011 why default should not be entered against it as a sanction for its persistent failure/refusal to comply with court orders. Signed by Chief Judge William H. Steele on 10/31/2011. Copy mailed to Water's Edge (tgw)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
ESSEX INSURANCE COMPANY,
Plaintiff,
v.
MICHAEL E. FOLEY, et al.,
Defendants.

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CIVIL ACTION 10-0511-WS-M

ORDER
This matter comes before the Court on the Renewed Motion for Summary Judgment
(doc. 58) filed by plaintiff, Essex Insurance Company. The Motion has been briefed and is now
ripe for disposition.1
I.

Relevant Background.
This declaratory judgment action was brought by Essex Insurance Company to resolve an

insurance coverage dispute arising from a slip-and-fall accident at premises owned by its insured,
1

Also pending is defendants’ Motion to Strike Plaintiff’s Renewed Motion for
Summary Judgment (doc. 61). Even if the arguments in the Motion to Strike are accepted at face
value, they would warrant, at most, denial of the Renewed Motion for Summary Judgment.
Defendants have not shown why the extreme remedy of striking that Renewed Motion (as
opposed to merely denying it) is appropriate, nor can the undersigned perceive any constructive
purpose that would be served by striking a Rule 56 Motion simply because it is deemed to lack
merit. See generally Odom v. Southeast Supply Header, LLC, 2009 WL 1658961, *1 (S.D. Ala.
June 11, 2009) (“The mere presence of legal and factual disputes, without more, hardly justifies
the extreme and disfavored remedy of striking [a party’s] pleading pursuant to Rule 12(f).”);
English v. CSA Equipment Co., 2006 WL 2456030, *2 & n.5 (S.D. Ala. Aug. 22, 2006)
(describing limited circumstances in which draconian remedy of striking material from court file
is appropriate); McGlauflin v. RCC Atlantic Inc., 269 F.R.D. 56, 57 (D. Me. 2010) (explaining
that motions to strike are disfavored because “[m]odern litigation is too protracted and expensive
for the litigants and the court to expend time and effort pruning or polishing the pleadings”)
(citation omitted); Exhibit Icons, LLC v. XP Companies, LLC, 609 F. Supp.2d 1282, 1300 (S.D.
Fla. 2009) (“Motions to strike, however, are generally disfavored by the court,” and are a
“drastic remedy to be resorted to only when required for the purposes of justice”) (citations
omitted). Simply put, the Court “will not strike a … brief simply because an argument expressed
therein may suffer from a logical or factual defect.” English, 2006 WL 2456030, at *2. The
Motion to Strike is denied as improper.

defendant Water’s Edge, LLC. The accident occurred in Fort Morgan, Alabama, when
defendant Michael Foley fell on a plywood ramp that Water’s Edge had constructed at a Tacky
Jack’s restaurant where he was employed. Foley (and his wife, defendant Susan Foley) filed suit
against Water’s Edge and others in state court, seeking to recover money damages for Foley’s
injuries sustained in that accident. Essex has been furnishing a defense to Water’s Edge in the
state-court proceedings, but seeks a declaration from this Court that it owes no duty to defend
Water’s Edge.
The Court is keenly familiar with the legal issues joined in this action. After all, more
than eight months ago, just after discovery commenced, Essex moved for summary judgment on
the duty to defend issue. At that time, Essex maintained that a Classification Limitation
Endorsement (the “Classification Endorsement”) in the subject insurance policy barred coverage
for the Foleys’ claims. The Classification Endorsement reads as follows: “The coverage
provided by this policy applies only to those operations specified in the application for insurance
on file with the company and described under the ‘description’ or ‘classification’ on the
declarations of the policy.” (Doc. 1, Exh. C, at 7.) The summary judgment record
unambiguously showed that the only type of operation specified in the insurance application
completed by Water’s Edge was “Marina,” and that the policy itself listed as insured
classifications “Boat Moorage and Storage,” “Vessel Fueling,” and “Store Sales.” (Doc. 1, Exh.
D, at 1; doc. 1, Exh. C, at 2.) At its core, Essex’s argument was that it should be awarded
summary judgment on the duty to defend issue because the Foleys’ claims concern Water’s Edge
activities that were outside the scope of that Classification Endorsement.
On May 5, 2011, the undersigned issued a 15-page Order (doc. 40) denying Essex’s
initial motion for summary judgment. The salient aspects of that ruling included the following:
(i) the Classification Endorsement was ambiguous as to whether coverage reached operations
specified in either the application or the declarations, or whether a given operation must be
recited in both the application and the declarations to be covered; (ii) under Alabama law, such
ambiguity must be resolved in favor of the insured; (iii) resolving the ambiguity in light of that
legal principle, “as long as the Foleys’ claims relate to Water’s Edge operations that are either
specified in the application or described under the ‘classification’ on the Policy’s declarations,
the duty to defend attaches” (doc. 40, at 9); (iv) the common, everyday meaning of the term
“marina operations” includes not only boat slips, but also “a variety of ancillary, complimentary
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facilities and services above and beyond the mere moorage of vessels” (id. at 12); (v) “[i]t is no
great stretch to say that Water’s Edge’s covered ‘marina operations’ may include the
management, oversight, and coordination of support services for common areas used by ancillary
service providers at Water’s Edge’s marina” (id. at 13); and (vi) genuine issues of material fact
existed as to whether Water’s Edge’s conduct in building the ramp at Tacky Jack’s fell within the
scope of covered marina operations under the Classification Endorsement or not.
In August 2011, after the close of discovery, Essex moved for summary judgment a
second time, without leave of court. Once again, Essex’s theory is that there are no genuine
issues of material fact and that coverage to Water’s Edge for the Foley’s claims is barred by the
Classification Endorsement. Water’s Edge (which is presently without counsel and subject to
entry of default pursuant to an Order (doc. 49) entered by Magistrate Judge Milling back in July
2011) has not responded to the Essex’s Renewed Motion for Summary Judgment; however, the
Foleys have done so.2
2

