                      FOR PUBLICATION

    UNITED STATES COURT OF APPEALS
         FOR THE NINTH CIRCUIT


 LILLIAN GRADILLAS; CHRIS                         No. 13-15638
 GRADILLAS; ASSIGNEES OF
 KENNETH NWADIKI, JR., DBA                         D.C. No.
 America Bus Line,                            3:12-cv-03697-CRB
           Plaintiffs-Appellees,
                                                 ORDER
                    v.                         CERTIFYING
                                             QUESTION TO THE
 LINCOLN GENERAL INSURANCE                   SUPREME COURT
 COMPANY,                                          OF
          Defendant-Appellant.                 CALIFORNIA


                         Filed July 6, 2015

   Before: Michael Daly Hawkins and Paul J. Watford,
 Circuit Judges, and Jed S. Rakoff,* Senior District Judge.




  *
    The Honorable Jed. S. Rakoff, Senior United States District Judge for
the Southern District of New York, sitting by designation.
2            GRADILLAS V. LINCOLN GEN. INS. CO.

                           SUMMARY**


      Certification to the California Supreme Court

    The panel certified to the Supreme Court of California the
following question:

         When determining whether an injury arises
         out of the “use” of a vehicle for purposes of
         determining coverage under an automobile
         insurance policy and an insurance company’s
         duty to defend, is the appropriate test whether
         the vehicle was a “predominating
         cause/substantial factor” or whether there was
         a “minimal causal connection” between the
         vehicle and the injury?




  **
     This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
           GRADILLAS V. LINCOLN GEN. INS. CO.            3

                           ORDER

   We respectfully request that the Supreme Court of
California exercise its discretion to decide the certified
question set forth in Part II of this order.

                               I

                  Caption and Counsel

A. The caption of the case is:

   No. 13-15638

   LILLIAN GRADILLAS; CHRIS GRADILLAS;
   ASSIGNEES OF KENNETH NWADIKI, JR., DBA
   America Bus Line,

   Plaintiffs-Appellees,

   v.

   LINCOLN GENERAL INSURANCE COMPANY,

   Defendant-Appellant.

B. The names and addresses of counsel for the parties are:

   For Plaintiffs-Appellees:

   Paul D. Fogel and Dennis Peter Maio, Reed Smith LLP,
   101 Second Street, Suite 1800, San Francisco, CA 94105,
   and Scott A. Brown and David M. Poore, Brown Poore
4          GRADILLAS V. LINCOLN GEN. INS. CO.

    LLP, 1350 Treat Boulevard, Suite 745, Walnut Creek, CA
    94597

    For Defendant-Appellant:

    Edward F. Ruberry, Ellen D. Jenkins, and David Allen,
    Ruberry, Stalmack & Garvey LLC, 500 W. Madison
    Street, Suite 2300, Chicago, IL 60661, and George D.
    Yaron and Henry M. Su, Yaron & Associates, 1300 Clay
    Street, Suite 800, Oakland, CA 94612

C. Designation of party to be deemed petitioner: Defendant-
   Appellant

                              II

                     Question Certified

    Pursuant to Rule 8.548 of the California Rules of Court,
a panel of the United States Court of Appeals for the Ninth
Circuit, before which this appeal is pending, requests that the
Supreme Court of California answer the question presented
below. This court will accept the California Supreme Court’s
decision on this question. Our phrasing of the question is not
intended to restrict the California Supreme Court’s
consideration of the case. The question certified is as
follows.

   When determining whether an injury arises out of the
“use” of a vehicle for purposes of determining coverage
under an automobile insurance policy and an insurance
company’s duty to defend, is the appropriate test whether the
vehicle was a “predominating cause/substantial factor” or
           GRADILLAS V. LINCOLN GEN. INS. CO.               5

whether there was a “minimal causal connection” between the
vehicle and the injury?

                             III

                    Statement of Facts

    On January 27, 2008, Lillian Gradillas, her then-husband
Chris Gradillas (“the Gradillases”), and other paid passengers
on a party bus operated by American Bus Lines (“ABL”) and
owned by Kenneth Nwadike (“Nwadike”) were transported
to a night club. Each passenger had a wristband intended to
provide admission to the night club, but the bouncer refused
to allow Lillian and one other woman inside because they
lacked proper identification.

