           United States Court of Appeals
                      For the First Circuit


Nos.   13-1528, 13-1602

                    PEABODY ESSEX MUSEUM, INC.,

               Plaintiff, Appellee/Cross-Appellant,

                                v.

               UNITED STATES FIRE INSURANCE COMPANY,

   Defendant/Third-Party Plaintiff, Appellant/Cross-Appellee,

                                v.

                    CENTURY INDEMNITY COMPANY,

                 Third-Party Defendant, Appellee.


           APPEALS FROM THE UNITED STATES DISTRICT COURT
                 FOR THE DISTRICT OF MASSACHUSETTS

             [Hon. Nancy Gertner, U.S. District Judge]
          [Hon. Nathaniel M. Gorton, U.S. District Judge]



                              Before

                       Howard, Chief Judge,
                 Selya and Stahl, Circuit Judges.


     Thomas M. Elcock, with whom Mitchell S. King and Prince Lobel
Tye LLP were on brief, for appellant/cross-appellee.
     Martin C. Pentz, with whom Jeremy A.M. Evans and Foley Hoag
LLP were on brief, for appellee/cross-appellant.
     Brian G. Fox, with whom Siegal & Park was on brief, for third-
party defendant, appellee.
September 4, 2015
              HOWARD, Chief Judge.           Some decades ago, a substantial

oil   spill    occurred      on   the   Salem,       Massachusetts    property   of

plaintiff Peabody Essex Museum ("the Museum").                      That pollution

eventually migrated to the land of a down gradient neighbor,

Heritage Plaza, which discovered the subsurface contamination in

2003.    Heritage Plaza notified the Museum in late 2003, and the

Museum   gave     prompt     notice     to    both    the   state    environmental

authorities      and   its    insurer,        defendant     United    States   Fire

Insurance Company ("U.S. Fire").                In 2006, the Museum filed a

coverage suit against U.S. Fire and eventually secured a sizable

judgment in 2013.          The parties now challenge numerous district

court rulings, and several of the insurance issues are governed by

state law under Boston Gas Co. v. Century Indemnity Co., 910 N.E.2d

290 (Mass. 2009), a decision which rejected joint and several

liability in progressive pollution cases in favor of pro rata

allocation of indemnity, including for self-insured years on the

risk.

              After careful review, we affirm the challenged rulings

related to insurance coverage but reverse a finding of Chapter 93A

liability against U.S. Fire under Massachusetts law.

                                         I.

              The surrounding facts are well-rehearsed in the district

court orders below.        See, e.g., Peabody Essex Museum, Inc. v. U.S.

Fire Ins. Co., 623 F. Supp. 2d 98 (D. Mass. 2009); Peabody Essex


                                        - 3 -
Museum, Inc. v. U.S. Fire Ins. Co., No. 06-11209-NMG, 2012 WL

2952770, at *1 (D. Mass. July 18, 2012).             A brief synopsis is

enough to set the stage.

             The principal parties share a contractual relationship

under a comprehensive general liability policy which, as pertinent

here, had a policy period that extended from December 19, 1983 to

December 19, 1985. Generally speaking, the policy covered property

damage occurring during that two-year period as long as the damage

arose out of a sudden and accidental discharge of pollutants.1

Under the policy, U.S. Fire also promised to defend the Museum

from any suit seeking damages against it on account of any covered

property   damage   and   to   investigate     any   claim   as    it   deemed

expedient.

             Once the Museum received notice of the pollution damage

from Heritage Plaza in 2003 ("the private demand"), it retained

the Ropes & Gray law firm as legal counsel and ENSR International

as an environmental consultant. The Museum confirmed the existence

of   subsurface   oil   pollution   on   its   property   and     immediately

notified the Massachusetts Department of Environmental Protection



      1The 1983-1985 policy excluded coverage for all property
damage arising out of the discharge, dispersal, release or escape
of pollutants into the ground. But an exception to that exclusion
reserved coverage for "sudden and accidental" discharges.     See
Peabody Essex Museum, 623 F. Supp. 2d at 102-03.     A subsequent
U.S. Fire policy incorporated an absolute pollution exclusion
provision and, thus, is not relevant to this litigation.


                                    - 4 -
of the pollution.         The Department, in turn, issued the Museum a

Notice of Responsibility in early 2004 ("the public claim"), and

ENSR continued its site investigation work throughout 2004.                     In

its Initial Site Investigation Report completed that November,

ENSR identified several isolated spills that had occurred on the

Museum's property over the years.              ENSR concluded, however, that

the likely cause of the pollution involved one or more of three

oil storage tanks or their pipelines previously buried on the

Museum's property: a 10,000-gallon tank had been installed in the

early 1960s and removed in 1973, and two 10,000-gallon tanks had

been installed in 1973 and removed in June 1986.

              Meanwhile, the Museum notified U.S. Fire of both the

private demand, in October 2003, and the public claim, in February

2004.     U.S. Fire denied a duty to defend for the private demand

but accepted defense for the public claim with a reservation of

rights.    Despite tendering both legal and environmental consultant

bills to U.S. Fire in April 2005, the Museum received no payment

for the defense of the public claim -- the one that U.S. Fire had

agreed to defend.         In June 2006, the Museum filed a four-count

complaint against U.S. Fire in state court, alleging that U.S.

Fire    had   breached    its    contractual     duties   to    investigate     the

pollution     claims     and    to   defend   and   indemnify    the   Museum    in

connection with both the private demand and the public claim

(counts I and II).         The Museum also alleged that U.S. Fire had


                                       - 5 -
violated state consumer protection laws, Mass. Gen. Laws ch. 93A,

§ 2, and certain common law duties owed to its insured (counts III

and IV).     At the behest of U.S. Fire, the case was removed to

federal court where it filed a third-party complaint for equitable

contribution    against    another    of     the   Museum's    insurers,    ACE

Property & Casualty Insurance.

            The extensive, multi-phase litigation included several

rounds of summary judgment proceedings and a jury trial resolving

indemnity    issues.      About   midway     through   the    litigation,   the

Massachusetts Supreme Judicial Court ("SJC") decided Boston Gas

Co., 910 N.E.2d 290, to which the district court moored its

decision on allocation of liability between U.S. Fire and the

Museum as self-insured on the risk after December 19, 1985.2                 In

the end, the district court's 2013 judgment required U.S. Fire to

pay the Museum over $1.5 million, including punitive damages under

Chapter 93A, attorney's fees, costs, and statutory interest.

             Our review of the various rulings on appeal is largely

de novo, and we abide by the well-established summary judgment

standards.     Fed. R. Civ. P. 56(c); see Celotex Corp. v. Catrett,

477 U.S. 317, 322-23 (1986). We are not restricted by the district

court's analyses and may affirm on any independent ground made



     2 The parties agree that the operative language in the U.S.
Fire policy does not meaningfully differ from that at issue in
Boston Gas.


                                     - 6 -
manifest in the record.       See Jones v. Secord, 684 F.3d 1, 5 (1st

Cir. 2012).     Where appropriate, we identify other review standards

along the way.

                                     II.