A threshold question is whether Essex can properly renew its summary judgment
motion at all. Contrary to the parties’ apparent assumption, no federal litigant has an absolute
right to bring multiple, piecemeal motions for summary judgment; rather, a successive Rule 56
motion may be filed only with the district court’s authorization. See, e.g., Fernandez v. Bankers
Nat’l Life Ins. Co., 906 F.2d 559, 569 (11th Cir. 1990) (“Two motions for summary judgment
may be ruled upon in the same case, particularly when … the district judge allows a second
summary judgment motion.”); Siemens Westinghouse Power Corp. v. Dick Corp., 219 F.R.D.
552, 554 (S.D.N.Y. 2004) (explaining that courts do “not approve in general the piecemeal
consideration of successive motions for summary judgment because parties ought to be held to
the requirement that they present their strongest case for summary judgment when the matter is
first raised”) (citations omitted); Sanders v. York, 2008 WL 1925232, *4 (E.D. Cal. Apr. 30,
2008) (“The court will not allow defendants another ‘bite at the apple’ to file a second summary
judgment motion addressing the merits of the remaining claims … as it would waste court
resources and delay resolution of this action”); McCabe v. Bailey, 2008 WL 1818527, *1 (N.D.
Iowa Apr. 4, 2008) (enforcing “one-summary-judgment-motion-per-party” rule “to conserve
scarce judicial resources, prevent repetitive motions and forestall potential abuse”). The
undersigned has observed the importance of not allowing parties to “treat their initial summary
judgment motions as a ‘dry run’ which they would have an opportunity to redo or supplement –
at considerable additional cost to opposing parties and at a considerable drain to scarce judicial
resources – via a new Rule 56 motion later on to correct any deficiencies identified by opposing
counsel or the court in processing the initial motion.” Middlegate Development, LLP v. Beede,
2011 WL 3475474, *11 n.26 (S.D. Ala. Aug. 9, 2011). In its discretion, and in the absence of
any objection from nonmovants, the Court will consider Essex’s Renewed Motion for Summary
Judgment, at least insofar as it relies on newly obtained evidence gleaned from discovery.

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II.

Summary Judgment Standard.
Summary judgment should be granted only “if the movant shows that there is no genuine

dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Rule
56(a), Fed.R.Civ.P. The party seeking summary judgment bears “the initial burden to show the
district court, by reference to materials on file, that there are no genuine issues of material fact
that should be decided at trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991).
Once the moving party has satisfied its responsibility, the burden shifts to the non-movant to
show the existence of a genuine issue of material fact. Id. “If the nonmoving party fails to make
'a sufficient showing on an essential element of her case with respect to which she has the burden
of proof,' the moving party is entitled to summary judgment.” Id. (quoting Celotex Corp. v.
Catrett, 477 U.S. 317 (1986)) (footnote omitted). “In reviewing whether the nonmoving party
has met its burden, the court must stop short of weighing the evidence and making credibility
determinations of the truth of the matter. Instead, the evidence of the non-movant is to be
believed, and all justifiable inferences are to be drawn in his favor.” Tipton v. Bergrohr GMBHSiegen, 965 F.2d 994, 999 (11th Cir. 1992) (internal citations and quotations omitted).
“Summary judgment is justified only for those cases devoid of any need for factual
determinations.” Offshore Aviation v. Transcon Lines, Inc., 831 F.2d 1013, 1016 (11th Cir. 1987)
(citation omitted).
III.