    Lillian and the other woman were left outside in the rain
until the bus driver, Gustavo Rosales, invited them to wait
aboard the bus, which they agreed to do. With Rosales, the
two women, and Rosales’s relative on the bus, Rosales drove
to an empty, dark parking lot across the street from the club
and parked. The other woman then sat down on a couch and
pretended to sleep, at which point Rosales approached Lillian
and, with the assistance of his relative, proceeded to grope
her. The other woman then woke up and went to the
bathroom on the bus; once she was inside, Rosales’s relative
blocked the door. “With the friend gone and [the relative]
guarding the friend, [Rosales] climbed on top of Lillian . . .
and then he raped her.” The Gradillases reported the rape to
the police, and Gustavo later pled guilty to felony sexual
assault.

    Lincoln General Insurance Company (“Lincoln”) had
issued a business auto policy of insurance (the “BA Policy”)
6          GRADILLAS V. LINCOLN GEN. INS. CO.

and a separate commercial general liability policy (the “CGL
Policy”) to Nwadike dba ABL. The BA Policy required
Lincoln to pay “all sums an ‘Insured’ legally must pay as
damages because of ‘bodily injury’. . . to which this
Insurance applies, caused by an ‘accident’ and resulting from
the ownership, maintenance or use of a covered ‘auto.’” In
the months following the assault, Lincoln sent Nwadike three
letters discussing the policy’s coverage and Lincoln’s duty to
defend. Initially, Lincoln denied coverage under the BA
Policy, but agreed, subject to a reservation of rights, to defend
Nwadike under the CGL Policy. In its second letter, Lincoln
again denied coverage under the BA Policy and reiterated that
the company would defend under the CGL Policy subject to
a reservation of rights. In its third letter, Lincoln denied
coverage under the CGL Policy and withdrew its defense.

    On September 11, 2009, the Gradillases filed suit in the
Superior Court for the County of San Francisco, seeking to
recover damages for the injuries they incurred from Nwadike,
ABL, Lincoln, and others. In August 2011, the Gradillases
settled their claim with Nwadike, and Nwadike stipulated to
the entry of judgment against him. The judgment awarded
$2,000,000 to Lillian and $500,000 to Chris. In addition, the
Gradillases entered into a covenant with Nwadike in which
they agreed not to execute the judgment and Nwadike
assigned his rights against Lincoln to the Gradillases. On
September 17, 2012, the state trial court entered the stipulated
judgment upon a finding of “good cause to support the
amount” of damages.

    Before the judgment in the underlying state court action
was entered, the Gradillases filed this lawsuit to enforce the
stipulated judgment against Lincoln and others. The case was
removed to the Northern District of California and the
           GRADILLAS V. LINCOLN GEN. INS. CO.                7

Gradillases moved for partial summary judgment, which the
district court granted, ruling that the stipulated judgment was
reasonable and Lincoln had breached its duty to defend
because the bus was a temporary substitute and the injuries
resulted from the “use of” the bus.

    Although Lincoln argues on appeal that the injury was
outside the scope of the policy’s coverage because it was not
an “accident” and the bus was not a qualifying substitute
vehicle, we do not reach these arguments because Lincoln
failed to raise them below. See Abex Corp. v. Ski’s Enters.,
Inc., 748 F.2d 513, 516 (9th Cir. 1984) (citing Rothman v.
Hosp. Serv. of S. Cal., 510 F.2d 956, 960 (9th Cir. 1975)).
Although application of this rule is discretionary, Singleton
v. Wulff, 428 U.S. 106, 121 (1976), Lincoln’s failure to
present the “accident” and “covered auto” arguments below
deprived the Gradillases of the opportunity to develop the
relevant factual record. See In re Mercury Interactive Corp.
Sec. Litig., 618 F.3d 988, 992 (9th Cir. 2010) (discretion to
reach waived issues “when the issue presented is purely one
of law and either does not depend on the factual record
developed below, or the pertinent record has been fully
developed.”) (citation and internal quotation marks omitted).

