Jacob Horn v. Liberty Insurance Underwriters, Inc. ( 2021 )

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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-12525
________________________
D.C. Docket No. 9:18-cv-80762-RLR
JACOB HORN,
individually and on behalf of all others similarly situated as assignees of
Ican Benefit Group LLC, a Florida Limited Liability company,
ROBERT VETTER,
individually and on behalf of all others similarly situated as assignees of
Ican Benefit Group LLC, a Florida Limited Liability company,
Plaintiffs-Appellants,
versus
LIBERTY INSURANCE UNDERWRITERS, INC.,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(June 1, 2021)
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Before MARTIN, NEWSOM, and BRANCH, Circuit Judges.
BRANCH, Circuit Judge:
This appeal requires us to interpret an insurance agreement between iCan
Benefit Group, LLC, a Florida company, and its insurance provider, Liberty
Insurance Underwriters, Inc. We must determine, under Florida law, whether a
policy exclusion barring coverage for “[c]laims . . . arising out of . . . an invasion
of privacy” excludes coverage for claims alleging violations of the Telephone
Consumer Protection Act of 1991 (“TCPA”) in which the complaint repeatedly
alleges that the defendants invaded the privacy of the plaintiffs.1 We hold that the
invasion of privacy exclusion unambiguously does so.
The insured, iCan, is not before our Court. Rather, the appellants are a class
of consumers that sued iCan asserting two causes of action for TCPA violations.
After the consumers filed suit, iCan sought coverage for the claims under its
insurance policy, but Liberty denied iCan’s request. iCan then settled the lawsuit.
In exchange for the class plaintiffs’ promise not to enforce the judgment against
iCan, iCan admitted to liability for $60,413,112 in damages, settled the suit, and
assigned all of its rights against its insurer, Liberty, to the plaintiffs. When the
plaintiffs attempted to enforce the judgment against Liberty, the district court
determined that the insurance policy did not cover the settled class claims because
1
See Pub. L. No. 102-243, 105 Stat. 2394 (codified as amended at 47 U.S.C. § 227).
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the TCPA causes of action were “[c]laims . . . arising out of . . . an invasion of
privacy.” Because we agree with the district court’s interpretation of the policy
exclusion at issue, we affirm the district court’s grant of summary judgment to
Liberty.
I. Background
A. The Class Action Lawsuit
The class action lawsuit at issue in this appeal revolved around iCan sending
“unsolicited text messages to cellular telephones without the . . . consent of the
recipients.” The class complaint, brought by class representative Jacob Horn,
specifically alleged two causes of action—both for TCPA violations: one for
violations of 47 U.S.C. § 227(b)(1)(A)(iii),2 and one for violations of 47 U.S.C.
§ 227(b)(1)(B). 3
2
In the first cause of action, Horn and the “Autodialed No Consent Class”—a class of
plaintiffs that allegedly received text messages from iCan without properly consenting—claimed
that iCan violated § 227(b)(1)(A)(iii) of the TCPA. That provision makes it unlawful for any
person “to make any call (other than a call made for emergency purposes or made with the prior
express consent of the called party) using any automatic telephone dialing system or an artificial
or prerecorded voice” to a cellphone.
3
In the second cause of action, Horn and the “Autodialed Stop Class”—a class of
plaintiffs that allegedly received text messages from iCan after informing iCan they no longer
wanted to receive messages—claimed that iCan violated § 227(b)(1)(B) of the TCPA. That
provision makes it unlawful for any person “to initiate any telephone call to any residential
telephone line using an artificial or prerecorded voice to deliver a message without the prior
express consent of the called party, unless the call is initiated for emergency purposes, is made
solely pursuant to the collection of a debt owed to or guaranteed by the United States, or is
exempted by rule or order by the Commission under paragraph (2)(B).”
3
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The complaint alleged that iCan “not only invaded the personal privacy of
Plaintiff and members of the putative Classes, but also intentionally and repeatedly
violated the TCPA.” It also alleged that “iCan has caused consumers actual harm
in the form of annoyance, nuisance, and invasion of privacy,” and that “the text
messages disturbed Horn’s use and enjoyment of his phone, in addition to the wear
and tear on the phone’s hardware (including the phone’s battery) and the
consumption of memory on Horn’s phone.” The class action sought actual and
statutory damages for the alleged TCPA violations.
B. The Insurance Policy
At the time the class action was filed, iCan was insured by Liberty. Under
the liability policy provision of their insurance agreement, Liberty was obligated to
“pay on behalf of [iCan] Loss which the Company becomes legally obligated to
pay by reason of any Claim . . . for any Wrongful Acts by the Company taking
place prior to the end of the Policy Period.” The insurance policy defined the term
“Claim” as, among other things, “a civil proceeding against any Insured
commenced by the service of a complaint or similar pleading.” The policy also
listed several exclusions to the liability provision. Relevant here, the policy
provided:
[Liberty] shall not be liable under [the coverage provision] for Loss
on account of any Claim made against [iCan] . . . based upon, arising
out of, or attributable to any actual or alleged defamation, invasion of
privacy, wrongful entry or eviction, false arrest or imprisonment,
4
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malicious prosecution, abuse of process, assault, battery or loss of
consortium[.]4
Doc. 56-1 at 19 (emphasis added) (hereinafter “invasion of privacy exclusion”).5
C. Liberty’s Refusal to Cover and Defend
After the class action was filed, iCan asked Liberty to defend and indemnify
it in the lawsuit, but Liberty declined to do so. Liberty wrote iCan a letter that
included several justifications for denying coverage under the policy—one of
which was that the invasion of privacy exclusion applied because the complaint
was “based upon allegations that [the class members’] privacy rights were violated
by [iCan] sending unsolicited text messages.”
