United States Court of Appeals for the Eleventh Circuit

June 28, 2022, Filed

No. 21-11070

Reporter

2022 U.S. App. LEXIS 17816 *; 38 F.4th 917; 29 Fla. L. Weekly C 1328

DUSTIN C. BRINK, Plaintiff-Appellant, versus DIRECT GENERAL INSURANCE COMPANY, Defendant-Appellee.

Prior History:  [*1] Appeal from the United States District Court for the Middle District of Florida. D.C. Docket No. 8:19-cv-02844-JSM-AEP.

Brink v. Direct Gen. Ins. Co., 2021 U.S. Dist. LEXIS 37007, 2021 WL 720437 (M.D. Fla., Feb. 1, 2021)

Core Terms

insureds, bad faith, district court, proposed instruction, settlement, settle, settlement offer, advise, sentences, claimant’s, totality of the circumstances, good faith, instruction of a jury, failure to settle, insurance company, excess judgment, requested instruction, obligations, jury instructions, closing argument, bad faith claim, fail to settle, due regard, policy limit, deliberations, correctly, responded, handling, circumstances, instructions

Case Summary

Overview

HOLDINGS: [1]-A district court erred by failing to properly instruct the jury on a failure-to-advise theory of bad faith under binding Florida precedent, the proposed instruction dealt with an issue properly before the jury, bad faith for failure to advise was the central issue of plaintiff’s lawsuit, which caused prejudicial harm to plaintiff because the standard bad-faith instruction that was given created such a misimpression by limiting the basis for bad faith to a failure to settle; [2]-Telling the jury that it should consider the totality of the circumstances when asked whether the bad faith claim encompassed the full length of time after the accident or only the time after plaintiff’s attorney sent the settlement offer was not an abuse of discretion as it was a correct statement of Florida law.

Outcome

Judgment reversed; remanded for new trial.

LexisNexis® Headnotes

Insurance Law > Liability & Performance Standards > Settlements > Excess Judgments

Insurance Law > Liability & Performance Standards > Good Faith & Fair Dealing > Third Party Claimants

Insurance Law > Liability & Performance Standards > Settlements > Policy Limits

HN1  Settlements, Excess Judgments

Under Florida law, a judgment creditor may maintain suit directly against a tortfeasor’s liability insurer for recovery of the judgment in excess of the policy limits, based upon the alleged fraud or bad faith of the insurer in the conduct or handling of the suit.

Civil Procedure > Appeals > Standards of Review > Abuse of Discretion

Civil Procedure > … > Jury Trials > Jury Instructions > Requests for Instructions

HN2  Standards of Review, Abuse of Discretion

Appellate courts review a district court’s refusal to give a requested jury instruction and its response to a jury question during deliberations for an abuse of discretion. In either case, appellate courts reverse only when a court’s jury instructions leave it with a substantial and ineradicable doubt as to whether the jury was properly guided in its deliberations.

Civil Procedure > Appeals > Standards of Review > Abuse of Discretion

Civil Procedure > … > Jury Trials > Jury Instructions > Requests for Instructions

HN3  Standards of Review, Abuse of Discretion

A refusal to give a requested jury instruction amounts to an abuse of discretion when (1) the requested instruction correctly stated the law, (2) the instruction dealt with an issue properly before the jury, and (3) the failure to give the instruction resulted in prejudicial harm to the requesting party.

Insurance Law > Liability & Performance Standards > Settlements > Excess Judgments

Insurance Law > Liability & Performance Standards > Settlements > Reasonable Basis

Insurance Law > Liability & Performance Standards > Settlements > Policy Coverage

Insurance Law > Liability & Performance Standards > Settlements > Good Faith & Fair Dealing

Insurance Law > … > Commercial General Liability Insurance > Obligations of Parties > Settlements

HN4  Settlements, Excess Judgments

The Florida Supreme Court in Boston Old Colony explains that an insurer has a duty to use the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business. The good faith duty obligates the insurer to advise the insured of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insured of any steps he might take to avoid same, and that the insurer must investigate the facts, give fair consideration to a settlement offer that is not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability > Elements of Bad Faith

HN5  Bad Faith & Extracontractual Liability, Elements of Bad Faith

The focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured. And this Court recently reemphasized that in Florida bad faith suits, the focus must remain on the actions of the insurer. There is a difference between focusing on a claimant’s actions, which would be improper, and factoring a claimant’s actions into the totality of the circumstances analysis, which is not improper.

Civil Procedure > Trials > Jury Trials > Province of Court & Jury

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability

HN6  Jury Trials, Province of Court & Jury

Under Florida law, it is for the jury to decide whether the insurer failed to act in good faith with due regard for the interests of the insured.

Civil Procedure > Appeals > Standards of Review > Prejudicial Errors

Civil Procedure > … > Jury Trials > Jury Instructions > Requests for Instructions

HN7  Standards of Review, Prejudicial Errors

Prejudice results when a district court’s failure to give a jury instruction creates a misimpression that requires a correction—that is, when it has an effect on the verdict.

Civil Procedure > Trials > Jury Trials > Jury Deliberations

HN8  Jury Trials, Jury Deliberations

In the Eleventh Circuit a jury is presumed to follow jury instructions.

Governments > Legislation > Interpretation

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability > Elements of Bad Faith

HN9  Legislation, Interpretation

As the Eleventh Circuit understands Florida law governing bad faith, due regard is a commonsense standard, not a term of art encompassing particular elements.

Civil Procedure > Trials > Closing Arguments > Improper Remarks

Civil Procedure > Trials > Jury Trials > Province of Court & Jury

HN10  Closing Arguments, Improper Remarks

A lawyer advocates for her client’s best interest (and usually against the interests of adversarial parties). The court, in contrast, is a neutral arbiter responsible for upholding the rule of law. When the jury makes its findings, it must rely on the law as stated by the court, not the law as construed in various—often conflicting—ways by attorneys throughout the trial. That is why appellate courts look to the words of the trial court, not defense counsel, in determining if jury instructions are adequate, and why the court cannot depend on defense counsel’s closing argument to save the judge from error. Fed. R. Civ. P. 51. But an attorney’s closing argument or an expert’s testimony, no matter how accurate, is no substitute for an instruction issued by the court.

Civil Procedure > Appeals > Standards of Review > Abuse of Discretion

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability > Elements of Bad Faith

HN11  Standards of Review, Abuse of Discretion

The Eleventh Circuit is mindful that the obligations set forth in Boston Old Colony are not a mere checklist for bad-faith lawsuits and do not suggest that jury instructions must treat them as such. When a party properly argues a theory of liability grounded in state law, a district court abuses its discretion if it causes prejudice by failing to instruct the jury on that theory.

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability > Elements of Bad Faith

HN12  Bad Faith & Extracontractual Liability, Elements of Bad Faith

As the Florida Supreme Court explains in Berges v. Infinity Insurance Co., the question of whether an insurer has acted in bad faith in handling claims against the insured is determined under the totality of the circumstances standard. The insurer’s entire conduct in the handling of the claim is relevant.

Counsel: For DUSTIN C. BRINK, Plaintiff – Appellant: Brent G. Steinberg, Daniel Greene, Attorney, Matthew Tyson Smith, Swope Rodante, PA, TAMPA, FL; Brandon Graham Cathey, Stephanie Miles, Cathey & MIles, PA, ST PETERSBURG, FL.

For DIRECT GENERAL INSURANCE COMPANY, Defendant – Appellee: James H. Wyman, Hinshaw & Culbertson, LLP, CORAL GABLES, FL; Megan Alexander, Jordan M. Thompson, Billy Richard Young, Young Bill Boles Palmer Duke & Thompson, PA, TAMPA, FL; Joshua John Cecil Hartley, Boyd & Jenerette, PA, BOCA RATON, FL; Rory Eric Jurman, Peter Joseph Lewis, Hinshaw & Culbertson, LLP, FORT LAUDERDALE, FL.

Judges: Before JILL PRYOR, GRANT, and ANDERSON, Circuit Judges. ANDERSON, Circuit Judge, concurring in part & dissenting in part.

Opinion by: GRANT

Opinion

Grant, Circuit Judge:

Dustin Brink was seriously injured in an automobile accident and won over $12 million in a suit against the other driver. To recover the judgment, Brink sued that driver’s insurance company on the theory that it acted in bad faith toward its insureds. The jury returned a verdict in the insurer’s favor, but Brink argues that the district [*2]  court abused its discretion by failing to give his proposed jury instruction.

We agree. The district court instructed the jury on bad faith resulting from the failure to settle a claim. But Florida law provides—and Brink argued at trial—that bad faith is also present when an insurance company fails to advise an insured about settlement offers and likely litigation outcomes. Because the district court’s instruction omitted the state law relevant to this theory of liability, we reverse.

I.

Fourteen years ago, Brink was riding a motorcycle when he collided with a car. He was airlifted to a hospital and lay in a coma for several weeks. The other driver, Juan Ruiz Pereles, was covered by a policy issued by Direct General Insurance. Direct General learned about the accident three weeks later and promptly interviewed both Pereles and his father (the policyholder). When those interviews revealed that Brink had hired a lawyer, Direct General immediately faxed a letter to Brink‘s counsel. But from there, communication sputtered. Despite several attempts, Direct General failed to reach Pereles and his father. And because Brink‘s lawyer quit representing him, it struggled to contact Brink as well. [*3] 

Four months after the accident, Direct General sent letters to the policyholder explaining its bodily injury policy—$10,000 per person with a $20,000 cap per accident—and asking about any other insurance coverage that might apply. But perhaps wearied by the struggle to actually reach its insureds, Direct General decided to simply pay the policy limit for the accident. A few days later, it attempted to contact Brink’s new attorney, Alexander Clem.

Clem also proved a difficult person to reach. After two months of futile efforts, Direct General sent a pointed letter to Clem in which it listed 11 previous attempts at contact, offered to tender the “bodily injury policy limits of $10,000 to settle” Brink’s claim, and enclosed a check for $10,000. The check was never cashed, and Direct General heard nothing for seven more months.

Fourteen months after the original accident, Clem broke the silence with a letter. He informed Direct General that he needed more information verifying the total coverage available to Pereles and his father. Direct General offered him an affidavit of coverage stating that it knew of no other insurer, but this did not satisfy Clem. Direct General continued to push for [*4]  a settlement, but Clem was not responsive.

After another eight months, on February 19, 2010, Clem finally replied to Direct General. He again asked about other insurance coverage and insisted that any settlement release allow Brink to recover uninsured motorist and medical payment claims. But this time, Clem indicated that a final settlement was possible. He concluded his letter with a promise: “If I receive that release and the requested insurance disclosure documentation in the next couple of weeks with all insurance proceeds offered by your company, then my client will sign the release. Of course, this is an offer for a unilateral contract, requiring that I receive these items rather than a promise.”

The settlement opportunity that Direct General had sought for almost two years had finally arrived—but two weeks came and went, and Clem heard nothing. No evidence suggests that Pereles or his father were informed of the offer during this time. After the third week, Clem sent a letter explaining that Brink was suing Pereles and his father because Direct General had ignored his offer. “For some reason, I have still never received a response to my letter of February 19, 2010, after Direct [*5]  General had called and written to me dozens of times over the history of this claim,” he wrote (with no comment on his own responsiveness). “Now, for some reason, when I presented a time-limited settlement offer, Direct General did not respond at all. . . . If you feel inclined to provide an explanation for this, I would be very interested in hearing it sometime next week.”

Direct General finally wrote back after two more weeks, expressing a hope that a settlement would soon be “finalized.” But under the terms of Clem’s February 19 offer, Direct General was too late. Clem rejected Direct General’s attempts to settle and, as he had promised, proceeded with a lawsuit against its insureds. Brink won $12,679,837.17 at the end of the ensuing jury trial.

All that is prelude to the case before us. Six years after the previous trial, Brink filed suit again—this time against Direct General for breach of fiduciary duty (that is, bad faith) toward its insureds.¹ Prevailing in this lawsuit would mean that Brink could collect his $12.6 million judgment from Direct General.

At the close of discovery the district court denied summary judgment to Direct General, explaining that Brink had offered “sufficient [*6]  evidence from which a reasonable jury may find Direct General failed to act in good faith as required under Florida law.” In the court’s view, the evidence supported a possible finding that “Direct General failed to timely respond” to a settlement offer and “failed to advise its insureds of the February 19, 2010 settlement opportunity.” The court also believed that the evidence supported Brink‘s argument that “Direct General failed to inform its insureds of the possibility of an excess judgment until March 2010, nearly two years after the accident.”

Once again, the case proceeded to trial. Brink produced an expert witness who testified that “Direct General failed to comply with the industry custom and practice” normally followed by insurance companies in at least two ways: by failing to settle the claim, and by failing to communicate with and advise its insureds. In response, Direct General argued that undisputed evidence showed that it had “made over 50 attempts to communicate with Mr. Clem by telephone and letter to try to settle” and that it had fulfilled its obligation to keep Pereles and his father informed throughout the process.

At the end of the trial, Brink requested a specific [*7]  jury instruction on the definition of bad faith that covered both theories of liability he presented—failure to settle and failure to advise:

Juan Ruiz Pereles and Juan Ruiz De Los Santos were insured against the claim made by Dustin Brink arising from the April 5, 2008 accident under a policy of insurance issued by Direct General Insurance Company.

Direct General’s insureds surrendered to Direct General control over the handling of the claim and settlement decisions. Direct General owed a fiduciary duty of good faith to act in its insureds’ best interests and protect its insureds from judgments in excess of their policy limits. In handling the claim against its insureds, Direct General had a duty to use the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.

