                                                    [DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                     ________________________
                                                            FILED
                             No. 05-10934          U.S. COURT OF APPEALS
                     ________________________        ELEVENTH CIRCUIT
                                                      FEBRUARY 1, 2006
                                                      THOMAS K. KAHN
                    D. C. Docket No. 99-01319-CV-S
                                                           CLERK

HOME INSURANCE COMPANY, as successor in interest to
the Home Indemnity Company,
                                       Plaintiff-Appellant,


COLONIAL COMPANIES, INC.,
COLONIAL LIFE & ACCIDENT INSURANCE COMPANY,

                                          Plaintiffs-Third Party-Plaintiffs-
                                          Cross-Claimants-Appellants,

                               versus


HARTFORD FIRE INSURANCE COMPANY,
                                          Defendant.

TWIN CITY FIRE INSURANCE COMPANY,

                                          Defendant-Cross-Defendant-
                                          Appellee,

HARTFORD CASUALTY INSURANCE COMPANY,

                                           Third-Party-Defendant-
                                           Appellee.
                           ________________________

                   Appeals from the United States District Court
                       for the Middle District of Alabama
                         _________________________

                                 (February 1, 2006)

Before EDMONDSON, Chief Judge, BLACK and FAY, Circuit Judges.

FAY, Circuit Judge:

      This appeal involves a dispute over insurance coverage and finds the

insured and one of its carriers suing another carrier for contribution toward the

settlement of a claim by the insured’s employee. Plaintiff-appellant, Home

Insurance, seeks indemnity and reimbursement from defendant-appellee, Hartford

Insurance, for the $2 million that it paid to settle the claims of H. Parker White

against his employer Colonial Companies, Inc. The district court granted

summary judgment in favor of Hartford, holding that as a matter of law, Colonial

had intended to cause White harm, and that no “occurrence” had taken place as

defined in the policies. In addition, the district court dismissed Colonial’s bad faith

claim, holding that as a matter of law, Hartford owed no duty to defend Colonial

because coverage did not exist. We affirm.



                             I. Statement of the Facts:

                                          2
      Home Insurance Company (hereafter referred to as “Home”) insured

Colonial Life and Accident Insurance Company (hereafter referred to as

“Colonial”) under four comprehensive general liability policies that ran from

January 1, 1990, until January 1, 1994. Twin City Fire Insurance Company, a

subsidiary of Hartford Fire Insurance Company (hereafter referred to as

“Hartford”), insured Colonial under an umbrella policy that ran from January 1,

1994, until January 1, 1997. These policies provided “bodily injury” coverage for

those sums that the insured became legally obligated to pay, but only if such was

caused by an “occurrence” during the policy period. The policies define “bodily

injury” as “bodily injury, sickness or disease by a person, including mental

anguish or death resulting from these symptoms.” “Occurrence” is defined as “an

accident, including continuous or repeated exposure to substantially the same

general harmful conditions.”



Parker White’s Lawsuit

      On October 19, 1995, Parker White (hereafter referred to as “White”) sued

Colonial for intentional fraud and breach of contract, alleging that Colonial had

intentionally breached his contract by taking away certain accounts that had been

previously assigned to him on a permanent basis. Colonial is in the business of

                                         3
selling large group insurance coverage to employees of businesses through payroll

deduction plans. The Colonial representative who establishes these accounts is

entitled to a new business commission. In addition, the same representative is

entitled to a renewal commission every time an outstanding policy is renewed by

the insured. These commissions constituted the income of Colonial’s sales

representatives.

      According to the record, White had been a Marketing Director for Colonial

since 1980; however, in 1991, he agreed to take a demotion due to representations

made by Colonial. White contends that Colonial induced him to continue working

as a Sales Director, a demotion from Marketing Director, by promising him that he

would be assigned permanently 174 employer accounts. During a meeting that

took place in April, 1991, White claims that Bill Hinson, an employee of Colonial,

represented that White’s 174 accounts would be assigned to him on a permanent

basis. White then received a memo from Hinson which indicated that it was

Hinson’s understanding that for a period of two years, Colonial’s reassignment

policy would not apply to the 174 accounts. Under this reassignment policy, if an

account had not been worked on for 14 consecutive months, the account would

“roll up” to the representative’s Regional Director for reassignment to another

representative.