Analysis.
Both sides devote considerable attention to arguments that are non-starters.3 The Court

will dispatch those red herrings before narrowing its focus to the specific issue properly raised on
summary judgment, to-wit: Whether new evidence gleaned during the discovery process
unequivocally establishes that the Foleys’ claims against Water’s Edge fall outside the scope of
the Classification Endorsement, such that Essex owes no duty to defend Water’s Edge under the
subject insurance policy.

3

Such detours into demonstrably weaker arguments in briefing this second motion
for summary judgment are a compelling reminder of why the pursuit of successive Rule 56
motions is strongly disfavored by federal courts as an unproductive use of scarce judicial and
litigant resources.

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A.

The Foleys Have Standing to Be Heard on the Rule 56 Motion.

Essex urges the Court to disregard the Foleys’ brief in response to its Rule 56 Motion,
reasoning that they lack standing to be heard on the duty to defend issues. In Essex’s words,
“[t]he Foley’s [sic] are not a party to the insurance contract between Essex and Water’s Edge,
they gain no benefit from requiring Essex to defend Water’s Edge in the underlying suit, and
their right to continue the personal injury claim against Water’s Edge is not impacted.” (Doc.
63, at 5.)
The Court finds this argument unpersuasive for several reasons. First, as a procedural
matter, this contention is not properly raised because Essex articulated it for the first time in its
reply brief. See, e.g., Herring v. Secretary, Dep’t of Corrections, 397 F.3d 1338, 1342 (11th Cir.
2005) (“As we repeatedly have admonished, arguments raised for the first time in a reply brief
are not properly before a reviewing court.”) (internal quotes omitted).4 Essex knew or should
have known that the Foleys would oppose its present Rule 56 Motion (just as the Foleys opposed
Essex’s first Rule 56 Motion), yet chose to remain silent about the standing issue until its reply
brief, after it was too late for the Foleys to be heard. Essex’s election not to advance in its
principal brief readily available arguments concerning the standing of the only active defendants
in this case precludes it from propounding those contentions in its Reply.
Second, Essex’s standing argument is a troubling reversal of its own position in this
litigation. The Foleys did not intervene as defendants in this action. They did not worm their
way into an insurer/insured dispute as uninvited guests via clever Rule 24 maneuvering. To the
contrary, the Foleys are here because Essex compelled them to be here by naming them as
defendants in this declaratory judgment action, which by plaintiff’s own reckoning relates solely
4

See also Sharpe v. Global Sec. Int’l, 766 F. Supp.2d 1272, 1294 n.26 (S.D. Ala.
2011) (“Because it is improper for defendant to raise this new argument in its reply brief, that
argument will not be considered.”); Abrams v. Ciba Specialty Chemicals Corp., 663 F. Supp.2d
1220, 1232 n.16 (S.D. Ala. 2009) (“new arguments are impermissible in reply briefs”). The
undersigned has outlined the virtues of this restriction as follows: “In order to avoid a scenario in
which endless sur-reply briefs are filed, or the Court is forced to perform a litigant’s research for
it on a key legal issue because that party has not had an opportunity to be heard, or a movant is
incentivized to save his best arguments for his reply brief so as to secure a tactical advantage
based on the nonmovant’s lack of opportunity to rebut them, this Court does not consider
arguments raised for the first time in a reply brief.” Hardy v. Jim Walter Homes, Inc., 2008 WL
906455, *8 (S.D. Ala. Apr. 1, 2008). Those considerations loom large here.