D. The Settlement Agreement
After iCan received the coverage denial letter from Liberty, it entered into a
settlement agreement with the class plaintiffs. iCan agreed it was liable to the class
for $60,413,112. That aggregate amount was not broken down into “actual” versus
“statutory” damages, nor was the amount broken down into loss that arose from
privacy harms versus loss that arose from nuisance, annoyance, or property
4
The policy also excluded coverage for “Claims”:
based upon, arising out of, or attributable to any actual or alleged price fixing,
restraint or trade, monopolization, unfair trade practices or any violation of the
Federal Trade Commission Act, Sherman Anti-Trust Act, Clayton Act, or any
similar law regulating anti-trust, monopoly, price fixing, price discrimination,
predatory pricing or restraint on trade activities[.]
5
“Doc.” numbers refer to the district court’s docket entries.
5
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damage. The agreement provided that “the Judgment may not be satisfied from or
executed on any assets or property of iCan,” but “shall only be satisfied from
Liberty.” The agreement assigned iCan’s rights against Liberty under its insurance
policy to the class plaintiffs. After a fairness hearing, the district court approved
the class action settlement.
E. The Declaratory Judgment Action
To recover under the settlement agreement, the class plaintiffs filed an
action against Liberty seeking declaratory relief that it was entitled to recover
under the policy. 6 After Liberty’s motion to dismiss the action was denied, both
parties moved for summary judgment. The class plaintiffs argued that iCan’s
insurance policy covered the class action, which meant that Liberty had a duty to
defend and indemnify iCan in the lawsuit, while Liberty argued that the invasion of
privacy exclusion applied to the class action and precluded recovery.7 Liberty also
argued, in its opposition to the class plaintiffs’ motion for summary judgment, that
6
Even though iCan agreed that it was liable to the class for $60,413,112, the class sought
a declaration that it was entitled to recover only $2,000,000—the policy liability limit for
covered claims.
7
Liberty also argued in its motion for summary judgment that the policy’s professional
services exclusion precluded recovery. The district court did not consider that argument because
it found that the invasion of privacy exclusion precluded recovery. Because we agree with the
district court that the invasion of privacy exclusion precluded recovery, we do not address
Liberty’s argument that the professional services exclusion also precludes recovery.
6
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the class could not recover under the policy in any event because iCan failed to
allocate between covered and noncovered losses in the settlement agreement.
The district court granted Liberty’s motion for summary judgment. It
concluded that the insurance policy’s invasion of privacy exclusion applied to the
class action lawsuit and barred coverage for the entire action. The district court
also concluded, in the alternative, that even if only some of the settled losses were
precluded by the invasion of privacy exclusion, iCan’s failure to allocate the
underlying settlement agreement into covered and noncovered loss precluded
recovery for any remaining covered loss.8 The class plaintiffs appealed.
II. Standard of Review
“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). Summary
judgment is appropriate only where there is “no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a).
8
The general rule in Florida is that the party seeking recovery has a duty to allocate a
settlement amount between covered and noncovered claims. See Keller Indus., Inc. v. Emps.
Mut. Liab. Ins. Co. of Wis., 429 So. 2d 779, 780 (Fla. 3d Dist. Ct. App. 1983). The class
plaintiffs argue that Florida’s general allocation rule did not apply to the iCan class settlement.
Because we agree with the district court’s determination that the invasion of privacy exclusion
barred the class from recovering under the settlement agreement, we do not address the district
court’s determination that iCan and the class plaintiffs’ failure to allocate in the settlement
agreement also precluded any recovery.
7
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III. Discussion
To resolve this appeal, we must interpret the insurance policy exclusion
which provides that Liberty “shall not be liable . . . for Loss on account of any
Claim made against [iCan] . . . based upon, arising out of, or attributable to any
actual or alleged . . . invasion of privacy.” The class plaintiffs argue that the class
action is not excluded from coverage by the invasion of privacy exclusion because
the class action alleged harms other than invasion of privacy, TCPA claims do not
include an element of invasion of privacy, and, at the very least, the exclusion is
ambiguous and should be resolved in favor of coverage.
The parties agree that Florida law controls the interpretation of the insurance
policy in this case. Under Florida law, we read iCan’s insurance policy “as a
whole, endeavoring to give every provision its full meaning and operative effect.”
Auto–Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000); see also Fla.
Stat. § 627.419(1) (“Every insurance contract shall be construed according to the
entirety of its terms and conditions as set forth in the policy[.]”). Policy terms are
given “their everyday meaning and read in light of the skill and experience of
ordinary people.” Lindheimer v. St. Paul Fire & Marine Ins. Co., 643 So. 2d 636,
638 (Fla. 3d Dist. Ct. App. 1994). Further, the law in Florida “[is] that insurance
coverage must be construed broadly and its exclusions narrowly.” Hudson v.
