Hansen v. Sentry Insurance Company

Filing 46

///ORDER granting 37 Motion for Summary Judgment. Clerk to enter judgment and close the case. So Ordered by Judge Joseph A. DiClerico, Jr.(dae)

UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF NEW HAMPSHIRE

Mark Hansen
v.

Civil No. 12-cv-466-JD

Sentry Insurance Co.
O R D E R
Mark A. Hansen brought suit against his liability insurer,
Sentry Insurance Company, seeking coverage for claims brought
against Hansen by his former employer, Wilcox Industries Corp.,
in Wilcox Industries Corp. v. Hansen, Civil No. 11-cv-551-PB
(D.N.H. Nov. 28, 2011) (“underlying action”).
summary judgment.

Sentry moves for

Hansen objects.

Standard of Review
Summary judgment is appropriate when “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.”
P. 56(a).

Fed. R. Civ.

“A genuine issue is one that can be resolved in favor

of either party and a material fact is one which has the
potential of affecting the outcome of the case.”
of P.R., 707 F.3d 7, 16 (1st Cir. 2013).

Gerald v. Univ.

In deciding a motion

for summary judgment, the court draws all reasonable factual

inferences in favor of the nonmovant.

Kenney v. Floyd, 700 F.3d

604, 608 (1st Cir. 2012).
“After the moving party has presented evidence in support of
its motion for summary judgment, the burden shifts to the
nonmoving party, with respect to each issue on which he has the
burden of proof, to demonstrate that a trier of fact reasonably
could find in his favor.”

Woodward v. Emulex Corp., --- F.3d

---, 2013 WL 1668221, at *4 (1st Cir. Apr. 18, 2013).

“On issues

where the movant does not have the burden of proof at trial, the
movant can succeed on summary judgment by showing ‘that there is
an absence of evidence to support the nonmoving party’s case.’”
OneBeacon Am. Inc. Co. v. Commercial Union Assur. Co. of Can.,
684 F.3d 237, 241 (1st Cir. 2012) (quoting Celotex Corp. v.
Catrett, 477 U.S. 317, 325 (1986)).

Background
Wilcox hired Hansen in April of 2005, and Hansen worked as
vice president of the company until June or July of 2007.

In

June of 2006, while still working for Wilcox and with the
knowledge and consent of Wilcox, Hansen founded a company called
Advance Life Support Technologies, Inc. (“ALST”).

Even after

terminating Hansen’s employment, Wilcox retained Hansen through
ALST to service its products and to train Wilcox’s customers in
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using the products.

Wilcox ended its business relationship with

Hansen and ALST in February of 2009.
On November 28, 2011, Wilcox filed the underlying action
against Hansen and ALST, alleging claims against Hansen for
breach of contract, breach of the implied covenant of good faith
and fair dealing, breach of fiduciary duties, and unjust
enrichment, and claims against both Hansen and ALST for unfair
competition, violation of RSA 358-A, misappropriation of trade
secrets under RSA 350-B, and intentional interference with
contractual relations.

The parties entered a stipulation of

dismissal in the underlying case on November 7, 2012.
Sentry provided commercial general liability and commercial
umbrella insurance coverage to Wilcox under a series of policies.
The policies cover, among other things, “those sums that the
insured becomes legally obligated to pay as damages because of
‘personal and advertising injury liability,’” which includes
“[o]ral or written publication of material that slanders or
libels a person or organization or disparages a person’s or
organization’s goods, products or services.”

An “insured”, under

the policies, is Wilcox and also includes Wilcox’s “executive
officers” and directors “but only with respect to their duties as
your officers or directors.”

“‘Executive officer’ means a person

holding any of the officer positions created by [Wilcox’s]
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charter, constitution, by-laws or any other similar governing
instrument.”

Complaint, Dkt. No. 1, Exhibit 3 (CGL policies).

Hansen filed this action seeking a declaratory judgment of
coverage from Sentry for the costs of his defense in the
underlying action and his liability to Wilcox and alleging a
breach of contract.

He moved for partial summary judgment as to

Sentry’s liability but not as to the amount of damages.

In

support, Hansen argued that as an executive officer at Wilcox, he
was an insured under Sentry’s policies, that Wilcox’s claims were
based in part on Hansen’s conduct while he was working for
Wilcox, and that Wilcox’s claims based on Hansen’s allegedly
harmful false statements triggered coverage under the provision
for advertising injury.

