Don’t Believe the Type – No Liability Coverage for Event Production Company Despite Contrary Insurance Certificate (LA)


Daniels v. SMG Crystal, LLC (Louisiana)

This case revolves around the 2005 Essence Festival held at the Louisiana Superdome in New Orleans. An attendee of the event slipped and fell on an unknown substance at the Superdome, suffering personal injury.  She filed a lawsuit against government entities, the Superdome manager, the festival organizer, and a production company hired by the organizer to produce the festival.  The government entities and the Superdome manager filed cross-complaints against the festival organizer and the production company seeking defense and indemnity protection.  The organizer filed a cross complaint against the production company and its commercial general liability (“CGL”) insurer.  The insurer eventually filed a motion for summary judgment on the grounds that it did not owe a duty to defend or indemnify any of the parties under the CGL policy.  The District Court initially denied the motion, but later granted the insurer’s motion for a new trial and for summary judgment.  Appeals followed.  On appeal, the Court of Appeal of Louisiana vacated the District Court decision and remanded the matter.  On remand, the District Court granted the insurer’s motion for summary judgment against the injured attendee and the production company on the issue of insurance coverage, and it dismissed all the claims against the insurer.  The production company appealed again.

The insurer argued that its policy insuring the production company “did not cover damages for plaintiff’s accident because the Superdome was not one of the designated premises covered under the policy.”  The policy included a designated premises endorsement, which expressly limited the coverage to two locations, neither of which included the Superdome.  The District Court had cited the specific language of the endorsement and referred to the amount of the renewal premium paid for the policy, which was deemed to be “insufficient for liability coverage for the Louisiana Superdome,” and the Court of Appeals ultimately agreed.  After reviewing the principles for construing insurance policies, including the responsibility to determine the parties’ intent and to not interpret policy language in an “unreasonable or a strained manner,” the Court of Appeals concluded the the insurer did not owe a duty to defend or indemnify the production company or any of the other defendants.

In opposing the insurer’s motion, the production company submitted a “Certificate of Liability Insurance” that it received from its insurance broker.  The certificate “included language that ‘additional coverages will apply for insureds doing work for 2005 Essence Festival only.'”  However, the Court pointed out that the language on the certificate itself established that the certificate was issued as a matter of information only and did not confer any rights upon the certificate holder.  The language also provided that the certificate did not amend, extend, or alter the coverage, and that it was subject to the terms and conditions of the policies themselves.  Therefore, the Court held that the certificate did not alter the policy and the policy did not provide coverage for the Essence Festival or the Superdome.

One judge concurred in part and dissented in part, stating that he believed there was a “reasonable possibility” the claim was covered by the insurance policy.

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