                 FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT


INTERSTATE FIRE & CASUALTY              No. 12-17195
COMPANY, INC., an Illinois
corporation,                               D.C. No.
       Plaintiff-Counter-Defendant–     2:09-cv-01405-
                           Appellant,       NVW

                 v.

ROMAN CATHOLIC CHURCH OF THE
DIOCESE OF PHOENIX, a corporation
sole, by and through Bishop Thomas
J. Olmsted, his predecessors and
successors,
       Defendant-Counter-Claimant–
                            Appellee.



INTERSTATE FIRE & CASUALTY              No. 12-17264
COMPANY, INC., an Illinois
corporation,                               D.C. No.
       Plaintiff-Counter-Defendant–     2:09-cv-01405-
                           Appellee,        NVW

                 v.

ROMAN CATHOLIC CHURCH OF THE
DIOCESE OF PHOENIX, a corporation
sole, by and through Bishop Thomas
2          IFC V. ROMAN CATHOLIC CHURCH

J. Olmsted, his predecessors and
successors,
      Defendant-Counter-Claimant–
                           Appellant.



INTERSTATE FIRE & CASUALTY               No. 13-15223
COMPANY, INC., an Illinois
corporation,                                D.C. No.
       Plaintiff-Counter-Defendant–      2:09-cv-01405-
                           Appellant,        NVW

                 v.
                                           OPINION
ROMAN CATHOLIC CHURCH OF THE
DIOCESE OF PHOENIX, a corporation
sole, by and through Bishop Thomas
J. Olmsted, his predecessors and
successors,
       Defendant-Counter-Claimant–
                            Appellee.


      Appeal from the United States District Court
               for the District of Arizona
        Neil V. Wake, District Judge, Presiding

                Argued and Submitted
       May 13, 2014—San Francisco, California

                   Filed July 30, 2014
               IFC V. ROMAN CATHOLIC CHURCH                           3

    Before: Dorothy W. Nelson, M. Margaret McKeown,
          and Milan D. Smith, Jr., Circuit Judges.

                 Opinion by Judge McKeown;
                 Dissent by Judge D.W. Nelson


                           SUMMARY*


                    Arizona Insurance Law

    The panel reversed the district court’s judgment in favor
of the Roman Catholic Church of the Diocese of Phoenix, and
vacated and remanded the district court’s grant of attorneys’
fees and taxable costs, in a diversity insurance coverage case
concerning indemnity for the alleged sexual abuse of
adolescent males by priests in the Diocese.

    Following the Diocese’s settlement of four lawsuits for
alleged sexual abuse by its priests, the Diocese sought
indemnification under its insurer’s excess liability indemnity
policies. The policy excluded “liability of any Assured for
assault and battery committed by or at the direction of such
Assured . . . .” The district court construed the exclusion as
applying only to the offending priest, and concluded that the
exclusion did not foreclose coverage for the Diocese of the
sexual abuse claims.

   The panel held, based on the ordinary meaning of the
exclusion and consistent with Arizona law, because the

  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4           IFC V. ROMAN CATHOLIC CHURCH

exclusion precluded coverage for “any assured” the assault
and battery exclusion categorically excluded coverage for
both the insured who committed the assault and battery as
well as innocent co-insureds. The panel remanded to the
district court to determine whether the insurer was the
“successful party” under Arizona law, and if so, whether to
award attorneys’ fees.

    Judge D.W. Nelson dissented because she believes that
the disputed policy provision excluded coverage only for
those individuals who committed or directed an assault or
battery, and she would affirm the district court.


                       COUNSEL

Steven G. Mesaros (argued), Richard H. Goldberg, and Kevin
R. Myer, Renaud Cook Drury Mesaros, Phoenix, Arizona;
Timothy J. McNamara, Onebane Law Firm, Lafayette,
Louisiana, for Plaintiff-Counter-Defendant–Appellant-Cross-
Appellee.