                                         4
      Upon receiving the Hinson memo, White met with Regional Director, Billy

Compton, to discuss this reassignment policy. Compton told White “not to worry

about the fact that there would be no permanent assignment of the 174 accounts,

because as long as he was Regional Director he would see that the accounts would

be reassigned to White.” However, in 1994, Don Fennell became the new

Regional Director, and in February or March, 1994, according to Colonial’s

reassignment policy, 25 of White’s accounts were “rolled up” to Fennell.

Notwithstanding the alleged agreement between White and Colonial, Fennell did

not reassign those 25 accounts back to White, instead he reassigned them to other

representatives. Indeed, White testified that this pattern of reassignment continued

until about half of his accounts were reassigned.

      White alleges that Colonial “engaged in a series of willful, malicious,

outrageous, deliberate and purposeful acts with the intention to inflict emotional

distress upon him.” White testified that not only did Colonial breach their contract

with him by not permanently assigning him the 174 employer accounts, but they

caused him severe emotional distress due to the loss of these economically

profitable accounts. The medical records of White’s internist, Dr. Paul Strong,

substantiate his claims of bodily injury. He has been treated for a heart attack,

depression, fatigue, alcoholism and impotence, all which were attributed to the

                                          5
above described activities of Colonial. White also claimed that he has seen a

psychologist for his depression and sleep problems.



Hartford’s Conduct in Refusing to Settle

      Recognizing that White was alleging claims that could possibly be covered

by the policies it had issued to Colonial, Hartford undertook a defense in the

White case. This was done under a “reservation of rights” letter. The case was

assigned to Sue Jackson (hereafter referred to as “Jackson”), an experienced

litigator. On November 17, 1995, Jackson hired Charles Stewart (hereafter

referred to as “Stewart”) to defend Colonial in the White case. On August 23,

1996, when Stewart took White’s deposition, he described the “bodily injury”and

“mental anguish” he had suffered due to the conduct of Colonial by virtue of its

deliberate breach of the agreement and the intentional reassignment of a large

number of his accounts. On November 13, 1997, Stewart submitted to Hartford his

personal status report on the White case. Stewart noted that White was seeking

both punitive and mental anguish damages, he further noted that the size of the

award of damages is generally left largely to the discretion of the jury. Stewart

stated that there was only a “50/50" chance of a defense verdict and it would be

wise to try and settle this matter. He also listed several jury verdicts which had

                                           6
been awarded in cases similar to the factual situation in the instant case. He stated

that the case of Lanier v. Old Republic, which was tried before the same judge

who was scheduled to hear the White case, ended with a $25 million verdict. He

went on to list several other cases, all which received double-digit million dollar

awards.



      On December 5, 1997, Stewart advised Hartford that this would be a good

time to settle this case. Hartford refused. On December 8, 1997, a conference call

was made between Jackson, Stewart, John Weidman of Home, and Jackie Winston

of Colonial. During this conference, Stewart suggested that in his opinion the case

could be settled for an amount between one and two million dollars. Hartford still

refused to contribute toward a settlement. On December 15, 1997, John Weidman

concluded that this case needed to be settled, and offered to contribute up to $1

million on behalf of Home. Hartford continued to refuse to participate.

Subsequently, Home offered White $500,000 to settle his claims. White denied

this offer. On December 16, 1997, Home offered $750,000 to settle, and White

again denied this offer.