The duty of good faith required Direct General to advise its insureds of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insureds of any steps they might take to avoid an excess judgment. Direct General was further required to investigate the facts, give [*8]  fair consideration to a settlement offer that was not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.

The focus in this bad faith case is not on the actions of Dustin Brink or his attorneys, but rather on the actions of Direct General and its obligation to act in good faith toward its insureds. The critical inquiry is whether Direct General diligently, and with the same haste and precision as if it were in its insureds’ shoes, worked on the insureds’ behalf to avoid an excess judgment. The absence of good faith constitutes bad faith.

Brink argued that this instruction, which was heavily footnoted with Florida precedents, correctly stated Florida’s law on bad faith, as explained by the state high court in Boston Old Colony Insurance Co. v. Gutierrez, 386 So. 2d 783 (Fla. 1980), and subsequent cases. But the district court chose instead to give a standard jury instruction addressing only liability for failure to settle:

Bad faith on the part of an insurance company is failing to settle a claim when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for their interests. [*9] 

See In re Standard Jury Instructions in Civ. Cases, 35 So. 3d 666, 720-21 (Fla. 2010).

During deliberations, the jury asked the following question: “Is bad faith based on the full length of time from the accident or on the time from [the] February 19, 2010 letter?” Although Brink urged the district court to respond that the jury had already been instructed on the law, the court instead responded, “In determining bad faith on the part of an insurance company, you should consider the totality of the circumstances.”

The jury returned a verdict for Direct General. Brink now appeals.

II.

HN2 We review a district court’s refusal to give a requested jury instruction and its response to a jury question during deliberations for an abuse of discretion. Lamonica v. Safe Hurricane Shutters, Inc., 711 F.3d 1299, 1309 (11th Cir. 2013); United States v. Joyner, 882 F.3d 1369, 1375 (11th Cir. 2018). In either case, we reverse only when a court’s jury instructions leave us “with a substantial and ineradicable doubt as to whether the jury was properly guided in its deliberations.” Broaddus v. Florida Power Corp., 145 F.3d 1283, 1288 (11th Cir. 1998) (quotation omitted).

III.

Brink argues that the district court erred in two ways: by failing to give his proposed jury instruction on bad faith, and by giving a deficient answer to the jury’s question during deliberations. The district court did not abuse its discretion in answering the jury’s question. But because the jury was not instructed on a failure-to-advise [*10]  theory of bad faith, the court’s refusal to use Brink’s proposed instruction requires us to reverse.

A.

We begin with Brink’s proposed jury instruction. HN3 A refusal to give a requested jury instruction amounts to an abuse of discretion when “(1) the requested instruction correctly stated the law, (2) the instruction dealt with an issue properly before the jury, and (3) the failure to give the instruction resulted in prejudicial harm to the requesting party.” Lamonica, 711 F.3d at 1309 (quotation omitted). Each requirement is met here.

First, Brink’s requested instruction correctly stated applicable Florida law. Each statement of law in the proposed instruction is supported by binding Florida precedent.² HN4 In Boston Old Colony, the Florida Supreme Court explained that an insurer “has a duty to use the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” 386 So. 2d at 785. The court further clarified that the “good faith duty obligates the insurer to advise the insured of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insured of any steps he might take to avoid same,” and [*11]  that the “insurer must investigate the facts, give fair consideration to a settlement offer that is not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.” Id.; see also Harvey v. GEICO Gen. Ins. Co., 259 So. 3d 1, 6-8 (Fla. 2018). The beginning paragraphs of Brink’s proposed instruction reproduce the Florida Supreme Court’s language in Boston Old Colony almost verbatim.

Direct General concedes that “most of the individual sentences in the instruction do, on a strictly technical basis, correctly state the law.” The problem, Direct General says, is that one sentence misstates the law: “The focus in this bad faith case is not on the actions of Dustin Brink or his attorneys, but rather on the actions of Direct General and its obligation to act in good faith toward its insureds.” In Direct General’s view, that statement invalidates the instruction because, contrary to Florida law, it does not allow the jury to consider the responsiveness of Brink’s attorney as part of the “totality of the circumstances.”

That argument does not hold water. The contested sentence is also drawn directly from binding Florida precedent. HN5 As the Florida Supreme Court has explained multiple [*12]  times, the “focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured.” Harvey, 259 So. 3d at 10 (quoting Berges v. Infinity Ins. Co., 896 So. 2d 665, 677 (Fla. 2004)). And this Court recently reemphasized that in Florida bad faith suits, the focus must remain on the actions of the insurer. There is a “difference,” we said, “between focusing on a claimant’s actions, which would be improper, and factoring a claimant’s actions into the totality of the circumstances analysis, which is not improper.” Pelaez v. GEICO, 13 F.4th 1243, 1253-54 (11th Cir. 2021). Brink’s proposed instruction carefully observed that difference, and the dissent points to no language in the instruction that violates the principle we explained in Pelaez.

The responsiveness (or lack thereof) of Brink’s attorney was not exemplary, and the jury was allowed to consider his actions as part of the totality of the circumstances. But his actions were not the focus of the case. The proposed instruction properly kept the focus away from the actions of Brink’s attorney while still allowing the jury to consider them.

Second, Brink’s proposed instruction dealt with an issue properly before the jury: bad faith for failure to advise. HN6 Under Florida law, “it is for the jury to decide whether [*13]  the insurer failed to act in good faith with due regard for the interests of the insured.” Harvey, 259 So. 3d at 7 (quotation omitted). And the question of bad faith was the central issue of Brink’s lawsuit.

Furthermore, Brink’s theory of bad faith based on a failure to advise was fully presented at each stage of the case. The complaint asserted liability for both “failing to settle Plaintiff’s claims against the insureds” and “failing to fully, honestly and promptly advise the insureds.” When the district court denied summary judgment to Direct General, it explicitly recognized that a jury could hold Direct General liable because it failed to advise Pereles and his father. Brink‘s expert witness testified that Direct General failed to comply with its legal duties to “notify [its] insured of a settlement opportunity,” to “advise him on the steps he can take to protect himself,” to “advise him of the nature of the injuries and likelihood of an excess verdict,” and to “correspond with him in a meaningful way.” And at closing argument, Brink argued that “[o]ne of the easiest ways to invite a bad faith claim is to fail to keep the insured advised of settlement opportunities.”

Direct General does not dispute that [*14]  Brink argued both failure-to-settle and failure-to-advise bases for liability. It was therefore proper for the jury to consider both theories.

Third, the district court’s failure to give Brink’s proposed instruction caused prejudicial harm. HN7 Prejudice results when a district court’s failure to give a jury instruction creates a “misimpression that require[s] a correction”—that is, when it has an “effect on the verdict.” Finnerty v. Stiefel Lab’ys, Inc., 756 F.3d 1310, 1324 (11th Cir. 2014). The standard bad-faith instruction adopted by the court here created such a misimpression because it limited the basis for bad faith to a failure to settle. Indeed, it was designed to cover only that issue—contrary to the dissent’s assertion that it also “fairly encompassed the Boston Old Colony duties.” The instruction was entitled “Insurer’s Bad Faith (Failure to Settle),” and the drafting committee warned that “[o]ther instructions may be necessary if liability is asserted for the insurance company’s violation of some other duty” than the duty to settle. In re Standard Jury Instructions, 35 So. 3d at 720-21. That warning was explicitly accompanied by a reference to Boston Old Colony‘s “duty ‘to advise.'” Id. at 721 (quoting Boston Old Colony, 386 So. 2d at 785).

To be clear, we do not-as the dissent suggests-“believe that the duty to advise the insured is an independent theory of liability” separate [*15]  from the duty of good faith. But Boston Old Colony and its progeny hold that bad-faith liability may be triggered in several distinct ways, and the jury instruction given by the court described only one: failure to settle.

As explained above, Brink repeatedly asserted that Direct General had violated its duty to advise its insureds. But the jury was never instructed that it could find liability on that basis, and HN8[] in this Circuit a “jury is presumed to follow jury instructions.” Adams v. Wainwright, 709 F.2d 1443, 1447 (11th Cir. 1983). We therefore conclude that the district court abused its discretion when it failed to give Brink‘s requested instruction.³

Direct General urges us to consider the district court’s error as harmless because “the jury was informed” of an insurer’s obligations beyond the duty to settle “and expressly told that they constituted a basis for bad faith.” By whom? Brink’s counsel, who “argued what he felt were the applicable obligations during closing argument,” and his expert, who “went through an insurer’s good-faith obligations during his testimony.” In the end, the insurer argues, the “jury was hardly left in the dark as to what Direct General’s good-faith obligations were,” despite the district court’s failure to fully explain them. [*16] 

This argument ignores the fundamental difference between counsel and the court. HN10 A lawyer advocates for her client’s best interest (and usually against the interests of adversarial parties). The court, in contrast, is a neutral arbiter responsible for upholding the rule of law. When the jury makes its findings, it must rely on the law as stated by the court, not the law as construed in various—often conflicting—ways by attorneys throughout the trial. That is why “we look to the words of the trial court, not defense counsel, in determining if jury instructions are adequate,” and why “we cannot depend on defense counsel’s closing argument to save the Judge from error.” See United States v. Wolfson, 573 F.2d 216, 221 (5th Cir. 1978);⁴ Fed. R. Civ. P. 51. The dissent protests that we are permitted to “consider what the parties’ counsel and expert witnesses said to the jury” when reviewing jury instructions. And so we are—to a point. The record provides vital context and background when we review jury instructions. But an attorney’s closing argument or an expert’s testimony, no matter how accurate, is no substitute for an instruction issued by the court.

While the district court’s error requires us to reverse the verdict below, our holding is limited in scope. HN11 We are [*17]  mindful that the “obligations set forth in Boston Old Colony are not a mere checklist” for bad-faith lawsuits and do not suggest that jury instructions must treat them as such. Harvey, 259 So. 3d at 7. Not every bad-faith jury instruction need be as detailed and expansive as the one Brink proposed. And—of course—we express no view on the merits of Brink‘s argument that Direct General acted in bad faith by failing to advise its insureds. All we hold is that when a party properly argues a theory of liability grounded in state law, a district court abuses its discretion if it causes prejudice by failing to instruct the jury on that theory.

B.

Brink also argues that the district court abused its discretion by telling the jury that it should consider the “totality of the circumstances” when asked whether the bad faith claim encompassed the full length of time after the accident or only the time after Brink’s attorney Clem sent the settlement offer. The court’s answer was no abuse of discretion; it was a correct statement of Florida law.

HN12 As the Florida Supreme Court explained in Berges v. Infinity Insurance Co., “the question of whether an insurer has acted in bad faith in handling claims against the insured is determined under the [*18]  ‘totality of the circumstances’ standard.” 896 So. 2d at 680 (citing State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So. 2d 55, 63 (Fla. 1995)); see also Harvey, 259 So. 3d at 7. The insurer’s “entire conduct in the handling of the claim” is relevant. Berges, 896 So. 2d at 672. Brink concedes that the totality-of-the-circumstances standard is correct. But he argues that the district court’s answer wrongly “implie[d]” that the jury should look beyond the most relevant time frame—the two-week period immediately after Clem sent the February 2010 letter.

That argument does not persuade us. At bottom, Brink suggests that the jury was misled by instructions that merely failed to emphasize the time period most favorable to his claim. No doubt Brink had good reason to draw the jury’s attention away from the many months during which his attorney failed to respond to Direct General’s inquiries. But the totality-of-the-circumstances standard did not cease to govern the jury’s deliberations simply because only some circumstances reflected well on Brink.

Brink offers no authority to suggest that the district court’s answer was an incorrect statement of Florida law-and he cannot, because it is not. The answer was thus not an abuse of discretion.

* * *

Brink’s proposed jury instruction correctly stated the legal basis for his failure-to-advise [*19]  theory of liability, and the district court’s failure to give that instruction to the jury caused him prejudice. We therefore REVERSE the district court’s judgment and REMAND for a new trial.

Concur by: ANDERSON (In Part)

Dissent by: ANDERSON (In Part)

Dissent

Anderson, Circuit Judge, concurring in part & dissenting in part:

I concur in Part III.B. of the opinion for the Court; I agree with the majority that the district court’s answer to the jury’s question was a correct statement of Florida law. However, I respectfully dissent from the majority’s decisions in Part III.A. For the reasons discussed below, I respectfully submit that Brink has failed both the first and the third prongs of our abuse of discretion standard of review applicable to an asserted failure to give a requested jury instruction. Lamonica v. Safe Hurricane Shutters, Inc., 711 F.3d 1299, 1309 (11th Cir. 2013).

Appellant Dustin Brink (“Brink“) is appealing a jury verdict in favor of Appellee Direct General Insurance Co. (“Direct General“). In September 2013, Brink obtained a final judgment against two of Direct General‘s insureds for roughly $12 million and $600,000, respectively. In 2019, he sought to recover this judgment from Direct General, alleging that it had acted in bad faith by breaching fiduciary duties it owed to the [*20]  insureds. His bad faith claim proceeded to trial, where the jury found that Direct General had not acted in bad faith in failing to settle Brink’s claims against the insureds.

Brink has appealed that jury verdict on two grounds. First, he argues that the trial court committed reversible error by refusing to give his requested jury instruction on what constitutes “bad faith” by an insurance company. Second, he argues that the court gave an erroneous and misleading supplemental instruction in response to a question from the jury during its deliberations. Our precedent dictates that this Court will only reverse a jury verdict and order a new trial if we harbor a substantial and ineradicable doubt as to whether the jury was properly instructed. Because I have no such doubt, I would affirm.

I.