Andrew S. Jacob (argued) and Andrew B. Turk, Polsinelli
PC, Phoenix, Arizona, for Defendant-Counter-Claimant–
Appellee-Cross-Appellant.
             IFC V. ROMAN CATHOLIC CHURCH                     5

                          OPINION

McKEOWN, Circuit Judge:

      Does “any” mean “any,” or does “any” mean “any one”?
The answer to this seemingly simple question dictates the
result in this insurance coverage case, which arises from the
alleged sexual abuse of adolescent males by priests in the
Roman Catholic Church of the Diocese of Phoenix (“the
Diocese”). The excess indemnity policy provided by
Interstate Fire & Casualty Company, Inc. (“IFC”) to the
Diocese excludes “liability of any Assured for assault and
battery committed by or at the direction of such Assured
. . . .” Based on the ordinary meaning of this exclusion and
consistent with Arizona law, we conclude that “the language
‘any insured’ . . . express[es] a contractual intent to prohibit
recovery by innocent co-insureds.” Am. Family Mut. Ins. Co.
v. White, 65 P.3d 449, 457 (Ariz. Ct. App. 2003). We reverse
the district court’s judgment in favor of the Diocese, and
vacate and remand its grant of attorneys’ fees and taxable
costs.

    This action follows the Diocese’s settlement of four
lawsuits for alleged sexual abuse by its priests, after which
the Diocese filed a declaratory judgment action seeking
entitlement to indemnification under IFC’s excess liability
indemnity policies. IFC’s policies typically “follow[ed]
form” with those of Lloyd’s of London, the Diocese’s
primary excess insurer. The general liability clause in
Lloyd’s of London’s insuring policy provided:

       Underwriters hereby agree, subject to the
       limitations, terms and conditions hereunder
       mentioned, to indemnify the Assured for all
6           IFC V. ROMAN CATHOLIC CHURCH

       sums which the Assured shall be obligated to
       pay by reason of the liability imposed upon
       the Assured by law or assumed by the Named
       Assured under contract or agreement, for
       damages direct or consequential, and
       expenses, all as more fully defined by the
       term “ultimate net loss”, on account of
       personal injuries . . . arising out of any
       occurrence happening during the period of
       Insurance.

The policy described the term “Assured” as including the
Diocese and “any official, trustee or employee of the
[Diocese],” working “in any parishes, schools, cemeteries,
and other agencies or directly connected organizations of the
Diocese,” and “acting within the scope of his duties as such
. . . .” The policy excluded coverage for claims that alleged
assault and battery:

       THIS INSURANCE DOES NOT APPLY -

           (a) to liability of any Assured for assault
       and battery committed by or at the direction
       of such Assured except liability for Personal
       Injury or Death resulting from any act alleged
       to be assault and battery for purpose of
       preventing injury to persons or damage to
       property[.]

    On cross motions for summary judgment, the district
court in relevant part granted summary judgment in favor of
the Diocese on the assault and battery exclusion. Despite
finding IFC’s argument “plausible,” the district court
construed the exclusion as applying only to the offending
             IFC V. ROMAN CATHOLIC CHURCH                      7

priest, concluding that “the best reading of the assault and
battery clause is that ‘such assured’ means ‘that insured’; i.e.,
the assured who committed or directed the assault and
battery.” The district court therefore concluded that the
exclusion did not foreclose coverage of the sexual abuse
claims.

    On appeal, as before the district court, IFC contends that,
because the exclusion precludes coverage for “any
assured”—and because “such assured” refers back to “any
assured”—the assault and battery exclusion categorically
excludes coverage for both the insured who committed the
assault and battery as well as innocent co-insureds. We agree
with IFC’s reading of the exclusion.

    Neither party disputes that the “Assured” under the policy
covers not only the Diocese itself but also its priests and other
employees working in the schools, parishes, agencies, and
organizations directly connected to the Diocese. The
question is the scope of the assault and battery exclusion,
which uses the term “Assured” in two places: “any Assured,”
followed by “such Assured.” Two principles guide our
analysis. In interpreting the policy under Arizona law, the
words “any” and “such” are to be given their ordinary
meaning. See Phelps Dodge Corp. v. Brown, 540 P.2d 651,
653 (Ariz. 1975). We read these words in the context of the
policy and do not rewrite its text. See id.; see, e.g., Barber v.
Old Republic Life Ins. Co., 647 P.2d 1200, 1202 (Ariz. Ct.
App. 1982) (“[T]he court must read the policy as a whole . . .
with an appropriate regard for the context of the various
component parts” and without “rewrit[ing] a policy . . . .”).