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to “a determination of the duty to defend.” (Doc. 63, at 3.) What’s more, in naming the Foleys
as defendants, Essex asserted in its Complaint that “[t]he Foleys … are proper parties to this
action because their rights will be affected by the outcome of this declaratory action.” (Doc. 1,
¶ 37.) Like most insurers in declaratory judgment actions, Essex joined all known interested
parties to obtain a global resolution of coverage issues that would be binding on all of them,
rather than litigating these issues piecemeal across multiple lawsuits spanning separate interested
parties. For Essex now to state that the Foleys have no right to defend against the very action
that Essex brought against them represents a remarkable about-face. The Court declines
plaintiff’s apparent suggestion that the Foleys are obliged to participate in this litigation as
defendants, on the one hand, even as they are forbidden from being heard as to Essex’s claims
for relief, on the other. See generally Casualty Reciprocal Exchange v. Wallace, 189 So.2d 861,
864 (Ala. 1966) (“In the instant declaratory judgment suit, the Brights had the right to defend. It
was no concern of theirs whether Robert Wallace defaulted or not. They (the Brights) were
called to litigate. Because another respondent failed to appear cannot affect their right to resist
the suit.”); Progressive Specialty Ins. Co. v. E & K Trucking, Inc., 2010 WL 2383971, *6 n.9
(S.D. Ala. June 11, 2010) (“If Progressive believes that Dial has no cognizable legal right to be
heard on the insurance coverage issues raised in the Complaint, then why did Progressive invite
Dial to the party by suing him?”).
Third, Essex’s assertion that the Foleys cannot gain or lose from entry of Essex’s
requested declaration that it owes no duty to defend Water’s Edge is inaccurate. It is true enough
that whether Essex has a contractual duty to defend Water’s Edge in the underlying suit brought
by the Foleys is fundamentally an issue between Essex and Water’s Edge. But the consequences
of a ruling that Essex owes no duty to defend Water’s Edge could be dire for the Foleys,
particularly if that ruling is binding on the Foleys in subsequent proceedings (as Essex would
presumably argue, on the theory that the Foleys were joined as defendants in this action and
should be bound by coverage determinations herein). After all, as recent Eleventh Circuit
precedent confirms, a judicial determination of no duty to defend compels a finding of no duty to
indemnify. See Trailer Bridge, Inc. v. Illinois Nat’l Ins. Co., --- F.3d ----, 2011 WL 4346579, *9
(11th Cir. Sept. 19, 2011) (“[A] court’s determination that the insurer has no duty to defend
requires a finding that there is no duty to indemnify.”); see also National Cas. Co. v.
McFatridge, 604 F.3d 335, 338 (7th Cir. 2010) (“If an insurer has no duty to defend, it has no
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duty to indemnify.”); Nationwide Mut. Ins. Co. v. CPB Int’l, Inc., 562 F.3d 591, 595 n.3 (3rd Cir.
2009) (“A finding that the duty to defend is not present will preclude a duty to indemnify.”);
Looney Ricks Kiss Architects, Inc. v. Bryan, 761 F. Supp.2d 399, 404 (W.D. La. 2010) (“Since
the duty to defend is greater than the duty to provide coverage and the issue of coverage can
likewise be invoked by a third-party, then it presupposes that the duty to defend can be invoked
by a third-party. As such, LRK has standing to invoke Lafayette’s duty to defend Lafayette’s
insureds.”). So a determination in this case that Essex owes no duty to defend Water’s Edge in
the underlying action would likely scuttle the Foleys’ future attempts to have Essex pay any
judgment they might obtain against Water’s Edge in the underlying action. Thus, if Essex were
to be granted summary judgment on the duty to defend issue, the outcome could be catastrophic
to the Foleys’ ability to collect a judgment against Water’s Edge. The Foleys plainly have
standing to take action to prevent such a catastrophe.5
B.

Defendants Misread the May 5 Order.

Equally unavailing are the Foleys’ contentions in their response to the summary judgment
motion that two aspects of this Court’s May 5 Order are fatal to Essex’s renewed motion and,
instead, dictate that summary judgment be granted in the Foleys’ favor on all coverage issues.6
5

One other point bears mention. In arguing that the Foleys lack standing, Essex
relies on Canal Ins. Co. v. Cook, 564 F. Supp.2d 1322 (M.D. Ala. 2008). In Cook, the injured
plaintiff filed a motion for summary judgment seeking to force the insurer to defend the insured
in the state court action; however, the district court denied that motion for lack of standing. See
id. at 1326-27. But Cook is distinguishable, at least to the extent that the Foleys are simply
opposing a declaration that Essex owes no duty to defend, rather than affirmatively seeking (as
the injured plaintiff in Cook was) a declaration that the insurer possesses such a duty to defend.
The Foleys’ interest is not in obtaining an affirmative ruling that Essex owes a duty to defend
Water’s Edge, but in forestalling a declaration that Essex owes no such duty to defend. Stated
differently, a finding that Essex owes a duty to defend Water’s Edge says nothing about whether
the narrower duty to indemnify exists (and therefore does not help the Foleys), but a finding that
Essex owes no duty to defend to Water’s Edge would be fatal to the duty to indemnify (and
therefore would hurt the Foleys). This is the point to which the May 5 Order alluded, when in
the course of denying the Foleys’ countermotion for summary judgment on the duty to defend
issue, the Court questioned how the Foleys could have standing to seek such relief. (See doc. 40,
at 14-15.) It is unfortunate that this judicial query as to the Foleys’ misguided efforts to obtain
summary judgment mutated into an erroneous argument by Essex that the Foleys (whom Essex
haled into court herein) have no right to be heard on any issues joined in this litigation.
6

