Travelers Casualty & Surety Co. v. Wausau Underwriters Insurance

MEMORANDUM **

In these diversity cases, consolidated for appeal, Plaintiffs-Appellants Columbia Falls Aluminum Company, Brack Duker, and Jerome Broussard (collectively “CFAC”) and Travelers Casualty and Surety Company (“Travelers”) appeal the district court’s grant of judgment on the pleadings to Defendants-Appellees Wausau Underwriters Insurance Company and Employers Insurance of Wausau (collectively ‘Wausau”). Appellants allege that Wausau had a duty to defend and indemnify CFAC in five lawsuits brought against CFAC by its employees. At issue is the interpretation of the insurance contracts entered into by CFAC and Wausau.

The district court opinion provides a comprehensive history of the dispute which will not be repeated in detail here. In 1985, CFAC implemented a profitsharing plan which provided:

Rec., Vol. Ill, No. 5, at 52; No. 6, at 68. Pursuant to this profitsharing plan, CFAC employees agreed to a reduction in their base wages in exchange for “a substantial portion of the profits” when business was good. Id., No. 5, at 52.

*398 Beginning in 1986 and continuing at all relevant times, Travelers issued to CFAC a Fiduciary Responsibility Insurance Policy affording…