          United States Court of Appeals
                        For the First Circuit


No. 15-1437

  WARREN BINGHAM, as Executor of the Estate of Marion Bingham,

                        Plaintiff, Appellant,

                                  v.

                           SUPERVALU, INC.,

                         Defendant, Appellee.


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

              [Hon. Indira Talwani, U.S. District Judge]


                                Before

                      Lynch, Stahl, and Kayatta,
                            Circuit Judges.


     Joshua N. Garick, with whom Law Offices of Joshua N. Garick,
P.C., was on brief, for appellant.
     Wesley S. Chused, with whom Preti Flaherty Beliveau & Pachios
LLP, was on brief, for appellee.


                          November 13, 2015
           STAHL, Circuit Judge.          Massachusetts law prohibits those

"in the business of insurance" from employing "unfair methods of

competition and unfair or deceptive acts or practices," which

include   "[f]ailing        to   effectuate    prompt,    fair   and    equitable

settlements of claims in which liability has become reasonably

clear."   Mass. Gen. Laws ch. 176D, § 3(9)(f) ("Chapter 176D").

This appeal requires us to consider what it means to be "in the

business of insurance."

           The     Appellant,      Warren     Bingham,     proceeding    in   his

capacity as the executor of the estate of Marion Bingham (the

"Estate"), brought suit alleging that the Appellee, Supervalu,

Inc., acted as an insurer of one of its subsidiaries, and violated

Chapter   176D   by    failing     to   promptly,      fairly,   and    equitably

effectuate   the      settlement     of     prior   litigation    between     the

subsidiary and the Estate. The district court found that Supervalu

was not in the business of insurance and, on this basis, entered

summary   judgment     in    Supervalu's      favor.     The   Estate   appeals.

Finding no error, we AFFIRM.

                            I. Facts and Background

     A.    The Prior Litigation

           In January 2006, Marion Bingham was shopping at a Shaw's

Supermarket in East Boston, Massachusetts when she was struck by

a motorized cart.      Ms. Bingham suffered a laceration to her right

heel in the area of her Achilles' tendon.              At the time, Ms. Bingham


                                          - 2 -
was   in   her   early-eighties,       and   the   incident    seems   to   have

precipitated a rapid decline in her health.               Ms. Bingham passed

away approximately eight months later in September 2006.

            Before she died, Ms. Bingham brought a negligence action

against Shaw's in Massachusetts state court.                  Later, after her

death, Ms. Bingham's nephew, Warren Bingham, was appointed as the

executor of the Estate, and was substituted as the plaintiff in

the suit against Shaw's.

            At the time of the January 2006 incident, Shaw's was a

subsidiary   of    Albertson's,       Inc.    On   June   2,   2006,   however,

Albertson's was acquired by Supervalu.              Thus, when Ms. Bingham

filed her lawsuit against Shaw's at the end of June 2006, Shaw's

was a subsidiary of Supervalu and, pursuant to the manner in which

Supervalu structured its relationship with its direct and indirect

corporate subsidiaries, Supervalu had the authority to negotiate

and settle claims on behalf of Shaw's.

            Including Shaw's, Supervalu owned some 228 distinct

subsidiaries.      Supervalu maintained a centralized risk management

system whereby it negotiated and resolved claims made against its

subsidiaries      that   were   not    otherwise    covered     by   insurance.1


      1 At all relevant times, Shaw's was covered by general
liability insurance policies taken out by Albertson's (and
transferred to Supervalu in the acquisition), but the policies
were subject to a self-insured retention of $2,000,000. This meant
that Shaw's was effectively self-insured for all claims below
$2,000,000.   See Self-Insured Retention, Black's Law Dictionary


                                         - 3 -
Supervalu employed claims adjusters to perform these functions,

and once a self-insured claim was settled, Supervalu would issue

payment from a central account on behalf of the subsidiary against

which the claim was made.             Supervalu did not issue insurance

policies to its subsidiaries.          However, in order to minimize its

total costs and exposure, Supervalu opted to centralize the self-

insured claims administration process.

           In July 2008, in the liability action, a judge of the

Massachusetts     Superior    Court    entered    judgment         against   Shaw's

pursuant to Massachusetts Rule of Civil Procedure 33(a), which

permits the entry of judgment against a party failing to timely

respond   to     interrogatories.       See     Mass.    R.    Civ.    P.     33(a).

Approximately a year later, in June 2009, the Superior Court

awarded damages to the Estate in the amount of $300,000, plus post-

judgment interest.

