          Case: 17-14500   Date Filed: 08/08/2018   Page: 1 of 11


                                                        [DO NOT PUBLISH]



            IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 17-14500
                        Non-Argument Calendar
                      ________________________

                  D.C. Docket No. 1:16-cv-25344-PCH



JONES BOAT YARD, INC.,

                                             Plaintiff-Appellant,

versus

ST. PAUL FIRE AND MARINE INSURANCE COMPANY,

                                             Defendant-Appellee.

                      ________________________

               Appeal from the United States District Court
                   for the Southern District of Florida
                     ________________________

                            (August 8, 2018)



Before WILLIAM PRYOR, BRANCH and BLACK, Circuit Judges.

PER CURIAM:
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       Plaintiff-Appellant Jones Boat Yard, Inc. (JBY) appeals from the district

court’s grant of summary judgment in favor of Defendant-Appellee St. Paul Fire

and Marine Insurance Company (St. Paul). The district court concluded St. Paul

had no duty to defend or indemnify JBY in connection with a suit brought against

JBY by one of its customers. After careful review, 1 we affirm.

                                   I. BACKGROUND

       JBY operates a ship-repair and marina facility. According to Charles Fleck

(who is now deceased), JBY contracted to repair his boat in November 2003, after

the boat was damaged in a storm. The boat sat idle for several years in JBY’s

custody, however, while Fleck disputed invoices for repairs and storage fees.

       In March 2006, Fleck hired a marine surveyor to inspect the boat at JBY’s

facility. The surveyor discovered the boat was partially flooded and sinking from

the bow. Based on the surveyor’s observations, Fleck filed a state-court lawsuit

alleging JBY was liable for the flooding and related damage, as well as for not

returning the boat to Fleck. Fleck did not initially serve JBY with a copy of the

complaint he filed in March 2006. Nevertheless, he was able to obtain physical

custody of the boat following an ex-parte replevin hearing in January 2007.



       1
          “We review the district court’s determination and application of Florida law in a
summary judgment ruling de novo.” Lime Tree Vill. Cmty. Club Ass’n, Inc. v. State Farm Gen.
Ins. Co., 980 F.2d 1402, 1405 (11th Cir. 1993).


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       JBY was eventually served with the complaint in May 2008, shortly before

Fleck amended it. Fleck’s amended complaint asserted claims for breach of

contract, conversion, gross negligence, and fraud. JBY moved to dismiss the suit

on the basis that Fleck’s claims were barred by Florida’s economic-loss rule. The

state court evidently agreed (in part), and it dismissed Fleck’s gross-negligence

claim with prejudice.2

       Fleck then filed a second amended complaint, asserting claims for breach of

contract, conversion, fraud, and fraud in the inducement. Following the second

amendment, JBY for the first time (in March or April 2009) notified St. Paul of

Fleck’s claims. St. Paul had issued JBY multiple liability policies covering the

years relevant to Fleck’s suit.

            After reviewing the second amended complaint, St. Paul denied coverage

and refused to defend JBY. JBY and Fleck’s estate3 thus proceeded to trial

(without St. Paul’s participation), based on a third amended complaint, which

contained substantially the same allegations against JBY. 4 St. Paul was not

provided a copy of the third amended complaint.



       2
            One of Fleck’s fraud counts was also dismissed with leave to amend.
       3
            Fleck was deceased by the time of the trial, so the claims were pursued by his estate.
       4
            The third amended complaint added a claim for civil theft, which has no bearing on our
analysis.


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       Following a February 2015 jury trial, the state court entered final judgment

against JBY in the amount of $175,874.52. Fleck’s estate then obtained two more

judgments against JBY—one for attorney’s fees of $170,350.50 and one for costs

of $20,947.75. JBY forwarded the judgments to St. Paul, demanding indemnity

and reimbursement for its defense costs. St. Paul once again denied the claim.

