                                                                           FILED
                            NOT FOR PUBLICATION                             SEP 27 2012

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS




                            FOR THE NINTH CIRCUIT



DALE CONLEY; KAREN CONLEY, in                    No. 11-35577
the name of the Estate of Steve A. Stolp;
KARIN M. STOLP; KAREN S.                         D.C. No. 9:10-cv-00116-DWM
SCHNABL, co-personal representatives of
the Estate of Steve A. Stolp, deceased;
SILVERTIP ACCOUNTING, INC., AKA                  MEMORANDUM *
Silvertip Accounting; SILVERTIP
CONSTRUCTION, INC.,

              Plaintiffs - Appellants,

  v.

FIRST NATIONAL INSURANCE
COMPANY OF AMERICA; AMERICAN
STATES INSURANCE COMPANY,

              Defendants - Appellees.



DALE CONLEY; KAREN CONLEY, in                    No. 11-35617
the name of the Estate of Steve A. Stolp;
KARIN M. STOLP; KAREN S.                         D.C. No. 9:10-cv-00116-DWM
SCHNABL, co-personal representatives of
the Estate of Steve A. Stolp, deceased;
SILVERTIP ACCOUNTING, INC., AKA
Silvertip Accounting; SILVERTIP
CONSTRUCTION, INC.,


        *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
              Plaintiffs - Appellees,

  v.

FIRST NATIONAL INSURANCE
COMPANY OF AMERICA; AMERICAN
STATES INSURANCE COMPANY,

              Defendants - Appellants.



                    Appeal from the United States District Court
                            for the District of Montana
                    Donald W. Molloy, District Judge, Presiding

                      Argued and Submitted August 31, 2012
                               Seattle, Washington

Before: SCHROEDER and GOULD, Circuit Judges, and RAKOFF, Senior District
Judge.**

       Dale and Karen Conley (the “Conleys”) appeal the district court’s order

denying their motion for summary judgment and granting defendant’s cross motion

for summary judgment in this action against First National Insurance Company and

American States Insurance Company (“Insurers”). Insurers cross-appeal the

district court’s finding that there was a covered “occurrence” under the subject

policy. We have jurisdiction under 28 U.S.C. § 1332, and we AFFIRM.




       **
             The Honorable Jed S. Rakoff, Senior District Judge for the U.S.
District Court for the Southern District of New York, sitting by designation.

                                          2
      The relevant insurance policy covered “bodily injury.” Under Montana law,

“bodily injury” includes “mental or psychological injury that is accompanied by

physical manifestations.” Allstate Ins. Co. v. Wagner-Ellsworth, 188 P.3d 1042,

1051 (Mont. 2008). “Such conditions include those which are susceptible to

medical diagnosis and treatment in a manner which distinguishes them from

mental injuries.” Id. at 1052.

      The Conleys contend their allegation of “anxiety” triggered Insurers’ duty to

defend because, unlike emotional distress or mental anguish, anxiety “is commonly

understood to include physical manifestations.” They further argue this duty was

triggered by their October 1, 2009, letter to Insurers, which explained, “[T]he dread

of the tax liability that the Conleys face [has] taken a serious toll on their health.”

       Even if anxiety “typically includes such things as headaches, sleeplessness,

muscle tension, [and] nausea,” an insurer need not assume physical manifestations

rising to the level of “bodily injury” whenever “anxiety” is alleged. See id. “At a

minimum, there must be allegations of physical manifestations supported by

sufficient documented evidence in order for insurance coverage to be triggered.”

Id. at 1052 (quoting State Farm Fire & Cas. Co. v. Basham, 520 N.W.2d 713, 715

(Mich. App. 1994)). The district court correctly held that the Conleys’ letter “fails

to make even a generalized reference to physical injury” and that it was reasonable


                                            3
to read “a serious toll on their health” in context with the rest of the paragraph,

which discussed only the “‘emotional cost’ of Stolp’s bad advice.”

      The Conleys argue that, at the very least, their complaint and letter triggered

a duty to investigate and that such an investigation would have revealed their

extreme weight loss and chronic diarrhea. But Montana law supports the district

court’s holding that it was “not the [Insurers’] responsibility to affirmatively

disprove a bodily injury where none had been alleged.” See Revelation Industries

v. St. Paul Fire & Marine Ins. Co., 206 P.3d 919, 926 (Mont. 2009). Insurers

fulfilled their duty to investigate by reading the complaint and submitted

information and requesting “additional information, documentation or authority

[that would] in any way help support [the] claim for coverage.” See Daly Ditches

Irrigation Dist. v. National Sur. Corp., 764 P.2d 1276, 1279 (Mont. 1988).

      We conclude that the district court was correct in granting summary

judgment, because there was no genuine dispute as to any material fact relating to

the asserted duty to defend, and defendants were entitled to judgment as a matter of

law. Because we decide Insurers had no duty to defend, we do not reach other

issues on appeal or cross appeal.

      AFFIRMED.




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