Casey Tibbs, Plaintiff/appellee/cross-Appellant v. Great American Insurance Company, Defendant/appellant/cross-Appellee

Great American Insurance Company (Great American) appeals a jury verdict finding that it breached its implied covenant of good faith and fair dealing by failing to defend Casey Tibbs in a personal injury action. Tibbs cross-appeals, contending that the district court abused its discretion by excluding a witness’s statement and by refusing to direct a verdict in his favor. Tibbs also seeks attorneys’ fees pursuant to Fed.R.App.P. 38. We affirm the jury’s verdict, but deny Tibbs attorneys’ fees.

I

BACKGROUND

This appeal arises out of a lawsuit brought against Great American over its duty to defend Tibbs as an alleged employee of San Diego County Estates, Inc. (San Diego). On July 1, 1974, Great American issued a liability policy to San Diego, a resort development in southern California, for the period of July 1, 1974 to April 1, 1977. The policy contained a Multi-Pur-pose Endorsement adding as an additional insured “any employee of the named insured while acting within the scope of his duties ...”

In July 1974, San Diego hired Tibbs, a rodeo star, to serve as its Director of Western Activities. He was responsible for managing an equestrian center and for promoting the…