           Rather than pay the judgment, Supervalu filed an appeal

to the Appeals Court of Massachusetts, which summarily affirmed

the   Superior    Court's    damages   award.      See    Bingham       v.    Shaw's

Supermarkets,      Inc.,    936   N.E.2d   452    (Mass.      App.     Ct.     2010)

(unpublished).       Then,    Supervalu    threatened         to    seek     further

appellate review in the Massachusetts Supreme Judicial Court (the



(10th ed. 2014) (defining a self-insured retention as "[t]he amount
of an otherwise-covered loss that is not covered by an insurance
policy and that usu[ally] must be paid before the insurer will pay
benefits").


                                        - 4 -
"SJC").    Rather than risk prolonging the litigation, the Estate

accepted a $475,000 settlement offer, which represented a figure

slightly below the sum of the original award, plus the post-

judgment interest that had accrued to that date.

           The Estate contends that Supervalu's decisions to appeal

to the Appeals Court of Massachusetts, and then to threaten a

further appeal to the SJC, were undertaken contrary to the advice

of counsel that, in each instance, an appeal was unlikely to

succeed.   The Estate argues that Supervalu's sole motive was to

protract the litigation in the hopes of achieving a reduced

settlement.   Ultimately, Supervalu made payment to the Estate on

December 8, 2010.

      B.   The Proceedings Below

           All was quiet until April 2013, when the attorney who

had   represented   the   Estate   in   the   underlying   state   court

proceedings sent a demand letter to Shaw's and Supervalu asserting

that Supervalu had acted as Shaw's insurer and had violated Chapter

176D and Mass. Gen. Laws ch. 93A ("Chapter 93A") by failing to

promptly and fairly resolve the Estate's claim against Shaw's.2

The letter demanded payment of just over $1,000,000.          Supervalu

declined to pay.




      2Chapter 93A provides an express cause of action for persons
aggrieved by a violation of Chapter 176D. See Mass. Gen. Laws ch.
93A, § 9(1).


                                    - 5 -
            The   Estate   brought    suit   against   Supervalu   in

Massachusetts Superior Court, asserting claims for violation of

Chapter 176D and Chapter 93A based on Supervalu's "willful" and

"frivolous" delay in resolving the underlying litigation between

Shaw's and the Estate.     Supervalu removed the action to federal

court and moved for summary judgment, arguing solely that it was

not in the business of insurance, and therefore was not subject to

regulation under Chapter 176D.

            Pursuant to a report and recommendation issued by a

magistrate judge, the district court concluded that Supervalu was

not in the business of insurance.       Relying heavily on the SJC's

holding in Morrison v. Toys "R" Us, Inc., Mass., 806 N.E.2d 388

(Mass. 2004), the district court reasoned that Supervalu did not

act as an insurer because it did not sell insurance policies for

profit and was not contractually obligated to settle claims made

against Shaw's or its other subsidiaries.       Rather, the district

court found that Supervalu operated a centralized risk management

system to negotiate and settle claims made against any of its

subsidiaries that were below the limits of its applicable insurance

coverage.   Thus, for these claims, as a "self-insurer," Supervalu

was not "in the business of insurance" as that term is contemplated

in Chapter 176D and in Morrison.      On this rationale, the district

court entered summary judgment in Supervalu's favor, prompting the

instant appeal.


                                     - 6 -
                        II. Standard of Review

             We review orders for summary judgment de novo, assessing

the record in the light most favorable to the nonmovant and

resolving all reasonable inferences in that party's favor. Packgen

v. BP Expl. & Prod., Inc., 754 F.3d 61, 66 (1st Cir. 2014).       The

entry of summary judgment is appropriate when "there is no genuine

dispute as to any material fact and the movant is entitled to

judgment as a matter of law."    Id. (quoting Fed. R. Civ. P. 56(a)).

                            III. Discussion

             Although a litigant is typically free to mount a vigorous

defense, and is under no obligation to make a settlement offer or

to otherwise promptly resolve a dispute, see Mass. Const. art. XV,

Chapter 176D imposes a statutory obligation on those "in the

business of insurance" to "prompt[ly], fair[ly] and equitabl[y]"

settle claims in which liability has become reasonably clear.

Mass. Gen. Laws ch. 176D, § 3(9)(f).     Chapter 176D was "enacted to

encourage settlement of insurance claims . . . and [to] discourage

insurers from forcing claimants into unnecessary litigation to

obtain relief."    Hopkins v. Liberty Mut. Ins. Co., 750 N.E.2d 943,

952 (Mass. 2001) (quoting Clegg v. Butler, 676 N.E.2d 1134, 1139

(Mass. 1997)).    "One obvious legislative concern was that entities

that profit from selling insurance policies not abuse exclusive

rights and duties to control litigation vested through those same

policies."     Morrison, 806 N.E.2d at 390.


