Clear Logic, Inc. v. Federal Insurance

MEMORANDUM *

Clear Logic, Inc., appeals the district court’s summary judgment in favor of defendants Federal Insurance Company (“Federal”) and St. Paul Fire & Marine Insurance Company (“St.Paul”). The district court held that Federal and St. Paul did not have a duty to defend Clear Logic in an action brought against Clear Logic by Altera Corporation (“Altera”) for Mask Act infringement, 1 tortious interference with contractual relations, and tortious interference with prospective business advantage. See Altera Corp. v. Clear Logic, Inc., 424 F.3d 1079 (9th Cir.2005). We affirm.

In this California diversity action, we apply California law. Under California law, the existence of a duty to defend under a particular insurance policy is a question of law because it involves the interpretation of a written contract. See Bank of the West v. Superior Court, 2 Cal.4th 1254, 1264 , 10 Cal.Rptr.2d 538 , 833 P.2d 545 (1992). An insurance company “must defend a suit which potentially seeks damages within the coverage of the policy.” Gray v. Zurich Ins. Co., 65 Cal.2d 263, 275 , 54 Cal.Rptr. 104 , 419 P.2d 168 (1966). The duty to defend is therefore triggered where the complaint alleges…