    Therefore, the only question remaining – which is
dispositive as to the merits of this appeal – is whether the
injuries arose from the use of the party bus such that Lincoln
had a duty to defend. We note that Lincoln also disputes
whether the amount of the settlement was reasonable, an issue
that we will address pending the California Supreme Court’s
disposition of the certified question.
8          GRADILLAS V. LINCOLN GEN. INS. CO.

                              IV

               Explanation of Our Request

    We seek the California Supreme Court’s determination as
to the proper test to apply in determining whether an injury
arises out of the “use” of an automobile for purposes of
determining the coverage of an automobile insurance policy
and an insurer’s duty to defend an insured. We ask for this
assistance because the test to be applied in the context of this
case will have a significant impact on these and similarly-
situated parties, and there is insufficient guidance in the
relevant statutes and case law to allow us to resolve this
question.

      Although a series of California Court of Appeal decisions,
Safeco Ins. Co. of Am. v. Parks, 170 Cal. App. 4th 992, 1012
(2009); R.A. Stuchbery & Others Syndicate 1096 v. Redland
Ins. Co., 154 Cal. App. 4th 796, 802 (2007); State Farm Mut.
Auto. Ins. Co. v. Grisham, 122 Cal. App. 4th 563, 566–67
(2004); Cal. Auto. Ins. Co. v. Hogan, 112 Cal. App. 4th 1292,
1297 (2003); Am. Nat’l Prop. & Cas. Co. v. Julie R., 76 Cal.
App. 4th 134, 140 (1999); Rowe v. Farmers Ins. Exch., 7 Cal.
App. 4th 964, 971–72 (1992); Peters v. Firemen’s Ins. Co.,
67 Cal. App. 4th 808, 812–13 (1998); Farmers Ins. Exch. v.
Reed, 200 Cal. App. 3d 1230, 1233 (1988), has adopted or
recognized the “predominating cause/substantial factor” test,
we note that these decisions are in potential conflict with the
California Supreme Court’s instruction that the “vehicle need
not be, in the legal sense, a proximate cause of the injury
. . . .” State Farm Mut. Auto. Ins. Co. v. Partridge, 514 P.2d
123, 127 n.7 (1973). We also note that a handful of
California Court of Appeal decisions have either employed
the test in Partridge or noted that the test is not a settled
           GRADILLAS V. LINCOLN GEN. INS. CO.                 9

question, Prince v. United Nat’l Ins. Co., 142 Cal. App. 4th
233, 244–45 (2006); Kramer v. State Farm Fire & Cas. Co.,
76 Cal. App. 4th 332, 336–37 (1999); Interinsurance Exch. v.
Flores, 45 Cal. App. 4th 661, 668–69 (1996); Nat’l Am. Ins.
Co. v. Ins. Co. of N. Am., 74 Cal. App. 3d 565, 571 (1977).

    As we read California law, we do not know whether the
district court in this case was required to apply the
“substantial factor” test or a “minimal causal connection”
test. We submit that this question is worthy of a decision by
the California Supreme Court, and that this case presents a
suitable vehicle for the California Supreme Court to address
this question. See Cal. Rules of Court 8.548(a). The answer
given by the California Supreme Court will dispose of this
appeal currently pending before the Ninth Circuit.

                               V

                 Accompanying Materials

    The clerk of this court is hereby directed to file in the
California Supreme Court, under official seal of the United
States Court of Appeals for the Ninth Circuit, copies of all
relevant briefs and excerpts of record, and an original and ten
copies of the request with a certification of service on the
parties, pursuant to California Rules of Court 8.548(c), (d).

    Further proceedings before us are stayed pending the
California Supreme Court’s decision regarding certification,
and in the event the California Supreme Court accepts
certification, pending our receipt of the answer to the question
certified. Submission of this case is withdrawn.
10          GRADILLAS V. LINCOLN GEN. INS. CO.

    After the California Supreme Court makes its
determination whether to accept certification of this question,
the parties shall file a joint report informing this court of the
decision. If the California Supreme Court accepts the
certified question, the parties shall file a joint status report to
our court every six months after the date of acceptance.

    If the California Supreme Court denies the request for
certification, this case will be automatically resubmitted upon
notice of that denial. If the California Supreme Court accepts
the certified question, the case will be automatically
resubmitted upon receipt of the California Supreme Court’s
answer to the certified question.

     SO ORDERED.