            U.S. Fire first appeals the district court's 2007 order

that it breached its duty to defend against the public claim, and

thus state law required it to bear the trial burden of proving no

coverage.      See Polaroid Corp. v. Travelers Indem. Co., 610 N.E.2d

912, 922 & n.22 (Mass. 1993) ("[A]n insurer that wrongfully

declines to defend a claim [must bear] the burden of proving that

the claim was not within its policy's coverage" including, in

pollution cases, "the existence or nonexistence of a sudden and

accidental discharge.").      Following this Polaroid burden-shifting

rule, the district court set forth the anticipated trial procedure

in which the Museum was expected to produce credible evidence

demonstrating that an occurrence took place during the term of the

insurance policy, and then U.S. Fire would bear the burden of

proving no coverage.        Electronic Order (Gertner, J., Dec. 19,

2007);   see    Peabody   Essex   Museum,   623   F.   Supp.   2d   at   106-10

(clarifying how the Polaroid burden-shifting rule applies in the

summary judgment context).3


     3 The district court held in abeyance the issue of whether
U.S. Fire also had a duty to defend on the Heritage Plaza private
demand.   See Electronic Order (Gertner, J., Dec. 19, 2007).
Eventually, the Museum settled the private demand for $300,000.


                                    - 7 -
              U.S. Fire attacks this summary judgment order on several

fronts, all aimed at foreclosing application of the Polaroid

burden-shifting rule.           This is understandable in light of the

cascade of practical effects that Polaroid had throughout this

litigation, especially given the dearth of evidence showing how

the polluting event occurred. However, the district court's breach

ruling   --     grounded   in    U.S.    Fire's    categorical   failure   for

approximately two years to make any payment for defense costs --

is unassailable on this record.                 Only a few snapshots of the

undisputed facts are necessary to show why.4

              U.S. Fire agreed in March 2004 to honor its contractual

duty to defend the public claim under a reservation of rights and

then paid nothing to its insured until cornered by the Museum

through its October 2007 motion for summary judgment.               From the

outset, U.S. Fire protested the hourly rate charged by Ropes &


The district court subsequently determined that while the Polaroid
burden-shifting rule applied to the settlement figure, an open
question remained on whether the private demand letter triggered
U.S. Fire's duty to defend during the period of time after U.S.
Fire received the private demand but before it received the public
claim.   See Electronic Order (Gertner, J., June 19, 2009).     No
issue on the duty to defend the private demand has surfaced on
appeal.
     4  The 2007 summary judgment record is robust and includes
communications among the various players from 2004 through 2007 as
explained by, inter alia, the deposition testimony of the third-
party claims administrators for both U.S. Fire and ACE.        The
material facts regarding U.S. Fire's breach involve the
interactions between the Museum and U.S. Fire, including their
agents.


                                        - 8 -
Gray but failed to pay even a partial payment despite repeated

requests for some measure of payment.         For example, in 2005, the

Museum sent U.S. Fire the billing invoices from both Ropes & Gray

and ENSR and, soon after, provided further detail for the ENSR

bills.5      Still, no money came.   Then, U.S. Fire remained silent

when directly asked in an August 2005 email whether it had paid

any defense costs to date.      According to the record, about a year

passed before U.S. Fire informed the Museum that it was unable to

confirm whether it had ever received any billing for defense costs.

              The Museum filed suit against U.S. Fire in June 2006 and

again sent copies of the Ropes & Gray bills to the insurer.         The

Museum also sent U.S. Fire additional legal bills at the end of

2006.       Yet, another six months passed before U.S. Fire informed

the Museum, in June 2007, that it had lost the billing information

and asked for additional copies.          The Museum promptly complied.

After another three-month lapse without any payment in hand, the

Museum filed a motion for summary judgment to enforce U.S. Fire's

defense obligation.      Finally, in conjunction with its objection,

U.S. Fire sent its first payment to the Museum totaling $611.41.

This amount represented what U.S. Fire considered to be a fair

portion of the Ropes & Gray bills for the public claim: it



        5
       The legal bills related to work for both the private demand
and the public claim but some invoices clearly identified the
public claim work.


                                  - 9 -
unilaterally reduced the charged attorney's fees rate to $200 per

hour, and further reduced to 40%6 the revised total legal bills.

No payment was offered for any of the 2004 ENSR bills which totaled

roughly $70,000.00 at that time.7

          U.S.   Fire's   persistent   failure   to   make   any   payment

toward defense costs despite having nominally accepted that duty

may be treated as a wrongful refusal to defend upon receipt of

notice of a claim.   The SJC has said explicitly that "[a]n insurer

which reserves its rights and takes no action in defense of its

insured, when it knew, or should have known, of a covered claim,

or which fails to investigate diligently, despite repeated claims

of coverage and requests for a defense from an insured facing

demands for immediate action, could be found to have committed a

breach of the duty to its insured."       Sarnafil, Inc. v. Peerless

Ins. Co., 636 N.E.2d 247, 253 (Mass. 1994); accord Chi. Title Ins.

Co. v. Fed. Deposit Ins. Corp., 172 F.3d 601, 604-06 (8th Cir.

1999) (holding that the insurer's failure to pay even what it had


     6 U.S. Fire and ACE purportedly agreed to a 40/60 split of
the defense cost bills for the public claim. ACE had agreed to
defend both the private demand and the public claim. In any event,
the apportionment agreed to by the insurers was not binding on the
insured.
     7 The precise dollar figure for the ENSR billings on the
public claim that were provided to U.S. Fire in 2005 is unclear in
the record. Still, the tens of thousands of dollars for the site
work that ENSR largely conducted in 2004 was in excess of
$66,000.00 but less than $85,000.00. As explained, U.S. Fire's
breach does not depend on the exact calculation.


                                - 10 -
considered to be a reasonable sum for defense costs, despite having

nominally accepted the tender of defense, constitutes a breach of

the duty to defend).

            None of the factual issues identified by U.S. Fire are

material to the breach question here.        See Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 248 (1986).        First, it is immaterial

that the individual employee who was managing the public claim

does not recall ever having personally received the packet.      U.S.

Fire does not contest the validity of the Federal Express receipt

signed by an employee of its third-party claims administrator and

dated April 11, 2005, which indisputably shows that the 2005

billing packet was actually received by U.S. Fire's agent.        See

Bockser v. Dorchester Mut. Fire Ins. Co., 99 N.E.2d 640, 642 (Mass.

1951) (noting that a principal is generally bound by the actions

of its agents); Chow v. Merrimack Mut. Fire Ins. Co., 987 N.E.2d

1275, 1279-80 (Mass. App. Ct. 2013) (same).          Moreover, other

undisputed documents show that the same individual claims adjuster

did receive follow-up information about the ENSR bills that the

Museum had sent that same summer.        In short, any failure on the

part   of   the   company   serving   as   U.S.   Fire's   third-party

administrator for the public claim does not bear on the legal

dispute between the insurer and its insured.          Cf. Palermo v.

Fireman's Fund Ins. Co., 676 N.E.2d 1158, 1163 (Mass. App. Ct.




                                - 11 -
1997) (emphasizing that proof of good faith has no relevance to

the Polaroid burden-shifting rule).