      On December 18, 1997, Stewart sent a letter to Hartford and Home

forwarding copies of the medical testimony of Dr. Paul Strong. In Stewart’s

                                          7
opinion, Dr. Strong’s testimony was extremely damaging to the defense’s case. He

again advised all concerned that the matter should be settled. Hartford maintained

its position. Finally, on December 22, 1997, Hartford sent a different message to

Colonial concerning settlement negotiations. Hartford stated that since it believed

that White’s claim was not based upon an “occurrence,” as defined in the policies,

Home and Colonial needed to supply the majority of the money for any settlement.



      On December 29, 1997, White made his final settlement offer which would

only be open until noon, December 31. White demanded $2 million, and either an

additional $400,000, or a promise not to reassign any more of White’s accounts. In

the discussions with Home and Colonial, Hartford offered to contribute $250,000

toward a $2,400,000 settlement. This offer was conditioned upon Home and

Colonial agreeing not to sue for additional contribution. Home refused to give

such a release. Hartford refused to contribute toward a settlement. Ultimately,

Colonial and Home contributed the funds necessary to conclude a settlement.



Consent to Magistrate Judge

      On March 27, 2001, pursuant to the provisions of Title 28 U.S.C. 636(c)(1)

and Fed.R.Civ.P. 73, the parties consented to the United States Magistrate Judge

                                         8
conducting all proceedings in this case to final judgment.



                              II. Standard of Review

      We review rulings on motions for summary judgment de novo, applying the

same legal standards used by the district court. See Info. Sys. & Networks Corp. v.

City of Atlanta, 281 F.3d 1220, 1224 (11th Cir. 2002).



                                    III. Analysis

      The district court granted summary judgment in favor of Hartford,

concluding that Home and Colonial failed to demonstrate that there exists a

genuine issue of material fact regarding whether Colonial’s acts constituted an

“occurrence” under Hartford’s policies. Alternatively, the lower court ruled that

even if Colonial’s acts did constitute an “occurrence,” coverage fails to exist

because of the intentional act exclusion. We agree with both findings.



Summary Judgment Standard

      Under Fed.R.Civ.P. 56©) summary judgment is proper “if the pleadings,

depositions, answers to interrogatories, and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to any material fact and

                                          9
that the moving party is entitled to judgment as a matter of law. See Celotex Corp.

v. Catrett, 477 U.S. 317, 322 (1986). The party moving for summary judgment

“always bears the initial responsibility of informing the . . . court of the basis for

its motion, and identifying those portions of the pleadings . . . which it believes

demonstrate the absence of a genuine issue of material fact.” Catrett, 477 U.S. at

323. If the moving party succeeds in demonstrating the absence of a material issue

of fact, the burden shifts to the non-moving party to establish that a genuine issue

of fact material to the non-movant’s case exists. See Fitzpatrick v. City of Atlanta,

2 F.3d 1112, 1115-17 (11th Cir. 1993). After the nonmoving party has responded

to the motion for summary judgment, the court must grant summary judgment if

there remains no genuine issue of material fact and the moving party is entitled to

judgment as a matter of law. With these principles of law in mind, we review the

record.

      Home and Colonial argue that the district court erred in granting summary

judgment in favor of Hartford. They contend that according to South Carolina

law,1 a genuine issue of material fact is present as to whether Colonial’s acts

constitute “occurrences,” as defined in the policies, and that Hartford failed to

prove that Colonial intended a specific injury to White.

      1
          The parties agree that South Carolina law controls the issue.

                                                 10
      The insurance policies at issue provide “bodily injury” coverage for those

sums that the insured becomes legally obligated to pay, but only if such damages

were caused by an “occurrence”which happened during the policy period.

“Occurrence” is defined as “an accident,” including continuous or repeated

exposure to substantially the same general harmful conditions. In addition, the

policies also contained an intentional act exclusion, “for bodily injury . . . expected

or intended from the standpoint of the insured.”

