Even With Assault & Battery Coverage Exclusion Applies
Barry Zalma
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Hitting Plaintiff on Head with Metal Pole is a Battery
Paul Semien (“Semien”), appealed the district court’s dismissal of his breach of contract claim for defense and indemnity against the Burlington Insurance Company (“Burlington”) after he was injured by a convenience store employee who hit him on the head with a metal pole. In Paul Semien v. The Burlington Insurance Company, No. 22-20195, United States Court of Appeals, Fifth Circuit (October 3, 2022) the Fifth Circuit applied the Eight Corners Rule and resolved the dispute in favor of the insurer.
BACKGROUND
Semien, a customer at a convenience store became embroiled in a dispute with the store’s clerk, Tam Truong, over Semien’s entitlement to store credits based on awards that he won from the store’s video poker machines. Truong left his post behind a glass-enclosed counter and hit Semien on the head with a metal pole, causing Semien severe injuries. Semien sued T&T and Truong in Texas state court (the “Underlying Lawsuit”) for negligence and assault against both Truong and his employer.
T&T had a general commercial liability insurance policy issued by Burlington (the “Policy.) “Coverage D” of the Policy provides for coverage up to $100,000 for assault and battery. But, Coverage D also excluded coverage when the assault or battery is “committed by any insured or agent of any insured.” The Policy defines “insured” to include T&T’s employees, but “only for acts within the scope of their employment by [T&T] or while performing duties related to the conduct of [T&T’s] business.”
Burlington denied that it had a duty to defend or indemnify T&T and Truong in the Underlying Lawsuit. Semien subsequently entered into a settlement agreement with T&T and Truong. As part of the settlement agreement, they assigned Semien “all rights they have jointly or separately to pursue claims and remedies under [their] insurance contract with The Burlington Company.”
Semien then sued Burlington. The district court granted the motion. Plaintiff timely appealed.
DISCUSSION
Under Texas law, an insurer’s duty to defend arises when a third party sues the insured on allegations that, if taken as true, potentially state a cause of action within the terms of the policy. But, if “the petition only alleges facts excluded by the policy, the insurer is not required to defend. Texas courts follow the eight-corners rule. Under this rule, courts determine whether an insurer has a duty to defend its insured by looking at the facts alleged within the four corners of the latest pleading upon which the insurer based its refusal to defend the action and the language within the four corners of the relevant insurance policy.
Since the Policy excludes coverage for assault or battery committed by an insured for acts within the scope of their employment and since Truong was working in the course and scope of his employment with T&T Global Enterprises Inc. when he hit Semien and Semien so alleged there was no coverage to defend or indemnify the insureds.
Reading the underlying pleading negates plaintiff’s contention that Truong was outside the scope of his employment at the time of the assault, and therefore was not an “insured” or “agent of an insured” under the Policy. This is true even reading the pleading liberally in favor of insurance coverage. Burlington had no duty to defend the insured in the Underlying Lawsuit.
ZALMA OPINION
Semien took an assignment of his claim against the people who injured him in favor of an attempt to get money from an insurer. If T&T or Truong had no assets then it was the only possible means of collecting damages. If, however, since T&T owned a convenience store it had some assets that Semien could have obtained with a judgment, the decision to let them off and sue the insurer who obviously owed nothing, was a waste of time and effort. The eight corners ruled eliminated coverage for T & T, Truong and Semien’s attempt to obtain damages.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected] and receive videos limited to subscribers of Excellence in Claims Handling at locals.com https://zalmaoninsurance.locals.com/subscribe.Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.
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Zalma on Insurance
Insurance, insurance claims, insurance law, and insurance fraud .
By Barry Zalma
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Concurrent Cause Doctrine Does Not Apply When all Causes are Excluded
Post 5119
Death by Drug Overdose is Excluded
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Southern Insurance Company Of Virginia v. Justin D. Mitchell, et al., No. 3:24-cv-00198, United States District Court, M.D. Tennessee, Nashville Division (October 10, 2024) Southern Insurance Company of Virginia sought a declaratory judgment regarding its duty to defend William Mitchell in a wrongful death case pending in California state court.