          The reasonableness of the Ropes & Gray hourly rate also

is immaterial.   It is U.S. Fire's prolonged failure to pay any

portion of its acknowledged responsibility that gives rise to the

breach here.   See, e.g., Chi. Title Ins. Co., 172 F.3d at 604-06.

Thus, any quibbling about the hourly rate simply relates to damages

that are owed to the Museum.

          U.S. Fire's plaint about the divisibility of the ENSR

bills between defense and indemnity costs is similarly immaterial.

U.S. Fire tacitly acknowledged in its 2007 papers (and also before

us now) that some portion of the ENSR bills relating to the 2004

site work constitutes recoverable defense costs.8     Yet, as with

the legal fees, U.S. Fire made no attempt to pay a single cent,

nor is there any record evidence that it made any effort to resolve

the sizable remuneration issue.

          U.S. Fire's apathy stands in sharp contrast to the

Museum's multiple requests for some measure of contractual defense

benefits in 2004 and 2005; its request for clarification in August

2005 of what "defense expenditures [its insurer may have paid] to


     8 Appropriately so. See, e.g., Chemical Leaman Tank Lines,
Inc. v. Aetna Cas. & Sur. Co., 117 F.3d 210, 223-24, 225 n.20 (3d
Cir. 1999); Endicott Johnson Corp. v. Liberty Mut. Ins. Co., 928
F. Supp. 176, 183-84 (N.D. N.Y. 1996); Siltronic Corp. v. Emp'rs
Ins. Co. of Wasau, No. 3:11-CV-1493-ST, 2104 WL 901161, at *7 (D.
Or. Mar. 7, 2014).


                               - 12 -
date [and] on what terms"; and its express reminder about the ENSR

bills in its November 2006 correspondence.        Cf. Vt. Mut. Ins. Co.

v. Maguire, 662 F.3d 51, 56-58 (1st Cir. 2011) (holding as a matter

of law that the insurer's diligent investigation efforts and

readiness to comply negated allegations of breach, especially when

compared to the insured's lackadaisical conduct).

          We also reject U.S. Fire's attempt to transform its

acknowledged   duty   to   defend   into   a   duty   only   to   reimburse

reasonable fees and costs.    According to U.S. Fire, as soon as the

Museum opted to retain control of its own defense for the public

claim, the insurer no longer had a duty to defend and thus its

subsequent conduct cannot amount to a defense breach triggering

Polaroid's burden-shifting rule.     But this newly minted theory was

not presented to the district court and, so, it "cannot be surfaced

for the first time on appeal."        Goldman v. First Nat'l Bank of

Bos., 985 F.2d 1113, 1116-17 n.3 (1st Cir. 1993) (internal citation

and quotation marks omitted).

          In any event, the state cases that U.S Fire cites in

support of its transformation theory address only how an insurance

company satisfies its duty to defend after the insured opts to

maintain the defense due to the insurance company's reservation of

rights.   See, e.g., Herbert A. Sullivan, Inc. v. Utica Mut. Ins.

Co., 788 N.E.2d 522, 528 (Mass. 2003); N. Sec. Ins. Co. v. R.H.

Realty Trust, 941 N.E.2d 688, 691 (Mass. App. Ct. 2011); Watts


                                - 13 -
Water Techs., Inc. v. Fireman's Fund Ins. Co., 22 Mass. L. Rptr.

659, 2007 WL 2083769, at *6, *9-10 (Mass. Super. Ct. 2007).            While

it is true that an insurance company's obligation to pay defense

costs may in some circumstances stem from its contractual duty to

indemnify,   rather   than   its   duty     to    defend,   any   contractual

framework to that effect is dictated by the mutually agreed upon

language in the policy or other comparable evidence.              See, e.g.,

Liberty Mut. Ins. Co. v. Pella Corp., 650 F.3d 1161, 1168-71 (8th

Cir. 2011); Stonewall Ins. Co. v. Asbestos Claims Mgmt. Corp., 73

F.3d 1178, 1218-19 (2d Cir. 1995); Shapiro v. Am. Home Assurance

Co., 616 F. Supp. 906, 910-11 (D. Mass. 1985); Health Net, Inc. v.

RLI Ins. Co., 141 Cal.Rptr.3d 649, 660, 670-71 (Cal. App. 2012).

The record does not suggest this to be the nature of the agreement

between the parties here.9     Moreover, the summary judgment record

contains numerous internal documents authored by U.S. Fire and

evidence of its communications with others plainly showing that it

understood the defense costs question to be tethered to its

contractual duty to defend the public claim, even after the Museum

chose to remain with Ropes & Gray.               On the whole, U.S. Fire's



     9 The policy provides that U.S. Fire "shall have the right
and duty to defend any suit against the insured seeking damages on
account of such . . . property damage, even if any of the
allegations of the suit are groundless, false or fraudulent, . .
. but the company shall not be obligated . . . to defend any suit
after the applicable limit of the company's liability has been
exhausted by payment of judgments or settlements."


                                   - 14 -
silence below on this transformation argument forecloses further

indulgence.

            Lastly,    U.S.    Fire       argues     that      application     of    the

Polaroid burden-shifting rule is foreclosed here by the lack of

evidence that the Museum suffered any prejudice due to the delay

in U.S. Fire's payment of the de minimis defense costs owed as of

October 2007.       The SJC's Polaroid holding does not require proof

of   prejudice,     however.        In    adopting    a       new    bright-line    rule

regulating    the    burden    of    proof    where       a    defense    default    has

occurred,     the    SJC   examined        the     natural          consequences    that

ordinarily flow from such a breach.               For example, the state court

explained that a delay in honoring defense obligations may cause

an insured to accept greater liability due to a lack of financial

resources to defend itself, or that delay may hinder the insured's

ability to later prove coverage.                 Polaroid Corp., 610 N.E.2d at

922.   The SJC did not then search for evidence of actual prejudice

in order to discern whether the new burden-shifting rule applied

to the case before it.         Id.       Indeed, it appears that the insured

in that case may very well have had the financial wherewithal to

pay for its own defense.        See id. (remarking that the insured had

"the benefit of controlling the defense").

            To cinch the matter, later Massachusetts cases provide

no indication that application of the Polaroid rule first requires

a showing of prejudice.        See, e.g., Highlands Ins. Co. v. Aerovox


                                         - 15 -
Inc., 676 N.E.2d 801, 804 n.6 (Mass. 1997); Liquor Liab. Joint

Underwriting Ass'n v. Hermitage Ins. Co., 644 N.E.2d 964, 968, 969

& n.6 (Mass. 1995); Utica Mut. Ins. Co. v. Fontneau, 875 N.E.2d

508, 513 (Mass. App. Ct. 2007); Swift v. Fitchburg Mut. Ins. Co.,

700 N.E.2d 288, 293-94 (Mass. App. Ct. 1998); Palermo, 676 N.E.2d

at 1163.