The court denied Hansen’s motion,

concluding that Hansen had not shown that he was acting in the
capacity of an insured under Sentry’s policies because his
alleged conduct violated his fiduciary duties as vice president
of Wilcox.

Discussion
Sentry moves for summary judgment on the ground that Hansen
cannot succeed on his claims in light of the court’s order
denying Hansen’s motion for partial summary judgment on the
ground that Hansen had not shown he was an insured under the
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policies.

Hansen objects to summary judgment “based on the

motion papers filed in support of Plaintiff’s motion for partial
summary judgment” and arguing that the prior order incorrectly
determined that he was not acting in the capacity of an insured
with respect to the claims in the underlying action.1
In essence, Hansen seeks reconsideration of the order
denying his motion for partial summary judgment.

Procedurally,

the relief he seeks is barred because he cannot combine a request
for affirmative relief with an objection to a pending motion.
7.1(a)(1).

LR

Also, the time has passed for filing a motion for

reconsideration.

LR 7.2(e).

Further, the grounds Hansen raises in his objection are not
persuasive.

Hansen states without citation to any supporting

authority:
As an initial matter, an insured such as Hansen is owed
a defense where allegations otherwise within the
insuring agreement are ‘false or fraudulent’ as to the
insured. This Court’s prior order overlooks that legal
principal entirely.
Even if an attack on the prior order were an appropriate basis
for Hansen’s objection, he does not develop his theory enough to

1

Hansen’s attempt to incorporate previously filed papers
into his objection to Sentry’s motion for summary judgment does
not comply with the local rules. See LR 7.1(a).
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permit review.2

See Higgins v. New Balance Athletic Shoe, Inc.,

194 F.3d 252, 260 (1st Cir. 1999); United States v. Zannino, 895
F.2d 1, 17 (1st Cir. 1990).
Hansen also attempts to distinguish the cases cited in the
prior order from his claims here and from the claims in the
underlying action.3

Hansen appears to argue that he might have

caused an advertising injury without violating his fiduciary
duties as vice president of Wilcox.

As is discussed in the prior

order, however, the allegations against Hansen involved conduct
that, if true, would violate his fiduciary duties.

The different

analysis in Farr, 61 F.3d at 682, cited by Hansen, is inapposite.
Sentry moved for summary judgment on the ground that Hansen
cannot show that he acted in the capacity of an insured under
Sentry’s policies for purposes of the claims in the underlying
action.

To succeed on either his declaratory judgment claim or

his breach of contract claim, Hansen must prove that he was an

2

Sentry explains in its reply that Hansen is referring to
language in the Sentry policies, not to a “legal principle.”
3

The statement in the prior order that Hansen disputes is:
“Courts that have considered coverage of a corporate officer as
an insured under an employer’s policy have concluded that ‘the
policies provide no coverage for injuries arising from a
corporate officer’s breach of a duty owed to the corporation.’”
Farr v. Farm Bureau Ins. Co., 61 F.3d 677, 681 (8th Cir. 1995)
(citing cases); Haggerty v. Fed. Ins. Co., 32 Fed. Appx. 845,
848-49 (9th Cir. 2002) (citing cases).
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insured under Sentry’s policies.4

Hansen has not shown a genuine

dispute as to any material fact on that issue.
Therefore, Sentry is entitled to summary judgment.

Conclusion
For the foregoing reasons, the defendant’s motion for
summary judgment (document no. 37) is granted.
The clerk of court shall enter judgment in favor of the
defendant and close the case.
SO ORDERED.
____________________________
Joseph A. DiClerico, Jr.
United States District Judge
June 12, 2013
cc:

Michael F. Aylward, Esquire
Stephen B. Mosier, Esquire
Clark Proffitt, Esquire

4

As stated in the order denying Hansen’s motion for partial
summary judgment:
Hansen bears the burden of showing that he is an
insured under the Sentry policy and that the claims in
the underlying action trigger Sentry’s duty to defend
him. See EnergyNorth Nat. Gas., Inc. v. Associated
Elec. & Gas Servs., Ltd., 21 F. Supp. 2d 89, 91 (D.N.H.
1998); see also Town of Allenstown v. Nat’l Cas. Co.,
36 F.3d 229, 233 (1st Cir. 1994). Hansen also bears
the burden to prove his breach of contract claim. See
Wilcox Indus. Corp. v. Hansen, 879 F. Supp. 2d 296, 311
(D.N.H. 2012).
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Todd A. Sullivan, Esquire

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