These are the relevant facts as I see them. On April 5, 2008, a car driven by one of Direct General‘s insureds collided with Brink, who was riding his motorcycle. Brink sustained serious bodily injuries. At that time, the driver and the owner of the car were insured by Direct General against liability arising out of operation of the car. This liability insurance policy had a $10,000 per person limit [*21]  for bodily injury claims and a $10,000 per accident limit for property damage claims. Brink himself had uninsured motorist insurance with a separate insurance company that provided up to $75,000 in coverage.

On April 28, 2008, Direct General learned of the accident and took statements from the insureds. On July 3, 2008, Brink entered a contingency fee agreement with two law firms—the firm who represented him in the underlying action against the insureds and the firm who represented him in this bad faith action. This fee agreement said, “For any recovery up to $85,000.00, there is NO fee.” For any recovery “greater than $85,000.00,” the two law firms would collectively receive 40% of the “gross recovery.”¹ On July 17, 2008, Direct General decided to cover the accident due to the seriousness of Brink’s injuries and the sworn statements from the insureds.

On August 4, 2008, Alexander Clem (“Clem”), Brink‘s lawyer in the underlying action, sent Direct General a letter stating that Clem’s firm was representing Brink and requesting that Direct General provide him insurance information as required by Florida law. Fla. Stat. § 627.4137.

On August 18, 2008, Direct General sent the insured car owner two letters. One [*22]  letter outlined the policy’s limits and warned him that he would be liable for any judgment in excess of those limits if Direct General could not settle Brink‘s claim. The second letter notified him of Clem’s request for information and asked him to provide Clem “the name and coverage of any other known insurance” he had. This letter also warned him that “[f]ailing to promptly provide [Clem] with information regarding any other insurance . . . may affect the ability to settle this case and may prevent a settlement.” Direct General sent both letters to the wrong address.

That same day, Direct General responded to Clem’s initial letter. It confirmed that it received Clem’s letter and enclosed (i) a copy of its letters to the insured car owner, (ii) an affidavit from its superintendent with the requested information,² and (iii) a copy of the policy it issued to the insured car owner. On August 22, 2008, it sent Clem a letter requesting that he provide medical records to verify the severity of Brink‘s injuries. Between August 22 and October 20, Direct General called and left voicemails for Clem 8 times concerning Brink‘s bodily injury and property damage claims.

On October 21, 2008, Direct [*23]  General sent a letter to Clem stating that it was “extending an offer to tender [its] policy limits of $10,000.00 to [Brink] . . . as settlement of the . . . bodily injury claim.” On October 28 and November 18, 2008, Direct General left Clem a total of 4 voicemail messages. There was no response. On November 18, it sent him another letter following up on its offer to tender the policy limit. On November 20, 2008, Direct General left another 2 voicemail messages for Clem and his paralegal. On November 20, 2008, Direct General sent Clem another letter along with a check for the $10,000 policy limit and a proposed release for Clem’s consideration. There was no response to any of these efforts.

On November 25, 2008, Direct General emailed Clem about Brink‘s property damage claim. Between December 8, 2008, and January 6, 2009, Direct General called Clem’s office 5 times and either left a voicemail or spoke with his paralegal. Direct General‘s adjuster for Brink‘s property damage claim sent Clem 3 more letters on January 29, February 16, and March 12, 2009 requesting the location Brink‘s motorcycle. Between February 9 and May 27, 2009, Direct General called and left Clem, or his paralegal, [*24]  another 6 voicemail messages. There was no response to Direct General’s letters and voicemail messages.³

On June 26, 2009, Clem finally responded in a letter to Direct General’s bodily injury and property damage claims adjusters. After requesting that Direct General pay for the towing of Brink‘s motorcycle, Clem said,

[P]lease go ahead and supplement your response to my request for the disclosure of insurance information. It has been a long time since my letter to you and I still do not have all the requested information in order to verify the amount of liability coverage available to your insureds. . . .

Clem did not specify what information he still needed, and he did not mention the $10,000 check that Direct General had sent the previous November.

On July 2, 2009, Clem sent a letter to the property damage claims adjuster with a copy of the towing bill; he did not mention Brink’s bodily injury claim. That adjuster responded on July 17 requesting the location of Brink’s motorcycle so it could inspect the motorcycle and provide an estimate.

On July 30, 2009, Direct General responded to Clem’s letter from June 26, 2009. Direct General attached the same information it had provided Clem in [*25]  response to his letter from August 4, 2008: the affidavit from Direct General’s superintendent and a copy of its policy with the insured car owner. It also offered to settle Brink’s property damage claim, including the cost of the towing bill.

On January 18, 2010, Direct General sent Clem a reissued $10,000 check for Brink‘s bodily injury claim and a proposed release for that claim. It also called and left Clem voicemail messages concerning that claim on January 27, February 3, and February 11.

On February 19, 2010, Clem sent a letter to Direct General which read as follows:

Dear Ms. Moore:

Thank you for your telephone message last week. I also received your letter dated January 18, 2010, with the enclosed $10,000.00 check made payable to “Morgan and Morgan P.A. Trust Account on behalf of Dustin Brink” and a proposed bodily injury release.

I have recently been in communication with Mr. Brink’s insurance company about resolving his claims for uninsured motorist and medical payments coverage benefits. As you may know, those claims for first-party benefits are under several Mississippi policies issued by an insurance company out of Missouri, so it may take some time to work them out. Be that [*26]  as it may, my client is now ready to resolve his claims against your insured for the amounts proposed by your company for the claims being released if the conditions for settlement are met.

Of course, we previously sent your company a request for information pursuant to 627.4137 of the Florida Statutes, including the statement of your insured or his insurance agent, in order to verify the amount of available liability insurance. I have statements from your company’s superintendent and copies of your personal auto policy and declarations page. But even after all this time, I still have not received the disclosure statement from your insured or his insurance agent.

Naturally, we need a complete set of your company’s information under 627.4137 Florida Statutes before our client can settle, and a statement from your insured, if possible, so please send that to me at your earliest convenience. If for some reason your insured’s statement is not available, please verify of [sic] all of your company’s efforts to obtain it by sending me copies of all of your company’s letters to your insured requesting that he provide the statement required under 627.4137 of the Florida Statutes.

As far as my client’s uninsured motorist and medical payments claims, we will need to have language in [*27]  the release that preserves my client’s rights to recover those benefits. So please just add a clause stating that my client reserves his claims for first-party benefits to your standard release of all claims. If I receive that release and the requested insurance disclosure documentation in the next couple of weeks with all insurance proceeds offered by your company, then my client will sign the release. Of course, this is an offer for a unilateral contract, requiring that I receive these items rather than a promise.

You made the $10,000.00 check enclosed with your last letter payable to our firm’s trust account, and that is an acceptable manner of issuing payment.

Please let me know if you need any information regarding this uninsured motorist or medical payments coverage.

Thank you for your attention to this matter.

Sincerely,

Alexander M. Clem

On March 12, 2010, Clem sent Direct General another letter stating that he had filed a lawsuit on behalf of Brink that day. Clem said his February 19 letter was “a time limited settlement offer” to which “Direct General did not respond at all.” He said to settle Brink‘s claim, “all [Direct General] needed to do was get [him] three items in two weeks”: [*28] 

1) a statement from an insured or his agent, which I have asked for in writing three times going back to August 4, 2008,

2) your company’s release of all claims simply containing a clause preserving my client’s right to recover first-party benefits, and

3) a draft for the $900 of property damage Direct General had previously offered to pay.⁴

Clem concluded that Direct General had rejected his settlement offer, and he stated that his client’s offer to settle had expired.

Direct General attempted to call both insureds but was unable to reach them. On March 25, 2010, Direct General sent letters to both insureds regarding Brink‘s lawsuit. Direct General told the insureds that “Brink and his counsel have been unwilling to accept [the] policy limits” as settlement and that it could “reasonably be expected” that the damages in the suit would “exceed [the] available limits.” It also told them that Direct General would appoint counsel for their defense and that Clem had requested that the insureds confirm that they had no other insurance available. These letters did not inform the insureds of Brink‘s settlement offer from the February 19 letter.

Direct General and Clem never reached a settlement. [*29]  Brink‘s bodily injury claim proceeded to a jury trial in March 2013. He won a final judgment of $12 million against the insured car driver and $600,000 against the insured car owner. In 2019, Brink filed his bad faith claim against Direct General in state court, and Direct General removed the action to federal court. After the district court denied Direct General‘s motion for summary judgment, Brink‘s bad faith claim proceeded to a jury trial.

The parties filed joint proposed jury instructions, and they agreed that the court should give Florida’s standard jury instruction on an “Insurer’s Bad Faith (Failure to Settle).” Brink proposed a nine-sentence, special instruction on the “Duties of a Liability Insurance Company Regarding Settlement”:

Juan Ruiz Pereles and Juan Ruiz De Los Santos were insured against the claim made by Dustin Brink arising from the April 5, 2008 accident under a policy of insurance issued by Direct General Insurance Company.

Direct General’s insureds surrendered to Direct General control over the handling of the claim and settlement decisions. Direct General owed a fiduciary duty of good faith to act in its insureds’ best interests and protect its insureds from judgments [*30]  in excess of their policy limits. In handling the claim against its insureds, Direct General had a duty to use the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.

The duty of good faith required Direct General to advise its insureds of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insureds of any steps they might take to avoid an excess judgment. Direct General was further required to investigate the facts, give fair consideration to a settlement offer that was not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.

The focus in this bad faith case is not on the actions of Dustin Brink or his attorneys, but rather on the actions of Direct General and its obligation to act in good faith toward its insureds. The critical inquiry is whether Direct General diligently, and with the same haste and precision as if it were in its insureds’ shoes, worked on the insureds’ behalf to avoid an excess judgment. [*31]  The absence of good faith constitutes bad faith.

Direct General objected to this proposed special instruction as “improper because [Brink] ha[d] hand-picked select statements of Florida law which either [did] not apply to this case, [were] misstated and/or [did] not present a complete picture of Florida law on bad faith.” Specifically, it argued that the seventh and ninth sentences of the proposed instruction were inaccurate or misleading.

Brink‘s trial counsel noted to the district court that Direct General had not specifically objected to “anything that’s contained in the first one, two, three paragraphs of the proposed instruction” and had objected only to two sentences in the fourth paragraph of the proposed instruction. Defense counsel responded that the proposed instruction, as a whole, “just cherry picked select statements from various cases” and “doesn’t give an accurate reflection of” Florida bad faith law. The district judge denied the proposed instruction and opted instead “to give the Florida Standard Instructions.”

At trial, Brink offered expert witness testimony from Daniel Doucette (“Doucette”). Doucette testified that “Direct General failed to comply with the industry [*32]  custom and practice” in several ways. First, it failed to settle Brink’s claim when it “could and should” have done so—i.e., after Brink’s attorney offered to settle the claim in the February 19 letter. He said the February 19 letter “triggered” “two primary duties” that Direct General failed to satisfy: (i) “[t]o try to meet the demand and resolve the case and protect their insured” and (ii) “to immediately notify the insured that there’s an opportunity to settle in front of them.” He noted that Direct General had failed to communicate with its insureds once it received the February 19 letter.

During closing arguments, Brink‘s counsel made several statements about Direct General‘s duty to its insureds and what constitutes bad faith:

• [Direct General has] got to treat their insured customers the same way as if it had been them who was exposed to this $12 million claim. In other words, if Direct General itself had the chance to accept the February 19, 2010 settlement offer to save itself from a $12 million liability for only $10,000, it’s got to use that same level of effort to protect its insureds. That’s what good faith requires.

• [W]hen we’re talking about insurance companies, bad [*33]  faith is simply failing to settle a claim when under all the circumstances it could and should have done so had it acted fairly and honestly and with due regard for their insured’s interest.

• What’s our claim? Our claim is that after February 19, 2010, Direct General failed to settle when under all the circumstances it could and should have done so had it acted fairly and honestly towards its insureds and with due regard for their interest. It’s up to you to decide whether we met that burden of proof.

• One cannot pay due regard to another if they pay no attention to their situation. [The insureds] needed attention paid to settlement offers that might be made in their case and they simply didn’t get it from Direct General. It’s been . . . essentially undisputed it was not responded to. It did not get any attention.

• Here they failed to pay attention to the time limited settlement offer and that’s failure of due regard.

• One of the easiest ways to invite a bad faith claim is to fail to keep the insured advised of settlement opportunities or fail to document that such advice was given. Documentation is key.

After closing arguments, the district court gave the following instruction for [*34]  an insurer’s bad faith failure to settle: “Bad faith on the part of an insurance company is failing to settle a claim when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for their interests.”

During deliberations, the jury asked the court a question: “Is bad faith based on the full length of time from the accident or on the time from February 19, 2010 letter?” Brink wanted the court to respond that the jury had already been instructed in the law, but defense counsel said “the answer . . . is, ‘totality of the circumstances.'” Brink disagreed because his claim was that Direct General “acted in bad faith after February 19th. So to say that, ‘the totality of the circumstances,’ you are telling them the answer is something else.” Brink’s counsel worried that by giving the “totality of the circumstances” answer “in isolation,” the court would be “implying that . . . [Brink’s claim was] not based on February 19th, but instead based on a larger time period, which is not [his] claim.” The court noted this objection and gave the jury the following written answer: “In determining bad faith on the part of [*35]  an insurance company, you should consider the totality of the circumstances.”

The jury returned from deliberations 5 minutes after receiving the court’s answer. The verdict form asked the jury, “Did [Direct General] act in bad faith in failing to settle the claims against [the insureds]?” and the jury answered, “No.”

II.

On appeal, Brink argues that the district court committed reversible error by (i) refusing to give his proposed special jury instruction on what constitutes “bad faith” by an insurance company and (ii) giving an erroneous and misleading supplemental instruction in response to the jury’s question during its deliberations. This Court reviews both actions by the district court for abuse of discretion. United States v. Joyner, 882 F.3d 1369, 1375 (11th Cir. 2018).