As to both of these arguments, the Foleys make conclusory statements that the
May 5 Order entitles them to summary judgment. Such a contention is puzzling at best, given
(Continued)
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In particular, the Foleys rely on portions of the May 5 Order concerning ambiguity and illusory
coverage in the subject insurance policy. In making such arguments, however, the Foleys
contort the meaning of that Order far beyond what its text might reasonably support.
1.

Ambiguity of the Essex Policy.

The Foleys assert that the May 5 Order held that the insurance policy is ambiguous and
that the meaning of the term “Marina Operations” is ambiguous. They further insist, without
explanation, that Essex’s present Rule 56 Motion is due to be denied, and a corresponding
judgment entered for the Foleys on coverage issues, simply because the ambiguity must be
resolved in the insured’s favor.7

that the May 5 Order specifically found that the Foleys were not entitled to summary judgment
on the Rule 56 motion they embedded in their response. Rather than explaining or
acknowledging the findings in the May 5 Order that none of the legal determinations therein
entitled the Foleys to summary judgment, the Foleys simply point to two aspects of that May 5
Order and state, in self-serving, conclusory fashion, that those portions of the Order, taken in
isolation, require entry of final judgment in their favor. If the Foleys are intending to ask the
Court to reconsider its denial of their Rule 56 Motion, they have not come close to satisfying the
legal threshold for reconsideration under Rule 60. “In the interests of finality and conservation
of scarce judicial resources, reconsideration of an order is an extraordinary remedy and is
employed sparingly.” Longcrier v. HL-A Co., 595 F. Supp.2d 1218, 1246 (S.D. Ala. 2008)
(citations omitted). In that regard, the Supreme Court has confirmed that motions to reconsider
“may not be used to relitigate old matters, or to raise arguments or present evidence that could
have been raised prior to the entry of judgment.” Exxon Shipping Co. v. Baker, 554 U.S. 471,
485 n.5, 128 S.Ct. 2605, 171 L.Ed.2d 570 (2008) (citation omitted); see also Richardson v.
Johnson, 598 F.3d 734, 740 (11th Cir. 2010) (“A motion for reconsideration cannot be used to
relitigate old matters, raise argument or present evidence that could have been raised prior to the
entry of judgment.”) (citation and internal quotation marks omitted). The Court declines to
reconsider its May 5 determination that the Foleys are not entitled to entry of summary
judgment.
7

The Foleys take this argument several steps further in their Motion to Strike,
wherein they assert that the May 5 Order’s finding of ambiguity “effectively ended the
Declaratory Judgment Action. … [B]ecause the Court already has ruled on the only issue raised
in Plaintiff’s Declaratory Judgment Action, namely that the subject policy language is
ambiguous, … there is no issue left to adjudicate and the Court should rule in favor of coverage
by entering a final order in favor of all Defendants. On May 5, 2011, when the Court found the
subject policy language ambiguous, the Court determined the only issue in the case.” (Doc. 61,
at 2.) Presumably, it is this reasoning that animates the Foleys’ present stance that the May 5
Order’s finding of ambiguity necessitates denial of Essex’s renewed summary judgment motion.