   We turn first to the plain meaning of the term “such
Assured.” As relevant here, the word “such” is defined as “of
8            IFC V. ROMAN CATHOLIC CHURCH

a kind or character about to be indicated, suggested, or
exemplified” or “having a quality already or just
specified—used to avoid repetition of a descriptive term.”
Webster’s Third New International Dictionary 2283 (2002).
This definition indicates that “such Assured” in the exclusion
carries the precise meaning as the assured “just specified.”
See id.; see, e.g., Spartan Petroleum Co. v. Federated Mut.
Ins. Co., 162 F.3d 805, 809 (4th Cir. 1998) (holding that
“such” property damaged referred back to the last mentioned
“property damage” in the policy at issue). Here, the assured
“just specified” is “any Assured”—those who allegedly
committed the assault and battery as well as innocent co-
insureds.

    The Diocese maintains that the phrases “any Assured”
and “such Assured” should be “presumed to have different
meanings” and that IFC should have used language clearly
communicating a limitation of coverage. Yet the Diocese’s
reading can only be reached by ignoring the plain meaning of
the exclusion and jumping to the conclusion that the text is
unclear. This effort to infuse ambiguity into an otherwise
clear agreement is unavailing. As the Arizona Court of
Appeals noted in Brown v. United States Fidelity & Guaranty
Company, “when an exclusionary clause precludes recovery
to ‘any insured,’ the term is not ambiguous and clearly
encompasses all persons insured under the policy.” 977 P.2d
807, 817 (Ariz. Ct. App. 1998). Reading the policy in
context, the ordinary meaning provides that “such” refers
back to “any,” thus indicating that the exclusion applies to
“any official, trustee or employee” of the Diocese.

   The Diocese’s argument also requires that we read
additional language into the text. The only assured “just
specified” in the exclusion is “any Assured.” A narrower
             IFC V. ROMAN CATHOLIC CHURCH                      9

specification, such as “the assured” or “that assured,” is
nowhere to be found. See Sales v. State Farm Fire & Cas.
Co., 849 F.2d 1383, 1385 (11th Cir. 1988) (“[U]nlike the
phrase ‘the insured,’ the phrase ‘any insured’ unambiguously
expresses a contractual intent to create joint obligations and
to prohibit recovery by an innocent co-insured.”). Nor does
“any” mean “any one”; the exclusion expressly states “any
Assured.” We decline to cast aside the ordinary meaning of
these terms in favor of words that are not included in the text.
See D.M.A.F.B. Fed. Credit Union v. Emp’rs. Mut. Liab. Ins.
Co. of Wis., 396 P.2d 20, 23 (Ariz. 1964) (en banc) (“[T]he
court will not pervert or do violence to the language used . . .
[by] expand[ing] it beyound [sic] its plain and ordinary
meaning or add[ing] something to the contract which the
parties have not put there.”).

    The plain meaning of “such Assured” also comports with
Arizona law. In White, an Arizona Court of Appeals joined
a “majority” of Arizona courts in “constru[ing] the phrase
‘any insured’ in an exclusion” as “bar[ring] coverage for any
claim attributable to the excludable acts of any insured . . . .”
65 P.3d at 456, 457; see TIG Specialty Ins. Co. v.
Pinkmonkey.com Inc., 375 F.3d 365, 372 (5th Cir. 2004)
(holding that coverage was foreclosed because a policy
exclusion “use[d] the specific term ‘such Insured’ to indicate
the same insured as previously referred to,” namely, “an
Insured”). We too conclude that “if any one of the insureds
[violates the exclusion], no other insureds can recover.”
White, 65 P.3d at 457 (alteration in original) (internal
quotation marks omitted). Because we determine that the
assault and battery exclusion applies to innocent co-insureds,
we need not reach the remainder of the arguments raised on
appeal.
10           IFC V. ROMAN CATHOLIC CHURCH

    We vacate the award of attorneys’ fees and taxable costs
and remand to the district court to determine whether IFC is
the “successful party” under Arizona Revised Statute § 12-
341.01, and if so, whether to award attorneys’ fees. See Med.
Protective Co. v. Pang, 740 F.3d 1279, 1280 (9th Cir. 2013).
Costs on appeal shall be taxed against the appellee.

