United States District Court, D. Connecticut
MEMORANDUM OF DECISION ON CROSS MOTIONS FOR SUMMARY
W. EGINTON SENIOR UNITED STATES DISTRICT JUDGE
an insurance policy coverage dispute stemming from the
February 7, 2010, Kleen Energy Systems power plant explosion
in Middletown, Connecticut.
are individuals and estates harmed by the blast. After
obtaining judgment against subcontractor Bluewater Energy
Systems, Inc., in the amount of $13.5 million, plaintiffs
instituted this action to enforce Bluewater's claim of
insurance coverage against defendant.
contends that (1) the commercial umbrella insurance policy it
issued to Bluewater excluded coverage for “any
liability arising out of any project insured under a
‘wrap-up' or any similar rating plan;” and
(2) the power plant project was insured under such a
“wrap-up” plan. Plaintiffs respond that the term
“wrap-up, ” not defined by the policy, is
ambiguous and should be construed in favor of the insured.
sides have moved for summary judgment. For the following
reasons, summary judgment will be granted in favor of
motion for summary judgment will be granted where there is no
genuine issue as to any material fact and it is clear that
the moving party is entitled to judgment as a matter of law.
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
"Only when reasonable minds could not differ as to the
import of the evidence is summary judgment proper."
Bryant v. Maffucci, 923 F.2d 979, 982 (2d Cir.),
cert. denied, 502 U.S. 849 (1991).
burden is on the moving party to demonstrate the absence of
any material factual issue genuinely in dispute. American
International Group, Inc. v. London American International
Corp., 664 F.2d 348, 351 (2d Cir. 1981). In determining
whether a genuine factual issue exists, the court must
resolve all ambiguities and draw all reasonable inferences
against the moving party. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 255 (1986).
nonmoving party has failed to make a sufficient showing on an
essential element of his case with respect to which he has
the burden of proof, then summary judgment is appropriate.
Celotex Corp., 477 U.S. at 323. If the nonmoving
party submits evidence which is "merely colorable,
" legally sufficient opposition to the motion for
summary judgment is not met. Anderson, 477 U.S. at
parties agree that Georgia law applies to interpretation of
argues that plaintiffs are not entitled to indemnity under
the commercial umbrella insurance policy issued to Bluewater,
as Endorsement 7 to its policy clearly and unambiguously
excludes coverage for plaintiffs' claims. Endorsement 7
provides, in relevant part:
insurance does not apply to . . . any liability arising out
of any project insured under a ‘wrap-up' or similar
asserts that the Kleen Energy Systems Project was insured
under a contractor controlled insurance program, which it
contends is a type of “wrap-up”
program. Plaintiffs respond that there are multiple
reasonable interpretations of Endorsement 7 that would allow
for coverage in this case. Moreover, under the principle of
contra proferentem, where the exclusion is drafted
by the insurer, the operative language must be read strictly
against the insurer and in favor of providing coverage.
See Lunceford v. Peachtree Cas. Ins. Co., 495 S.E.2d
88, 90 (Ga.Ct.App. 1997) (holding that where a rational