       JBY then sued St. Paul for breach of contract in state court. The case was

removed to federal court, and both parties moved for partial summary judgment on

the issue of whether St. Paul owed JBY a duty to defend. The parties’ arguments

on the dispositive issue hinged on differing interpretations of Florida law as

applied to the operative policy language.

       The general policy provision 5 underlying JBY’s claims 6 states:

       [St. Paul] will pay on behalf of [JBY] all sums which [JBY] shall
       become legally obligated to pay as damages because of . . . “Property
       Damage” to which this insurance applies. [St. Paul] will have the
       right and duty to defend [JBY] against any claim or “suit” seeking
       those damages. [St. Paul] will have no duty to defend [JBY] against
       any claim or “suit” seeking damages to which this insurance does not
       apply. [St. Paul] may, at their [sic] discretion, investigate any
       “occurrence” and settle any claim or “suit” that may result.




       5
         Each of the policies in force during the relevant time period contained a general liability
provision with substantially the same language. To the extent the language varied slightly, the
differences are not relevant to our analysis.
       6
         JBY argued coverage under other policy provisions in the district court, but they have
not asserted those provisions as a basis for liability on appeal.
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The policies’ definitions and exclusions clarify the types of suits or claims “to

which [the] insurance applies.” Most notably, coverage is limited to claims

“caused by an ‘occurrence.’”

      The policies’ definitions of “occurrence” changed slightly over the relevant

period. From 2003 to 2005, “occurrence” was defined as “an accident, including

continuous or repeated exposure to substantially the same general harmful

conditions, which results in . . . ‘property damage’ neither expected nor intended

from the standpoint of the insured.” From 2005 to 2006, “occurrence” was defined

simply as “an accident, including continuous or repeated expos[ure to]

substantially the same general harmful conditions.”

      The crux of the issue determined by the district court was whether it was

appropriate to consider—for purposes of determining the duty to defend—the

claims and legal theories asserted in Fleck’s second amended complaint, in

addition to Fleck’s factual allegations. JBY contended Fleck’s claims and legal

theories were irrelevant. According to JBY, coverage depended solely on the

factual allegations in the second amended complaint. If those allegations could

arguably support a claim that would be covered under the policy language, St. Paul

owed a duty to defend. Thus, because Fleck’s second amended complaint alleged

facts that arguably could support a claim for accidental property damage, St. Paul

was obligated to defend the suit.


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       St. Paul disagreed, arguing that Fleck’s factual allegations had to be viewed

in the context of the claims and legal theories actually pursued in the second

amended complaint. Because Fleck’s second amended complaint alleged claims

based on intentional conduct, the factual allegations could not fairly be construed

as supporting a claim for damages caused by an “accident.” Thus, Fleck’s claims

were not based on an “occurrence” covered by the policies.

       After ordering supplemental briefing and holding a hearing on the issue, the

district court agreed with St. Paul. It concluded Fleck’s suit was not based on an

“occurrence,” because the second amended complaint “did not assert any cause of

action through which [JBY] could potentially be found liable for acts that were not

intentional.” Thus, the “second amended complaint did not ‘fairly and potentially’

bring Fleck’s suit within the scope of coverage under the Policies.” The district

court therefore granted St. Paul’s motion and denied JBY’s on the issue of the duty

to defend. 7

       In addition, because it determined St. Paul owed no duty to defend JBY

under the relevant policy provisions, the district court concluded St. Paul could not

possibly owe a duty to indemnify JBY under those same provisions. It therefore

       7
          The district court further determined summary judgment was appropriate because
Fleck’s gross-negligence claim was dismissed by the state court with prejudice. Thus, according
to the district court, it would be impossible for Fleck to state a claim that would be covered under
the policies. JBY challenges this ruling on appeal, arguing it was inappropriate for the district
court to consider facts beyond those alleged in the second amended complaint. We need not
reach this issue because we agree with the district court that the second amended complaint’s
allegations did not support a claim within the policies’ scope of coverage.
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granted St. Paul summary judgment on the issue of indemnity as well. JBY timely

appealed.