   REVERSED in part; VACATED and REMANDED in
part.



D.W. NELSON, Senior Circuit Judge, dissenting:

    Because I believe that the plain language of the policy
provision relied on by IFC excludes coverage only for those
individuals who commit or direct an assault or battery, I
would affirm the district court. I respectfully dissent.

    I agree with the majority that this case turns on what
exactly the plain meaning of the phrase “such Assured” refers
back to. See Sparks v. Republic Nat. Life Ins. Co., 647 P.2d
1127, 1132 (Ariz. 1982). In my view, however, the definition
of “such” adopted and applied by the majority—“having a
quality already or just specified—used to avoid repetition of
a descriptive term[,]”—does not refer back to the class of
“any Assured[s]” “just specified.” Instead, “such” refers to
those Assureds “having a quality already or just specified.”
Maj. Op. at 8 (emphasis added). Referring to the language of
the exclusion, I see three possible qualities that “such” can
refer to. First, the exclusion identifies “the liability of any
Assured,” so “such” may refer to those Assureds facing
liability. Second, the exclusion references “any Assured,”
meaning that “such” might refer to the entire class of those
             IFC V. ROMAN CATHOLIC CHURCH                    11

covered by the policy. Finally, the exclusion references
“assault and battery committed by or at the direction of,”
which means that “such” might refer to those Assureds who
committed or directed assault and battery. Of these three
possible qualities, that which was “just specified” is the
quality of having committed or directed assault and battery.
Under the plain meaning of the word “such,” I believe that
the exclusion therefore only excludes coverage for assureds
who committed or directed the assault or battery giving rise
to liability.

     Moreover, the word “quality,” a word central to the
definition of “such,” is defined as a “peculiar or essential
attribute” or “distinguishing attribute[.]” Webster’s Ninth
New Collegiate Dictionary 963 (9th ed. 1987). That is, a
quality is an attribute used to differentiate individuals within
a class, compare them to one another, or explain why one
individual in a class or subset of a class is different from
others within the wider class. Out of the three possible
“qualities” in the exclusion, only two serve to differentiate
from the wider class—the subset of assureds facing liability
for assault and battery and the subset of assureds who
committed or directed assault and battery. It is least likely
that “such” refers back to “any Assured” because “any
Assured” is the complete class of assureds, not a subset of the
class identified by some unique characteristic. Nor is “any
Assured” the quality “just specified.” Finally, if “such” refers
back to the entire class of “any Assured,” the exclusion is
redundant, but using such to refer to either of the other
qualities gives meaning to the phrase “such Assured” that is
consistent with the plain and common usage of the word
“such.”
12             IFC V. ROMAN CATHOLIC CHURCH

    Considering the plain and customary usage of the word
“such,” it is difficult to construct a hypothetical sentence that
carries the same structure as the policy exclusion in this case
where the word “such” refers back to the entire universe of
individuals under consideration. For example:

         The recess policy does not apply to any
         student acting up during Mr. Jones’ class,
         such students are not entitled to recess.

Do all students in Mr. Jones’ class lose recess privileges, or
is it plain that only those students who act up lose recess
privileges? If such referred back to “that just specified,” then
“any Student,” or the entire class of students who attended
Mr. Jones’ class, would lose recess privileges. That is not the
commonly understood meaning of the sentence. It is also
relevant that it is easy to construct1 an exclusion that clearly
applies to all assureds without ambiguity. For example:

         This insurance does not apply to liability
         arising from an assault and battery committed
         or directed by any Assured.

Or:

         This insurance does not apply to liability of
         any Assured for assault and battery committed
         by or at the direction of any Assured.



