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Scottsdale Insurance Co. v. Sheppard

United States District Court, C.D. Illinois, Peoria Division

June 28, 2019

SCOTTSDALE INSURANCE COMPANY, Plaintiff,
v.
CARLA SHEPPARD AND IRHERE TAP, INC. Defendants; IRHERE TAP, INC., Counter-Plaintiff
v.
SCOTTSDALE INSURANCE COMPANY, Counter-Defendant.

          ORDER & OPINION

          JOE BILLY MCDADE UNITED STATES SENIOR DISTRICT JUDGE

         Before the Court is Plaintiff/Counter-Defendant Scottsdale Insurance Company's Motion for Judgment on the Pleadings (Doc. 13). The Court has ensured its subject matter jurisdiction (Doc. 27), and Defendant/Counter-Plaintiff Irhere Tap, Inc., has responded (Doc. 16); the motion is now ripe for review. For the following reasons, the Court GRANTS the Motion for Judgment on the Pleadings.

         Background

         This action stems from a personal injury lawsuit currently pending in the Tenth Judicial Circuit Court located in Peoria County, Illinois, under the caption Sheppard v. Wilson et. al, No. 16-L-277 (Doc. 1-2). The underlying lawsuit is the result of an altercation that occurred on or around July 9, 2016, at a bar owned by Defendant/Counter-Plaintiff Irhere Tap, Inc. Specifically, Defendant Carla Sheppard was stabbed with a sharp object by another bar patron. (Doc. 1-2 at 1-2). In the underlying lawsuit, Defendant Sheppard brings two claims against Defendant Irhere Tap; the first is a Dram Shop Act claim under 235 ILCS 5/6-21 for selling and/or giving alcohol to a bar patron who became intoxicated and then caused injury to Defendant Sheppard, and the second is for negligently failing to maintain peace at its establishment. (Doc. 1-2 at 2-5). Shortly after the altercation, Defendant Irhere Tap submitted a claim to Plaintiff Scottsdale, its insurance provider, seeking defense and indemnification in the underlying lawsuit; in return, Defendant Irhere Tap received a letter dated December 21, 2016, indicating the insurance policy provided no coverage for Defendant Sheppard's injury. (Doc. 24 at 24-25).

         The insurance policy at issue provides Commercial General Liability Coverage and includes Liquor Liability Coverage. The letter identified relevant portions of the policy, specifically the Commercial General Liability Coverage provision and the Assault and/or Battery Exclusion. (Doc. 16 at 27-31). Section I, Coverage A of the Commercial General Liability Coverage part reads:

We will pay those sums that the insured becomes legally obligated to pay as damages because of “bodily injury” or “property damage” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages. However, we will have no duty to defend the insured against any “suit” seeking damages for “bodily injury” or “property damage” to which this insurance does not apply.

(Doc. 1-1 at 9). The Liquor Liability Coverage Form states under the subsection entitled “Insuring Agreement”:

We will pay those sums that the insured becomes legally obligated to pay as damages because of “injury” to which this insurance applies if liability for such “injury” is imposed on the insured by reason of the selling, serving or furnishing of any alcoholic beverage. We will have the right and duty to defend the insured against any “suit” seeking those damages. However, we will have no duty to defend the insured against any “suit” seeking damages for “injury” to which this insurance does not apply.

(Doc. 1-1 at 25).

         The Assault and/or Battery Exclusion applies to the Commercial General Liability Coverage and the Liquor Liability Coverage and, as its title indicates, excludes coverage for injuries arising from assault or battery. It states:

         The following exclusion is added to the Exclusions section:

         This insurance does not apply to “injury, ”. . . [or] “bodily injury, ”. . . arising from:

1. Assault and/or Battery committed by any insured, any employee/“employee” of any insured, or ...

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