                                                                           FILED
                            NOT FOR PUBLICATION
                                                                            JUL 29 2016
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT


PESTMASTER SERVICES, INC., a                     No.   14-56294
California Corporation,
                                                 D.C. No. 2:13-cv-05039-JFW-
              Plaintiff - Appellant,             MRW

 v.
                                                 MEMORANDUM*
TRAVELERS CASUALTY AND
SURETY COMPANY OF AMERICA, a
Connecticut Corporation,

              Defendant - Appellee.


                    Appeal from the United States District Court
                       for the Central District of California
                     John F. Walter, District Judge, Presiding

                         Argued and Submitted July 8, 2016
                               Pasadena, California

Before: VANASKIE,** MURGUIA, and WATFORD, Circuit Judges.




         *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
        **
            The Honorable Thomas I. Vanaskie, United States Circuit Judge for
the U.S. Court of Appeals for the Third Circuit, sitting by designation.
                                                                            Page 2 of 3
      The district court granted summary judgment to Travelers Casualty and

Surety Company on the ground that Pestmaster’s losses were not covered under its

Crime Policy. Pestmaster appeals this decision, alleging coverage under two

provisions.

      First, Pestmaster argues that the transfer of funds from its bank account to

Priority 1’s bank account is covered by the Funds Transfer Fraud provision. The

district court found that this provision “does not cover authorized or valid

electronic transactions . . . even though they are, or may be, associated with a

fraudulent scheme.” We agree that there is no coverage under this clause when the

transfers were expressly authorized.

      Second, Pestmaster seeks coverage under the Computer Fraud provision.

The Policy defines Computer Fraud as “[t]he use of any computer to fraudulently

cause a transfer . . . .” We interpret the phrase “fraudulently cause a transfer” to

require an unauthorized transfer of funds. When Priority 1 transferred funds

pursuant to authorization from Pestmaster, the transfer was not fraudulently

caused. Because computers are used in almost every business transaction, reading

this provision to cover all transfers that involve both a computer and fraud at some

point in the transaction would convert this Crime Policy into a “General Fraud”

Policy. While Travelers could have drafted this language more narrowly, we
                                                                          Page 3 of 3
believe protection against all fraud is not what was intended by this provision, and

not what Pestmaster could reasonably have expected this provision to cover.

      We accordingly affirm the district court’s decision that no coverage was

afforded under the Computer Fraud provision for any transfers to Priority 1 that

were authorized by Pestmaster. However, we remand to the district court to

determine whether the Computer Fraud provision or the Funds Transfer Fraud

provision covers the allegedly unauthorized transfers on May 23 and 27, 2011,

totaling $11,991.89. Each party to bear their own costs.

      AFFIRMED IN PART, VACATED IN PART, and REMANDED.