A district court’s refusal to give a proposed jury instruction is an abuse of discretion “only when (1) the requested instruction correctly stated the law, (2) the instruction dealt with an issue properly before the jury, and (3) the failure to give the instruction resulted in prejudicial harm to the requesting party.” Lamonica, 711 F.3d at 1309 (quoting Burchfield v. CSX Transp., Inc., 636 F.3d 1330, 1333-34 (11th Cir. 2011)). When evaluating the first prong-i.e., whether the instruction misstates, or misleadingly states, the law-we review the instruction de novo. Goldsmith v. Bagby Elevator Co., Inc., 513 F.3d 1261, 1276 (11th Cir. 2008).

“The [*36]  substance of jury instructions in diversity cases is governed by the applicable state law, but questions regarding procedural aspects of jury charges are controlled by federal law and federal rules.” Pate v. Seaboard R.R., Inc., 819 F.2d 1074, 1081-82 (11th Cir. 1987). Whether a district court’s refusal to give a proposed jury instruction “necessitate[s] a new trial is a procedural matter governed by federal law.” Id. at 1082; see also Pesaplastic, C.A. v. Cincinnati Milacron Co., 750 F.2d 1516, 1525 (11th Cir. 1985) (“The granting or denial of jury instructions in diversity cases is controlled by federal laws and federal rules while the substance of those instructions is governed by the applicable state law . . . .” (citation omitted)).

Our standard of review is “deferential.” Bearint ex rel. Bearint v. Dorell Juv. Grp., Inc., 389 F.3d 1339, 1351 (11th Cir. 2004). Our “role” when “reviewing a trial court’s jury instructions[] is to assure ‘that the instructions show no tendency to confuse or to mislead the jury with respect to the applicable principles of law.'” Mosher v. Speedstar Div. of AMCA Int’l, Inc., 979 F.2d 823, 824 (11th Cir. 1992) (quoting Rohner, Gehrig & Co. v. Cap. City Bank, 655 F.2d 571, 580 (5th Cir. Unit B Sept. 1981)). Accordingly, “[i]f the instructions accurately reflect the law, the trial judge is given wide discretion as to the style and wording employed in the instruction.” Bearint, 389 F.3d at 1351. “We will reverse and order a new trial only when we are ‘left with a substantial and ineradicable doubt as to whether the jury was properly guided in its deliberations.'” MidlevelU, Inc. v. ACI Info. Grp., 989 F.3d 1205, 1215 (11th Cir. 2021) (quoting Broaddus v. Fla. Power Corp., 145 F.3d 1283, 1288 (11th Cir. 1998)).

III.

I think [*37]  Brink’s challenge to the district court’s failure to give his requested jury instruction must fail at either the first or third prong of this Court’s abuse of discretion standard of review. I first address Lamonica‘s first prong and then address the third.

A.

The first prong says a district court’s refusal to give a proposed jury instruction may be an abuse of discretion only when the proposed instruction correctly stated the law. Lamonica, 711 F.3d at 1309. Brink’s proposed instruction, considered as a whole, misleadingly stated Florida law on bad faith failure to settle.

Florida law “imposes a fiduciary obligation on an insurer to protect its insured from a judgment that exceeds the limits of the insured’s policy.” Harvey v. GEICO Gen. Ins. Co., 259 So. 3d 1, 3 (Fla. 2018). When an insurer breaches that duty by acting in bad faith when handling the claim, the judgment creditor of the insured (i.e., the tort victim) may sue the insurer directly for a recovery that exceeds the insurance policy’s limits. Thompson v. Com. Union Ins. Co. of N.Y., 250 So. 2d 259, 264 (Fla. 1971). Brink‘s suit against Direct General is an example of these “third-party bad faith action[s].” State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So. 2d 55, 58 (Fla. 1995).

The Supreme Court of Florida has authorized these bad faith suits where the insurer has failed to settle the third party’s claim against the insured. Bos. Old Colony Ins. Co. v. Gutierrez, 386 So. 2d 783, 784 (Fla. 1980) (per curiam). In Boston Old [*38]  Colony, the court outlined the contours of an insurer’s duty of good faith: “An insurer, in handling the defense of claims against its insured, has a duty to use the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” Id. at 785. An insurer must act “in good faith and with due regard for the interests of the insured” when handling claims against the insured. Id. In the context of settlement negotiations,

This good faith duty obligates the insurer to advise the insured of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insured of any steps he might take to avoid same. The insurer must investigate the facts, give fair consideration to a settlement offer that is not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.

Id. (citation omitted).

The Supreme Court of Florida has clarified that “[t]he obligations set forth in Boston Old Colony are not a mere checklist.” Harvey, 259 So. 3d at 7. “An insurer is not absolved of liability simply because [*39]  it” fulfills these specific obligations. Id. Conversely, violating one of these Boston Old Colony duties “does not automatically establish bad faith; it is simply one factor for the jury to consider in determining whether the insurer acted in bad faith.” Berges v. Infinity Ins. Co., 896 So. 2d 665, 680 (Fla. 2004). These duties are “subsumed within the duty of good faith owed by an insurer to an insured.” Id. In lieu of the “checklist” approach, “the critical inquiry in a bad faith [case] is whether the insurer diligently, and with the same haste and precision as if it were in the insured’s shoes, worked on the insured’s behalf to avoid an excess judgment.” Harvey, 259 So. 3d at 7. “[N]egligence is relevant to the question of good faith,” Boston Old Colony, 386 So. 2d at 785, but it “is not the standard” for bad faith. Harvey, 259 So. 3d at 9.

Whether an insurer has acted in bad faith is for the jury to decide based on the totality of the circumstances. Berges, 896 So. 2d at 680. While the jury must consider the totality of the circumstances, “the focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured.” Id. at 677. However, this Court recently has held: “[W]e don’t understand that principle to mean the actions of a claimant – or a claimant’s attorney – are irrelevant. [*40]  In a bad faith action there’s a difference between focusing on a claimant’s actions, which would be improper, and factoring a claimant’s actions into the totality of the circumstances analysis, which is not improper.” Pelaez v. Gov’t Emps. Ins. Co., 13 F.4th 1243, 1254 (11th Cir. 2021). Thus, the seventh sentence of Brink’s proposed instruction was misleading. That sentence requested that the jury be instructed that the “focus in this bad faith case is not on the actions of Dustin Brink or his attorneys, but rather on the actions of Direct General.” It is misleading in that it suggests that the actions of Brink’s counsel are irrelevant. But we know from our Pelaez decision that the actions of Brink’s attorney were relevant under Florida law and could properly be factored into the totality of the circumstances analysis.

Brink proposed a nine-sentence special instruction on the “Duties of a Liability Insurance Company Regarding Settlement.” But, on appeal, he is defending the accuracy of only three of the nine sentences in his original proposed instruction. Those three sentences, which summarize the Boston Old Colony duties, are as follows:

[1] In handling the claim against its insureds, Direct General had a duty to use the same degree of care and diligence [*41]  as a person of ordinary care and prudence should exercise in the management of his own business.

[2] The duty of good faith required Direct General to advise its insureds of settlement opportunities, to advise as to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insureds of any steps they might take to avoid an excess judgment. [3] Direct General was further required to investigate the facts, give fair consideration to a settlement offer that was not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so.

Federal Rule of Civil Procedure 51(c)(1) requires parties “who object[] to . . . the failure to give an instruction” to “do so on the record, stating distinctly the matter objected to and the grounds for the objection.” See 9C Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2554 (3d ed. April 2022 Update) (“The grounds must be stated with sufficient clarity so that the trial judge may follow and understand them if they are well taken.”). Brink did not do so. His original proposed instruction was nine sentences. On appeal, he “is only arguing [*42]  the trial court committed reversible error by refusing” to give three of those sentences.

Brink never notified the district court that it should consider giving those three sentences on the Boston Old Colony duties separately from the rest of the proposed instruction. The closest he came to doing so was when Brink‘s counsel told the district court that Direct General had not objected to “anything that’s contained in the first one, two, three paragraphs of the proposed instruction.” However, he never asked the district court to charge only those three paragraphs. And he certainly never even suggested that the court should consider giving these three sentences—about which he complains for the first time on appeal—as a separate instruction.

Other circuits have held that, in these circumstances, district courts do not have a duty to parse lengthy, proposed jury instructions and to instruct the jury solely on the accurate portions of those proposed instructions. See 9C Wright & Miller, supra, § 2552 (“[A] number of courts have said that the trial judge need not give a requested instruction if it is inaccurate or deficient in any respect.”). When a requested instruction is “defective,” these [*43]  circuits have suggested that the district court has “no independent duty to supply a correct instruction.” Id.; see also Rogers v. Ingersoll-Rand Co., 144 F.3d 841, 845, 330 U.S. App. D.C. 198 (D.C. Cir. 1998) (acknowledging that the defendant “may have been entitled to a less sweeping instruction” but concluding that “[t]he district court was under no obligation to tinker with the flawed proposed instruction until it was legally acceptable”); Parker v. City of Nashua, 76 F.3d 9, 12 (1st Cir. 1996) (“[W]hen the instruction offered by the lawyer is manifestly over-broad, the district judge may reject without assuming the burden of editing it down to save some small portion that may be viable.”); Chase v. Consolidated Foods Corp., 744 F.2d 566, 570 (7th Cir. 1984) (noting that “it would be an unwelcome burden on our over-worked district judges to obligate them to repair all defects in tendered instructions” when evaluating the district judge’s duty “to instruct correctly when the party objecting to an erroneous instruction offers an erroneous substitute”); Cherry v. Stedman, 259 F.2d 774, 777-78 (8th Cir. 1958) (“A party cannot claim error in the refusal to give a requested instruction which is not entirely correct, or which it is not possible to give without qualification, or which is so framed as to be capable of being misunderstood.”).

I believe this Court should adopt the reasoning of our sister circuits. Direct General objected generally to [*44]  the entire requested instruction, and specifically objected to two sentences thereof. Brink’s counsel did not defend the accuracy or relevance of those sentences before the district court. Once the district court determined that the nine-sentence instruction was partially inaccurate, it had no duty to “edit[] it down to save some small portion that may be viable.” Parker, 76 F.3d at 12. In other words, even if Brink “may have been entitled to a less sweeping instruction on” the Boston Old Colony duties, “[t]he district court was under no obligation to tinker with the flawed proposed instruction until it was legally acceptable.” Rogers, 144 F.3d at 845. Accordingly, the district court did not abuse its discretion by rejecting the proposed instruction because it had no duty to parse the proposed instruction for accurate sentences that otherwise could (or should) have been given.

For the foregoing reasons, I would conclude that Brink has failed to satisfy the first prong of our Lamonica test; he has failed to show that his requested instruction correctly stated the law. For example, he has failed even to offer an argument that the seventh sentence of his requested instruction was not misleading. That sentence—which says “[t]he focus in [*45]  this bad faith case is not on the actions of Dustin Brink or his attorneys, but rather on the actions of Direct General“—is misleading as noted above; our Pelaez decision holds that the actions of the claimant’s attorney are not irrelevant, and that although the focus is on the actions of the insurance company, the actions of the claimant’s attorney can be factored into the totality of the circumstances analysis. Because Brink’s requested instruction included misleading statements and because the district court should have no duty to parse the request and save whatever portions thereof that might be correct, I would hold that Brink has failed to satisfy Lamonica‘s first prong. Thus, the district court has not erred.⁵

B.

I turn now to a separate and independent reason that the district court did not commit reversible error in declining to give Brink’s proposed instruction. Brink has also failed to satisfy the third prong of our Lamonica test; he has not shown that the failure to give his instruction resulted in prejudicial harm.

Even assuming arguendo (contrary to my view above) that the proposed instruction “correctly stated the law” and “dealt with an issue properly before [*46]  the jury,” Lamonica, 711 F.3d at 1309, I cannot conclude that the district court committed reversible error because I am satisfied that the district court’s rejection of the proposed instruction did not cause prejudicial harm to Brink; and I certainly have no “substantial and ineradicable doubt” in that regard. MidlevelU, Inc., 989 F.3d at 1215 (quoting Broaddus, 145 F.3d at 1288). Federal, rather than state, law governs this procedural question of whether the district court committed reversible error. Pate, 819 F.2d at 1081-82.

In Pelaez, we affirmed a grant of summary judgment in favor of an insurer in a bad faith suit under Florida law. 13 F.4th at 1254. As part of our reasoning, we acknowledged that the “focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured.” Id. (quoting Berges, 896 So. 2d at 677). But we also noted that the Supreme Court of Florida has held that the question of bad faith is for the jury to decide based on the totality of the circumstances, and the jury may consider the actions of the insurer, claimant, and the claimant’s attorney when deciding that question. Id. Importantly, the Supreme Court of Florida has never held that the jury may not consider the claimant’s (or his attorney’s) conduct when deciding whether the insurer has [*47]  acted in bad faith. We concluded in Pelaez that “there’s a difference between focusing on a claimant’s actions, which would be improper, and factoring a claimant’s actions into the totality of the circumstances analysis, which is not improper.” Id.

