Research Corp. v. Westport Insurance

MEMORANDUM *

Westport Insurance Corporation (“Westport”) appeals the judgment of the district court, entered after a bench trial, in favor of Research Corporation (“Research”) in Research’s action seeking a declaration that Westport owed a duty to defend Research in an underlying civil action filed by Johnson Matthey, Inc. (“Johnson”). We affirm in part and reverse in part. Because the parties are familiar with the factual and procedural history of this case, we will not recount it here.

I

The district court properly determined that Westport owed a duty to defend Research against the claims asserted by Johnson. Under Arizona law, as in most states, the insurer’s duty to defend is distinct and broader than its duty to indemnify. Lennar Corp. v. Auto-Owners Ins. Co., 214 Ariz. 255 , 151 P.3d 538, 543-44 (Ariz.App.2007). The duty to defend in Arizona covers “any claim potentially covered by the policy.” United Servs. Auto. Ass’n v. Morris, 154 Ariz. 113 , 741 P.2d 246, 250 (1987). “The duty to defend arises at the earliest stages of litigation and generally exists regardless of whether the insured is ultimately found liable.” IN A Ins. Co. of N. Am. v. Valley Forge Ins. Co., 150…