                                    - 7 -
            The sole issue we must consider is whether Supervalu was

in the business of insurance.        The Estate proffers a series of

arguments suggesting that it was.3     First, the Estate contends that

the district court erred in concluding, pursuant to the SJC's

decision in Morrison, that Supervalu was a "self-insurer" exempt

from regulation under Chapter 176D.          Second, the Estate argues

that Supervalu functions in a manner similar to both a "captive

insurer" and a "third-party administrator," and thus should be

deemed to be in the business of insurance.       Third and finally, the

Estate suggests that because one of Supervalu's many subsidiaries,

Risk Planners, Inc. ("Risk Planners"), was an insurance agency,

that Supervalu, as its parent company, was by definition engaged

in the business of insurance.      We consider each of these arguments

in turn.

     A.     The Morrison Exemption for Self-Insureds

            In Morrison, the SJC considered the contours of Chapter

93A and Chapter 176D in the context of a suit brought by a Toys

"R" Us ("Toys") patron who was injured while shopping at a Toys

store.     806 N.E.2d at 388-89.    After the Superior Court entered




     3 In her report and recommendation, the magistrate judge
concluded that the Estate bore the burden of proof under Chapter
176D to demonstrate that Supervalu was engaged in the business of
insurance. See Bingham v. Supervalu Inc., No. 13-11690-IT, 2015
U.S. Dist. LEXIS 42925, at *14 (D. Mass. Feb. 20, 2015). Because
the Estate appears to concede the point, we assume -- without
deciding -- that the magistrate judge's conclusion was correct.


                                     - 8 -
summary judgment for Toys on grounds that it was not in the

business    of     insurance,    the     Appeals   Court   of    Massachusetts

reversed.     See Morrison v. Toys "R" Us, Inc., Mass., 797 N.E.2d

405 (Mass. App. Ct. 2003).         On further appellate review, the SJC

reinstated the judgment of the Superior Court, finding that Toys

was indeed not in the business of insurance.           Morrison, 806 N.E.2d

at 388.

            We rehearse the factual background as described by the

SJC, augmenting where necessary with the Appeals Court's somewhat

more robust account.4        After she had been injured by a falling sign

at a Toys location in Massachusetts, the plaintiff brought suit

against     Toys    "R"    Us,   Inc.,    Massachusetts,    a      wholly-owned

subsidiary of Toys, seeking damages of $250,000.                Morrison I, 797

N.E.2d at 406-07.         Toys had a policy whereby it handled claims of

less than $1,000,000 made against itself or its subsidiaries

through a central risk management department. Morrison, 806 N.E.2d

at 389.     Toys, through the risk management department, made the

plaintiff a series of exceedingly low offers, all of which she

rejected.    Id.     At trial, the jury returned a $1,200,000 verdict

for the plaintiff based on her "significant" injuries.5                Morrison

I, 797 N.E.2d at 406-07.


     4   We cite to the Appeals Court's decision as "Morrison I."

     5 This figure was later reduced by remittitur.                Morrison I,
797 N.E.2d at 407.


                                         - 9 -
             The plaintiff then brought a separate suit alleging that

Toys had violated Section 176D by failing to promptly, fairly, and

equitably resolve her claim against the Toys subsidiary. Morrison,

806 N.E.2d at 389.      In affirming the Superior Court's entry of

summary judgment for Toys on grounds that it was not in the

business of insurance, the SJC found that Toys was "self-insured,"

meaning that it "assum[ed] [its] own risk, instead of transferring

it to a third-party insurer by means of purchasing insurance

coverage."      Id. at 390 n.1.     Focusing on the fact that Toys

administered, negotiated, and settled claims made only against

itself, "or one of its subsidiaries," the SJC reasoned that Chapter

176D "cannot legitimately be extended to a self-insurer . . . which

had no contractual obligation to settle the plaintiff's claim and

is not otherwise regulated by the Commonwealth for insurance

activities."     Id. at 389, 391.

             We find the Estate's attempts to distinguish Morrison

unpersuasive because these attempts overlook critical factual

parallels between the two cases.         In Morrison, as here, the

plaintiff brought suit against a subsidiary retailer responsible

for injuries occurring on the retailer's premises.    In both cases,

the subsidiary's parent company undertook to resolve the claim

directly with the claimant, rather than rely on insurance provided

by a third party.      Toys, as a matter of practice, attempted to

negotiate and resolve claims for less than $1,000,000 made against


                                    - 10 -
itself and its subsidiaries.         Supervalu had a similar practice

whereby it negotiated and resolved uninsured claims made against

its subsidiaries through a centralized risk management system.

