Beardsley

MEMORANDUM *

Betty Beardsley (“Ms.Beardsley”), Thomas Beardsley (“Mr.Beardsley”), and Beardsley & Son, Inc. (collectively referred to as “Beardsley”) appeal the district court’s grant of summary judgment for Mutual Service Casualty Insurance Company (“MSCIC”) and consequent dismissal of Beardsley’s action against MSCIC for failure to satisfy the duty to defend pursuant to an insurance contract. We review de novo a district court’s grant of summary judgment concerning the meaning of an insurance contract. See HS Servs., Inc. v. Nationwide Mut. Ins. Co., 109 F.3d 642, 644 (9th Cir.1997). We reverse and remand. 1 The focus of this ap *74 peal is whether MSCIC has a duty to defend Mr. Beardsley, as an officer of Beardsley & Son, Inc., from a slander lawsuit brought by Ms. Beardsley, his former employee and former wife. MSCIC argues that it does not, because, under each of two insurance contracts between MSCIC and Beardsley & Son, Inc., an employment-related practices exclusion applies to the action and negates coverage.

Pursuant to a principle first articulated by the California Supreme Court nearly 40 years ago in Gray v. Zurich Insurance Co., 65 Cal.2d 263 , 54 Cal.Rptr. 104 , 419…