CONSTITUTION INSURANCE COMPANY v. SOCIETY FOR CREATIVE ANACHRONISM, INC. et al

Filing 1

COMPLAINT FOR DECLARATORY JUDGMENT against ELIZABETH AMICK, JAMEY OLIFF, BENJAMIN SCHRAGGER, SOCIETY FOR CREATIVE ANACHRONISM, INC., PAUL ZONA ( Filing fee $ 350 receipt number 045560.), filed by CONSTITUTION INSURANCE COMPANY. (Attachments: # 1 Civil Cover Sheets)(mima, )

BUDD LARNER
A PROFESSIONAL CORPORATION
Jonathan S. Roth, Esquire
I.D. No. JR1246
1939 ROUTE 70 EAST, SUITE 100
CHERRY HILL, NEW JERSEY 08003
[phone]
[phone] FAX
ATTORNEYS FOR PLAINTIFF,
CONSTITUTION INSURANCE COMPANY
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
_________________________________________________________________
:
CONSTITUTION INSURANCE,
:
COMPANY,
:
:
Plaintiff,
: CIVIL ACTION NO.:
:
vs.
:
:
SOCIETY FOR CREATIVE
:
ANACHRONISM, INC., ELIZABETH
:
AMICK, JAMEY OLIFF, PAUL ZONA, :
AND BENJAMIN SCHRAGGER,
: COMPLAINT FOR
:
: DECLARATORY JUDGMENT
Defendants.
:
:
:
_________________________________________________________________
Plaintiff, Constitution Insurance Company (“CIC”) by its
attorneys, Budd Larner, P.C., by way of Complaint for Declaratory
Judgment against Defendant, Society for Creative Anachronism,
Inc.(“SCA”), Elizabeth Amick, Jamey Oliff, Paul Zona and Benjamin
Schragger states as follows:

45526

NATURE OF ACTION AND RELIEF SOUGHT
1.

This is an action to determine the rights and liabilities

of the parties pursuant to a policies of insurance issued by
Plaintiff to Defendant, SCA.
2.

There is now existing between the parties an actual

controversy for which Plaintiff is entitled to have a declaration
of its rights pursuant to 28 U.S.C. §§ 2201 and 2202 because of the
facts, conditions and circumstances hereinafter set forth.
3.

Joined as parties are all those persons necessary for a

just and complete adjudication of the dispute between Plaintiff and
Defendant.
THE PARTIES
4.

Plaintiff CIC is a corporation organized and existing

under the laws of the State of New York with its principal place of
business at 7 Times Square, 37th Floor, New York, NY 10036.
5.

Upon

information and belief, Defendant SCA was and is a

non-profit corporation organized and existing under the laws of the
State of California with its principal place of business in
Milpitas, California, having a mailing address of P.O. Box 360789,
Milpitas, California, 95036-0789.
6.

Upon information and belief, Defendant SCA operated an

educational

organization

which

studies

the

recreating pastimes and crafts of the period.

45526

2

Middle

Ages

by

SCA organizes

tournaments, festivals, classes, feasts and all manner of arts and
sciences you would find in the culture of pre-1600s Western Europe.
7.
(“Amick”)

Upon
is

information and belief, Defendant, Elizabeth Amick
an

officer

of

SCA

and

is

a

resident

of

the

Commonwealth of Pennsylvania, residing at 1030 Wyandotte Street,
Bethlehem, PA 18015-4645.
8.
(“Oliff”)

Upon
is

information and belief, Defendant, Jamey Oliff
an

officer

of

SCA

and

is

a

resident

of

the

Commonwealth of Pennsylvania, residing at 1241 Spruce Street,
Easton, PA 18042.
9.

Upon

information

and

belief,

Defendant,

Paul

Zona

(“Zona”) is an officer of SCA and is a resident of the Commonwealth
of Pennsylvania, residing at 405 E. Abbott Street, Lansford, PA
18232.
10.

Defendant

Benjamin

Schragger

(“Schragger”)

was

an

employee of SCA and, prior to his incarceration, resided in New
Tripoli, PA.

Mr. Schragger currently resides at SCI-Rockview, Box

A, Bellefont, PA 16823.
JURISDICTION AND VENUE
11.

This Court has jurisdiction under 28 U.S.C. § 1332(a)(1)

by reason of diversity of citizenship between the parties.

The

value of the matter in controversy exceeds $75,000, exclusive of
interest and costs.

45526

3

12.
1391(a)

Venue is proper in this District pursuant to 28 U.S.C. §
and

1391(c)

because

it

is

the

District

in

which

a

substantial part of the events occurred and in which several of the
Defendants reside.
THE PRIMARY COMMERCIAL GENERAL LIABILITY INSURANCE POLICIES
13.

Fireman’s Fund Insurance Company (“FFIC”) issued two

policies of insurance to Defendant SCA for the period from December
31, 2000 to December 31, 2002.
14.