Then, in both cases, the plaintiff brought a subsequent suit

alleging that the parent company was in the business of insurance.

            The SJC has recognized that the hallmarks of companies

engaged in the business of insurance include making "profit driven

business     decisions   about     premiums,     commissions,     marketing,

reserves and settlement policies and practices," assuming the risk

of losses suffered by third parties, Poznik v. Mass. Med. Prof'l

Ins. Ass'n, 628 N.E.2d 1, 3 (Mass. 1994), and settling claims

pursuant to a contractual obligation to do so, Morrison, 806 N.E.2d

at 391.     As in Morrison, none of those factors are present here.

Supervalu did not sell insurance policies to its subsidiaries; it

handled claims only for itself and its subsidiaries and therefore

did not assume risk on behalf of unaffiliated third parties; and,

Supervalu was not under a contractual obligation to settle claims

with the Estate or with any other claimant.

            True, as the Estate notes, Supervalu spread risk among

its subsidiaries and paid claims out of a central account, much

like a typical insurer.       But this merely underscores the fact that

Supervalu    qualifies   as    self-insured     because,   like   the   parent

company in Morrison, Supervalu opted to bear the full risk of loss

stemming    from   uninsured    claims   made    against   itself   and    its


                                     - 11 -
subsidiaries.        See id. at 390 n.1 ("The term 'self-insured' is a

manner of referring to a decision not to be insured by a third

party when one has the financial means . . . to satisfy claims or

judgments imposing liability for wrongful conduct.").                For all of

these reasons, we concur with the district court that Morrison is

controlling and that Supervalu is properly characterized as a self-

insurer exempt from regulation under Chapter 176D.

      B.     Captive Insurers and Third-Party Administrators

             The Estate next contends that Supervalu should fall

within Chapter 176D's purview by virtue of functioning in a manner

similar to a captive insurer and a third-party administrator.                  We

conclude that neither shoe fits.

             Captive    insurers   are    "insurance     companies     owned   by

another organization whose exclusive purpose is to insure risks of

the parent organization and affiliated companies[.]"                   Lemos v.

Electrolux N. Am., Inc., 937 N.E.2d 984, 989 (Mass. App. Ct. 2010)

(quoting Mass. Gen. Laws ch. 175, § 174G). The Estate's suggestion

that Supervalu is properly viewed as a captive insurer cannot

survive a basic reading of this statutorily-prescribed definition.

As   an    initial    matter,   Supervalu    was   not    owned   by    another

organization; it was the parent company to Shaw's and its other

subsidiaries, and there is no record support for the conclusion

that Supervalu's purpose (let alone its exclusive purpose) was to

insure its affiliates. Furthermore, for reasons we have described,


                                         - 12 -
Supervalu did not operate as an insurance company in that it did

not issue insurance policies for profit and was not contractually

obligated to settle claims.           Cf. Lemos, 937 N.E.2d at 987-90

(finding that a captive insurer could not "evade its statutory

duties imposed by [Chapter 176D]" where the captive insurer had,

inter alia, issued insurance policies to its parent company in

exchange for a premium and had the exclusive right to resolve

claims on the parent company's behalf).          Simply put, no reasonable

reading of Lemos or Mass. Gen. Laws ch. 175 would support the

conclusion that Supervalu should be regulated as a captive insurer.

             The Estate next contends that Supervalu is in the

business of insurance by virtue of functioning like a third-party

administrator by resolving claims on behalf of its subsidiaries.

In advancing this argument, Supervalu principally relies on Miller

v. Risk Mgmt. Found. of Harvard Med. Insts., Inc., 632 N.E.2d 841

(Mass. App. Ct. 1994).         There, the plaintiff brought a medical

malpractice claim against a Harvard-affiliated hospital.             Id. at

842-43.     The hospital was insured by a Harvard-owned insurance

company, and malpractice claims against the hospital were assessed

and negotiated through a separate Harvard-owned risk management

provider.    Id. at 844.      In a separate suit brought under Chapter

93A   and   Chapter   176D,    the   plaintiff    alleged   that   the     risk

management    provider   had    unlawfully     stymied    his   attempts    at

settlement, despite obvious liability.           Id.     In concluding that


                                      - 13 -
the risk management provider was liable under Chapter 93A, the

Appeals Court of Massachusetts found that, "as claims negotiator

and potential settler, [the risk management provider] has been

interposed between the insurer [] and the claimant, and nothing

seems more appropriate than to apply to it the standards of fair

dealing expressed in [Chapter 176D]."        Id. at 846.