Not only are we bound by the interpretation of Florida law in Pelaez, I think that reading of Florida law is correct. Common sense tells us that it is not possible to evaluate whether a party has acted in bad faith without considering the events to which that party was responding. For example, in this case, it is not possible to evaluate whether Direct General’s delay in responding to Clem’s February 19, 2010 letter constituted bad faith—as opposed to mere negligence or even less—without considering the content of Clem’s February 19, 2010 letter. Contrary to Clem’s assertion in his March 12, 2010 letter, the February 19, 2010 letter did not say it was a “time-limited settlement offer.” Quite contrary to a time limit, the letter requested the other insurance “statement from your insured, if possible, so please send that to me at your earliest convenience.” And far from demanding a time-limited response, the February letter requested the information “in [*48]  the next couple of weeks.” The jury would obviously be influenced in its evaluation of the bad faith issue by the absence of a definite time limit and lack of urgency evidenced in the February letter, as well as the previous year and one-half of efforts by Direct General to settle the case and Clem’s lack of responsiveness and lack of any sense of urgency or even desire to settle.

As we said in Pelaez, it is appropriate to consider the actions of the claimant’s attorney:

[B]ecause they show how, in the totality of these circumstances, [the insurer] did fulfill its good faith duty to [the insureds]. They show how the failure to settle the lawsuit against the insureds did not result from bad faith of the insurer.

13 F.4th at 1254.

The Supreme Court of Florida has also held that “there must be a causal connection between the damages claimed and the insurer’s bad faith.” Perera v. U.S. Fid. & Guar. Co., 35 So. 3d 893, 902 (Fla. 2010). In other words, in a bad faith failure to settle action, a claimant must show that the insurer’s bad faith caused the failure to settle and the resulting excess judgment. See id. at 901 (“Although an excess judgment is not always a prerequisite to bringing a bad-faith claim, the existence of a causal connection is a prerequisite—in other words, the claimed [*49]  damages must be caused by the bad faith.”).⁶ When adjudicating that question, the “focus” is “on the actions [of] the insurer” because there is no “contributory negligence defense” for insurers in bad faith cases—i.e., a claimant’s negligence or bad faith cannot “absolve[]” an insurer of bad faith. Harvey, 259 So. 3d at 12. That said, a jury may still consider the actions of a claimant or his attorney when deciding whether the insurer’s bad faith caused a failure to settle because those actions are relevant to the causation question.

With that clarification of what the Florida substantive law provides with respect to the bad faith inquiry in mind, it becomes clear that the district court’s refusal to give a three-sentence instruction on the Boston Old Colony duties caused no prejudicial harm to Brink.⁷ Three reasons persuade me of this. First, the jury likely understood that the Boston [*50]  Old Colony duties were part of the duties that Direct General owed to its insureds. In his closing argument, Brink‘s counsel repeatedly referenced Direct General‘s duty to communicate with its insureds and its duty to “treat [its] insured customers the same way as if it had been [Direct General] who was exposed to this $12 million claim.” These, of course, are examples of the Boston Old Colony duties. Moreover, Brink‘s expert witness emphasized these duties and argued that Direct General failed to comply with them. Nothing in Direct General’s closing argument, or anything else in the trial, cast doubt upon the fact that the specific examples of the insurer’s duty referenced by Brink’s counsel and expert were part of the insurer’s duty that the district court charged the jury in the more general terms of the pattern instruction. Because the jury likely understood that Direct General’s communication (or lack thereof) with its insureds was relevant to Direct General’s duty of good faith, I cannot conclude that prejudicial harm resulted from the district court’s failure to charge the three sentences Brink now complains about on appeal.⁸

Second, the general language of the pattern jury [*51]  instruction on bad faith failure to settle fairly encompassed the Boston Old Colony duties. The district court instructed the jury as follows: “Bad faith on the part of an insurance company is failing to settle a claim when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for their interests.” The Boston Old Colony duties are merely specific examples of the duties described in the pattern instruction. As mentioned, Brink‘s counsel argued in his closing statement that Direct General did not act with due regard for the insureds’ interests because they failed to communicate with them and failed to pay attention to Brink’s time-limited settlement offer. Nothing in defense counsel’s closing argument, nor anything else at trial, suggested that the Boston Old Colony duties were not encompassed in the pattern instruction’s more general articulation of the duty to “settle a claim when, under all the circumstances, it could and should have done so, had it acted fairly and honestly to-ward its insured and with due regard for their interests.” Because the Boston Old Colony duties were fairly encompassed in the [*52]  jury charge that was given, Brink’s suggestion that there was a complete absence of crucial guidance to the jury rings hollow.⁹

Third, overwhelming evidence indicates that no settlement was possible in this case because Brink’s counsel clearly did not want to settle. As discussed above, while the focus in a bad faith case is on the insurer, the claimant’s attorney’s actions may be “factor[ed]” into the totality of the circumstances analysis. Pelaez, 13 F.4th at 1254. Here, the overwhelming evidence suggests that any actions of Direct General did not cause the failure to settle and the resulting excess judgment against the insureds. Rather, it shows that Brink‘s counsel tried to lure Direct General into making mistakes that he could later use to generate a bad faith claim. From August 18, 2008 to February 19, 2010, Clem did not respond to over two dozen attempts by Direct General to discuss Brink‘s claims against the insureds and settle them, and he rejected two checks that tendered the $10,000 policy limit to Brink. In the February 19 letter, Clem extended what he later called a time-limited settlement offer. However, the February 19 letter itself contained, at best, ambiguous instructions [*53]  on how and when to comply. The letter requested that the insurance information from Direct General’s insured be sent “to me at your earliest convenience,” and said that his client would sign the release (revised as requested) upon receipt of the “requested insurance disclosure” information and the insurance amounts already offered in a “couple of weeks.” Moreover, in his March 12 letter withdrawing the settlement offer, Clem said one reason for doing so was that Direct General failed to comply with a condition of settlement that was not included in the February 19 letter—namely, paying Brink‘s $900 property damage claim.

As Direct General‘s counsel argued in his closing argument, Clem had no incentive to settle Brink’s claim because, under the terms of his contingency agreement with Brink, he would only be compensated if he recovered from Direct General amounts above the policy limits:

Part of the agreement . . . was 40 percent of the gross recovery. Based on the contingency fee contract Mr. Clem would get $0 if the Claimant settled for the $10,000, but under the terms of the agreement by not settling and claiming Direct General acted in bad faith, Mr. Clem now stands to make approximately [*54]  $3,600,000.

. . . .

Mr. Clem may have 3,600,000 reasons to do what he did but settling wasn’t one of them. . . .

Moreover, Brink hired counsel for his bad faith claim against Direct General on the same day he hired counsel for the underlying action against Direct General’s insureds, and the above-described contingency fee agreement covered both counsel. In other words, they were planning a bad faith claim from the very beginning, even before the first communication from Brink‘s counsel to Direct General.

Direct General acknowledged before the jury that its adjuster should have responded more promptly to Clem’s February 19, 2010 letter. Although Direct General in effect acknowledged negligence and that it had reprimanded the adjuster, it argued that the error was attributable to oversight and certainly not bad faith, especially in light of the ambiguity of the letter.¹⁰ Although negligence can be evidence of bad faith, Boston Old Colony, 386 So. 2d at 785, it “is not the standard.” Harvey, 259 So. 3d at 9.

There is overwhelming evidence that the reason there was no settlement in this case was that Brink’s counsel did not want to settle. In order for Brink to receive compensation to reimburse him for any substantial percentage of his injuries, and [*55]  for his counsel to receive any compensation at all for their services, the only hope was for Clem to generate a bad faith claim.

It seems clear to me that the jury in this case found either that Direct General’s agents did not act in bad faith or that their failure to immediately respond to the February 19, 2010 letter did not cause the failure to settle. It seems clear to me that the jury would have recognized the overwhelming evidence that Brink‘s counsel had no incentive to settle with Direct General, that their only incentive was to generate a bad faith claim that would both create an enormous benefit for Brink and a nice attorney’s fee, and that the failure of this case to settle was because Brink’s counsel did not want to settle—not because of Direct General’s actions or omissions. It is clear to me that the jury’s verdict would have been the same had the district court given Brink’s requested jury instruction, which contained merely more specific examples of the general duty of the insurer already included in the pattern instruction actually given, especially in light of the fact that such specific duties were amply presented to the jury in Brink’s closing argument and in the [*56]  testimony of his expert and were not disputed by opposing counsel or the court.

I have no doubt that the district court’s rejection of the proposed instruction did not cause Brink prejudicial harm. Our standard of review is deferential: we will only reverse a jury verdict if we harbor a “substantial and ineradicable doubt as to whether the jury was properly guided.” MidlevelU, Inc., 989 F.3d at 1215 (quoting Broaddus, 145 F.3d at 1288). And, under our caselaw, the jury was allowed to consider the actions of the insurer, the claimant, and the claimant’s attorney when deciding whether the insurer’s alleged bad faith caused a failure to settle. Pelaez, 13 F.4th at 1254. Accordingly, I cannot conclude that Brink suffered prejudicial harm from the district court’s failure to give his proposed three-sentence instruction on the Boston Old Colony duties.¹¹

C.

In sum, Brink’s challenge to the district court’s failure [*57]  to give his requested instruction fails because he cannot satisfy either the first or third prong of our Lamonica test. For the foregoing reasons, I cannot conclude that the district court committed reversible error in failing to give the requested instruction.

Although I join the Court’s opinion in Part III.B., I respectfully dissent from the majority’s decisions in Part III.A. of the opinion for the Court. I would affirm the judgment of the district court and the verdict of the jury.

End of Document

---

¹ HN1[] Under Florida law, “a judgment creditor may maintain suit directly against [a] tortfeasor’s liability insurer for recovery of the judgment in excess of the policy limits, based upon the alleged fraud or bad faith of the insurer in the conduct or handling of the suit.” Thompson v. Com. Union Ins. Co. of N.Y., 250 So. 2d 259, 264 (Fla. 1971).

² The dissent asserts that the district court had “no duty to parse” Brink’s proposed instructions and “save whatever portions thereof that might be correct.” We do not suggest otherwise. Because the complete instruction correctly states Florida law, we need not consider whether any portion of the instructions can be considered separately on appeal.

³ In his initial brief (but not at oral argument), Brink also argued that because the jury was instructed “without any guidance on what it means to act with ‘due regard’ for the interests of the insured,” the jury instructions were per se deficient. That argument goes too far. HN9[] As we understand Florida law governing bad faith, “due regard” is a commonsense standard, not a term of art encompassing particular elements, and Brink has pointed us to no Florida authority to the contrary.

⁴ In Bonner v. City of Prichard, 661 F.2d 1206, 1207 (11th Cir. 1981) (en banc), this Court adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to October 1, 1981.

¹ Note that this $85,000 figure is the sum of the insureds’ $10,000 bodily injury coverage limit and Brink’s $75,000 uninsured motorist coverage limit.

² The superintendent’s affidavit provided the information required by Florida law. Fla. Stat. § 627.4137(1)(a)-(e). It stated the insurer’s name, the insured’s name, and the policy limits. It answered “None” to the following prompt: “A statement of any policy or coverage defense which such insurer reasonably believes is available to such insurer at the time of filing such statement.” Id. § 627.4137(1)(d). It also said that Direct General “does not know of any other insurer for its insured.”

³ Brink concedes that “[f]rom August 19, 2008, through June 25, 2009, Direct General attempted to contact Clem regarding the bodily injury claim via phone call and letter approximately 18 times, with no record of a response from Clem.” Based on my count, that number jumps to 25 times if you include Direct General‘s attempts to contact Clem regarding Brink‘s property damage claim.

⁴ Notably, the three conditions listed in the March 12 letter do not match the conditions specified in the February 19 letter, which did not mention the $900 property damage claim.

⁵ Moreover, even the three sentences Brink defends on appeal are deficient in part. The second of those sentences—which lists the several Boston Old Colony duties—is misleading. Florida law is clear that the Boston Old Colony duties are merely factors for the jury to consider and that violating one of those duties “does not automatically establish bad faith.” Berges, 896 So. 2d at 680. The second sentence that Brink urges on appeal is misleading in that it omitted that caveat.

So, both Brink’s original nine-sentence proposed instruction, and the three sentences thereof that he defends on appeal, are deficient in part. Accordingly, I do not think the district court erred.

⁶ The Florida pattern instruction on “legal cause” is as follows:

Bad faith conduct is a legal cause of [loss] [damage] [or] [harm] if it directly and in natural and continuous sequence produces or contributes substantially to producing such [loss] [damage] [or] [harm], so that it can reasonably be said that, but for the bad faith conduct, the [loss] [damage] [or] [harm]would not have occurred.

Harvey, 259 So. 3d at 11 (alterations in original).

⁷ Of course, federal law governs our determination of whether a district court’s failure to give a requested jury instruction resulted in prejudicial harm, but, in any event, there is no tension or difference between the federal law and the Florida substantive law in that both provide for consideration of the totality of the circumstances, including the actions of both Direct General and Brink‘s counsel. To the extent that we are trying to measure whether the absence of a particular instruction to the jury caused prejudicial harm, Florida substantive law is relevant in determining whether there was any deficiency in the jury charge and the degree thereof and in evaluating whether the outcome of the trial would have been different if the additional instruction had been given.

⁸ When deciding whether a failure to give a requested jury instruction is an abuse of discretion under federal law, we may consider what the parties’ counsel and expert witnesses said to the jury. See W. Air Lines, Inc. v. Criswell, 472 U.S. 400, 420, 105 S. Ct. 2743, 2755, 86 L. Ed. 2d 321 (1985) (expressly considering the arguments of counsel, the Court said: “Jury instructions . . . ‘may not be judged in artificial isolation,’ but must be judged in the ‘context of the overall charge’ and the circumstances of the case” (quoting Cupp v. Naughten, 414 U.S. 141, 147, 94 S. Ct. 396, 400, 38 L. Ed. 2d 368 (1973))); Booth v. Pasco Cnty., 757 F.3d 1198, 1209 (11th Cir. 2014) (in rejecting plaintiffs’ argument that the district court erred in failing to give their requested instruction, we held: “Plaintiffs have failed to persuade us . . . that they suffered prejudicial harm . . . . [T]he district court permitted Plaintiffs to make the same point during closing argument. . . . [That] mitigated any prejudice that may have otherwise resulted.”).