FFIC issued Policy No. S95MZX80773001 with effective

dates December 31, 2000 to December 31, 2001 and Policy No.
S95MZX80793425 with effective dates December 31, 2001 to December
31, 2002 (collectively the “FFIC Policies”) to Defendant, SCA.
Copies of the FFIC Policies are attached as Exhibits A and B
respectively and are incorporated herein by reference.
THE CIC POLICIES
15.

CIC issued two Excess/Umbrella Liability policies to the

insured (collectively the “CIC Policies”):
a.

CIC Policy No. CUL 40410, has effective dates of

December 31, 2000 to December 31, 2001. It provides coverage of $5
million each occurrence, excess of $1 million each occurrence
provided by the underlying FFIC policy.

The policy provides a $5

million

than

general

aggregate

(other

product/completed

operations), excess of the $2 million general aggregate provided by
the underlying Fireman’s Fund policy. A copy of CIC Policy No. CUL
45526

4

40410 is annexed hereto as Exhibit C and is incorporated herein by
reference.
b.

CIC Policy No. CUL 41529 has effective dates of

December 31, 2001 to December 31, 2002. It also provides coverage
in the amount of $5 million each occurrence, excess of $1 million
each occurrence coverage provided by the underlying Fireman’s Fund
policy.
than

The policy provides a $5 million general aggregate (other

product/completed

operations),

excess

of

the

$2

million

general aggregate provided in the underlying Fireman’s Fund policy.
A copy of CIC Policy No. CUL 41529 is annexed hereto as Exhibit D
and is incorporated herein by reference.
16.

The

CIC

Policies

are

identical

in

their

conditions.
17.

The CIC Policies provide as follows:
I.

INSURING AGREEMENTS
COVERAGE A - EXCESS LIABILITY INSURANCE
(FOLLOWING FORM)

Coverage A is excess insurance and follows the
underlying

insurance

except

as

otherwise

stated in this policy.
1.

We will pay those sums that the insured
must legally pay as damages because of
bodily injury, property damages, personal
injury, or advertising injury, caused by

45526

5

terms

and

an occurrence which occurs during the
policy period of this policy in excess of
the

sums

payable

as

damages

in

the

underlying insurance or which would have
been payable but for the exhaustion of
the

applicable

limit

of

insurance.

(Exhibits C and D, page 1)
18.

The CIC Policies are “follow form” policies, subject to

the terms of the underlying insurance:
4.

Coverage A is subject to the terms of the underlying
insurance except:
a.

That the amounts or limits of liability,
policy period, and conditions relating to
the

premium,

subrogation,

other

insurance, obligation to investigate and
defend, and cancellation or non-renewal
and any renewal agreement of underlying
insurance do not apply to this insurance;
b.

That where any exclusions of this policy
conflict with any terms of the underlying
insurance, the exclusions of this policy
shall apply;

c.

that where the underlying insurance has
an

45526

aggregate

limit-of-liability,

6

such

aggregate
purpose

limit
of

insurance

shall

not,

determining

applies,

be

for

when
reduced

the
this
or

exhausted by any payment relating to any
act, error, omission, injury, damage or
offense which occurs prior to the policy
period shown in the Declarations of this
policy; and
d.

For any obligation to provide or to pay
for legal defense.

Legal defense is

covered by this insurance only as shown
under DEFENSE SETTLEMENTS.

(Exhibits C

and D, page 1)
19.

The CIC Policies provide that coverage does not apply to

a loss not covered by the underlying insurance because of an
exclusion contained in the underlying insurance:
COVERAGE B - UMBRELLA LIABILITY INSURANCE
Coverage B is excess insurance over a selfinsured retention.
the

exposures

Coverage B applies only to

which

are

not

covered

by

Coverage A and are not otherwise excluded by
this policy or any of the underlying policies.
(Exhibits C and D, page 1)
II.

45526

UNDER COVERAGE A

7

(EXCESS LIABILITY INSURANCE)
In addition to the exclusions in Section I
above,

this

policy

does

not

apply

under

Coverage A to any loss not covered by the
underlying insurance, and all exclusions now
or

hereafter

contained

in

the

underlying

insurance, apply to Coverage A with the same
force and effect.
III. UNDER COVERAGE B
(UMBRELLA LIABILITY INSURANCE)
In addition to the exclusions in Sections I
and II above, this policy does not apply under
Coverage B to: (Exhibits A and B, page 5)
20.

The CIC Policies provide coverage only for occurrences,

defined as follows:
10.

Occurrence means:

a.

With respect to bodily injury or property
damage: an accident, including continuous
or repeated exposure to substantially the
same

general

results

in

harmful

bodily

condition,

injury

or

which

property

damage neither expected nor intended from
the

standpoint

of

the

insured

includes: (Exhibits A and B, page 6)

45526

8

and

21.

The CIC Policies each contain Amendatory Endorsement

CUL020, confirming that the CIC Policies each follow the terms,
conditions, definitions, and exclusions of the underlying insurance
policy:
AMENDATORY ENDORSEMENT
Except

as

otherwise

modified

herein

this

policy shall follow the terms, conditions,
definitions and exclusions of the controlling
underlying insurance policies (as more fully
defined

in

the

Schedule

of

Underlying

Insurance).
(CUL020(11/00))
22.