            The   Estate's   reliance   on   Miller   cannot   withstand

scrutiny.   For one thing, in the underlying litigation, Supervalu

was not interposed between an insurer and the Estate; indeed, as

we have said, Supervalu was self-insured for the first $2,000,000

of potential liability facing any one of its subsidiaries.          See

Morrison, 806 N.E.2d at 391 ("The significance of the holding of

the Appeals Court in the Miller case is that an insurance company

cannot evade its statutory duties imposed by [Chapter 176D] by

delegating its work.").

            What is more, unlike the risk management provider at

issue in Miller, Supervalu did not purport to act on behalf of an

insurer that had a contractual obligation to pay claims.        Rather,

Supervalu was under no duty to settle claims made against Shaw's

or its other subsidiaries.6     See id. ("The Miller decision simply


     6 The Estate points to record evidence which it suggests
establishes that Supervalu may have acted as a claims administrator
for one or more subsidiaries that it did not wholly own. We do
not view this evidence as establishing a dispute of material fact
regarding whether Supervalu was in the business of insurance
because there is no evidence that Supervalu bore the risk of loss


                                   - 14 -
cannot be read to impose an affirmative claim settlement duty on

the risk management department of Toys, when none could be imposed

on Toys itself.").      In sum, we share the view of the district court

that Supervalu did not function as a captive insurer, nor did it

function as a third-party administrator, and thus it should not be

regulated as such.

     C.     Supervalu's Ownership of Risk Planners

            Finally, the Estate contends that Supervalu was in the

business of insurance by virtue of owning Risk Planners, an

insurance agency.       During the pendency of the underlying state

court     litigation,    Risk   Planners      was   one   of   Supervalu's

subsidiaries.

            It   is   undisputed   that    Risk     Planners   was   wholly

uninvolved in the litigation between the Estate and Shaw's.           Risk

Planners did not insure either Shaw's or Supervalu, and it had no

role in adjusting, negotiating, or litigating the Estate's claim.

Nevertheless, the Estate's argument is not entirely without merit.

Take, for example, a hypothetical parent company that has a number

of subsidiaries in different sectors, including one that operates

an airline. By virtue of owning a subsidiary airline, no one could

reasonably dispute that the parent company is, by some measure,



for these entities, that it adjusted claims on their behalf
pursuant to a policy of insurance, or that it was obligated to
settle claims made against these entities.   See Morrison, 806
N.E.2d at 391; Poznik, 628 N.E.2d at 3.


                                     - 15 -
"in the airline business."       So too, one might fairly conclude that

Supervalu was "in the business of insurance" by virtue of owning

an insurance agency.

             It is an entirely different proposition, however, to

suggest that a parent company is independently subject to all of

the   laws   and   regulations    that   govern   the   operation   of   its

individual subsidiaries.         For example, it would defy logic to

suggest that our hypothetical parent company is itself subject to

aviation regulations, even though those regulations would plainly

apply to its subsidiary airline.

             What is more, the Estate's suggestion that Supervalu was

in the business of insurance by virtue of owning an insurance

agency that had nothing to do with the subject litigation contorts

Chapter 176D's well-established policy underpinnings.          As we have

said, Chapter 176D was enacted to curb abuses that might result

from an insurer's exclusive right to control litigation stemming

from policies that the insurer has sold for profit.         Morrison, 806

N.E.2d at 390.       Here, there is no such concern because Risk

Planners neither sold relevant coverage, nor had any control over

the litigation between Shaw's and the Estate.           Thus, Supervalu's

ownership of Risk Planners does not support the conclusion that it

was in the business of insurance for purposes of Chapter 176D.




                                     - 16 -
                          IV. Conclusion

          We concur with the district court that Supervalu was not

in the business of insurance, and thus we AFFIRM the entry of

summary judgment in Supervalu's favor.7




     7 Prior to oral argument, the Estate filed a motion asking
that we certify a series of questions to the SJC bearing on the
scope of Chapter 176D. That motion was denied without prejudice
by order dated August 21, 2015.       Because the motion was not
renewed, we need not consider it. And, in any event, we would
decline to certify these issues to the SJC given the law's existing
clarity. See Tarr v. Manchester Ins. Corp., 544 F.2d 14, 15 (1st
Cir. 1976) (per curiam) ("The purpose of certification is to
ascertain what the state law is, not, when the state court has
already said what it is, to afford a party an opportunity to
persuade the court to say something else.").


                                - 17 -