⁹ Brink presented his claim to the jury as bad faith failure to settle when the insurance company could and should have done so. As Brink’s counsel argued to the jury in closing: “What’s our claim? Our claim is that after February 19, 2010, Direct General failed to settle when under all the circumstances it could and should have done so had it acted fairly and honestly towards its insureds and with due regard for their interest.” And the pattern instruction actually given to the jury amply encompassed the gist of the Florida law with respect to that failure-to-settle claim. The other specific Boston Old Colony duties about which Brink complains on appeal probably did not contribute at all to failure of a settlement in this case, but, in any event, these specific duties were also encompassed within the general language of the pattern instruction. It is clear to me that, even if Brink’s more specific language had been charged, the jury would not have found bad faith or that Direct General’s actions in this regard caused the failure to settle.

¹⁰ The same is true with respect to Brink‘s argument that Direct General‘s early letters to its insured were sent to the wrong address, and his suggestion that the insureds might never have received the letters. The jury likely would have understood that, too, as an oversight.

¹¹ Unlike the majority, I do not believe that the duty to advise the insured is an independent theory of liability. Rather,

The duty to inform the insured of settlement opportunities is one of the duties subsumed within the duty of good faith owed by an insurer to an insured. The failure to inform the insured of the settlement offer does not automatically establish bad faith; it is simply one factor for the jury to consider in determining whether the insurer acted in bad faith.

Berges, 896 So. 2d at 680.

Moreover, even assuming arguendo (contrary to my belief) that this case did involve a failure to instruct on an independent theory of liability, the overwhelming evidence in this case is that any such deficiency did not cause the failure to settle. And it is even clearer to me that even if the district court had given the requested instruction about the duty to advise the insured, that would not have changed the jury’s verdict. That possibility was extremely remote in light of the fact that the court’s more general instruction fairly encompassed the more specific duty, which, in any event, was already in the jury’s mind because of the closing arguments and expert evidence, and in light of the overwhelming evidence that the failure to settle was caused by the fact that Brink’s counsel was not going to settle for $10,000.

United States District Court for the Northern District of Georgia, Atlanta Division

July 14, 2022, Decided; July 14, 2022, Filed

CIVIL ACTION FILE NO. 1:19-CV-3024-TWT

Reporter

2022 U.S. Dist. LEXIS 125649 *

LANCER INSURANCE COMPANY, Plaintiff, v. JET EXECUTIVE LIMOUSINE SERVICE, INC., et al., Defendants.

Core Terms

coverage, insured, endorsement, Policies, summary judgment, interstate, Transportation, travel, journey, intrastate, genuine issue of material fact, argues, declaration, provisions, trip, continuity, lists, interstate commerce, statutory minimum, cross motion, Undisputed, passengers, Parties, rented, material fact, motor carrier, broker, Reply, hotel, coverage obligation

Counsel:  [*1] For Jet Executive Limousine Service, Inc., Defendant: Wesley Clements Taulbee, LEAD ATTORNEY, Taulbee, Rushing, Snipes, Marsh & Hodgin, LLC, Statesboro, GA; James Townshend Budd, PRO HAC VICE, Mabry & McClelland, LLP, Atlanta, GA.

For Philadelphia Indemnity Insurance Company, Defendant: Kim M. Jackson, LEAD ATTORNEY, David Russell Smith, Bovis, Kyle, Burch & Medlin, LLC, Atlanta, GA.

For Cooper-Global Chauffeured Transportation, Inc., Defendant: Gerald B. Kline, Taylor English Duma LLP, Atlanta, GA; William Gordon Leonard, Continuum Legal Group LLP, Atlanta, GA.

For Steven Hoppenbrouwer, Defendant: James Townshend Budd, PRO HAC VICE, Mabry & McClelland, LLP, Atlanta, GA.

For Kent Plowman, Defendant: Brooks P. Neely, Zagoria Law firm, Atlanta, GA; Myrece Rebecca Johnson, Rebecca Beane, Swift, Currie, McGhee & Hiers, LLP, Atlanta, GA.

For Thomas Matthesen, Defendant: Arthur Bryan Baer, LEAD ATTORNEY, The Baer Law Firm, Atlanta, GA.

For Sahil Raina, Robin Raina, Defendants: James Franklin Cook, Jr., LEAD ATTORNEY, Drew Eckl & Farnham LLP, Atlanta, GA; Jeremy Hayes, Boling Rice, LLC, Cumming, GA.

For Wesley Hudson, Brian Dill, Defendants: Davis Kingsley Loftin, Jeffrey Norman Mykkeltvedt, LEAD [*2]  ATTORNEYS, Mykkeltvedt & Loftin, LLC, Atlanta, GA; Joe A. King, Jr., Joseph D. Aiello, LEAD ATTORNEYS, PRO HAC VICE, Morris, King & Hodge, P.C., Huntsville, AL.

For Georganna Gullia, Defendant: Barry Goodman, PRO HAC VICE, Goodman & Goodman, LLP, Atlanta, GA; Michael D. Goodman, Goodman & Goodman, Atlanta, GA; Titus Thomas Nichols, Nichols Injury Law, P.C., Marietta, GA.

For Joseph Best, Defendant: Peter A. Law, LEAD ATTORNEY, Denise Hoying, E. Michael Moran, Law & Moran, Atlanta, GA.

For Jessica Barnes, Defendant: Jeff P. Shiver, LEAD ATTORNEY, Shiver Hamilton, LLC -Atl, Atlanta, GA; Alan J. Hamilton, Darrell Wayne Hinson, Shiver Hamilton LLC, Atlanta, GA.

For John Mason, Defendant: Bradley W. Pratt, LEAD ATTORNEY, Pratt Clay, LLC, Atlanta, GA; Charles L. Clay, Jr., LEAD ATTORNEY, Pratt Clay, LLC, Atlanta, GA; Wesley Clements Taulbee, LEAD ATTORNEY, Taulbee, Rushing, Snipes, Marsh & Hodgin, LLC, Statesboro, GA.

For Kenny Strickler, Defendant: Michael K. Beard, LEAD ATTORNEY, Marsh, Rickard & Bryan, P.C., Birmingham, AL; W. Andrew Bowen, LEAD ATTORNEY, Middleton, LLC, Savannah, GA; Paul W. Painter, III, Bowen Painter, LLC, Savannah, GA.

For Tim Sheehy, Defendant: Joseph A. Fried, Nathan [*3]  A. Gaffney, LEAD ATTORNEYS, Briant G. Mildenhall, Fried Goldberg LLC, Atlanta, GA.

For Scott Armstrong, Alan Cooling, Defendants: Alexander Vida Salzillo, LEAD ATTORNEY, Waldon Adelman Castilla Hiestand & Prout, Atlanta, GA; Terry Dale Jackson, LEAD ATTORNEY, PRO HAC VICE, Terry D. Jackson, P.C., Atlanta, GA; Stephen G. Lowry, Harris Lowry Manton, LLP – S. Ga, Savannah, GA.

Judges: THOMAS W. THRASH, JR., United States District Judge.

Opinion by: THOMAS W. THRASH, JR.

Opinion

OPINION AND ORDER

This is a declaratory judgment action. It is before the Court on the Plaintiff’s Motion for Summary Judgment [Doc. 237], the Defendants Jessica Barnes and Joseph Best’s Cross Motion for Summary Judgment [Doc. 248], and the Defendant Cooper-Global Chauffeured Transportation, Inc.’s Cross Motion for Summary Judgment [Doc. 264]. For the reasons set forth below, the Plaintiff’s Motion for Summary Judgment [Doc. 237] is GRANTED in part and DENIED in part, the Defendants Jessica Barnes and Joseph Best’s Cross Motion for Summary Judgment [Doc. 248] is GRANTED in part and DENIED in part, and the Defendant Cooper-Global Chauffeured Transportation, Inc.’s Cross Motion for Summary Judgment [Doc. 264] is GRANTED in part and DENIED in part. [*4] 

I. Background

On April 5, 2018, a 2011 Freightliner Motor Coach (“the Motor Coach”) was involved in a single-vehicle accident on Interstate 20 in Columbia County, Georgia. (Pl.’s Statement of Undisputed Material Facts in Supp. of Pl.’s Mot. for Summ. J. ¶ 1.) The Motor Coach was owned by the Defendant Jet Executive Limousine Service, Inc. (“Jet”) and was carrying 18 passengers and the driver, Stephen Hoppenbrouwer. (Id. ¶¶ 1-2.) Jet insured the Motor Coach through the Defendant Philadelphia Indemnity Insurance Company. (Id. ¶ 4.) Though there are factual disputes regarding the specifics, the Defendants claim that their reservation of the Motor Coach was made through the Defendants Cooper-Global Chauffeured Transportation, Inc. (“Cooper-Global”) and Hennessy Transportation, Inc. (“Hennessy”), which then referred the reservation to Jet to accommodate the passengers’ specific request. (Defs. Barnes and Best’s Statement of Add’l Fact in Opp’n to Pl.’s Mot. for Summ. J. ¶ 2-4.)

Cooper-Global and Hennessy had five insurance policies issued by the Plaintiff, Lancer Insurance Company (“Lancer”), at the time of the accident. (Pl.’s Statement of Undisputed Material Facts in Supp. of Pl.’s Mot. [*5]  for Summ. J. ¶ 5.) Lancer issued Hennessy two commercial auto liability policies, “the Hennessy Primary Policy” and “the Hennessy Excess Policy.” (Compl., Exs. 5 & 6.) Lancer issued Cooper-Global three different policies: “the Cooper-Global Primary Policy,” “the Cooper Global Excess Policy,” and a commercial general liability policy (“the CGL Policy”). (Id., Ex. 1-3.) An endorsement to the CGL Policy names Hennessy as an additional insured. (Id., Ex. 3, at 6.) The Plaintiff filed this suit seeking declaratory relief that these five Policies do not obligate it to provide coverage for any claims resulting from the accident. (Compl. at 13.) The Parties have filed cross motions for summary judgment on these claims, which the Court evaluates below.

II. Legal Standard

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The court should view the evidence and draw any inferences in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 90 S. Ct. 1598, 26 L. Ed. 2d 142 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue [*6]  of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). The burden then shifts to the nonmovant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact exists. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986).

III. Discussion

The Plaintiff raises several arguments in favor of its Motion for Summary Judgment. First, the Plaintiff argues that the Hennessy Policies and the Cooper-Global Excess Policy do not impose a duty to defend upon it because the accident did not involve a vehicle covered under the Policies. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 16-20.) Second, the Plaintiff argues that the CGL Policy’s Auto Exclusion precludes coverage of the accident. (Id. at 20-22.) Finally, the Plaintiff argues that the MCS-90B Endorsement of the Cooper-Global Excess Policy does not apply because the bus was completing an intrastate trip. (Id. at 24-25.) After the Plaintiff filed its Motion for Summary Judgment, many of the Defendants responded individually and filed their own Cross-Motions for Summary Judgment. Several Defendants presented their own arguments while adopting additional arguments of their fellow Defendants, particularly those arguments made by Jessica Barnes and Joseph Best. The result is a mosaic [*7]  of overlapping arguments presented in different manners. Rather than address each responsive brief separately, the Court will evaluate each disputed Policy in turn, noting specific arguments made by the Parties when necessary to avoid any unwarranted repetition.

A. The Cooper-Global Primary Policy

In its Complaint, the Plaintiff seeks a declaration that it has no obligation to provide coverage under the Cooper-Global Primary Policy. (Compl. at 13.) However, it is undisputed that the Plaintiff has already tendered the Policy’s limit to resolve the claims against its insureds. (Pl.’s Statement of Undisputed Material Facts in Supp. of Pl.’s Mot. for Summ. J. ¶ 55.) Further, the Plaintiff implicitly abandons its claims for such a declaration in its briefing. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 26.) As a result, there is no genuine issue of material fact that the Plaintiff is not entitled to a declaration that it has no coverage obligation under the Cooper-Global Primary Policy.

B. The CGL Policy

The Plaintiff issued Cooper-Global the CGL Policy, which obligated the Plaintiff to “pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ [*8]  or ‘property damage’ to which this insurance applies.” (Compl., Ex. 4, at 12.) An endorsement to the CGL Policy lists Hennessy as an additional named insured under the CGL Policy. (Id., Ex. 4, at 6.) In support of its motion, the Plaintiff directs the Court to a “standard auto exclusion” included in the Policy which it argues bars coverage of this accident. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 20.) This provision excludes coverage for “‘[b]odily injury’ or ‘property damage’ arising out of the ownership, maintenance, use or entrustment to others of any aircraft, ‘auto’ or watercraft owned or operated by or rented or loaned to any insured.” (Compl., Ex. 4, at 15.) Further, the exclusion notes that it “applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured” if the harms resulted from the “use or entrustment to others of any” automobile “owned or operated by or rented or loaned to any insured.” (Id.) The Plaintiff argues that this exclusion applies to the allegations in the underlying lawsuits regarding the accident. (Pl.’s Br. in Supp. of Pl.’s Mot. for [*9]  Summ. J., at 20-22.) The Defendants contest this assessment because the Motor Coach was not “owned or operated or rented or loaned to any insured.” (Defs. Barnes & Best’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 22-23; Def. Cooper-Global’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 15.) In reply, the Plaintiff notes that Georgia courts read auto exclusions broadly, and because these “claims are inextricably linked to the use of an auto[,]” the exclusion must apply. (Pl.’s Reply Br. in Supp. of Pl.’s Mot. for Summ. J. [Doc. 278], at 21.)