           A cautionary tale to be sure.            The full amount of the

Ropes & Gray bills that were pending in October 2007 for the public

claim was fairly modest.       However, the dollar amounts of the ENSR

bills -- mostly left ignored by U.S. Fire in its advocacy --

numbered in the tens of thousands as of January 2005.             Even still,

U.S.   Fire's   breach   of   its   duty    to   defend   does   not   rest   on

calculations, but on its wholesale apathy towards its contractual

defense obligation that it owed to its insured -- and that it had

affirmatively accepted as of March 2004.

           Given the undisputed facts, the district court properly

faulted U.S. Fire as a matter of law for breaching its duty to

defend.    Accordingly, we uphold the court's 2007 decision on

defense breach and, thus, the insurance company must swallow

Polaroid's bitter pill.

                                     III.

           The principal parties next appeal discrete aspects of

the district court's allocation decision, which is woven out of

portions of the court's September 2010 and August 2011 orders.


                                    - 16 -
See   Peabody         Essex   Museum,   Inc.   v.   U.S.   Fire   Ins.   Co.,   No.

06CV11209-NG, 2010 WL 3895172 (D. Mass. Sept. 30, 2010) (Gertner,

J.); id., 2011 WL 3759728 (D. Mass. Aug. 24, 2011) (Gertner, J.).

Under attack are the court's rulings that: (i) the pro rata

allocation rule under Boston Gas applied in this case; (ii) the

appropriate start date for the allocation period was the first day

of U.S. Fire's 1983-1985 policy period, i.e., December 19, 1983;

(iii)        the    fact-based   approach,     rather   than    time-on-the-risk,

governed the allocation calculus; and (iv) defense costs were not

subject to pro rata allocation.10              We review de novo the district

court's interpretation and application of state law, and for abuse

of discretion the court's understanding of the jury's verdict and

selection of allocation method. See Salve Regina Coll. v. Russell,

499 U.S. 225, 231-234 (1991); Boston Gas Co. v. Century Indem.

Co., 708 F.3d 254, 259-66 (1st Cir. 2013).

                   The proceedings following the court's 2007 order on

defense obligations included a 2008 pre-trial summary judgment

order        resolving    certain   indemnity    issues,    a   2009   jury   trial

establishing indemnity liability, and then, the 2010 and 2011 post-

trial        summary     judgment   orders     resolving    the   allocation    of

indemnity as between U.S. Fire and the Museum's self-insured


        10
        One of the many legal rulings that neither party appeals
is the district court's conclusion that language in the U.S. Fire
policy is most consistent with an injury-in-fact trigger.     See
Peabody Essex Museum, 2010 WL 3895172, at *11-12.


                                        - 17 -
portion.   We note four aspects of these proceedings that help

inform the analysis.

           First, the competing evidence.     An estimated release of

ten thousand gallons11 caused a significant subsurface oil plume,

a portion of which polluted the Heritage Plaza property.           The

Museum's expert blamed the underground storage tanks or associated

piping on the Museum's property that, he asserted, may have begun

releasing oil no later than 1979.      By contrast, U.S. Fire's expert

tied the pollution to a compromised fuel line that was damaged on

the Museum's property during reconstruction activities in 1987,

more than one year after the conclusion of the 1983-1985 policy

period.

           Second,   the   indemnity   rulings   and   findings.   The

district court ruled in March 2009 that because of the "scant

evidence" on how the oil release occurred, U.S. Fire could not

prove, pursuant to its burden under Polaroid, that any oil release

from the underground storage tanks or piping was not sudden;

"[t]here is simply no evidence on this issue, either way." Peabody

Essex Museum, Inc., 623 F. Supp. 2d at 106-11 (noting that the

parties did not dispute whether the oil release was accidental).

Then, with respect to the timing of the contamination, in June

2009 a jury found that U.S. Fire had not proven that the pollution


     11 While the record is not entirely consistent, the parties
eventually seemed to settle on this estimated calculation.


                                - 18 -
first began after the policy period.              This finding triggered

indemnity.      The jury also found that U.S. Fire further failed to

prove any date on which the pollution had first begun.12

             Third, the Boston Gas decision.        As noted earlier, the

SJC issued its decision in Boston Gas about one month after the

2009 indemnity trial in this case but before the district court

had resolved allocation questions.          Boston Gas rejected the joint

and   several    liability    approach    for   indemnity    in   progressive

pollution cases, instead adopting a pro rata allocation rule that

applies even for pollution years in which the property owner is

self-insured. 910 N.E.2d at 299-311, 315-16 (holding depends on

the policy language at hand).       The SJC further held that, while a

fact-based    method   of    allocation   is    "ideal,"    time-on-the-risk

serves as a default approach absent sufficient evidence that may

allow for a more accurate estimation of the quantum of property

damage during the risk period.       Id. at 312-16.




      12Explication of trigger and allocation of indemnity in
Massachusetts is provided in Boston Gas Co., 910 N.E.2d at 300-
01.   Of note, proration in progressive injury cases requires
setting a start and end date for the pollution in order to devise
an allocation period. See, e.g., Peabody Essex Museum, 2010 WL
3895172, at *6-12. In this case, knowing that certified questions
were pending before Boston Gas, the district court required counsel
to submit proposed jury instructions for addressing allocation
issues in order to aid the post-trial resolution of the scope of
indemnity. Neither party appeals the court's denial of the joint
request for bifurcation.


                                   - 19 -
           Fourth, the post-trial procedural posture.               Whittled

down, the parties' pleadings show that they ultimately agreed that

the district court could decide the Boston Gas allocation issues

without the aid of a second jury trial.

           With this grounding, we turn to the appellate arguments.

                                    A.

           The Museum contends that U.S. Fire's failure to prove

when the pollution first began forecloses the insurer from relying

on Boston Gas to prorate the indemnity costs that it owes to its

insured. Essentially, the Museum advocates for a joint and several

liability approach in this case.         We conclude, however, that the

district   court   properly   presaged     the   SJC's   approach   when   it

declined to adopt the insured-friendly position urged by the

Museum.    See Boston Gas, 708 F.3d at 264 (explaining federal

court's duty to "make an informed prediction" as to state court's

probable decision if it faced the state law question).

           No doubt the allocation issue is complicated in this

case by the absence of a factual finding from the jury that marks

a definite start date.        But a dearth of evidence is no anomaly

where long-term pollution has gone undetected for decades.             Even

so, as the district court explained, limited evidence on the timing

of known pollution in a given case may display a range of possible

allocation periods, any of which would result in less than 100%

indemnity from a particular insurer.         In such circumstances, the


                                  - 20 -
principles of Polaroid and Boston Gas would not countenance full

indemnity based on failure of proof alone.

            In   both   Polaroid    and   Boston   Gas,   the   SJC   rejected

proposed legal rules that would have enabled insureds to receive

windfall judgments that extended indemnity beyond the contractual

limits set forth in the operative policies.              See Boston Gas, 910

N.E.2d at 299-312 (rejecting joint and several allocation for

progressive pollution cases as incongruous with both the policy

language and important public policy objectives); Polaroid Corp.,

610 N.E.2d at 920-22 (declining to automatically impose full

indemnity   liability     for   a   breach   of    the   duty   to   defend   as

incongruous with both the policy language and important public

policy objectives).       Instead, the SJC has opted for a balanced

approach that affords indemnity coverage only up to the extent

secured by the policy contract between the parties, even where

factual circumstances may muddy the evidentiary waters. See, e.g.,

Boston Gas, 910 N.E.2d at 293, 301, 312, 314, 317 (noting absence

of evidence for proving timing of property damage in progressive

pollution cases, while still endorsing a fact-based calculus where

plausible).