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This argument substantially distorts the plain language of the May 5 Order. That ruling
did not deem the terms “marina” or “marina operations” to be ambiguous. To be sure, the May 5
Order did find an area of ambiguity in the policy, but that ambiguity had nothing to do with
whether Water’s Edge’s conduct did or did not constitute marina operations. Rather, the May 5
Order deemed the Classification Endorsement ambiguous as to its language that coverage
“applies only to those operations specified in the application for insurance … and described …
on the declarations of the policy.” (Doc. 1, Exh. C, at 7.) As set forth in the May 5 Order, the
ambiguity was that the Classification Endorsement could be read as either (i) extending coverage
only to any operation that was both specified in the application and set forth in the declarations,
or (ii) extending coverage to any operation that was either specified in the application or set forth
in the declarations. The language of the policy could reasonably be read either conjunctively or
disjunctively, and the parties lobbied for conflicting interpretations. (See doc. 40, at 7-9.) The
May 5 Order resolved this ambiguity in the manner most favorable to the insured, as follows:
“[A]s long as the Foleys’ claims relate to Water’s Edge operations that are either specified in the
application or described under the ‘classification’ on the Policy’s declarations, the duty to defend
attaches.” (Doc. 40, at 9.) Of course, there remained a critical dispute of fact over whether
Water’s Edge’s conduct at issue in the underlying state lawsuit constituted “marina operations,”
in the customary, everyday meaning of the term. That fact dispute had no nexus to the ambiguity
in the policy, but was rather the product of an incomplete and undeveloped record. It was for
that reason (and not because of any ambiguity) that Essex’s first motion for summary judgment
was denied.
Thus, the ambiguity identified in the May 5 Order had nothing to do with the meaning of
the term “marina operations.” The Court construed the existing ambiguity in the manner most
favorable to the insured, and still found genuine issues of fact for trial. In light of these
circumstances, the Foleys’ suggestion that the May 5 Order found the term “marina operations”
ambiguous and that they are therefore entitled to prevail in this case because “there is no issue
left to adjudicate” is inaccurate by a wide margin. Contrary to the Foleys’ flawed interpretation,
the May 5 Order did not resolve this action in its entirety. Even after construing the identified
policy ambiguity in the insured’s favor, the May 5 Order explained that there were remaining
fact issues for trial as to whether Water’s Edge’s conduct in constructing the ramp at Tacky

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Jack’s fell within the scope of the plain, ordinary meaning of the term “marina operations.” The
Foleys cannot ignore or rewrite the May 5 Order to suit their purposes.
2.

“Illusory Coverage” is Extraneous to the Remaining Issues.

An alternative argument proffered by the Foleys is similarly flawed. Footnote 10 of the
May 5 Order addressed an “illusory coverage” issue. The Foleys now reproduce that footnote in
its entirety, profess their approval of it, and maintain (without elaboration) that footnote 10
mandates the denial of Essex’s renewed Motion for Summary Judgment and the entry of
judgment in the Foleys’ favor.
A fair reading of footnote 10 simply cannot support the Foleys’ position. That footnote
says nothing about whether Water’s Edge’s conduct is or is not “marina operations,” which is the
central issue still pending in this case. Rather, the footnote explains that Essex’s reading of the
Classification Endorsement (as requiring that a certain operation be listed both in the policy
application and on the declarations page in order to be covered, rather than in one location or the
other) would run afoul of the prohibition on illusory coverage. But the footnote made clear that
it was unnecessary to reach the “illusory coverage” issue at all because the May 5 Order had
already rejected Essex’s interpretation of the Classification Endorsement on ambiguity grounds.
As such, the illusory coverage issue had no bearing on the outcome of the May 5 Order.
Nor does the issue of illusory coverage have anything at all to do with the narrow
questions presented on summary judgment. The May 5 Order determined the meaning of the
Classification Endorsement, so there is no further room for debate in this action as to what that
endorsement means. The remaining question for trial is whether Water’s Edge’s conduct does or
does not constitute an operation listed in the application for insurance (which recited “marina” as
the sole operation for which coverage was sought). The illusory coverage issue is extraneous to
that question and relates to other arguments that the Court has already decided. It in no way
supports the Foleys’ position that the renewed motion for summary judgment should be denied.8
8

At best, the Foleys assert that the Classification Endorsement “completely
swallows up the Commercial General Liability Policy, for which Water’s Edge paid a separate
premium.” (Doc. 62, at 5.) They do not explain this position in any way, leaving a host of
unanswered questions. Nor does their “completely swallows up” argument make sense; after all,
as construed in the May 5 Order, the Classification Endorsement specifically allows CGL
coverage for “marina operations” as well as the specific operations listed on the declaration page,
so it obviously does not “completely swallow up” all such coverage. In any event, the Court is
(Continued)
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C.

Genuine Issues of Fact Remain.

At the core of Essex’s Renewed Motion for Summary Judgment is its contention that
newly discovered facts in discovery reveal that Water’s Edge did not construct the ramp outside
the Tacky Jack’s restaurant as part of its marina operations.9 To be sure, Essex concedes that
there “could be a question of fact that cannot be resolved through summary judgment” as to
whether the area where the ramp was constructed was part of the marina complex that Water’s
Edge was overseeing. (Doc. 58, at 11.)10 Nonetheless, Essex asserts that this new evidence
unambiguously establishes that Water’s Edge did not construct the ramp in furtherance of its
marina oversight responsibilities.
The evidence adduced in discovery on this point is as follows: A Water’s Edge employee
named Francis LaPointe observed a beer deliveryman having difficulty wheeling his hand cart
into the Tacky Jack’s restaurant at the marina after the restaurant parking lot was renovated.
(LaPointe Dep. I (doc. 58, Exh. C), at 32.) In particular, LaPointe saw that “[t]here was no way
for anyone to wheel their delivery down to where it had to go” because the previous ramp had
been cut off. (Id. at 33.) The very day that LaPointe observed this problem, he constructed the