By its plain language, the CGL Policy applies to the accident here absent a valid exclusion. The Plaintiff appears to concede as much by focusing its argument exclusively on the auto exclusion. Under Georgia law, the insurer has the burden of proving an exclusion applies. See York Ins. Co. v. Williams Seafood of Albany, Inc., 223 F.3d 1253, 1255 (11th Cir. 2000) (citing Nationwide Mut. Fire Ins. Co. v. Rhee, 160 Ga. App. 468, 471, 287 S.E.2d 257 (1981)). To satisfy its burden, it must show that the injuries alleged in the underlying lawsuits arose out of the use of an auto owned, operated, rented by, or leased to an insured. Clearly, the injuries caused by the accident arose out of the use of an “auto” as defined in the Policy.¹ The question before the Court is whether that auto was owned, operated, rented by, or [*10]  leased to an insured.

To answer this question, the Court must first determine who is insured under the CGL Policy, which is covered in Section II of the Policy. Beyond Cooper-Global and Hennessy as corporations, the CGL Policy includes “your ’employees’, . . . but only for acts within the scope of their employment by you or while performing duties related to the conduct of your business.” (Compl., Ex. 4, at 21.)

Given these broad definitions, the Court must determine whether the Motor Coach’s driver, Hoppenbrouwer, is an insured here, as the Parties dispute whether he qualifies as a Cooper-Global or Hennessy employee. The Plaintiff argues that the underlying lawsuits “allege that Hoppenbrouwer operated the Motor Coach as an employee of Hennessy and Cooper-Global.” (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 21.). In response, the Defendants characterize the underlying suits as alleging “that Cooper-Global and Hennessy are vicariously liable for Jet/Hoppenbrouwer’s negligence and/or independently liable for their own negligence in selecting and entrusting Hoppenbrouwer to drive” the Motor Coach. (Defs. Barnes & Best’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 22; see also Def. [*11]  Sheehy’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 8 (arguing that Hoppenbrouwer was an independent contractor for Cooper-Global and Hennessy, rendering them liable through the CGL Policy).)

In the end, it is not necessary to sort out the exact basis for any liability of Cooper-Global and Hennessy for the actions of Hoppenbrouwer. If he was an insured employee, coverage is excluded under the auto exclusion. If there is vicarious liability under any plausible theory against the named insureds Cooper-Global and Hennessy arising out of the operation of the Motor Coach, coverage is excluded under the auto exclusion. Video Warehouse, Inc. v. S. Tr. Ins. Co., 297 Ga. App. 788, 790-91, 678 S.E.2d 484 (2009) (“The point is, for liability to attach to Video Warehouse under this particular complaint, the employee had to be acting within the scope of his employment or performing duties related to the conduct of Video Warehouse’s business. Yet, if the employee was so acting or was performing such duties, then by definition he was an ‘insured’ under the policy, and under the exclusionary clause, the policy expressly excluded from coverage bodily injury arising out of the use of an automobile owned or operated by such an insured.”). If he was not an insured, there is no coverage under [*12]  the policy to begin with. Id. at 791. Therefore, the Plaintiff is entitled to summary judgment with respect to coverage under the CGL Policy.

C. The Cooper-Global Excess Policy

The Parties dispute whether several provisions of the Cooper-Global Excess Policy trigger coverage obligations for the Plaintiff. The Court addresses each of these disputed provisions and endorsements individually.

i. The Motor Coach is Not a Covered Vehicle

In many of the responsive briefs, the Defendants argue that the Motor Coach is a covered vehicle under the Cooper-Global Excess Policy. As discussed above, the Plaintiff concedes that the Cooper-Global Primary Policy could provide coverage of the Motor Coach. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 12-13.) The Defendants argue that the Cooper-Global Excess Policy is a “follow-form” policy as it relates to the Primary Policy, and without an explicit exclusion of coverage, the Motor Coach remains covered under the Excess Policy. (Defs. Barnes & Best’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 16-19; Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 8-14.) The Plaintiff points to a provision in the Cooper-Global Excess Policy dictating that any [*13]  conflicting or differing provisions between the two policies give way to the provisions of the Excess Policy. (Pl.’s Reply Br. in Supp. of Pl.’s Mot. for Summ. J., at 3-7.) The Defendants respond by claiming that any conflict that exists between the two Policies is too narrow to eliminate coverage of hired vehicles. (See, e.g., Defs. Barnes & Best’s Reply Br. in Supp. of Defs.’ Cross Mot. for Summ. J., at 3-5.)

Because the resolution of this dispute relies on the interaction between the two Cooper-Global Policies, a summary of the Policies is necessary. The Cooper-Global Primary Policy contains a “Schedule of Coverages and Covered Autos.” (Compl., Ex. 2, at 4.) This Schedule lists a series of coverage options alongside the “Covered Autos,” the coverage limits, and the premiums owed for each option. (Id.) Only those coverage options with a premium charge listed next to it are included in the Policy. (Id.) There are four coverage options with premiums charged: “Liability;” “Uninsured Motorists;” “Physical Damage Specified Causes of Loss Coverage;” and “Physical Damage Collision Coverage.” (Id.) The group of “Covered Autos” under each coverage are indicated by numbers which are defined [*14]  in the “Business Auto Coverage Form.” (Compl., Ex. 2, at 4, 64.) All coverages except for “Liability” have only one number—7—listed under the “Covered Autos.” The “Business Auto Coverage Form” shows that 7 stands for the vehicles “described in Item Three of the Declarations[.]” Item Three of the Declarations contains a list of ninety-two vehicles. (Id., Ex. 2, at 5-7.) Thus, all applicable coverages except for the “Liability” coverage apply only to these ninety-two vehicles. The “Liability” coverage applies to three categories of vehicles, listed as “7, 8, 9.” (Id., Ex. 2, at 4.) According to the policy, “8” indicates coverage for vehicles that the insured “lease[s], hire[s], rent[s], or borrow[s].” (Id., Ex. 2, at 64.) “9” indicates coverage for vehicles the insured “do[es] not own, lease, hire, rent, or borrow that are used in connection with [the insured’s] business.” (Id.) Thus, the “Liability” coverage under the Cooper-Global Primary Policy extends beyond the vehicles owned by Cooper-Global and includes unlisted vehicles used in connection with Cooper-Global’s business. And, as discussed above, Lancer has already tendered this Policy’s limit to resolve the claims against its insureds. [*15] 

The Defendants argue that the Cooper-Global Excess Policy is a “follow form” policy because of the following language included in the preamble of the “Commercial Excess Liability Coverage Form”:

The insurance provided under this Coverage Part will follow the same provisions, exclusions and limitations that are contained in the applicable “controlling underlying insurance”, unless otherwise directed by this insurance. To the extent such provisions differ or conflict, the provisions of this Coverage Part will apply.

(Id., Ex. 3, at 11.) The Defendants then direct the Court to the “Schedule of Covered Autos,” which identifies twenty-three vehicles as covered autos. (Id., Ex. 3, at 5.) Because the Cooper-Global Excess Policy lists these twenty-three vehicles but does not explicitly exclude coverage for vehicles included under groups “8” and “9” from the Primary Policy, the Defendants argue that this excess coverage applies to those leased and non-leased vehicles used in connection with Cooper-Global’s business. (Defs. Barnes & Best’s Br. in Opp’n to Pl.’s Mot. for Summ. J, at 17-19.) The Defendants also argue that the Policy is at least ambiguous and must be construed against the Plaintiff [*16]  and in favor of coverage. (Id. at 19-21.)

The Defendants rely heavily on the absence of an explicit exclusion of the non-owned vehicles covered under the Primary Policy. However, such an exclusion is not necessary here, as the Cooper-Global Excess Policy clearly limits coverage to the twenty-three vehicles specifically identified in the policy. The Cooper-Global Primary and Excess Policies detail the coverages provided through different formats. The Primary Policy lists several different types of coverages and then uses a numeric code to describe the “Covered Autos” to convey this information on one page. (Compl., Ex. 2, at 4.) On the other hand, the Excess Policy only details one type of coverage. (Id., Ex. 3, at 3.) Rather than numeric codes, the Excess Policy includes a “Schedule of Covered Autos for Auto Liability.” (Id., Ex. 3, at 5.) As the text above this list of vehicles states in bolded type, “THIS ENDORSEMENT CHANGES THE POLICY.” (Id.) Here, it seems clear that that the “Schedule of Covered Autos for Auto Liability” in the Excess Policy conflicts with the “Covered Autos” indicated by numeric codes in the Primary Policy. As a result, the Court finds that the collection of Covered [*17]  Autos listed in the Primary Policy as “7, 8, 9” gives way to the schedule of Covered Autos under the Excess Policy, and that the Motor Coach does not fall within the Excess Policy’s Covered Autos.

The Defendants argue that only the two lists of vehicles conflict in the two Policies, and therefore the list in the Excess Policy’s schedule should merely replace the list of ninety-two vehicles in the Primary Policy. But that argument assumes these lists represent identical categories, which is incorrect. While the Excess Policy’s schedule lists the covered autos under the Policy, the Primary Policy’s schedule of vehicles merely defines the vehicles included in “Specifically Described ‘Autos'” of the Policy’s Business Auto Coverage Form. (Id., Ex. 2, at 4-7, 64.) Because these lists define different terms within the relevant policies, the Defendants cannot argue that the specific vehicles listed in each Policy constitute the full extent of the differences between the Policies. Both Policies define the set of covered autos differently, and because the Motor Coach is not listed in the Excess Policy’s covered autos, its coverage is not triggered here.

ii. The MCS-90B Endorsements Provide No [*18]  Coverage Here

Anticipating an argument by the Defendants, the Plaintiff argues that the Cooper-Global Excess Policy’s MCS-90B Endorsement does not apply to the accident here. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 24-25.) The MCS-90B Endorsement is a means of complying with federal insurance regulations for motor carriers:

An MCS-90 endorsement to an automotive insurance policy obligates an insurer to cover an insured’s negligence involving vehicles subject to the financial responsibility requirements of the Motor Carrier Act. The Motor Carrier Act, in turn, creates minimum levels of financial responsibility for the transportation of property by motor carrier within the United States.

Grange Indem. Ins. Co. v. Burns, 337 Ga. App. 532, 533, 788 S.E.2d 138 (2016) (citation, quotation marks, and alterations omitted). In essence, an MCS-90 endorsement² “creates a suretyship, which obligates an insurer to pay certain judgments against the insured arising from interstate commerce activities, even though the insurance contract would have otherwise excluded coverage.” Id. at 534 (citation and quotation marks omitted). The Plaintiff argues that because the route in this case was entirely contained to Georgia, the MCS-90B endorsement does not apply here. (Pl.’s Br. in [*19]  Supp. of Pl.’s Mot. for Summ. J., at 24.) This argument is supported by the statute granting the Secretary of Transportation authority to enforce certain minimum coverage amounts for motor carriers:

The Secretary of Transportation shall prescribe regulations to require minimum levels of financial responsibility sufficient to satisfy liability amounts established by the Secretary covering public liability and property damage for the transportation of passengers for compensation by motor vehicle in the United States between a place in a State and—

(A) a place in another State;

(B) another place in the same State through a place outside of that State; or

(C) a place outside the United States.

49 U.S.C. § 31138(a)(1); see also Canal Ins. Co., 625 F.3d at 249 (holding that the character of the journey at the time of the loss determines the MCS-90 endorsement’s applicability and noting that its position is the majority view).

In response, the Defendants raise several arguments. Several Defendants claim that the endorsement “applies to all federally authorized carriers regardless of” whether the trips occurred in interstate or intrastate travel. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 17; see also Def. [*20]  Strickler’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 22.) Further, they argue that the endorsement should be construed and applied liberally to serve the legislative intent behind the requirements. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 17.) Alternatively, the Defendants Armstrong and Cooling appear to concede that the endorsement requires the trip to be interstate in nature, arguing that the trip here was merely one leg in an interstate trip for individuals traveling from outside Georgia to attend the Masters. (Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 4-7.) The Defendants cite Eleventh Circuit case law from a different context that describes intrastate legs of interstate journeys as falling within the meaning of “interstate commerce.” (Id. at 5-6.)

The Eleventh Circuit has acknowledged its case law on MCS-90 endorsements is sparse, and it has not opined on whether such endorsements only cover incidents that occur during interstate journeys. Nat’l Specialty Ins. Co. v. Martin-Vegue, 644 F. App’x 900, 906 (11th Cir. 2016). Here, the Court adopts the majority view that the MCS-90B endorsement’s applicability is determined by whether the vehicle is engaged in interstate travel at the time of the loss, as [*21]  this view most closely aligns with the statutory text requiring such endorsements. See 49 U.S.C. § 31138(a)(1); see also Nat’l Specialty Ins. Co., 644 F. App’x at 907 n.9 (adopting, because the parties agreed, the perspective that “the time of the accident is the relevant focal point” in determining certain characteristics that would invoke the MCS90 endorsement).