            Accordingly, we hold that the district court correctly

ruled that Boston Gas applies to this case such that the "start

and end dates [must be] construed against the party with the burden

of proof, so long as they are consistent with the jury's verdict"


                                    - 21 -
and the trial record.   Peabody Essex Museum, 2010 WL 3895172, at

*7.   This approach comports with Polaroid by holding U.S. Fire

responsible for the problems of proof that were presumptively

caused by its breach of the duty to defend.    See Polaroid Corp.,

610 N.E.2d at 922.

                                   B.

           With that understanding of Polaroid and Boston Gas, we

turn to the district court's selection of the beginning of the

1983-1985 policy period as the start date for the allocation

period.   U.S. Fire contends that the court misconstrued the jury's

findings and that 1979 should be the start date in order to align

with the testimony of the Museum's expert and trial concessions.

We are unpersuaded that there was any reversible error.

           The verdict form that was presented to the jury posed

three questions that addressed the timing of the pollution for

purposes of both triggering coverage and marking a start date for

an allocation period.   Question 1 essentially asked whether U.S.

Fire had proven its factual theory that the 1987 oil spill was the

source of the pollution, rather than the older underground storage

tanks or pipelines.   Question 2 asked whether U.S. Fire had proven

the date on which the release of oil first caused property damage,

to be answered only if the jury disbelieved U.S. Fire's theory

about the 1987 spill.   Question 3 then asked the jury to select a

proven beginning date from a list of ranges in the event that it


                              - 22 -
answered Question 2 affirmatively.      The jury answered the first

two questions in the negative and did not answer the third.

            In light of the trial template, the district court

discerned that these jury findings, particularly in answer to

Question 2, meant either that the jurors had accepted the Museum's

expert evidence on the source and timing of the pollution relating

to the older underground storage tanks, or that the jury had

discredited the evidence presented by both parties.       After all,

pursuant to Polaroid, the Museum only bore the burden of producing

credible evidence to trigger indemnity; it had no burden to proffer

any evidence of a definitive start date for the oil release(s),

much less to prove it.     And, so, to determine a start date from

this verdict ambiguity, the district court returned to the Polaroid

burden-shifting rule: given U.S. Fire's failure of proof, the court

"construe[d] the jury's findings to mean that the allocation period

begins on the first day of U.S. Fire's policy" as "the least

favorable date for an insurer that could not meet its burden of

proof" while still remaining "broadly consistent with the jury's

verdict."    Peabody Essex Museum, 2010 WL 3895172, at *8.

            U.S. Fire protests this construction.   According to U.S.

Fire, "the jury was never asked to determine the start date." U.S.

Fire reasons that because it "never attempted to prove a release

prior to December 19, 1985," it necessarily could not have proven

by a preponderance of the evidence the date on which the release


                               - 23 -
of fuel oil first caused property damage.           Thus, it says, the

jury's negative answer to Question 1 (rejecting the 1987 spill

theory) automatically required a negative answer to Question 2 (a

lack of a start date), without any further deliberation.           This

position, however, is out of step with the language of the verdict

form, the jury instructions, and the context of the litigation.

            The verdict form plainly prompted the jury to decide

Question 2 only if it answered the first question in the negative,

a point that the court included in its instructions to the jury.13

The court also instructed the jurors to answer "no" to Question 2

if they found the evidence was "insufficient to make a decision

one way or the other" or could not "figure out the date" of a pre-

December 1983 oil release.

           Moreover, the district court had abundantly forewarned

the parties that the indemnity trial likely would serve as staging

for potential allocation issues given the pending status of Boston

Gas   pre-trial.   The   court   requested,   and   received,   proposed



      13Beginning after Question 1, the pertinent part of the
verdict form provides:
           If your answer is "Yes," there is no coverage and
      you should not go on.
           2. If you answered "No" to Question 1, has U.S.
      Fire proven, by a preponderance of the evidence, the
      date on which the release of fuel oil first caused
      property damage?
(Bolded format is in the original.)


                                 - 24 -
allocation instructions from the parties.     And colloquies with

counsel during trial show that U.S. Fire expressly assented to a

start date question tethered to the underground oil tanks as the

possible pollution source, in order to avoid a potential second

trial for allocation.

          In short, U.S. Fire's self-chosen trial strategy of

focusing the jury's attention on the 1987 event in order to avoid

indemnity does not alter the trial realities that the start date

question was directly posed to and answered by the jury, with U.S.

Fire bearing the burden of proof.14

          We also reject U.S. Fire's contention that the district

court erred in failing to select 1979 as the start date in keeping

with the Museum's expert's testimony.    As noted, the Museum was

not required to prove any definitive start date at all.    Nor did

the Museum's counsel concede that a negative answer to Question 1

meant that the jury necessarily found that the pollution began no

later than 1979.   Indeed, the Museum's summation at the close of

trial expressly belies U.S. Fire's current supposition.     To the

extent that U.S. Fire relies on principles of equity to advance a

1979 start date, it provides no basis for holding that the district



     14 U.S. Fire did not object to the jury instructions, nor to
the format of the verdict form in relation to the start date
question. See Palermo, 676 N.E.2d at 1162 n.7, 1163. Thus, U.S.
Fire's opportunity for challenging the framing of the verdict form
as "improperly drafted" has long since passed.


                              - 25 -
court abused its discretion in rejecting this position. See Boston

Gas, 708 F.3d at 259-64.

           In the end, we acknowledge as anyone must that the

December 19, 1983 start date has a make believe quality.                    Lean

evidence has been the nemesis of this case from the inception of

the   litigation.      But   the   district    court   did    not   abuse   its

discretion, on this record, in construing the jury's findings in

a manner that maximizes U.S. Fire's indemnity exposure in line

with its burden under Polaroid.

                                        C.

           U.S. Fire next argues that the district court erred in

opting to apply a fact-based method for allocation rather than the

default time-on-the-risk method. In so deciding, the court adopted

the Museum's post-trial revised expert report which projected that

9,000 square feet of soil damage occurred during the two-year

policy period.      See Peabody Essex Museum, 2011 WL 3759728, at *1.

This calculation relied on the assumption that the 10,000-gallon

oil release began on December 19, 1983, the start date selected by

the court, and definitively ceased in June 1986 when the oil tanks

were removed from the ground.15

           U.S.     Fire   contends   that    the   revised   report   cannot

support a fact-based allocation because the December 19, 1983 start


      15The parties agreed that oil migration continued to cause
property damage after the tanks were removed from the ground.