 1
   I recognize that the policy exclusion was drafted by Lloyd’s of London
and merely incorporated by IFC into the excess policy. I also note that
Lloyd’s of London provided coverage for the underlying claims despite
the existence of the exclusion.
             IFC V. ROMAN CATHOLIC CHURCH                    13

Where these examples would unambiguously preclude
coverage for the underlying claims, in order to reach the same
result with the actual exclusion applicable here, “such
Assured” must be, for all practical purposes, stripped from
the policy language. I therefore do not think that the
exclusion applies to the Diocese’s vicarious liability for the
torts of its employees.

    Finally, although I believe the exclusion is inapplicable to
the vicarious claims against the Diocese on its plain language,
even if the exclusion is merely ambiguous it should be
construed in favor of coverage. Sparks, 647 P.2d at 1132.
Arizona law resolves ambiguities in favor of the insured if
“after consideration of legislative goals, social policy, and
examination of the transaction as a whole[,]” it is not clear
how the policy applies to the facts of the particular case.
Empl’rs Mut. Cas. Co. v. DGG & CAR, Inc., 183 P.3d 513,
515 (Ariz. 2008) (quotation omitted). As the district court
noted, both IFC’s and the Diocese’s interpretations of the
assault and battery exclusion are at least plausible, and
neither interpretation offends public policy as both exclude
coverage for intentional torts. See, e.g., Transamerica Ins.
Grp. v. Meere, 694 P.2d 181, 185–86 (Ariz. 1984). I
therefore believe Arizona law requires interpreting the
exclusion in favor of the Diocese.

    Nothing in the authority cited by the majority compels a
different result. American Family Mutual Insurance Co. v.
White construed the following provision to preclude coverage
for innocent co-insureds:

       Violation of Law. We will not cover bodily
       injury or property damage arising out of . . .
14             IFC V. ROMAN CATHOLIC CHURCH

         violation of any criminal law for which any
         insured is convicted . . . .

65 P.3d 449, 452 (Ariz. Ct. App. 2003) (emphasis omitted).
White relied on Brown v. United States Fiduciary & Guaranty
Corporation, which interpreted a similar provision to also
preclude coverage for innocent co-insureds:

         [The insurer] will not pay for loss or damage
         arising out of any acts committed:

             a. By or at the direction of any “insured;”
             and

             b. With the intent to cause a loss.

977 P.2d 807, 817(Ariz. Ct. App. 1998). The provisions
interpreted in White and Brown use materially different
language than the exclusion in the Diocese’s policy. The
precluding provisions from White and Brown use the term
“any insured” once to unambiguously identify the class of
insureds referenced, i.e. all of the individuals covered under
the policy. Thus, the precluding provisions from White and
Brown exclude coverage entirely based solely on the type of
liability. But the exclusion in the Diocese’s policy references
assureds twice. First, “Assured” identifies the type of
liability excluded—liability arising from acts of assault and
battery committed by “any Assured.” Second, “such
Assureds” limits the exclusion to those whose acts gave rise
to the liability.2 Thus, while “any insured” clearly limits the


     2
      The insurance policies in White and Brown were also family
homeowner policies where the class of insureds was limited by the nature
of the policies to the family members or residents in the home. White,
               IFC V. ROMAN CATHOLIC CHURCH                             15

type of liability in simply constructed policy exclusions like
those in White and Brown, the same reasoning does not apply
to the exclusion in the Diocese’s policy due to the additional
“such Assured” language. And at the least, the exclusion in
the Diocese’s insurance policy has a significant ambiguity not
present in the relatively simple exclusions analyzed in White
and Brown.

    I would hold that the policy exclusion does not apply in
this case and would reach the parties’ remaining arguments.
I respectfully dissent.




65 P.3d at 451; Brown, 977 P.2d at 809. The Diocese’s policy, however,
is a general liability excess insurance policy issued to a huge organization
that provides coverage for the Diocese itself and its employees over a
number of parishes, schools, and other sub-units. Such a policy must
account for direct and vicarious liability in its exclusions if it is to be
sufficiently clear.