not tasked with developing arguments that a summary judgment litigant has chosen to prevent in
only the barest of skeletal forms. See, e.g., Harris v. Hancock Bank, 2011 WL 1435500, *2 n.4
(S.D. Ala. Apr. 14, 2011) (“Federal courts generally do not develop arguments that the parties
could have presented but did not.”); Pears v. Mobile County, 645 F. Supp.2d 1062, 1081 n.27
(S.D. Ala. 2009) (“The parties … cannot be heard to balk if the undersigned does not perform
their research and develop their arguments for them.”).
9

It is proper to consider facts elicited in discovery in this matter in assessing
whether Essex does or does not owe Water’s Edge a duty to defend. See, e.g., Hartford Cas. Co.
v. Merchants & Farmers Bank, 928 So.2d 1006, 1010 (Ala. 2005) (in deciding whether
allegations of underlying complaint show covered action or occurrence, “the court is not limited
to the bare allegations of the complaint … but may look to facts which may be proved by
admissible evidence”) (citations omitted).
10

In its reply brief, Essex backtracks on this admission by arguing that it has
presented “uncontroverted evidence … that the ramp was built in an area that was not part of the
marina complex.” (Doc. 63, at 8.) Having taken this issue off the table as a ground for seeking
summary judgment in its principal brief, plaintiff cannot be heard to place it back on the table in
its reply. At a minimum, this would be unfair to the Foleys, who would effectively be deprived
of an opportunity to be heard on that issue by virtue of Essex’s reversal of position in its reply.

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new ramp at Tacky Jack’s on his own, and without assistance from others. (Id. at 33-34.) When
LaPointe built that ramp, he worked for Water’s Edge at the marina as a “[f]orklift driver; marina
employee.” (Id. at 10.)11 LaPointe was “on the clock” for Water’s Edge when he constructed
that ramp. (Id. at 49.) Amanda Stubbs, the Water’s Edge marina manager, testified that she did
not instruct LaPointe to construct such a ramp and that she does not know why he did it. (Stubbs
Dep. (doc. 58, Exh. A), at 90, 92.) This is consistent with LaPointe’s own testimony that “[n]o
one” told him to construct that ramp; rather, he indicated, “I decided to build what I had felt was
a temporary ramp.” (LaPointe Dep. II (doc. 58, Exh. D), at 44; LaPoint Dep. I, at 34.)
To be clear, the issue presented on summary judgment is not whether Water’s Edge may
be held legally responsible for LaPointe’s actions for purposes of the Foleys’ claims asserted
against it. The doctrines of respondeat superior, vicarious liability, and agency – and their
potential application to this case – have not been briefed by the parties; therefore, the Court
cannot and will not undertake to present and resolve such arguments for them. See, e.g., Fils v.
City of Aventura, 647 F.3d 1272, 1284 (11th Cir. 2011) (“district courts cannot concoct or
resurrect arguments neither made nor advanced by the parties”). The Court makes no findings
and expresses no opinions as to whether Water’s Edge may be held liable to the Foleys for
LaPointe’s conduct of building the ramp. Rather, the sole question here is whether the
construction of that ramp constitutes “marina operations” for purposes of Classification
Endorsement on the subject insurance policy.
Essex’s position that the construction of the ramp does not constitute marina operations,
as a matter of law, rests on the following facts: (i) the ramp was built solely for the use of Tacky
Jack’s restaurant operation; (ii) Water’s Edge had no contractual or other obligation to build the
ramp for Tacky Jack’s; (iii) LaPointe built the ramp on his own, without being directed to do so;
and (iv) after Foley slipped and fell, it was Tacky Jack’s (and not Water’s Edge) that conducted a
remedial investigation and undertook to improve the ramp. These facts, taken together, may well
suffice to convince a jury that Water’s Edge is not responsible for the dangerous condition on the
11

Essex suggests that LaPointe’s true job title was that of “dock attendant,” but
identifies no record evidence to support such a classification. At any rate, Water’s Edge “dock
attendants” are acutely involved in day-to-day marina operations, with duties including “fueling
boats, ice, taking ice to boats, moving boats from the storage area … out into the water and then
picking them back up and putting them away,” and so on. (Stubbs Dep., at 34.)

