The opinion of the court was delivered by: Samuel Der-yeghiayan, District Judge
This matter is before the court on an appeal from a bankruptcy court ruling on July 27, 2006. For the reasons stated below, we affirm in part and reverse in part and remand the instant action.
The basic underlying facts in this matter are undisputed by the parties. Nanovation Technologies, Inc. and its related corporation Nanovation Technologies of Michigan, Inc. (collectively referred to as "Nanovation") purchased insurance policies ("D&O Policies") from Appellee National Union Fire Insurance Company of Pittsburgh, PA, ("National"), Appellee Federal Insurance Company ("Federal"), and Appellee Twin City Fire Insurance Company ("Twin City") (collectively referred to as "Insurers"). National issued the primary policy ("Primary Policy") and Federal and Twin City issued excess policies that provided the same scope of coverage as the primary policy and which stated that the policies would apply in conformance with the terms of the Primary Policy. The D&O Policies provided coverage for suits brought against Nanovation's directors and officers relating to misconduct in their operation of Nanovation. Section 7 of the Primary Policy ("Section 7") included the following provision:
(c) If during the Policy Period or during the Discovery Period (if applicable) the Company or the Insureds shall become aware of any circumstances which may reasonably be expected to give rise to a Claim being made against the Insureds and shall give written notice to the Insurer of the circumstances and the reasons for anticipating such a Claim, with full particulars as to the dates, persons and entities involved, then any Claim which is subsequently made against the Insureds and reported to the Insurer alleging, arising out of, based on or attributable to such circumstances or alleging any Related Wrongful Act to such circumstances, shall be considered made at the time such notice of such circumstances was given.
On July 23, 2001, Nanovation's Vice President of Finance, John Ofenloch ("Ofenloch"), sent a letter ("Ofenloch Letter") to Nanovation's insurance broker, Dennis E. Love ("Love") of Marsh USA, Inc. In the letter, Ofenloch stated the following:
Pursuant to Section 7 of the [full title of policy] we are putting you on notice of potential claims against the Company. The Company is contemplating the filing of a Chapter 11 bankruptcy petition and believe that such filing will give rise to claims being filed against the Company, its Board and Officers. We will advise you of the specifics of the claims as the Company becomes aware of them. If you have any questions, please contact me at 734-351 0691. (Letter 1). Two days later, on July 25, 2001, Nanovation filed voluntary petitions under Chapter 11 of the United States Bankruptcy Code. On that same day, the Ofenloch Letter was forwarded by Love to National, Federal, and Twin City, along with a letter from Love, requesting that the Insurers accept the letter as a notice of circumstances required under Section 7. (N. Ans. 2); (F. Ans. 4); (T. Ans. 3). On August 10, 2001, Federal mailed to Nanovation a letter that Federal contends served as a reservation of rights letter in compliance with Section 7. Appellants contend that the letter does not suffice to meet the Section 7 requirements and that National and Twin City waited for a long period of time to inform Nanovation that the Ofenloch Letter was not sufficient to satisfy Section 7 so that Nanovation would be unable to provide notice in compliance with Section 7.
On November 20, 2001, the bankruptcy court converted Nanovation's Chapter 11 cases into cases under Chapter 7 of the Bankruptcy Code and appointed Barry A. Chatz ("Chatz") as the Chapter 7 Trustee. On May 7, 2002, Chatz filed an adversary action against certain former officers and directors of Nanovation alleging that they had breached their fiduciary duties and violated Florida state law and federal law. The officers and directors filed claims for coverage with the Insurers despite the fact that the D&O Policies' coverage period had expired. The directors and officers contended that the Ofenloch Letter, which was forwarded to the Insurers during the D&O Policies' coverage period, met the requirements for a notice of circumstances under Section 7 and that Section 7 therefore allowed their claims to be "considered made at the time such notice of such circumstances was given." (Ex.1). The Insurers, however, refused to accept the Ofenloch Letter as a proper notice of circumstances under Section 7 and the Insurers denied coverage because they believed that no claim was made during the policy period. (N. Ans. 2); (F. Ans. 5-6); (T. Ans. 5).
On October 29, 2002, Chatz filed the adversary action ("Adversary Proceeding") against the Insurers that is the subject of the instant appeal. Certain former directors and officers of Nanovation, such as Stephen Barney, Dr. Gary Bjorklund, Joseph S. Carr, Daniel Dorman, David Grubb, Howard Gitten, and James D. Davidson (collectively referred to as "Directors and Officers") also intervened in the Adversary Proceeding and filed a third-party complaint against the Insurers. In the Adversary Proceeding, Chatz sought relief such as a declaration that the D&O Policies provide coverage for the claims brought against the Directors and Officers and a declaration that the Insurers are precluded from denying coverage.
The parties filed cross motions for summary judgment in the Adversary Proceeding and on July 27, 2006, the bankruptcy court granted the Insurers' motions for summary judgment and denied Chatz's and Directors and Officers' motions for summary judgment. On October 19, 2006, the bankruptcy court denied a motion for reconsideration. Chatz and the Directors and Officers appealed the bankruptcy court's July 27, 2006 ruling. (Case numbers, 06 C 6138, 06 C 6140, 06 C 6374, 06 C 6376). On December 15, 2006, we consolidated all four appeals. Chatz and former Director James D. Davison ("Davidson") have each filed an individual appellant brief. Former Directors and Officers Stephen Barney, Dr. Gary Bjorklund, Joseph S. Carr, Daniel Dorman, David Grubb, and Howard Gitten (collectively referred to as "Individual Directors and Officers") have filed a combined appellant brief.
A federal district court has jurisdiction, pursuant to 28 U.S.C. § 158, to hear appeals from the rulings of a bankruptcy court. On appeal, the district court reviews the factual findings of the bankruptcy court under the clearly erroneous standard and reviews the bankruptcy court's legal findings under the de novo standard. In re A-1 Paving and Contracting, Inc., 116 F.3d 242, 243 (7th Cir. 1997).
Appellants argue that the bankruptcy court erred in concluding that the Ofenloch Letter did not satisfy the notice of circumstances requirements in Section 7. The Appellees also argue that the bankruptcy court erred in concluding that Fla. Stat. § 627.426(2)(a) ("Florida Notice Statute") did not apply to the Adversary Proceeding and concluding that the court did not need to engage in a choice of law analysis since there is no conflict between Illinois and Florida law. Appellees, on the other hand, argue that Chatz and the Individual Directors and Officers waived their right to argue on appeal that the bankruptcy court should have considered Florida law. The Appellants and Appellees present many other arguments as well, however, the above-mentioned issues are determinative for the purposes of the appeal and many of the other arguments are premature at ...