Winbrook Communications Services, Inc., et al. v. United States Liability Insurance Company (Lawyers Weekly No. 11-068-16)
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us 15-P-401 Appeals Court WINBROOK COMMUNICATION SERVICES, INC., & others[1] vs. UNITED STATES LIABILITY INSURANCE COMPANY. No. 15-P-401. Suffolk. March 8, 2016. – June 14, 2016. Present: Hanlon, Sullivan, & Massing, JJ. Practice, Civil, Default, Summary judgment. Insurance, Coverage, Insurer’s obligation to defend, Construction of policy. Contract, Insurance, Performance and breach. Damages, Negligent misrepresentation. Civil action commenced in the Superior Court Department on December 20, 2011. The case was heard by Geraldine S. Hines, J., on a motion for summary judgment, and a motion for reconsideration and a second motion for summary judgment were heard by Bonnie H. MacLeod, J. Eric F. Eisenberg for the plaintiffs. John B. DiSciullo for the defendant. SULLIVAN, J. In this insurance coverage dispute we consider whether the factual record on cross motions for summary judgment is adequate to permit either party to establish entitlement to judgment as matter of law. Plaintiff Winbrook Communication Services, Inc. (Winbrook[2]), appeals from a summary judgment declaring that the defendant, United States Liability Insurance Company (USLIC), had no obligation under a directors and officers liability policy to pay a judgment obtained by Winbrook against USLIC’s insureds, DeSales Group, LLC (DSG), and William York (collectively, DSG). We conclude that it was error to grant USLIC’s motion for summary judgment because there remain genuine issues of material fact as to the applicability of the policy’s personal profit exclusion. More precisely, there is a genuine dispute of material fact whether DSG received any profit, benefit, remuneration, or advantage to which DSG was not legally entitled. Accordingly, we vacate and remand for further proceedings. Background. The procedural history of the litigation is both material and undisputed. Winbrook filed suit against DSG and York on August 24, 2010, alleging that York had made a series of negligent misrepresentations concerning DSG the entity’s financial condition that induced Winbrook to continue to work on the development of a children’s storybook series and associated promotional items. The series never went to market and Winbrook sued, seeking compensation for work performed. DSG gave notice to USLIC of Winbrook’s claims in advance of suit. USLIC replied that the policy would not cover the claims. After suit was filed, Winbrook notified USLIC of the suit and of a pending motion for entry of default. DSG reportedly told USLIC that it did not intend to […]