Each of the FFIC Policies contain the following “Abuse or

Molestation Exclusion-CG 21 46 07 98”:
This endorsement modifies insurance provided
under the following:
Commercial General Liability Coverage Part
The following exclusion is added to Paragraph
2., Exclusions of Section I - Coverage A Bodily Injury and Property Damage Liability
and Paragraph 2., Exclusions of Section I Coverage B - Personal and Advertising Injury
Liability:

45526

9

This

insurance

injury,

does

property

not

damage

apply
or

to

bodily

personal

and

advertising injury arising out of:
1.

The

actual

or

threatened

abuse

or

molestation by anyone of any person while
in the care, custody or control of any
insured, or
2.

The negligent:
a.

Employment;

b.

Investigation;

c.

Supervision;

d.

Reporting

to

the

proper

authorities, or failure to so
report; or
e.

Retention;

of a person for whom any insured is
or ever was legally responsible and
whose conduct would be excluded by
Paragraph 1. above.
FACTS
23.

On or about February 25, 2010, a complaint was filed

against SCA and others in the Court of Common Pleas of Lehigh
County, Pennsylvania, entitled S.P., as a parent and natural
Guardian
45526

of

C.L.,

a

minor,

et
10

al.

v.

Society

for

Creative

Anachronism, Inc., Case No. 2009-C-1644; a third amended complaint
(the “Underlying Complaint”) was filed on or about June 15, 2010.
A copy of the Underlying Complaint is annexed hereto as Exhibit E.
24.

The plaintiffs named in the Underlying Complaint are S.P.

as parent and natural guardian of C.L., a minor; T.M. as parent and
natural guardian of I.M., a minor; D.B. as parent and natural
guardian

of

S.B.,

a

minor;

and

K.B.,

an

adult

individual

(collectively, the “Underlying Plaintiffs”).
25.

The Underlying Complaint alleges, in part, that between

1999-2003, while S.B. was a minor, Schragger improperly touched
plaintiff S.B.'s body, engaged in sexual acts and exposed himself.
See Exhibit E at paragraph 18.
26.

The Underlying Complaint alleges, in part, that between

1999-2003, while K.B. was a minor, Schragger improperly touched
plaintiff K.B.'s body, engaged in sexual acts and exposed himself.
See Exhibit E at paragraph 21.
27.

The Underlying Complaint alleges, in part, that between

2002-2003, while C.L. was a minor, Schragger improperly touched
plaintiff C.L.'s body, caused C.L. to be naked in a hot tub with
him and masturbated C.L.
28.

See Exhibit E at paragraph 24.

The Underlying Complaint alleges, in part, that on or

about August-September 2003, while I.M. was a minor, Schragger
improperly touched plaintiff I.M.'s body and masturbated I.M See
Exhibit E at paragraph 27.

45526

11

29.

The Underlying Complaint alleges that S.B., K.B., I.M.

and C.L. sustained physical and emotional injury as a result of the
improper sexual acts and touching by Schragger.
30.
convicted

The Underlying Complaint alleges that Schragger has been
of

the

improper

sexual

acts

and

touching

of

the

Underlying Plaintiffs.
31.

SCA has requested that CIC provide coverage to SCA for

the claims asserted by the Underlying Plaintiffs in the Underlying
Complaint.
32.

By letter dated December 9, 2010, CIC denied Defendant’s

Coverage under the CIC Policies for the claims asserted in the
Underlying Complaint. A copy of the December 9, 2010 denial letter
is annexed hereto as Exhibit F and is incorporated by reference.
33.

An actual controversy has arisen and now exists between

Plaintiff and Defendants.

The actual controversy concerns whether

Plaintiff has any obligation under the CIC Policies for any claims
asserted in the Underlying Complaint.

Plaintiff denies that

Defendants are entitled to coverage under the CIC Policies for the
reasons stated herein.
COUNT ONE
34.

Plaintiff repeats and realleges the allegations made in

paragraphs 1 through 33 of the Complaint as if set forth at length
herein.

45526

12

35.

The claims asserted in the Underlying Complaint arise out

of sexual abuse and/or molestation perpetrated by Schragger against
the individuals named in the Underlying Complaint.
36.

The claims asserted in the Underlying Complaint did not

arise from a covered occurrence.
37.

The claims asserted in the Underlying Complaint arise out

of incidents of sexual abuse and/or molestation, and are not
covered by the CIC Policies.
RELIEF
WHEREFORE, Plaintiff, Constitution Insurance Company, prays
for judgment by this Court as follows:
1.

Determining that Plaintiff has no obligation under the

CIC Policies to defend or indemnify Defendants for the claims
asserted in the Underlying Complaint.
3.

Awarding

Plaintiff

its

costs,

attorney

fees

and

disbursements; and
4.

For such other relief as this Court may deem just and

proper.
BUDD LARNER, P.C.
Attorneys for Plaintiff,
Constitution Insurance Company

BY: /s/ Jonathan S. Roth
JONATHAN S. ROTH (JR1246)
DATED: June 27, 2011

45526

13