X2 Biosystems, Inc v. Federal Insurance Co.
Opinion
Opinion
MEMORANDUM
X2 Biosystems, Inc. (“X2”) appeals the district court’s order granting Federal Insurance Co.’s (“Federal”) motion to dismiss. We have jurisdiction under 28 U.S.C. § 1291 , and we affirm.
X2 manufactures products that detect sports-related brain injuries. In 2011, X2 entered into a Technology License Agreement (“TLA”) with Bite Tech, Inc., granting Bite Tech licenses to certain X2 technology. As partial consideration, the TLA required Bite Tech to pay X2 $2 million in advance royalties. After receiving the $2 million in royalties, X2 terminated the TLA. X2 never sold any products that would generate revenues for Bite Tech.
Bite Tech alleged seven causes of action against X2, two of which (breach of special relationship and conversion) are relevant to this appeal. X2 tendered defense of the action to Federal, its insurer. Federal refused to defend, asserting that Bite Tech’s claims fell within an exclusion in the insurance policy pertaining to claims based on, arising from, or resulting from X2’s liability under any contract. According to Federal, Bite Tech’s claims were based on X2’s contractual liability under the TLA.