Prudential Prop. & Cas. Ins. Co., 450 So. 2d 565, 568 (Fla. 2d Dist. Ct. App.
8
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1984). Given that general rule, ambiguities are construed against the insurer and in
favor of coverage, but “to allow for such a construction the provision must actually
be ambiguous.” Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d 528,
532 (Fla. 2005). “Only when a genuine inconsistency, uncertainty, or ambiguity in
meaning remains after resort to the ordinary rules of construction is the rule [that
ambiguities are resolved in favor of coverage] apposite.” Excelsior Ins. Co. v.
Pomona Park Bar & Package Store, 369 So. 2d 938, 942 (Fla. 1979); Swire Pac.
Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161, 165 (Fla. 2003) (“[S]imply
because a provision is complex and requires analysis for application, it is not
automatically rendered ambiguous.”).
To give the invasion of privacy exclusion its “full meaning and operative
effect,” we focus our analysis on three of the operative terms in the invasion of
privacy exclusion: (1) “Claim”; (2) “arising out of”; and (3) “invasion of privacy.”
A. “Claim”
We turn first to the term “Claim.” In considering this term, we are not “to
rewrite [it], add meaning that is not present, or otherwise reach results contrary to
the intentions of the parties.” Excelsior Ins. Co., 369 So. 2d at 942; see also State
Farm Fire & Cas. Ins. Co. v. Deni Assocs. of Fla., Inc., 678 So. 2d 397, 401 (Fla.
4th Dist. Ct. App. 1996) (“Where the insurer has defined a term used in the policy
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in clear, simple, non-technical language . . . judges are [not] empowered to give the
defined term a different meaning deemed more . . . desirable to the insured.”).
Interpreting the term “Claim” here is simple because the insurance policy
itself clearly and thoroughly defines the term as “a civil proceeding against any
Insured commenced by the service of a complaint or similar pleading.” In this
case, therefore, the claim is the civil proceeding against iCan commenced by the
service of the class action complaint. Accordingly, if any of the allegations of the
complaint are excluded from coverage, the entire lawsuit is excluded, even if the
complaint contains allegations that would otherwise be covered.
This interpretation—that the “claim” is the entire “civil proceeding”—
is quite broad. But the rule requiring us to construe exclusions narrowly does not
mean that expansive definitions in insurance policies are impermissible. And
although it may be more “desirable to the insured”—or here the class plaintiffs—to
read the term “Claim” narrowly in this case, the clear policy language prevents us
from doing so. If we find the civil proceeding “arose out of . . . an invasion of
privacy,” Liberty is not liable for any of the consent judgment.
B. “arising out of”
“Arising out of” is a term of art regularly used in insurance policies. The
Supreme Court of Florida has interpreted the phrase broadly and held that it is
“broader in meaning than the term ‘caused by’ and means ‘originating from,’
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‘having its origin in,’ ‘growing out of,’ ‘flowing from,’ ‘incident to’ or ‘having a
connection with.’” Taurus Holdings, 913 So. 2d at 539 (quoting Hagen v. Aetna
Cas. & Sur. Co., 675 So. 2d 963, 965 (Fla. 5th Dist. Ct. App. 1996)). Florida’s
broad interpretation of the phrase “arising out of” means that if the class action
even “ha[s] a connection with” the invasion of privacy, the lawsuit falls under the
invasion of privacy exclusion. See id.C. “invasion of privacy”
The final step in our analysis is for us to determine whether the class action
arose out of an “invasion of privacy.” We conclude that it did because the class
complaint specifically alleged that iCan intentionally invaded the class members’
privacy and sought recovery for those invasions. The class complaint alleged that:
• “Defendant not only invaded the personal privacy of Plaintiffs and
members of the putative Classes, but also intentionally and repeatedly
violated the TCPA.”
• “By sending the text messages at issue in this Complaint . . . ,
Defendant caused Plaintiffs and the other members of the Classes
actual harm and cognizable legal injury. This includes . . . invasions
of privacy that result from the sending and receipt of such text
messages[.]”
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• “By sending the unauthorized text messages as alleged herein, iCan
caused Plaintiff actual harm in the form of . . . invasion of privacy.”
• The TCPA allows certain persons to “bring a private action based on a
violation of said regulations, which were promulgated to protect
telephone subscribers’ privacy rights to avoid receiving telephone
solicitations to which they object.”
These allegations show that the class claim clearly “ha[s] a connection with” the
invasion of privacy.9 Taurus Holdings, 913 So. 2d at 539. Accordingly, as the
“civil proceeding” in this case “arises out of” an “invasion of privacy,” the
invasion of privacy exclusion in the insurance policy applies. 10 Like the district
9
While we are not, as the dissent suggests, building a trap for the unwary who
“colloquially” include allegations of invasions of privacy in their complaint, we also need not
save the plaintiffs from themselves. We cannot ignore the fact that the class complaint
repeatedly alleges and seeks damages for the invasion of privacy the text messages in the
underlying class action caused. We also note that in the typical case, an unwary plaintiff could
amend his complaint to remove any “inadvertent” phrases, although the unique procedural
posture in this case would not permit it.