KEY POINTS
1. Motion for Judgment on the Pleadings: The Plaintiff moved for judgment on the pleadings, which was granted in part and denied in part.
2. Duty to Defend: The court found that the Plaintiff has no duty to defend William Mitchell in the California case due to a specific exclusion in the insurance policy.
3. Duty to Indemnify: The court could not determine at this stage whether the Plaintiff had a duty to ...
GEICO Sued Fraudulent Health Care Providers Under RICO and Settled with the Defendants Who Failed to Pay Settlement
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Post 5119
Default of Settlement Agreement Reduced to Judgment
In Government Employees Insurance Company, Geico Indemnity Company, Geico General Insurance Company, and Geico Casualty Company v. Dominic Emeka Onyema, M.D., DEO Medical Services, P.C., and Healthwise Medical Associates, P.C., No. 24-CV-5287 (PKC) (JAM), United States District Court, E.D. New York (July 9, 2025)
Plaintiffs Government Employees Insurance Company and other GEICO companies (“GEICO”) sued Defendants Dominic Emeka Onyema, M.D. (“Onyema”), et al (collectively, “Defendants”) alleging breach of a settlement agreement entered into by the parties to resolve a previous, fraud-related lawsuit (the “Settlement Agreement”). GEICO moved the court for default judgment against ...
ZIFL – Volume 29, Issue 14
Post 5118
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You can read the full 20 page issue of the July 15, 2025 issue at https://lnkd.in/giaSdH29
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
This issue contains the following articles about insurance fraud:
The Historical Basis of Punitive Damages
It is axiomatic that when a claim is denied for fraud that the fraudster will sue for breach of contract and the tort of bad faith and seek punitive damages.
The award of punitive-type damages was common in early legal systems and was mentioned in religious law as early as the Book of Exodus. Punitive-type damages were provided for in Babylonian law nearly 4000 years ago in the Code of Hammurabi.
You can read this article and the full 20 page issue of the July 15, 2025 issue at https://zalma.com/blog/wp-content/uploads/2025/07/ZIFL-07-15-2025.pdf
Insurer Refuses to Submit to No Fault Insurance Fraud
...
Rulings on Motions Reduced the Issues to be Presented at Trial
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CASE OVERVIEW
In Richard Bernier v. State Farm Mutual Automobile Insurance Company, No. 4:24-cv-00002-GMS, USDC, D. Alaska (May 28, 2025) Richard Bernier made claim under the underinsured motorist (UIM) coverage provided in his State Farm policy, was not satisfied with State Farm's offer and sued. Both parties tried to win by filing motions for summary judgment.
FACTS
Bernier was involved in an auto accident on November 18, 2020, and sought the maximum available UIM coverage under his policy, which was $50,000. State Farm initially offered him $31,342.36, which did not include prejudgment interest or attorney fees.
Prior to trial Bernier had three remaining claims against State Farm:
1. negligent and reckless claims handling;
2. violation of covenant of good faith and fair dealing; and
3. award of punitive damages.
Both Bernier and State Farm dispositive motions before ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
See the full video at https://lnkd.in/gK_P4-BK and at https://lnkd.in/g2Q7BHBu, and at https://zalma.com/blog and at https://lnkd.in/gjyMWHff.
Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
Professional Health Care Services Exclusion Effective
Post 5073
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This opinion is the recommendation of a Magistrate Judge to the District Court Judge and involves Travelers Casualty Insurance Company and its duty to defend the New Mexico Bone and Joint Institute (NMBJI) and its physicians in a medical negligence lawsuit brought by Tervon Dorsey.
In Travelers Casualty Insurance Company Of America v. New Mexico Bone And Joint Institute, P.C.; American Foundation Of Lower Extremity Surgery And Research, Inc., a New Mexico Corporation; Riley Rampton, DPM; Loren K. Spencer, DPM; Tervon Dorsey, individually; Kimberly Dorsey, individually; and Kate Ferlic as Guardian Ad Litem for K.D. and J.D., minors, No. 2:24-cv-0027 MV/DLM, United States District Court, D. New Mexico (May 8, 2025) the Magistrate Judge Recommended:
Insurance Coverage Dispute:
Travelers issued a Commercial General Liability ...
