Lomes
Lomes v. Hartford Financial Services Group, Inc.
Opinion
Opinion
Ortega, J.
The trial court granted declaratory relief to the insured, finding that the insurer owed a duty to defend. In all other respects, the trial court entered judgment for the insurer. Both parties have appealed.
Reversing the trial court’s ruling on the declaratory relief cause of action, we hold there was no duty to defend. We remand for the trial court to enter judgment for the insurer.
Background
Scott M. Lomes and William Low were the sole shareholders of Newton Wholesale Co., Inc., a wholesale grocery business that developed a computer software program to track inventories and evaluate food prices. When their business relationship soured, Low wrested control of Newton and ousted Lomes both as an employee and as president, although Lomes remained a director and minority shareholder. Lomes sued Newton Wholesale and Low in federal court, and Hartford Insurance Company of the Midwest provided a defense to Low and Newton in that action. However, Hartford refused to defend Lomes against the federal counterclaim filed by Low and Newton. Lomes then sued Hartford in state court over its failure to provide him a defense in the federal action.