                                  II. DISCUSSION

      Because the substantive law of Florida controls this contractual dispute,

“[o]ur objective is to determine the issues of state law as we believe the Florida

Supreme Court would.” State Farm Fire & Cas. Co. v. Steinberg, 393 F.3d 1226,

1231 (11th Cir. 2004). In doing so, we are bound by decisions of the Florida

Supreme Court. We are also bound by decisions from Florida’s intermediate

appellate courts, barring persuasive evidence that the Florida Supreme Court would

rule differently. See Bravo v. United States, 577 F.3d 1324, 1325 (11th Cir. 2009).

Our own decisions interpreting Florida law are also binding, “absent a later

decision by [a] state appellate court casting doubt on our interpretation of that

law.” EmbroidMe.com, Inc. v. Travelers Prop. Cas. Co., 845 F.3d 1099, 1105

(11th Cir. 2017).

      The parties agree, as they must, that an insurer’s duty to defend is broader

than its duty to indemnify. See Jones v. Fla. Ins. Guar. Ass’n, Inc., 908 So. 2d

435, 443 (Fla. 2004). Likewise, the parties concede the duty to defend “arises

when the complaint alleges facts that fairly and potentially bring the suit within

policy coverage.” Id. at 442–43. The parties disagree, however, as to the meaning

of the Florida Supreme Court’s instruction that “[t]he duty to defend must be


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determined from the allegations in the complaint.” Id. at 443; see also id. (“The

duty is determined solely by the allegations against the insured, not by the actual

facts, nor the insured’s version of the facts.” (quoting Irvine v. Prudential Prop. &

Cas. Ins. Co., 630 So. 2d 579, 579–80 (Fla. 3d DCA 1993))).

      As it did in the district court, JBY contends on appeal that the duty to defend

depends solely on the factual allegations of the complaint, to the exclusion of any

causes of action or legal theories that might also be alleged. We disagree.

      Nothing in the Florida Supreme Court’s statement that the duty to defend

depends on a complaint’s allegations indicates a desire to limit consideration to the

complaint’s factual allegations. Indeed, such a limitation would appear to be

inconsistent with the Florida Supreme Court’s own application of the relevant

standard. See Nat’l Union Fire Ins. Co. v. Lenox Liquors, Inc., 358 So. 2d 533,

536 (Fla. 1977) (“The original complaint filed by McClendon did not allege facts

which would bring the cause within the coverage of the insurance policy since the

only cause of action alleged was one for intentional acts by Rosen. Therefore, the

insurer has no duty to defend.” (emphasis added)); see also Chicago Title Ins. Co.

v. CV Reit, Inc., 588 So. 2d 1075, 1076 (Fla. 4th DCA 1991) (“[W]hether or not a

duty to defend exists arises from the allegations of the complaint itself, not on

some conclusions drawn by the insured based upon a theory of liability which has

not been pled.” (emphasis added)); Baron Oil Co. v. Nationwide Mut. Fire Ins.


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Co., 470 So. 2d 810, 813–14 (Fla. 1st DCA 1985) (“[W]here an amended

complaint alleges facts that clearly bring the entire cause of action within a policy

exclusion, and the amended complaint contains no additional counts or causes of

action which show coverage, the allegations in the amended complaint control and

the insurer’s duty to defend comes to an end.” (emphasis added)).

       JBY’s contention is also at odds with our previous interpretation of the

standard. In a long line of cases, we have stated that the duty to defend depends on

“the facts and legal theories alleged in the pleadings and claims against the

insured.” Stephens v. Mid-Continent Cas. Co., 749 F.3d 1318, 1323 (11th Cir.