10
The class plaintiffs argue that even if the policy excluded the class action, Liberty still
had a duty to defend iCan because an insurer’s “duty to defend is . . . broader than [its] duty to
indemnify.” Lime Tree Vill., 980 F.2d at 1405 (quoting Baron Oil Co. v. Nationwide Mut. Fire
Ins. Co., 470 So. 2d 810, 813–14 (Fla. 1st Dist. Ct. App. 1985)).
In Florida, an insurer must defend where the “complaint alleges facts that fairly and
potentially bring the suit within policy coverage.” Jones v. Fla. Ins. Guar. Ass’n, Inc., 908 So.
2d 435, 442–43 (Fla. 2005) (per curiam). If the complaint’s allegations leave any doubt as to the
duty to defend, the question must be resolved in favor of the insured. Trizec Props. v. Biltmore
Const. Co., 767 F.2d 810, 812 (11th Cir. 1985); Baron Oil, 470 So. 2d at 814. Although the
class plaintiffs are correct that the duty to defend is broader than the duty to indemnify loss, “[a]
duty to defend does not create coverage where coverage does not exist.” Colony Ins. Co. v. G &
E Tires & Serv., Inc., 777 So. 2d 1034, 1038 (Fla. 1st Dist. Ct. App. 2000).
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court, we need not determine whether TCPA violations are per se invasions of
privacy to reach the conclusion that, in this case, the “civil proceeding” arose out
of an “invasion of privacy.”11
The class plaintiffs and the dissent assert that the invasion of privacy
exclusion is ambiguous, and should be construed in the favor of coverage, because
one reasonable interpretation is that, by listing multiple common law tort causes of
After construing iCan’s insurance policy as a whole, we find that the policy does not
provide coverage for the class action, so we reject the class plaintiffs’ argument that Liberty had
a duty to defend the class action lawsuit.
11
Liberty urges us to adopt the Ninth Circuit’s approach to this issue and hold that “a
TCPA claim is, by its nature, an invasion of privacy claim.” L.A. Lakers, Inc. v. Fed. Ins. Co.,
869 F.3d 795, 799 (9th Cir. 2017). Under the Los Angeles Lakers approach, “a liability
insurance policy that unequivocally and broadly excludes coverage for invasion of privacy
claims also excludes coverage for TCPA claims.” Id.We acknowledge that in enacting the TCPA, Congress found that banning robocalls was
“the only effective means of protecting telephone consumers from this nuisance and privacy
invasion.” See TCPA § 2; Barr v. Am. Ass’n of Pol. Consultants, Inc., 140 S. Ct. 2335, 2344
(2020). Further, the TCPA explains that Congress passed the TCPA to protect the “privacy
rights” of consumers. See 47 U.S.C. § 227(b)(2)(C) (providing that the Commission may
promulgate rules “in the interest of the privacy rights this section is intended to protect”). The
Supreme Court has likewise recognized this connection. Barr, 140 S. Ct. at 2348 (noting that
“Congress’s continuing broad prohibition of robocalls amply demonstrates Congress’s
continuing interest in consumer privacy”).
Although we acknowledge the TCPA’s connection to invasions of privacy that the Ninth
Circuit relied on in Los Angeles Lakers, we need not address in this case whether every TCPA
claim is by its nature an invasion of privacy claim because of the broad qualifying language in
iCan’s insurance policy.
Because we do not address whether TCPA claims are per se claims for invasion of
privacy, we need not address the class plaintiffs’ argument, adopted by the dissent in Los
Angeles Lakers, that because the TCPA does not include an element of invasion of privacy, that
TCPA claims are not claims for invasion of privacy. See 869 F.3d at 807 (Tallman, J.,
dissenting) (“When Congress defines a cause of action based on specific and unambiguous
statutory elements, what matters is what the statute says—not what motivated enactment of the
statute.”).
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action but not statutory causes of action like the TCPA, the exclusion does not
reach a TCPA claim. 12 In other words, the class plaintiffs and dissent argue that
the exclusion applies only to common law torts, and the complaint does not allege
the common law tort of invasion of privacy. 13 This argument is unavailing.
The insurance policy does not cabin the invasion of privacy exclusion to
claims alleging those listed tort causes of action, rather it broadly excludes “civil
proceedings” “arising out of” an “invasion of privacy.” As explained above, when
we construe the policy “as a whole” and “give meaning to each of its provisions,”
as we must, the invasion of privacy exclusion unambiguously excludes the class
action—which is a civil proceeding arising out of an invasion of privacy—from
coverage. Auto–Owners Ins. Co., 756 So. 2d at 34; Excelsior Ins. Co., 369 So. 2d
at 942 (“Only when a genuine inconsistency, uncertainty, or ambiguity in meaning
remains after resort to the ordinary rules of construction is the rule [that
ambiguities are resolved in favor of coverage] apposite.”).
12
Plaintiffs also argue that the invasion of privacy exclusion is ambiguous because the
insurance policy contains a separate exclusion which lists several federal statutes, not including
the TCPA. See note 4, supra. As an initial matter, we note that neither party has argued this
other exclusion applies here. And we are not persuaded by an argument that, because one
exclusion does not apply, another applicable exclusion is somehow rendered ambiguous.