      First, Home and Colonial contend that a genuine issue of material fact exists

as to whether Colonial’s acts are deemed an “occurrence.” They argue that

because the policies fail to define the term “accident,” this court must look to other

common understandings of that term. Consequently, when a policy does not

specifically define a term, “the term should be defined according to the usual

understanding of the term’s significance to the ordinary person.” Manufacturers &

Merchants Mut. Ins. Co. v. Harvey, 498 S.E.2d 222, 225 (S.C. Ct. App. 1998).

Because the contracts at issue were created in South Carolina, we will look to the

law of South Carolina for a definition of the term “accident.” The parties cite a

plethora of cases to answer this question. However, we find the most persuasive

authority to be Geothe v. New York Life Ins. Co., 190 S.E. 451 (S.C. 1937). In

Geothe, the Supreme Court of South Carolina considered whether an insured had

                                          11
died of accidental means when he collapsed from a heatstroke after attempting to

put out a fire. The Supreme Court of South Carolina concluded the insured died of

accidental means, holding:

      [W]hen injury or death follows or results from a voluntary act of the
      insured, and the act is one which is not manifestly dangerous, but
      which is ordinarily done or performed without serious consequences
      to the doer, such result is caused by accidental means. . . . “An effect
      which does not ordinarily follow and cannot be reasonably
      anticipated from the use of those means, an effect which the actor did
      not intend to produce and * * * cannot be charged with the design of
      producing, * * * is produced by accidental means.”

Geothe, at 458 (citation omitted).

      According to Geothe, "accident" or "accidental means," is an injury or death

that does not ordinarily follow and “cannot be reasonably anticipated” from the act

of the insured. Colonial contends that even though it may have intentionally

breached its agreement with White, at no time did it “intend” to cause White any

specific non-economic injuries. However, Home and Colonial have pointed to no

issues of disputed fact regarding the intentional nature of Colonial’s acts.

      The facts as alleged and set forth in testimony clearly demonstrate that the

conduct of Colonial was knowing and intentional. According to the record, White

alleges that he was the target of Colonial's wrongful conduct, which he described

as "willful, malicious, outrageous, deliberate and purposeful.” According to



                                         12
White’s deposition, he had worked for Colonial for many years when, in March

1991 Colonial "manipulated" him into taking a demotion from his position as

Marketing Director by fraudulently promising him 174 accounts on a permanent

basis. Soon thereafter, White realized that Colonial had no intention of keeping its

promise. The uncontradicted testimony shows that during extensive discussions

following the reassignment of the first 25 accounts, Fennell made it clear that he

had no intention of honoring the agreement. Thereafter, White’s accounts

continued to be reassigned. This caused a substantial reduction in his income and

the resulting health problems.

      Even though Colonial argues that it never intended to cause depression,

alcoholism, and impotency to White, it has failed to present a scintilla of evidence

going to prove that its conduct was not deliberate.

      There is simply no dispute, based upon a review of the record, that

Colonial’s acts were intentional and done to harm. By their very nature these acts

could not be called accidents, and thus could not constitute “occurrences” as

defined in the policies. Accordingly, this court finds that Home and Colonial have

failed to demonstrate that there exists a genuine issue of material fact regarding

whether or not Colonial’s acts constituted an “occurrence” under Hartford’s

policies.

                                         13
      This does not end our analysis, however, because under South Carolina law

there are two prongs to an intentional act exclusion. The above discussion

involves the first prong. We now turn to the second.

      Home and Colonial argue that unless Hartford can demonstrate that

Colonial specifically intended or expected its actions to cause White’s alcoholism,

depression, and impotency, the intentional act exclusion does not apply. Colonial

and Home rely on State Farm Mut. Auto. Ins. Co. v. Moorer, 496 S.E.2d 875 (S.C.