                                   - 26 -
date is purely fictional.        It also faults the district court for

considering     U.S.   Fire's   indemnity    burden    under   Polaroid   when

assessing whether the report's estimation of the spread of oil

warranted a fact-based approach.         Again, we are not persuaded of

any reversible error.16

           In deciding Boston Gas, the SJC granted trial courts

considerable leeway in selecting between time-on-the-risk and

fact-based allocation in progressive pollution cases.            Boston Gas,

910 N.E.2d at 316.         Courts face this choice in complex cases in

which the factual events are already thickly clouded by evidentiary

uncertainty, see id. at 300-02, 305; the ultimate decision requires

a careful review of the intricacies of the case as well as

equitable considerations, see id. at 316; see also New Eng.

Insulation Co. v. Liberty Mut. Ins. Co., 988 N.E.2d 450, 454 (Mass.

App. Ct. 2013).        The SJC emphasized that it favors a fact-based

approach   as     more     reflective   of     the    parties'   contractual

obligations, explaining that this method should be applied where

the   record    contains    "evidence   more   closely   approximating    the

actual distribution of property damage" than time-on-the-risk

calculations.     Boston Gas, 910 N.E.2d at 293.           Thus, fact-based

allocation should apply when "a more accurate estimation" of the



      16While the district court relied on two expert reports
proffered by the Museum, U.S. Fire's appeal relates only to the
report that we discuss.


                                   - 27 -
quantum of property damage that took place during the triggered

policy years is "feasible."        Id. at 314, 316.

             As we have noted, mooring the start of the property

damage to the commencement of the policy period on December 19,

1983 indeed bears a fictional quality.                The revised report,

however, adopted that start date as previously determined by the

district court in its 2010 order, which was generally based on the

evidence and on the jury's findings. Although the Polaroid burden-

shifting rule also influenced the start date finding, that date is

no less a factual finding under the circumstances of this case.

No more is required under Boston Gas.          Cf. Boston Gas, 708 F.3d at

259, 260 (holding that the trial court's decision to apply time-

on-the-risk was "reasonable" because the record would not allow a

factfinder to specify damages "in time and degree with any level

of certainty" (emphasis added)).

             Neither did the district court err in considering U.S.

Fire's burden under Polaroid when evaluating the estimation of the

spread of the oil plume.         The court faced the allocation method

question in a case not only rife with the normal problems of proof

in progressive pollution cases, see Boston Gas, 910 N.E.2d at 316,

but   also   couched   in   an   atypical    legal   setting   in   which   the

insurance company had controlled the evidentiary template during




                                    - 28 -
the indemnity trial.17           In short, we cannot say that it was error

for the district court to hew to the Polaroid rule, which compels

insurance       companies   to    shoulder   the   indemnity   share   that   is

associated with proof problems when that company defaulted on its

duty to defend.

            In the final analysis, the district court judge -- who

had presided over the entirety of the litigation through the August

2011    order    --   confronted     two   somewhat   unsatisfactory   factual

situations in selecting the appropriate allocation method.18             After

a careful scrutiny of the complexities, we see no sound reason for

disturbing the court's discretionary decision that fact-based

allocation aligned closer to the evidence and the equities in this

case.19




       17
        Tellingly, U.S. Fire remained silent in the face of the
Museum's post-trial accusation that the insurer had never pursued
any discovery on the duration of contamination respecting the
underground oil tanks.
       18
        Two district court judges presided over the lengthy
litigation. Judge Gertner resolved the bulk of the merits while
presiding from 2006 through August 2011, and Judge Gorton resolved
the tail-end of the matter such as the inevitable motions for
reconsideration, modification of judgment, attorney's fees, and
prejudgment interest.
       19
        U.S. Fire's assorted complaints about the district court's
"silence" respecting the revised report's "series of assumptions"
ring hollow.    Its assertions fail to account for the court's
implicit adoption of the Museum's responsive pleadings and
exhibits, recapitulate the "artificial" start date argument, and
otherwise ignore the trial testimony including that of its own
expert.


                                      - 29 -
                                         D.

             As a final allocation matter, U.S. Fire contends that

the district court erred in ruling that defense costs for the

public claim are not subject to time-on-the-risk proration under

Boston Gas.      U.S. Fire acknowledges that the SJC did not reach the

question of whether or how defense costs should be prorated, and

its argument on appeal is not robust.         See Powell v. Tompkins, 783

F.3d 332, 348-49 (1st Cir. 2015) (explaining appellate waiver).

We go only so far as the argument takes us, which is not far enough

to divvy up defense costs here.

             U.S. Fire briefly offers two "significant indicators"

from Boston Gas to support its pitch that defense costs should be

prorated: the SJC's citation to case law that applies time-on-the-

risk proration to both defense costs and indemnity,20 and the SJC's

decision to apply proration principles to self-insured retentions

which,    U.S.    Fire   points   out,    generally   include   defense   and

indemnity.       These supposed indicators, however, appear diminutive



     20 U.S. Fire identifies just one case cited in Boston Gas,
which is readily distinguishable from the circumstances at hand.
In Insurance Company of North America v. Forty-Eight Insulations,
Inc., the Sixth Circuit prorated defense costs to avoid a
troublesome scenario in which the insured manufacturer, "which had
insurance coverage for only one year out of 20[,] would be entitled
to a complete defense of [about 1,300 different] asbestos actions
the same as a manufacturer which had coverage for 20 years out of
20." 633 F.2d 1212, 1225 (6th Cir. 1980); cf. GMAC Mortg., LLC,
985 N.E.2d at 827 (noting that the complete defense rule typically
applies for claims asserted in the same lawsuit).


                                    - 30 -
next to long-standing state precedent on the broad and formidable

contractual duty to defend that heavily favors insureds and that

stands apart from indemnity obligations.               See, e.g., GMAC Mortg.,

LLC v. First Am. Title Ins. Co., 985 N.E.2d 823, 827 (Mass. 2013);

Doe v. Liberty Mut. Ins. Co., 667 N.E.2d 1149, 1151 (Mass. 1996);

see also Dryden Oil Co. of New England, Inc. v. Travelers Indem.

Co.,   91   F.3d    278,    282     (1st    Cir.   1996)   (noting     that    under

Massachusetts      law,    "[t]he    duty     to   indemnify   is    defined   less

generously [than the duty to defend] as it depends on the evidence,

rather than an expansive view of the complaint" (internal citation

omitted)).    And duty to defend protection is all-encompassing.

See GMAC Mortg., LLC, 985 N.E.2d at 827 (explaining the "in for

one, in for all" or "complete defense" rule that applies to

insurers in the general liability insurance context); Deutsche

Bank Nat'l Ass'n v. First Am. Title Ins. Co., 991 N.E.2d 638, 641-

42, n.10 (Mass. 2013); see also Liberty Mut. Ins. Co. v. Met. Life

Ins.   Co.,   260    F.3d    54,      63-64     (1st   Cir.    2001)   (reviewing

Massachusetts law on allocation of defense costs generally); Chi.

Bridge & Iron Co. v. Certain Underwriters at Lloyd's, London, 797

N.E.2d 434, 444-45 (Mass. App. Ct. 2003) (refusing to allocate

defense costs where the litigation relating to contamination sites

covered under the policy also resolved liability questions for

sites that were not).