13
The dissent says that we hold that the invasion of privacy exclusion “cannot even
reasonably be understood to refer to the century-old common-law tort called ‘invasion of
privacy.’” Not so. We hold, after analyzing the entire provision, that the exclusion cannot be
reasonably understood to refer only to a cause of action for the tort of invasion of privacy. While
the language would certainly cover—and thus exclude—an action for the tort of invasion of
privacy, it is broader than just that when the exclusion is read as a whole.
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It is true, as the dissent explains, that “[i]f the relevant policy language is
susceptible to more than one reasonable interpretation, one providing coverage and
another limiting coverage, the insurance policy is considered ambiguous.” Garcia
v. Fed. Ins. Co., 969 So. 2d 288, 291 (Fla. 2007) (quoting Auto-Owners Ins. Co.,
756 So. 2d at 34). But the dissent’s proposed “alternative interpretation” is not
reasonable because it ignores the surrounding language in the policy—specifically
the phrase “arising out of,” which is crucial to our analysis.14 Notably, the dissent
omits that phrase from its analysis and suggests that a plaintiff must state a
common law tort claim to trigger the coverage exclusion provision. That position
contravenes the Florida Supreme Court’s broad interpretation of the phrase
because it would transform the phrase “arising out of” or “having a connection
with” into “for” any “invasion of privacy” in the tort sense. But the policy as
written cannot bear that interpretation, and it is not our role to modify the terms of
a contract.
Accordingly, although we acknowledge that “invasion of privacy” is the
name of a common law tort, we cannot simply analyze the phrase, as the dissent
proposes, without heeding the interpretive constraints imposed by the other terms
in the policy.
14
We note that the dissent does not dispute that the policy definition of “Claim” and the
interpretation by Florida courts of the phrase “arising out of” are quite broad and control the
interpretation of the invasion of privacy exclusion.
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IV. Conclusion
Because the invasion of privacy exclusion barred coverage for the class
action, we affirm the district court’s grant of summary judgment to Liberty.
AFFIRMED.
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NEWSOM, Circuit Judge, dissenting:
The Court holds that a term in an insurance policy that excludes coverage for
claims arising out of an “invasion of privacy” cannot even reasonably be
understood to refer to the century-old common-law tort called “invasion of
privacy.” I disagree—not only is the exclusion provision at least susceptible of
that interpretation, it is, to my mind, best read that way. Accordingly, I
respectfully dissent.
I
I agree with the Court’s account of the factual and procedural history
underlying this appeal. Liberty Insurance issued a policy to iCan Holdings that
generally committed Liberty to covering damages that iCan incurred in lawsuits.
But the policy contained a provision—the meaning of which is determinative of
this case—that excluded certain kinds of claims from the coverage that Liberty
would provide:
[Liberty] shall not be liable under [the policy] for Loss on account of
any Claim made against [iCan] . . . based upon, arising out of, or
attributable to any actual or alleged defamation, invasion of privacy,
wrongful entry or eviction, false arrest or imprisonment, malicious
prosecution, abuse of process, assault, battery or loss of consortium.
While the policy was in effect, a class of plaintiffs sued iCan. They brought four
counts, all under the Telephone Consumer Protection Act, 47 U.S.C. § 227,
alleging that iCan had sent them unwelcome robotexts.
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The TCPA provides a private cause of action to recipients of robocalls and
robotexts. To prove a TCPA violation, a plaintiff generally must prove that the
defendant made a robocall or sent a robotext without the plaintiff’s consent. See
47 U.S.C. § 227(b)(1); 47 C.F.R. § 64.12000. Although the class plaintiffs’
complaint in this case at times colloquially characterized iCan’s robotexts as
involving “invasions of privacy,” it didn’t contain any counts alleging the
common-law tort of invasion of privacy.
The district court nonetheless concluded that the policy provision quoted
above—which refers to claims arising out of an “invasion of privacy”—
unambiguously excluded the class plaintiffs’ TCPA claims from coverage. It also
held that even if the claims weren’t excluded, iCan’s failure to allocate losses
precluded it from recovering here.
II
A
The following propositions are, I think, incontestable. First, Florida law
requires us to interpret “any ambiguities” in an insurance contract “against the
insurer and in favor of coverage.” U.S. Fire Ins. Co. v. J.S.U.B., Inc., 979 So. 2d
871, 877 (Fla. 2007). Second, a contract provision is ambiguous if it is susceptible
of “more than one reasonable interpretation.” Garcia v. Fed. Ins. Co., 969 So. 2d
288, 291 (Fla. 2007). And third, the class plaintiffs in the underlying lawsuit here
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neither (1) brought a count for the tort of “invasion of privacy” nor (2) alleged
facts that would state a claim for that tort.1
Therefore, if the policy exclusion is ambiguous as to whether it refers to the
common-law tort called “invasion of privacy”—in other words, if it could
reasonably be so interpreted—then we must interpret it to refer only to that tort.
And if that’s how we have to interpret the exclusion, then it can’t exclude the class
plaintiffs’ lawsuit from coverage because the suit doesn’t arise out of an invasion
of privacy in the tort sense.