2014) (emphasis added); James River Ins. Co. v. Ground Down Engineering, Inc.,

540 F.3d 1270, 1275 (11th Cir. 2008) (same); Lawyers Title Ins. Corp. v. JDC

(Am.) Corp., 52 F.3d 1575, 1580 (11th Cir. 1995) (same). 8 This interpretation of

the standard, in addition to being repeatedly applied within our circuit, has been

adopted by at least one Florida intermediate appellate court. See Mid-Continent

Cas. Co. v. Royal Crane, LLC, 169 So. 3d 174, 180–81 (Fla. 4th DCA 2015).




       8
          JBY argues at length in its reply brief that we should ignore this line of precedent
because it is based on a case that is factually distinguishable. Ironically, JBY then accuses St.
Paul (in the very next paragraph) of “artfully ignor[ing]” the Second Circuit’s opinion in Allianz
Insurance Company v. Lerner, 416 F.3d 109 (2d Cir. 2005), because St. Paul suggested the case
was distinguishable. JBY’s reliance on Allianz is misplaced. In addition to being non-binding
on this Court, the Second Circuit’s opinion in Allianz dealt with materially different policy
language and was decided under New York law. It therefore has little relevance to our
application of Florida law to JBY’s policies.
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      JBY nevertheless argues we should disregard this line of cases and instead

take guidance from our opinion in Lime Tree Village Community Club Association,

Inc. v. State Farm General Insurance Co., 980 F.2d 1402 (11th Cir. 1993). In

Lime Tree, the defendant insurer asked us to re-characterize claims that were, in

fact, asserted in the complaints against its insured. Id. at 1404–05. Those claims

included, among others, slander of title and restraint of trade. Id. The insurer

argued such claims were “‘merely’ creative” ways of seeking relief for intentional

discrimination, which was excluded from the policy. Id. at 1406. We declined the

insurer’s invitation to re-characterize the claims, explaining that under the facts

alleged, the insured could be liable “for example, for unintended slander of title

and unintended restraint of trade.” Id. (footnote omitted). The duty to defend was

thus triggered “regardless of the label [the insurer] would like to attach to the cause

of action.” Id. (emphasis added).

      It was in that context we explained in Lime Tree that a “court cannot

speculate as to the nature or merit of the claims”; rather, a court “may only look to

the factual allegations of the underlying complaint.” Id. In other words, a court is

not free to look at whether the causes of action asserted in a complaint are actually

meritless or are “‘merely’ creative” ways of recasting other claims. If the

complaint’s factual allegations could support liability under one of the legal

theories alleged in the complaint, the duty is triggered. Lime Tree did not hold that


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the legal theories alleged in a complaint are irrelevant to the analysis of whether a

duty to defend exists.9

       We therefore conclude the district court did not err by considering whether

the complaint alleged both facts and legal theories under which JBY could be

found liable. Nor did the district court err by concluding the facts and legal

theories alleged in the underlying complaint did not “fairly and potentially bring

the suit within policy coverage.”10 See Jones, 908 So. 2d at 442–43.

                                       III. CONCLUSION

       We affirm the district court’s grant of summary judgment in favor of St.

Paul and its denial of JBY’s motion for partial summary judgment.

       AFFIRMED.




       9
          In any event, a subsequent case from an intermediate appellate court in Florida has
stated the standard as allowing consideration of the legal theories alleged in a complaint. See
Royal Crane, 169 So. 3d at 180–81 (“The insurer’s duty to defend arises solely from the facts
and legal theories alleged in the pleadings and claims against the insured.” (quotation omitted)).
Thus, even if we were to assume JBY’s interpretation of the holding in Lime Tree were correct,
we would not be bound by that holding. See EmbroidMe.com, 845 F.3d at 1105.
       10
           JBY argues for the first time in its reply brief that the district court erred by concluding
liability for Fleck’s breach-of-contract claim would necessarily be based on intentional conduct.
That argument has been waived. Herring v. Sec’y, Dep’t of Corr., 397 F.3d 1338, 1342 (11th
Cir. 2005) (“As we repeatedly have admonished, arguments raised for the first time in a reply
brief are not properly before a reviewing court.” (quotation and alteration omitted)). Further, the
policies exclude contractual liability from coverage.
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