Granite Management Corp. v. Aetna Casualty & Surety Co.

MEMORANDUM **

Aetna Casualty & Surety Company appeals a judgment in favor of Granite Management Corporation finding Aetna liable for bad faith and awarding substantial damages. Granite conditionally cross-appeals the dismissal of its claim for punitive damages. We have jurisdiction under 28 U.S.C. § 1291 , and we affirm. We thus dismiss Granite’s cross-appeal as moot.

Because the facts and prior proceedings are known to the parties, we restate them only as necessary to explain our disposition.

1. Endorsement No.

The first issue is whether the trial court correctly determined as a matter of law, for purposes of Granite’s bad faith claim, that Endorsement No. 5 was ambiguous and created a duty for Aetna to defend Granite in the underlying “Smoke Tree litigation” (“Smoke Tree”). 1 Our answer is yes.

The court reviews grants of summary judgment de novo. Clicks Billiards, Inc. v. Sixshooters, Inc., 251 F.3d 1252, 1257 (9th Cir.2001). “The meaning and interpretation of an insurance contract is a question of law reviewed de novo.” HS *265 Servs., Inc. v. Nationwide Mut. Ins. Co., 109 F.3d 642, 644 (9th Cir.1997).

There are two distinct but related ways to trigger a duty to…