1
Here’s why the plaintiffs didn’t allege facts that would state a tort claim for invasion of
privacy: Only one type of invasion-of-privacy claim, the “invasion of privacy by intrusion,” is
even roughly analogous to the facts alleged in the plaintiffs’ complaint. To establish an invasion
of privacy by intrusion, a plaintiff typically must prove (1) an intentional intrusion (2) into a
matter that he has a right to keep private (3) by a method highly offensive to the reasonable
person or in such a manner as to cause outrage or mental suffering. See 62A Am. Jur. 2d Privacy
§ 34; 77 C.J.R. Right of Privacy and Publicity § 24. As to element (3), Florida courts
adjudicating invasion-of-privacy-by-intrusion claims require evidence of an invasion that is
“indecent and outrageous and calculated to cause . . . excruciating mental pain.” Stoddard v.
Wohlfahrt, 573 So. 2d 1060, 1063 (Fla. Dist. Ct. App. 1991).
In this case, the class plaintiffs’ complaint alleged that iCan sent unwelcome robotexts
offering help getting insurance. It didn’t allege that the texts were calculated to cause
excruciating mental pain. Florida courts have specifically held that unsolicited contact by phone,
including in ways far more offensive and personal than what the plaintiffs alleged here, doesn’t
satisfy element (3) of the invasion-of-privacy-by-intrusion tort. See Stoddard, 573 So. 2d at
1061 (holding that two unsolicited phone calls with threatening and vulgar words didn’t
constitute invasion of privacy). Tort treatises confirm that conclusion. For unsolicited phone
messages to “render the caller or seller liable in tort for an invasion of privacy,” they say, the
“intrusion supporting liability must be repeated [and] persistent.” R. Keith Perkins, Unsolicited
telephone calls and other forms of communication, Domestic Torts § 6:7 (2020). The contact
must also be “offensive to a person of ordinary sensibilities,” which depends on “whether the
language used was vile, vicious, abusive, or profane; the late hour of the intrusion; the number of
intrusions; the presence of publicity surrounding the intrusion; and the malicious falsity of the
defendant’s intrusive messages.” Id. By any reading, the facts alleged here fall short of that
standard.
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B
The Court holds that it is unreasonable to interpret the policy exclusion’s
term “invasion of privacy” to refer to the tort bearing that name. See Maj. Op. at
13–15. The Court reasons that the term instead unambiguously refers to any
lawsuit in which a plaintiff includes the words “invasion of privacy” in her
complaint. Id. at 11–13. The plaintiffs here alleged, for instance, that in violating
the TCPA, iCan “invaded the[ir] personal privacy” and subjected them to
“aggravation and nuisance and invasions of privacy.” Compl. at 4–5. According
to the Court, the policy exclusion absolves Liberty of responsibility for insuring
iCan against—so far as I can tell—any complaint that, like the one here,
colloquially (and conclusorily) uses the term “invasion of privacy,” no matter what
the complaint was really about or what concrete facts it alleged. See Maj. Op. at
11–13. Although the complaint here didn’t allege facts amounting to an invasion
of privacy or bring a claim for invasion of privacy in the tort-law sense, the
complaint’s occasional colloquial references were enough.
That seems wrong to me for two independent reasons, which I’ll explain in
turn.
1
As an initial matter, the Court hasn’t shown, as it must, why iCan’s reading
of the policy—such that the term “invasion of privacy” refers to the common-law
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tort, and thus that the provision excludes only suits about that tort—is
unreasonable. And with good reason. Having been around for more than a century
now, the tort called “invasion of privacy” is a familiar thing. See Hunstein v.
Preferred Collection & Mgmt. Servs., 994 F.3d 1341, 1347 (11th Cir. 2021)
(citing, e.g., Pavesich v. New England Life Ins. Co., 122 Ga. 190, 50 S.E. 68(1905), Munden v. Harris, 153 Mo. App. 652, 134 S.W. 1076 (1911), and Kunz v.
Allen, 102 Kan. 883, 172 P. 532 (1918)). It comprises four closely related types of
claims, each with its own formal elements. It is most assuredly well known to
lawyers drafting contracts about the types of lawsuits that their insurance will
cover.
Indeed, the primary definition that legal authorities assign to the term
“invasion of privacy” is just that: a specific common-law tort that comprises four
familiar legal claims. They explain, for instance, that “[t]here are four disparate
torts under the common name of invasion of privacy; these may be described
briefly as: (1) intrusion upon the plaintiff’s seclusion or solitude, or into his private
affairs; (2) public disclosure of embarrassing private facts about the plaintiff;
(3) publicity which places the plaintiff in a false light in the public eye; and
(4) appropriation, for the defendant’s advantage, of the plaintiff’s name or
likeness.” Invasion of Privacy, Plaintiff’s Proof Prima Facie Case § 14:18 (2020);
see also Invasion of Privacy, Black’s Law Dictionary (10th ed. 2014) (“An
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unjustified exploitation of one’s personality or intrusion into one’s personal
activities, actionable under tort law and sometimes constitutional law,” which
comprises the same four claims: (1) “invasion of privacy by appropriation,” (2)
“invasion of privacy by intrusion,” (3) “invasion of privacy by public disclosure of
private facts,” and (4) “invasion of privacy by false light.”); cf. 77 C.J.S. Right of
Privacy and Publicity § 8 (“The elements of liability for invasion of privacy are a
public disclosure of facts which are private, secluded, or secret, and facts which are
offensive and objectionable to a reasonable person of ordinary sensibilities.”).