Ct. App. 1998), to assert that even if an insured intends to commit an act, the event

is still an “occurrence,” so long as the insured did not intend to cause the injury

which resulted. This reliance is misplaced. In Vermont Mut. Ins. Co. v. Singleton,

446 S.E.2d 417, 419 (S.C. 1994), the South Carolina Supreme Court explains its

two-prong test to determine the applicability of an intentional act exclusion in an

insurance policy. The first prong of the test is met because, as set forth above, the

acts complained of were clearly done knowingly and intentionally. The second

prong of the test requires “an intentional result.” In Singleton, the insured struck

the victim in the head inflicting a serious eye injury. As it turns out, the facts

revealed that this was done in self defense. The court held that because the

intended result was self-defense and not an eye injury to the victim, the intentional

act exclusion did not apply. In other words, the eye injury was accidental.

                                           14
       Hartford contends that the undisputed facts in this case prove that Colonial

engaged in a series of intentional acts that were so inherently injurious, that non-

economic injuries are inferred as a matter of law. It argues that Harvey, stands for

this proposition. In Harvey, the court considered whether homeowners insurance

policies provided coverage against claims that the insureds sexually abused their

grandchildren. The policy in Harvey contained language identical to that of the

policies sub judice.2 The Court of Appeals of South Carolina concluded that

because "[T]he sexual abuse of a child is so inherently injurious . . . [the] intent to

harm the child will be inferred as a matter of law." Harvey, 498 S.E.2d at 226. In

addition, the court held, “[T]he effect of sexual abuse is so integral to the act that

the intent to do the act is interchangeable with the intent to cause the resulting

injury.” Id. at 227.

       As illustrated in Harvey, the inquiry of the court is whether harm was

intended, not whether a specific type of harm was intended. We find this case

much closer to Harvey than to Singleton. As set forth in Harvey, some acts are so

inherently injurious that the intent to harm will be inferred. No reasonably prudent

person could fail to know that if you: (1) take away a substantial portion of a



       2
        Harvey defined "occurrence" as an "accident," and the policies did not define the term
"accident.”

                                               15
person’s income, (2) demote them within the organization, (3) embarrass them

with their co-workers, and (4) separate them from their established clients-----

non-economic bodily injuries are most certainty going to result.

       Although we find no case in South Carolina identical to ours, we believe the

reasoning in Harvey controls. According to the record, White lost his managerial

position at Colonial, had about half of his commission-based contracts reassigned

resulting in a drastic reduction of income, was manipulated into taking a job

demotion, was ridiculed in front of his colleagues, and was separated from his

clients. We believe that it is outside the range of reasonableness to hold that a

person who has suffered from such acts would only incur economic damages.

Consequently, we find that Hartford has met both prongs of Singleton.3



“Personal Injury” Coverage

       Home contends that the district court erred by failing to consider if White’s

claims of disparagement, humiliation and discrimination fall within the Hartford

coverage for “Personal Injury.” The Hartford policy covers “personal injury”

which is defined to include; “publication of material that slanders or libels a



       3
          As set forth above, and according to the law of South Carolina, because coverage did
not exist under the Hartford policies, Colonial’s bad faith claim has no merit.

                                               16
person or organization or disparages a person’s or organizations’s goods, products

or services” and “discrimination or humiliation that results in injury to the feelings

or reputation of a natural person . . .” Home contends that White made claims of

discrimination, humiliation and disparagement, and it was error for the district

court to grant summary judgment in favor of Hartford without considering whether

these claims are covered under the Hartford policy.

      This argument is misplaced. Similar to the term “occurrence” in the

Hartford policies, “personal injury” coverage applies only if the discrimination or

humiliation was “not done intentionally by or at the direction of the insured . . . . “

As set forth above, Colonial’s actions toward White were knowingly and willfully

committed. Therefore, any discrimination and humiliation Colonial caused White,

would have been intentional, and thus outside the scope of “personal injury”

coverage.



                                     Conclusion

      Our review of the record convinces us that the district court was correct in

granting summary judgment in favor of Hartford. There is no genuine issue of

material fact regarding whether Colonial’s acts constituted an “occurrence.” The

conduct in question was deliberate and intentional. In addition, Hartford has

                                          17
established that both prongs of the intentional act exclusion as set forth in the law

of South Carolina exist.

      AFFIRMED.




                                         18