                                       - 31 -
             Even narrowing our view to Boston Gas itself, we observe

that the SJC carefully circumscribed its decision to the indemnity

allocation questions that were before it.               See, e.g., 910 N.E.2d

at 301, 311 n.38.21       And, in its allocation analysis -- including

the self-insured retention discussion -- the state court placed

significant    weight     on   the   specific   language      embodied     in   the

indemnity provisions of the policy before it.             Id. at 304-09, 315-

16.

             In short, we decline U.S. Fire's invitation to extend

the Boston Gas allocation holding to defense costs in this case,

particularly where the insurance company has made no attempt to

address its own policy language on the duty to defend.                  Cf. id. at

306   n.33   (referring    to   cited      policy    language    that   expressly

provided for proration of defense costs).                After all, U.S. Fire

pursued removal of this case from state court to federal court,

and "[w]e have warned, time and again, that litigants who reject

a   state    forum   in   [favor     of]   federal    court     under   diversity

jurisdiction cannot expect that new state-law trails will be

blazed" by the federal court.          Carlton v. Worcester Ins. Co., 923


      21We are aware that at least one district court decision
appears to have interpreted Boston Gas as endorsing allocation of
defense costs.   See Graphic Arts Mut. Ins. Co. v. D.N. Lukens,
Inc., No. 11-CV-10460, 2013 WL 2384333, at *7 (D. Mass. May 29,
2013) (Hillman, J.). That decision does not, however, address the
robust, contrary state law precedent on the contractual duty to
defend.   And U.S. Fire does not rely on Graphic Arts for this
argument.


                                      - 32 -
F.2d 1, 3 (1st Cir. 1991) (internal quotation marks and brackets

omitted).

            Accordingly, we affirm the district court's September

2010 and August 2011 allocation rulings that the parties have

challenged on appeal.

                                          IV.

            U.S.   Fire   appeals   the    district   court's   Chapter   93A

ruling that it knowingly and willfully failed to effect a fair

settlement for the unreimbursed defense costs after the court

issued the 2007 order on its defense default.            See Peabody Essex

Museum, Inc., 2011 WL 3759728, at *2; see also Mass. Gen. Laws ch.

93A, §§ 2, 11.     The court's ruling was grounded in the business-

to-business provision under Chapter 93A, § 11, as the Museum had

pitched its claim.        After reviewing the litigation record22 and

governing state law, we conclude that reversal is required because

the court's decision rests on a legal error and the record does

not, as a matter of law, support a finding of unfair settlement

conduct actionable under Chapter 93A.           See Fed. Ins. Co. v. HPSC,

Inc., 480 F.3d 26, 34 (1st Cir. 2007); Ahern v. Scholz, 85 F.3d

774, 797 (1st Cir. 1996).




     22 We have considered the materials that both parties provided
to the district court, mindful that U.S. Fire does not press before
us the evidentiary objection about the settlement documents that
was raised below.


                                    - 33 -
              Chapter      93A   precludes       "unfair    or    deceptive       acts    or

practices in the conduct of trade or commerce" and penalizes

"willful or knowing" violations with awards of multiple damages.

Mass. Gen. Laws ch. 93A, §§ 2, 9, 11; see Barron Chiropractic &

Rehab. v. Norfolk & Dedham Grp., 17 N.E.3d 1056, 1065-66 (Mass.

2014)   (describing        pertinent        factors).      To    be    actionable,       the

challenged misconduct must rise to the level of an "extreme or

egregious" business wrong, "commercial extortion," or similar

level of "rascality" that raises "an eyebrow of someone inured to

the rough and tumble of the world of commerce."                        Baker v. Goldman

Sachs   &     Co.,   771    F.3d    37,    49-51    (1st    Cir.       2014);    Zabin    v.

Picciotto, 896 N.E.2d 937, 963 (Mass. App. Ct. 2008).                             The core

inquiry focuses on "the nature of challenged conduct and on the

purpose and effect of that conduct."                 Mass. Emp'rs Ins. Exch. v.

Propac-Mass, Inc., 648 N.E.2d 435, 438 (Mass. 1995).

              In the insurance context, business misconduct that is

actionable      under      Chapter    93A     may    include       unfair       settlement

practices that are defined under Chapter 176D, § 3.                          Hallmarks of

such misconduct generally involve the "absence of good faith and

the presence of extortionate tactics."                     Guity v. Commerce Ins.

Co.,    631    N.E.2d      75,     77–78    (Mass.      App.     Ct.     1994).       Such

circumstances include withholding payment from the insured and

"stringing out the process" by using shifting, specious defenses

with    the    intent      to    force     the   insured        into    an    unfavorable


                                           - 34 -
settlement.    Commercial Union Ins. Co. v. Seven Provinces Ins.

Co., 217 F.3d 33, 40 (1st Cir. 2000) (providing examples under

Massachusetts law).          By contrast, neither a good faith dispute

over billing, nor the mere failure to settle a claim when another

reasonably prudent insurer would have done so, establishes Chapter

93A liability.       See id. at 43; see generally Hartford Cas. Ins.

Co. v. N.H. Ins. Co., 628 N.E.2d 14, 17-18 (Mass. 1994).

            Rather    than    apply    these    Chapter    93A   standards,   the

district court solely relied on an unfair settlement practice

provision under Chapter 176D as the litmus test for finding Chapter

93A, § 11 business-to-business liability.             See Mass. Gen. Laws ch.

176D, § 3(9)(f) (proscribing the failure "to effectuate prompt,

fair and equitable settlements of claims in which liability has

become reasonably clear").        However, unlike consumer claims under

Chapter 93A, § 9, a violation of Chapter 176D constitutes only

probative   evidence,    not     per    se   proof,   of   egregious   business

misconduct for a Chapter 93A, § 11 business-to-business claim.

See Polaroid Corp., 610 N.E.2d at 917; Transamerica Ins. Grp. v.

Turner Constr. Co., 601 N.E.2d 473, 477 (Mass. App. Ct. 1992).

The district court did not recognize this well-established legal

distinction under state law.           See Mass. Gen. Laws ch. 93A, § 9(1);

see also Hopkins v. Liberty Mut. Ins. Co., 750 N.E.2d 943, 950

n.12 (Mass. 2001) (explaining 1979 amendment to Ch. 93A, § 9




                                       - 35 -
consumer-to-business claims).    Accordingly, its ruling on Chapter

93A, § 11 liability contains a legal error.

          Moreover,   the   record    does   not   display   the   type    of

egregious settlement malfeasance that may be actionable under

Chapter 93A, § 11.    The district court targeted, albeit through

the Chapter 176D lens, two aspects of U.S. Fire's conduct: its

fractional payment as of June 2009 (about $9,000) of significant

defense costs then-incurred by the Museum and its subsequent

failure to reach a fair settlement on the remaining amount, forcing

the Museum to continue to litigate defense costs.            The district

court's view of the record, however, is too constricted.

          In fact, U.S. Fire immediately pursued mediation for

defense costs after the court's December 2007 decision, which had

left open pertinent surrounding issues.23      But the Museum resisted,

desirous of a global settlement despite the fact that no expert

evidence on the indemnity issues had yet been procured at that

point.    After   discovery,    the    parties     participated    in     two

significant efforts for formal mediation throughout 2009, and U.S.