Not surprisingly, Florida courts have likewise recognized that the term
“invasion of privacy” means “the common law tort of invasion of privacy.”
Allstate Ins. Co. v. Ginsberg, 863 So. 2d 156, 162 (Fla. 2003). Echoing the
treatises, encyclopedias, and dictionaries, they have explained that the invasion-of-
privacy tort includes “four categories” of claims: “(1) appropriation …
(2) intrusion … (3) public disclosure of private facts … and (4) false light in the
public eye.” Id. When a contract uses the name of such a familiar and well-
established common-law tort, it seems to me at the very least reasonable to
interpret it as referring to that tort.
Lest there be any serious doubt about the reasonableness of that reading, the
neighboring terms in the policy exclusion here remove it. That provision, recall,
provides (with my emphasis added) that:
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[Liberty] shall not be liable under [the policy] for Loss on account of
any Claim made against [iCan] . . . based upon, arising out of, or
attributable to any actual or alleged defamation, invasion of privacy,
wrongful entry or eviction, false arrest or imprisonment, malicious
prosecution, abuse of process, assault, battery or loss of consortium.
Tellingly, every term listed in the exclusion provision refers to a common-law tort.
Cf. Restatement (Second) of Torts §§ 13, 21, 35, 88–95, 558–623, 653–73, 682,
693 (1965). Where, as here, eight of the nine items listed in a series are
indisputably identifiable common-law torts, and the ninth term also names a
specific tort, then surely it is at least reasonable—if not well nigh compulsory—to
interpret the ninth term likewise to refer to that ninth specific tort. See id. at
§§ 652A–652I (“Invasion of Privacy”). See Antonin Scalia & Bryan A. Garner,
Reading Law: The Interpretation of Legal Texts 195 (2012) (“When several nouns
or verbs or adjectives or adverbs—any words—are associated in a context
suggesting that the words have something in common, they should be assigned a
permissible meaning that makes them similar.”); see also United States v.
Williams, 553 U.S. 285, 294 (2008) (“[A] word is given more precise content by
the neighboring words with which it is associated.”).
If I were an insured party wanting to ensure that an exclusion provision
would exempt from coverage only claims based on these nine specific torts—and
not other claims, like ones under the TCPA—I would probably insist that the
insurer include the exact language that the provision here used. So I find it
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surprising that interpreting the language to cover only those nine specific torts is,
according to the Court, positively unreasonable. See Maj. Op. at 13–15.
2
Even setting aside its inability to refute the reasonableness of iCan’s
interpretation, the Court’s own reading may itself be unreasonable. The Court
reasons that the policy exclusion means that whenever a plaintiff includes the term
“invasion of privacy” in her complaint, Liberty is absolved from covering losses
incurred in that lawsuit. See Maj. Op. at 11–13. It’s unclear to me why any party
to an insurance policy would ever allow coverage to be dictated by the conclusory
terms and labels that a plaintiff might later choose to include in her complaint.
After all, conclusory descriptions in complaints don’t have any legal relevance for
any purposes. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007).
Both practically and legally, then, it would be surprising—again—for
millions (billions?) of dollars in insurance coverage to depend on a plaintiff’s
colloquial and conclusory use of the term “invasion of privacy.” The Court’s
reasoning suggests that if the class plaintiffs had amended their complaint to do
nothing more than strike the term “invasion of privacy,” then—although it
wouldn’t have had any other legal consequence—Liberty would lose this case. See
Maj. Op. at 12 n.9. Weird.
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I suppose it’s theoretically possible that two parties could contract to make
insurance coverage turn on whether a complaint included magic (if conclusory)
words. But such hypothetical parties would surely use more explicit language to
accomplish that goal. If Liberty and iCan had wanted their contract to have the
effect that the Court gives it, they presumably would have said something like the
following: “Liberty shall not be liable for Loss on account of any Claim made
against iCan that uses the words ‘invasion of privacy’ in the complaint.” Because
they didn’t say that, I don’t think it’s reasonable to interpret the exclusion
provision to accomplish such an unnatural end. And it most certainly isn’t
unreasonable to embrace the (more natural) tort-law interpretation.
C
Liberty argues in the alternative that, regardless of what magic words the
class plaintiffs included in their complaint, we should interpret the term “invasion
of privacy” more broadly. Instead of referring to the common-law tort, Liberty
says, the term unambiguously refers to all causes of action that involve privacy
interests. The Ninth Circuit adopted that view in a materially identical case. See
L.A. Lakers, Inc. v. Fed. Ins. Co., 869 F.3d 795, 799 (9th Cir. 2017). The Court
rightly declines Liberty’s invitation to endorse the Ninth Circuit’s approach. See
Maj. Op. at 13 n.11.
