Hybrid Promotions, LLC v. Federal Insurance Company ( 2020 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JUN 22 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
HYBRID PROMOTIONS, LLC, a No. 18-56658
California Limited Liability Company,
D.C. No.
Plaintiff-Appellant, 8:18-cv-00891-JVS-MRW
v.
MEMORANDUM*
FEDERAL INSURANCE COMPANY, an
Indiana corporation,
Defendant-Appellee.
Appeal from the United States District Court
for the Central District of California
James V. Selna, District Judge, Presiding
Submitted April 15, 2020**
Pasadena, California
Before: COLLINS and LEE, Circuit Judges, and PRESNELL,*** District Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Gregory A. Presnell, United States District Judge for
the Middle District of Florida, sitting by designation.
Hybrid Promotions, LLC (“Hybrid”) appeals the district court’s grant of
summary judgment in favor of its insurer, Federal Insurance Company (“Federal”).
We have jurisdiction pursuant to 28 U.S.C. § 1291. We affirm.
Hybrid had insurance policies (“Policy”) with Federal that provided
coverage for lawsuits arising out of “advertising injuries” as defined by the Policy.
Hybrid had a supplier agreement with Walmart, pursuant to which it provided
Walmart with private label apparel, such as tee shirts, as well as display racks and
related graphic signage for those products. Hybrid also agreed to indemnify
Walmart for certain lawsuits related to the provided items. The agreement required
that Hybrid obtain liability insurance for personal and advertising injuries.
Ultimate Brand Management (“UBM”) is the owner of the MMA Elite
trademark. UBM sued Walmart for trademark infringement, accusing Walmart of
displaying UBM’s MMA Elite trademark adjacent to or above displays that
included Hybrid’s private label merchandise, which was visually similar to UBM’s
trademarked merchandise. Pursuant to its indemnification obligation to Walmart,
Hybrid requested that Federal defend Walmart. Federal declined, contending that
the Policy did not cover this situation.
Hybrid first argues that, because disputed facts material to actual coverage
remain, the potential for coverage exists, and thus it was entitled to partial
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summary judgment on the duty to defend. Hybrid next contends that Federal’s
cross-motion should have been denied, because a jury could reasonably conclude
that a consumer would view the retail display at issue as one advertisement,
provided at least in part by Hybrid.
An order granting or denying summary judgment is reviewed de novo.
Pavoni v. Chrysler Grp., LLC, 789 F.3d 1095, 1098 (9th Cir. 2015). The
“interpretation of an insurance policy is a question of law.” Waller v. Truck Ins.
Exch., Inc., 900 P.2d 619, 627 (Cal. 1995), as modified on denial of reh'g (Oct. 26,
1995). Although Hybrid contends there are lingering factual disputes, the material
facts are not in dispute. At most, the evidence cited by Hybrid indicates that
Walmart displayed Hybrid’s products and signage in close proximity to the MMA
signage and that Hybrid paid for and designed part of the signage for Hybrid’s
products and some of the physical display materials for those products.
At issue in both the denial of Hybrid’s summary judgment motion and the
granting of Federal’s cross-motion is whether (1) the retail display constitutes an
advertisement within the meaning of the Policy and (2) there was an advertising
injury under the Policy.
The Policy defines an advertisement as “an electronic, oral, written or other
notice, about goods, products or services, designed for the specific purpose of
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attracting the general public or a specific market segment to use such goods,
products or services.” The Policy defines an advertising injury as an “injury . . .
sustained by a person or organization and caused by an offense of infringing, in
that particular part of [Hybrid’s] advertisement about [Hybrid’s] goods, products or
services, [ ] upon their copyrighted advertisement; or registered collective mark,
registered service mark or other trademarked name, slogan, symbol or title.”
Hybrid contends that the advertisement was the entire retail display. Thus, as
Hybrid repeatedly emphasizes, the advertisement is the combination of signage and
displays of products. Even assuming that Hybrid is correct on this point, we
conclude that summary judgment was properly granted because undisputed
evidence establishes that the advertisement was not “[Hybrid’s] advertisement.”
That combination is not Hybrid’s, because Hybrid did not design, pay for, possess,
or set up the combination; Walmart did.
While “close proximity” of Hybrid’s products to the MMA Elite signage
arguably may be enough to show that the resulting arrangement was an
“advertisement about [Hybrid’s] goods,” it is not enough to establish that the retail
display was Hybrid’s advertisement about Hybrid’s goods. Similarly, with respect
to the non-MMA-Elite signage and display materials that Hybrid paid for and/or
designed, the contribution of materials that are used to make a different composite
advertisement does not make that resulting advertisement Hybrid’s. Accordingly,
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the district court did not err in granting Federal’s cross-motion for summary
judgment.
Hybrid also appeals the district court’s denial of Hybrid’s motion for
continuance to conduct additional discovery, which sought underwriting guidelines,
underwriting manuals, claims handling guidelines, claims handling manuals and
underwriting files. The requested discovery would not have been useful in resolving
the key coverage issue discussed above. The district court did not abuse its discretion
in denying the request.
Finally, Hybrid asks that, pursuant to Federal Rule of Evidence 201(c)(2), we
take judicial notice of two photographs that are referenced in two of the cases that
Hybrid cites in the Reply Brief. These photographs show retail advertising displays.
Even assuming the request is timely, those other retail advertising displays are not
relevant to this case. We therefore deny the Appellant’s Request for Judicial Notice.
AFFIRMED.
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