Fire continued taking active steps to resolve the defense costs

issue in the midst of a variety of entangled disputes. See Premier



     23 The open defense costs issues included, for example, the
reasonableness of the hourly rate charged by Ropes & Gray, the
relationship between the public claim and the Heritage Plaza
private demand, and the division between defense costs and
indemnity respecting ENSR's then-completed work.


                                - 36 -
Ins. Co. of Mass. v. Furtado, 703 N.E.2d 208, 210 (Mass. 1998);

Duclersaint v. Fed. Nat'l Mortg. Ass'n, 696 N.E.2d 536, 540 (Mass.

1998).     On the whole, the unreimbursed defense costs issue was

shuffled    into     the     broader    panoramic    of   on-going,     complex

litigation which included the potential legal responsibility of

the Museum's other insurers.            See Cullen Enters., Inc. v. Mass.

Prop. Ins. Underwriting Ass'n, 507 N.E.2d 717, 723 (Mass. 1987);

Waste Mgmt. of Mass., Inc. v. Carver, 642 N.E.2d 1058, 1061 (Mass.

App. Ct. 1994).

            There is simply no evidence that the delay in paying

unreimbursed       defense     costs    was     attributable   to     nefarious

leveraging conduct or motives on U.S. Fire's part. See Boston

Symphony Orchestra, Inc. v. Commercial Union Ins. Co., 545 N.E.2d

1156, 1160 (Mass. 1989); cf. N. Sec. Ins. Co., 941 N.E.2d at 692.

In fact, at one point, when U.S. Fire challenged the Museum's

calculation of interest for unreimbursed defense costs in 2009,

the Museum averred "futility [in] submitting further bills" given

U.S. Fire's oversight, years earlier, with respect to the first

billing packet that the Museum had sent in 2005.                When efforts

toward global settlement ultimately failed, U.S. Fire offered the

Museum a significant sum to settle the unreimbursed defense costs

and associated issues, which apparently went unanswered.               Then, in

June 2011, the Museum spotlighted -- for the first time -- U.S.




                                       - 37 -
Fire's post-2007 settlement conduct as the primary impetus for

Chapter 93A, § 11 liability and punitive damages.

            U.S. Fire's conduct under these circumstances is not the

kind that the SJC has condemned as egregious settlement misconduct

that is actionable under Chapter 93A.             Cf. R.W. Granger & Sons,

Inc. v. J & S Insulation, Inc., 754 N.E.2d 668, 678-79 (Mass. 2001)

(holding that the surety's conduct of unexplained delay, hollow

settlement effort, and groundless legal stance comprised culpable

unfair business conduct under Chapter 93A).

            By no means do we endorse some of the gamesmanship that

laces the protracted litigation.         But the Museum's own posturing

is not unimportant to the Chapter 93A inquiry.               See Parker v.

D'Avolio,    664   N.E.2d   858,   864      n.9   (Mass.   App.   Ct.   1996)

(emphasizing in the Chapter 93A context that good faith is a

reciprocal responsibility between an insurer and an insured); see

also Ahern, 85 F.3d at 798 (noting that the Chapter 93A calculus

considers "the equities between the parties, including what both

parties knew or should have known").

            Even if some measure of U.S. Fire's conduct may have

been ill-advised, and perhaps even violative of Chapter 176D, we

hold that this record does not invoke the potent weaponry of

Chapter 93A.24     Additionally, we deem waived the Chapter 93A


     24 Our analysis assumes, without deciding, that in certain
instances settlement conduct during the course of ongoing


                                   - 38 -
theories set forth in the 2006 complaint that the Museum failed to

pursue in its 2011 pleadings.    Finally, any continued reliance on

U.S. Fire's failure to pay defense costs prior to the December

2007 order also fails as a matter of law since the record fails to

show that the insurance company's conduct, while amounting to a

contractual   breach,   was   purposed   by   the   kind   of   nefarious

leveraging that may give rise to Chapter 93A, § 11 liability.         Cf.

N. Sec. Ins. Co., 941 N.E.2d at 692-93; Mass. Emp'rs Ins. Exch.,

648 N.E.2d at 438.

          Accordingly, we reverse the district court's decision

that U.S. Fire violated Chapter 93A, § 11 and vacate the award of

punitive damages, fees, costs and statutory interest associated

with the Chapter 93A claim.       Our holding obviates any need to

address the punitive damages issues debated by the parties pursuant

to Rhodes v. AIG Domestic Claims, Inc., 961 N.E.2d 1067 (Mass.

2012) and Auto Flat Car Crushers, Inc. v. Hanover Ins. Co., 17

N.E.3d 1066 (Mass. 2014).

                                  V.

          Two final miscellaneous matters go nowhere.           First, the

Museum appeals the district court's decision declining to award it

attorney's fees for litigating the scope of defense obligations



litigation may give rise to Chapter 93A liability.       Compare
Morrison v. Toys "R" Us, Inc., 806 N.E.2d 388, 391 (Mass. 2004),
with Commercial Union Ins. Co., 217 F.3d at 41 n.5.


                                - 39 -
after the 2007 summary judgment order.                 Its appellate arguments

depend on the success of its Chapter 93A claim and, thus, are

rendered moot by our reversal of the district court's decision.

To   the     extent     that   the   Museum   attempts   to   pursue   arguments

unrelated to its Chapter 93A success below, we deem them waived

for insufficient briefing.            See Powell, 783 F.3d at 348-49.

               Second, U.S. Fire appeals the district court's decision

denying its motion to amend its 2006 third-party complaint against

ACE.        U.S. Fire's 2009 motion sought to transform the original

single-count complaint into a five-count complaint enforcing an

alleged       express    or    implied   contractual   agreement   for   sharing

defense costs between the two insurance companies.                 We detect no

abuse of discretion in the district court's decision given that

the 2006 third-party complaint had already failed on the merits

months earlier.25         Additionally, U.S. Fire's 2009 pitch of newly

discovered facts is undermined both by its own express allegations

in the original complaint and by its apparent failure to pursue

timely discovery from the inception of that 2006 third-party

complaint.       See Lombardo v. Lombardo, 755 F.3d 1, 3-4 (1st Cir.




       25
        In its March 2009 summary judgment order, the district
court granted ACE's motion for summary judgment due to U.S. Fire's
insufficient proof that the oil release was "sudden and accidental"
under ACE's 1980-1983 policy. See Peabody Essex Museum, 623 F.
Supp. 2d at 112.


                                         - 40 -
2014); Steir v. Girl Scouts of the USA, 383 F.3d 7, 12 (1st Cir.

2004).

                                   VI.

            To summarize, we affirm the district court's December

2007 ruling that U.S. Fire breached its duty to defend and its

September   2010   and   August   2011   allocation     rulings   that   are

challenged on appeal.      We reverse the district court's August 2011

finding of Chapter 93A liability and vacate its associated award

of punitive damages.     We also vacate the award of attorney's fees,

costs,   and   statutory     interest    and   remand    for   appropriate

recalculation consistent with this opinion.       Parties to bear their

own appellate costs.




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