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I agree with Liberty that legal actors can and sometimes do use the term
“invasion of privacy” in this broad, colloquial sense to refer to other causes of
action that implicate privacy. See, e.g., Barr v. Am. Ass’n of Pol. Consultants, Inc.,
140 S. Ct. 2335, 2344 (2020). And I agree that, used in that sense, the term
“invasion of privacy” would encompass suits that arise under the TCPA because
that statute protects a person’s privacy-based interest in being free from unwanted
robocalls and robotexts. See id.But that argument doesn’t win the day for Liberty, either. Because (as
already explained) we are required by law to interpret ambiguities in policy
exclusions narrowly, Liberty has to establish not only that its interpretation is
reasonable, but also that alternative interpretations that preserve coverage are
unreasonable. See Garcia, 969 So. 2d at 291. But Liberty—like the Court—
forgoes this step. It hasn’t explained why it is unreasonable to interpret the term
“invasion of privacy” to refer to the traditional common-law tort called “invasion
of privacy.”
Liberty suggests that, even if it can’t explain why the term “invasion of
privacy” can’t reasonably be interpreted to refer to the common-law tort, a Florida
Supreme Court decision requires us to accept that it can’t. In Penzer v.
Transportation Insurance Co., the court interpreted an insurance provision that
covered any “injury . . . arising out of . . . oral or written publication of material
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that violates a person’s right of privacy.” 29 So. 3d 1000, 1003 (Fla. 2010)
(emphasis added). The court held that the provision covered suits arising under the
TCPA for unwelcome faxes because “the plain meaning of ‘right of privacy’ is the
legal claim one may make for privacy, which is to be gleaned from federal or
Florida law.” Id. at 1006. On this definition, the “right of privacy” covered TCPA
claims because those claims implicated legally protected privacy interests. Id.But unlike the term “invasion of privacy”—which is at issue here—the term
“right of privacy”—which was at issue in Penzer—doesn’t refer to a common-law
tort. Rather, it refers to a broad constellation of constitutional and private-law
rights. See Right of Privacy, Black’s Law Dictionary (10th ed. 2014) (“The right
to personal autonomy.”); Griswold v. Connecticut, 381 U.S. 479, 486 (1965)
(recognizing a “right of privacy” against a contraception prohibition); Mincey v.
Arizona, 437 U.S. 385, 391 (1978) (recognizing a “right of privacy” against the
search of house). At the risk of stating the obvious, it’s a lot less reasonable to
conclude that a contract refers to the tort of “invasion of privacy” when it says
“right of privacy,” which describes a separate legal concept, than when it says
“invasion of privacy,” which literally names the tort itself.
* * *
Because I remain unconvinced that the term “invasion of privacy”
unambiguously refers to a robotext-based claim under the TCPA, I (under binding
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Florida law) have to give it the narrower meaning—as referring to the common-
law tort of “invasion of privacy.” And because the plaintiffs here didn’t bring a
count for the invasion-of-privacy tort or allege facts that would state a claim for
that tort, I would conclude that the exclusion provision didn’t cover this suit, and
that Liberty was therefore obligated to provide coverage.2
III
Because I would interpret the policy to provide (rather than exclude)
coverage, I would reach the district court’s alternative holding that iCan’s failure to
allocate the settlement agreement between covered and uncovered losses precluded
recovery. The district court’s conclusion depends on Florida law that provides that
if—and only if—a lawsuit’s claims or damages are partially but not fully covered
by an insurance policy, the insured party must allocate any settlement amount
between covered and uncovered losses. Keller Indus. v. Empl. Mut. Liab. Ins. Co.
of Wis., 429 So. 2d 779, 780 (Fla. Dist. Ct. App. 1983). If the insured fails to
allocate its losses, it is precluded from recovering against the insurer. Id.Florida’s allocation requirement doesn’t matter in this case because the
requirement’s precondition—that the lawsuit’s claims or damages are partially but
2
The Court responds by emphasizing the phrase “arising out of,” which it says should be
construed broadly. See Maj. Op. at 10–11, 15. With respect, I think that the Court misses the
point. If we’re bound to interpret the exclusion provision to refer to an “invasion of privacy” in
the tort sense, then it is incontrovertible that there was no invasion of privacy here. And of
course, a lawsuit can’t “aris[e] out of”—or originate from, grow out of, flow from, be incident to,
or have a connection with—an “invasion of privacy” that didn’t occur.
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not fully covered—isn’t met. If the term “invasion of privacy” must be interpreted
to refer only to the common-law tort, and none of the claims here concerned that
tort, then the whole lawsuit fell outside of the exclusion provision. It was fully
covered. Therefore, iCan had no duty to allocate the settlement, so it isn’t
precluded from recovering.
IV
In sum, the Court reasons that the policy exclusion’s reference to the term
“invasion of privacy” unambiguously covers any complaint that includes the term
“invasion of privacy.” Liberty alternatively argues that the term “invasion of
privacy” unambiguously refers to all causes of action that involve privacy interests.
Because neither addresses the robust evidence that supports interpreting the term
“invasion of privacy” to refer to the tort by the same name, I don’t think that either
is correct. Accordingly, I would reverse and remand to the district court to decide
the remaining issues at summary judgment. For these reasons, I respectfully
dissent.
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