Having determined the majority view controls here, the Court must assess whether the Motor Coach’s journey between Atlanta and Augusta was an interstate or intrastate trip. In other contexts, the Eleventh Circuit has provided the general rule that “trips within a single state are made in interstate commerce when they are part of a practical continuity of movement of the goods in interstate commerce.” Abel v. S. Shuttle Servs., Inc., 631 F.3d 1210, 1215 (11th Cir. 2011) (quotation marks omitted). For example, in Abel, the Eleventh Circuit held that a shuttle company that transported individuals to and from several Florida airports without leaving the state engaged in interstate commerce. Id. at 1216. Several conditions were critical to the Panel’s analysis: (1) the shuttle passengers had mostly flown from or were about to fly to other states or countries; (2) travelers often boarded these shuttles with tickets purchased in packages that included airfare and hotel accommodations; [*22]  and (3) these packages resulted from an arrangement between the shuttle company and online travel companies. Id. at 1216-17. The Eleventh Circuit also cited case law that held “the lack of coordination with other transportation” providers could render a journey “purely intrastate.” Id. at 1216 (quotation marks omitted) (citing Packard v. Pittsburgh Transp. Co., 418 F.3d 246, 258 (3d. Cir. 2005)).

Ultimately, this Court finds that the relevant journey here constituted intrastate travel because there was no practical continuity of movement or evidence of coordination between transportation providers. First, regarding the practical continuity of movement, the undisputed facts show that the Motor Coach’s planned route was from the Atlanta hotel to the Masters Tournament in Augusta. (Pl.’s Statement of Undisputed Material Facts in Supp. of Pl.’s Mot. for Summ. J. ¶ 3.) The Defendants argue that the Motor Coach’s journey must be “viewed as part of overall, continuous interstate travel” because the Defendants’ “trips began and terminated outside Georgia[.]” (Defs. Armstrong & Coolings’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 6; see also Defs. Barnes and Best’s Response to Pl.’s Statement of Undisputed Material Facts in Supp. of Pl.’s Mot. for Summ. J. ¶ 3.) The Defendants urge [*23]  this Court to read the endorsement liberally to align its coverage with the “evident purpose” of the federal requirement. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 23.) However, the Court is not entitled to construe “interstate commerce” more broadly than precedent allows. The fact that the Defendants experienced the Motor Coach route as merely one leg of their trip to Augusta is not determinative of whether the Motor Coach maintained the practical continuity of their journey. Such a finding would massively expand activities that fall within interstate travel, rendering every outing taken by out-of-state tourists interstate commerce. Instead, the Court finds there is no practical continuity of movement between the Defendants’ interstate journeys to arrive in Atlanta and the Defendants’ intrastate journey from the Atlanta hotel to Augusta. In essence, the arrival at the Atlanta hotel interrupts the Defendants’ practical continuity of movement in interstate travel.

Second, and related to the practical continuity of movement, there was no coordination between the interstate and intrastate transportation providers. Evidence in the record indicates that the Motor [*24]  Coach passengers were invited to the Masters by an accounting firm, Cherry Bekaert, and were responsible for their own travel from the Atlanta airport to the hotel. (Thompson Dep., at 34:1-5.) Once the passengers were at the hotel, Cherry Bekaert arranged for bus travel to Augusta with Hennessy. (Defs. Armstrong & Cooling’s Add’l Material Facts ¶ 78.) This lack of coordination highlights this disconnect between the Defendants’ interstate and intrastate travel. Because these two legs of the journey were not coordinated and did not represent a practical continuity of movement, the Motor Coach’s journey was purely intrastate travel, and the Cooper-Global Excess Policy’s MCS-90B endorsement therefore does not apply here.

iii. The Form F Endorsements Do Not Apply to Cooper-Global

The Parties make similar arguments regarding the Form F endorsements attached to Hennessy and Cooper-Global’s Policies. As some of the Defendants describe it, a “Form F Endorsement is an intrastate version of an MCS-90B Endorsement[.]” (Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 12.) The Form F endorsements at issue here are largely identical to those evaluated in Ross v. Stephens, 269 Ga. 266, 269, 496 S.E.2d 705 (1998). In that case, the [*25]  Supreme Court of Georgia found that such an endorsement indicates an agreement “that the insurer would pay the statutory minimum to a party injured by [an insured’s] vehicle not specifically identified in the insurance policy.” Id. Georgia’s Public Service Commission (“PSC”) has set the statutory minimum at $100,000 per claimant and up to $500,000 per incident involving a vehicle with a seating capacity of over twelve passengers. See Ga. Comp. R. & Regs. 515-16-11-.03. The Plaintiff argues that because it already offered to tender $1.5 million under the Cooper-Global Primary Policy, the Form F endorsement imposes no additional obligation. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 25.)

The Defendants raise a variety of arguments in response to the Plaintiff’s view of the Form F endorsement. Several Defendants argue that Georgia law requires payment of the full policy amount under Form F, not just the statutory minimum. (Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 14.) Further, these Defendants argue that the Plaintiff’s tender of $1.5 million under Cooper-Global’s Primary Policy does nothing to relieve Hennessy of its Form F obligations. (Id. at 16.) Other Defendants argue Hennessy [*26]  must pay the statutory minimum of $500,000 under the Form F endorsements. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 23-27.)

The Defendants imply that Cooper-Global’s tender of its Primary Policy limit extinguishes its Form F liability. (Id. at 26 (“Allowing Hennessy to escape payment simply because Cooper-Global had already tendered an offer would create perverse incentives on the part of the insurers of motor carriers to attempt to wait each other out.”); see also Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 16 (“Lancer’s tender for Cooper Global of its $1.5 million auto policy limits does nothing for Hennessy in the face of the verdicts[.]”).) This implication aligns with the Supreme Court of Georgia’s view that when the statutory minimum is paid to an injured party, Georgia’s “public policy is achieved by the assurance to the motoring public of existence of the financial compensation the PSC has deemed minimally necessary[,] . . . and the insurer has provided no more than the liability coverage it agreed to provide the motor common carrier.” Ross, 269 Ga. at 708. As determined above, the Plaintiff’s tender under the Cooper-Global Primary Policy provides [*27]  coverage as to this accident for at least $1.5 million. This amount exceeds the Form F endorsement minimum and satisfies the public policy of compensating victims to the extent determined by the PSC. Cf. Nat’l Specialty Ins. Co., 644 F. App’x at 906-07 (finding that MCS-90 endorsements do not apply where a carrier’s other insurance coverage provides compensation equal to or greater than the statutory minimum). Thus, the Plaintiff’s tender under the Cooper-Global Primary Policy extinguishes any Form F endorsement coverage under the Cooper-Global Excess Policy.

As a result of the above analyses, none of the disputed provisions or endorsements of the Cooper-Global Excess Policy are triggered by this accident. Therefore, there is no genuine issue of material fact that the Plaintiff is entitled to summary judgment on its declaratory claim that is owes no coverage under the Cooper-Global Excess Policy here.

D. The Hennessy Policies

The Hennessy Policies receive much less attention in the briefing than Cooper-Global’s Policies. For example, the Defendants Barnes and Best only address the Cooper-Global Policies, and most Defendants adopt this briefing as their own. (See Defs. Barnes & Best’s Br. in Opp’n to Pl.’s Mot. for Summary Judgment, [*28]  at 5 (noting that Lancer issued five policies to Cooper-Global and Hennessy but only the three Policies issued to Cooper-Global “unambiguously provide coverage”).) The Plaintiff cites provisions of the Hennessy Policies that define the covered vehicles and notes that the Policies do not include the Motor Coach. (Pl.’s Br. in Supp. of Pl.’s Mot. for Summ. J., at 16-18.) None of the Defendants argue to the contrary.

The only arguments implicating the Hennessy Policies are related to the Policies’ Form F endorsements. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 23-27; Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 12-16.) The Defendants argue that the tender of $1.5 million under the Cooper-Global Primary Policy does nothing to alleviate Hennessy’s Form F liability under its own Policies. (See, e.g., Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 25-26.) In response, the Plaintiff argues that Hennessy is covered under Cooper-Global’s Primary Policy. To support this contention, the Plaintiff points to the Cooper-Global Primary Policy’s definition of the insureds³ and an expert report stating that if Cooper-Global and Hennessy [*29]  merged on February 1, 2018, Cooper-Global’s insurance would cover Hennessy. (Pl.’s Reply Br. to Defs. Armstrong & Cooling’s Br. in Opp’n to Pl.’s Mot for Summ. J., at 18; Pl.’s Reply Br. to Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 15.) However, the Plaintiff points to no evidence indicating a merger between the companies occurred on February 1, 2018, beyond the pleadings. Indeed, one of the Plaintiff’s filings concedes that “there is conflicting evidence regarding whether Cooper-Global and Hennessy merged.” (Pl.’s Response to Defs. Hudson & Dill’s Statement of Add’l Fats ¶ 10.) Further, the Plaintiff does not point to a specific provision of the Cooper-Global Primary Policy’s definitions that would include Hennessy. Unlike the CGL Policy, which explicitly includes both Cooper-Global and Hennessy as named insureds, the Cooper-Global Policy does not name Hennessy. Because there appears to be a genuine dispute as to whether the two companies merged before the accident, and because there is no other evidence suggesting Hennessy is a named insured under the Cooper-Global Excess Policy, Cooper-Global’s tender of $1.5 million does not alleviate Hennessy’s Form F liability. [*30] 

The Plaintiff relies exclusively on this tender to relieve Hennessy’s Form F liability. Because none of the other Policies trigger any coverage as to Hennessy, there is insufficient coverage to meet the statutory minimum of $500,000. Thus, the Form F endorsements of the Hennessy Policies are triggered by the accident, and there is no genuine issue of material fact that the Plaintiff is not entitled to a declaration that it has no coverage obligations under the Hennessy Policies.

E. The Defendants’ Remaining Arguments Fail

i. O.C.G.A. § 33-24-14 Does Not Preclude Reliance on Exclusions

The Defendants Hudson and Dill claim that the Plaintiff “failed to prove” it delivered the Policies to Cooper-Global prior to the accident, and that under Georgia law, such a failure renders the Plaintiff unable to rely upon exclusions in those Policies. (Defs. Hudson & Dill’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 14-15.) However, the Defendants point to no evidence in the record suggesting the Policies were not delivered to Cooper-Global. Instead, the Defendants place the burden on the Plaintiff to prove such delivery was made and insist that “whether Cooper-Global [] received the policy is an issue of disputed [*31]  f^act to be decided by a jury[.]” (Id. at 15.) Bare accusations that the delivery did not occur are insufficient at this stage in the proceedings to create a genuine issue of material fact. As a result, Georgia law does not prevent the Plaintiff from relying on exclusions within the Policies here.

ii. The Defendants Fail to Present Evidence of Dual Agency

The Defendants Robin and Sahil Raina argue that a dual agent for the Plaintiff and its insureds was responsible for the purchase of these Policies. (Defs. Raina & Raina’s Br. in Opp’n to Pl.’s Mot. for Summ. J., at 3-4.) The Raina Defendants point to evidence in the record that the Plaintiff paid Cooper-Global and Hennessy’s insurance broker a percentage on their policy purchases. (Rose Dep. at 41:5-8.) However, under Georgia law, insurance brokers “are generally considered the agent of the insured, not the insurer.” Eur. Bakers, Ltd. v. Holman, 177 Ga. App. 172, 173, 338 S.E.2d 702 (1985). Insurance brokers may be considered agents of the insurer under two circumstances: first, “if the plaintiff brings forth evidence that the insurer granted the agent or broker authority to bind coverage on the insurer’s behalf[;]” and second, “if an insurer holds out an independent agent as its agent and an insured justifiably [*32]  relies on such representation.” Popham v. Landmark Am. Ins. Co., 340 Ga. App. 603, 606, 798 S.E.2d 257 (2017) (quotation marks omitted). The Raina Defendants rely solely on the Plaintiff’s payment to the insurance broker in arguing there remains a genuine issue of material fact as to dual agency. Under Georgia law, this is insufficient. Without evidence in the record indicating the Plaintiff’s grant of authority to bind it or the Plaintiff’s holding out of the broker as an agent, the Raina Defendants’ argument fails.

IV. Conclusion

In summary, there is no genuine issue of material fact that the Plaintiff is entitled to a declaration that it has no coverage obligations under the Cooper-Global Excess Policy and the CGL Policy. There is also no genuine issue of material fact that the Plaintiff is not entitled to a declaration that it has no coverage obligations under the Cooper-Global Primary Policy and the Hennessy Policies. As a result, the Plaintiff’s Motion for Summary Judgment [Doc. 237] is GRANTED in part and DENIED in part, the Defendants Jessica Barnes and Joseph Best’s Cross Motion for Summary Judgment [Doc. 248] is GRANTED in part and DENIED in part, and the Defendant Cooper-Global Chauffeured Transportation, Inc.’s Cross Motion for Summary Judgment [Doc. [*33]  264] is GRANTED in part and DENIED in part. Because the Court has decided these motions without the need for oral argument, the pending motions for oral argument [Docs. 250 & 254] are DENIED as moot. The Clerk is directed to enter a final judgment in favor of the Plaintiff declaring that there is no coverage for the accident described in the Complaint with respect to the Cooper-Global Excess Policy and the CGL Policy.

SO ORDERED, this 14th day of July, 2022.

/s/ Thomas W. Thrash, Jr.

THOMAS W. THRASH, JR.

United States District Judge

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¹ “Auto” is broadly defined in the CGL Policy to include any “land motor vehicle . . . designed for travel on public roads. (Compl. Ex. 4, at 24.)

² MCS-90 endorsements apply to motor carriers that transport property, while MCS-90B endorsements apply to motor carriers of passengers. Compare 49 C.F.R. § 387.7 with 49 C.F.R. § 387.31. Federal appellate courts have found that their MCS-90 precedents control their MCS-90B interpretations and vice versa. See, e.g., Canal Ins. Co. v. Coleman, 625 F.3d 244, 249 n.7 (5th Cir. 2010)

³ The Plaintiff’s briefing cites to Doc. 102 for this contention, but that docket entry is a motion to appear pro hac vice. Instead, the Court assumes that the Plaintiff intended to cite to Doc. 1-02, which is the Cooper-Global Primary Policy.