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ramp that culminated in Foley’s injury. Indeed, that seems to be thrust of Essex’s argument, as
its summary judgment brief is filled with assertions that “Water’s Edge was not responsible for
the ramp” and that LaPointe acted “outside the scope of his employment.” (Doc. 58, at 13.) If
the question presented was whether Water’s Edge bears any liability to the Foleys, or if Essex’s
renewed Rule 56 Motion had been bolstered by a discussion of applicable legal principles
relevant to vicarious liability (rather than simply conclusory statements that LaPointe was acting
beyond the scope of his employment), then perhaps Essex’s motion might stand on a different
footing. But, again, that is simply not the way this case is postured on summary judgment.
At the risk of belaboring the point, the critical insurance coverage question in this case is
whether the conduct for which the Foleys are suing Water’s Edge in state court amounts to
“marina operations.” The facts on that point are subject to differing interpretations. After all,
the actor in question was a Water’s Edge dock attendant, whose job duties (by Water’s Edge’s
own admission) centered on marina activities such as fueling, stocking and moving boats housed
at the marina. A reasonable finder of fact could find that the entire purpose of Water’s Edge
hiring and employing LaPointe was to perform marina operations. Moreover, this dock attendant
built the ramp for a marina tenant of Water’s Edge, and did so while he was on the clock for
Water’s Edge. A reasonable factfinder could infer from these facts that LaPointe’s construction
of the ramp on Water’s Edge’s behalf for a tenant of the marina complex was indeed a “marina
operation” within the scope of the Classification Endorsement. Stated differently, Water’s Edge
owned and/or operated the marina facility where the Tacky Jack’s restaurant was located. A
Water’s Edge dock attendant – whose entire function was to engage in marina operations – built
a ramp to assist that marina tenant during working hours for which he was being compensated by
Water’s Edge. Under the circumstances, it would be entirely reasonable to infer that his
activities on Water’s Edge’s behalf were indeed “marina operations,” within the customary,
everyday meaning of the phrase. In other words, a reasonable construction of these facts is that
Water’s Edge is being sued in state court for the acts of its employee in engaging in marina
maintenance and oversight activities on Water’s Edge’s behalf. The Court cannot and will not
construe facts and inferences in the light most favorable to Essex for purposes of evaluating
Essex’s summary judgment motion, and therefore cannot discard the reasonable inference from
record facts that the Foleys are suing Water’s Edge for the latter’s marina operations, which lie
squarely within the coverage provisions of the Classification Endorsement.
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Because Essex’s Renewed Motion for Summary Judgment essentially asks this Court to
disregard adverse inferences that may readily be drawn from record facts, and because a
reasonable fact finder could conclude from this record that the Foleys’ claims against Water’s
Edge do indeed relate to covered marina operations, entry of summary judgment in favor of
Essex is inappropriate.12
IV.

Conclusion.
For all of the foregoing reasons, it is ordered as follows:
1.

The Foleys’ Motion to Strike Plaintiff’s Renewed Motion for Summary Judgment
(doc. 61) is denied as improper;

2.

Plaintiff’s Renewed Motion for Summary Judgment (doc. 58) is denied because
there are genuine issues of material fact;

3.

The Court notes that Water’s Edge failed to respond to the Order (doc. 49)
entered by Magistrate Judge Milling on July 25, 2011, requiring it to retain new
counsel for this action on or before August 8, 2011. Water’s Edge is ordered to
show cause, on or before November 10, 2011, why default should not be entered
against it as a sanction for its persistent failure/refusal to comply with court
orders. If Water’s Edge fails to respond in a timely manner, default will be
entered against it immediately; and

4.

The Clerk of Court is directed to mail a copy of this Order to Water’s Edge, LLC,
c/o Billy Parks, 8971 Foxtail Loop, Pensacola, FL 32526-3235.

DONE and ORDERED this 31st day of October, 2011.
s/ WILLIAM H. STEELE
CHIEF UNITED STATES DISTRICT JUDGE
12

The same conclusion attaches to the Foleys’ conclusory, unsupported suggestion
that they are entitled to summary judgment in the declaratory judgment action. A factfinder
could reasonably conclude from examination of these facts that LaPointe’s renegade activities
were outside the scope of Water’s Edge’s marina supervision and oversight functions, but were
instead gratuitous acts divorced from Water’s Edge’s marina operations on the premises. The
Foleys have not shown otherwise, but have simply asked in the most cursory fashion for
summary judgment to be granted in their favor, without making anything approaching the
necessary factual and legal showing to support same.

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