Ramara Inc v. Westfield Insurance Co

PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______________

No. 15-1003
______________

RAMARA, INC.

v.

WESTFIELD INSURANCE COMPANY; FORTRESS
STEEL SERVICE, INC.;
SENTRY BUILDERS CORP.; ANTHONY AXE

Westfield Insurance Company,

Appellant
______________

On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. No. 2-13-cv-07086)
District Judge: Honorable Gerald A. McHugh
______________

Submitted under Third Circuit LAR 34.1(a)
December 11, 2015
 BEFORE: FUENTES, CHAGARES, and GREENBERG,
Circuit Judges

(Filed: February 17, 2016)

Allan C. Molotsky, Esq.
Dennis Chow, Esq.
Fowler Hirtzel McNulty & Spaulding
2000 Market Street, Suite 550
Philadelphia, PA 19103

Attorneys for Appellant

Francis S. Blatcher, Esq.
Pamela W. Blatcher, Esq.
Mallon Blatcher
12 South Monroe Street
Media, PA 19063

Attorneys for Appellee

______________

OPINION OF THE COURT
______________

GREENBERG, Circuit Judge.

I. INTRODUCTION

This matter comes on before this Court on an appeal from

2
a supplementary order entered following the District Court’s
ruling and entry of an order on cross-motions for summary
judgment in a case arising out of a workplace accident at a
Philadelphia parking garage. Appellee, Ramara, Inc.
(“Ramara”), the garage owner, engaged Sentry Builders
Corporation (“Sentry”) as a general contractor to perform work
at its parking garage, and, in turn, Sentry engaged a
subcontractor, Fortress Steel Services, Inc. (“Fortress”), to
install concrete and steel components as part of the work. As
required by its subcontracting agreement with Sentry, Fortress
obtained a general liability insurance policy (“the Policy”) from
Westfield Insurance Group (“Westfield”) naming Ramara as an
additional insured under the Policy. While Fortress was
working on the project in April 2012, one of its employees on
the job, Anthony Axe, was injured in an accident. As a result of
his injury, Axe filed a tort action against Ramara and Sentry but
he did not include Fortress as a defendant as it was immune
from actions at law by its employees for injuries suffered on the
job if they were entitled to compensation for their injuries under
the Pennsylvania Workers’ Compensation Act (“Act”).1 Ramara
tendered its defense in Axe’s action to Westfield. But Westfield
declined to defend Ramara as it claimed that Axe’s complaint
against Ramara did not include allegations imposing that
obligation on it under its Policy with its applicable
endorsements. Ramara responded by initiating this action.

Both parties moved for summary judgment, and the
District Court on November 24, 2014, granted partial summary
judgment to Ramara and denied summary judgment to

1
The parties on this appeal do not question that Axe was
entitled to compensation for his injuries under the Act.

3
Westfield. Ramara, Inc. v. Westfield Ins. Co., 69 F. Supp. 3d
490 (E.D. Pa. 2014). The Court on December 19, 2014, entered
a supplemental order that included a quantified judgment in
favor of Ramara against Westfield for Ramara’s counsel fees
and costs incurred to date and ordered that Westfield
“prospectively . . . provide defense to Ramara in the underlying
action . . . .” App. 21. Westfield timely appealed from the
December 19, 2014 order. We address two issues on this
appeal: whether we have jurisdiction and, if so, whether
Westfield must defend Ramara in the Axe action.

II. JURISDICTION

The District Court had subject matter jurisdiction
pursuant to 28 U.S.C. § 1332 based on diversity of citizenship
and, as we will explain, even though Ramara argues that we do
not have jurisdiction, we have jurisdiction under 28 U.S.C. §
1292(a)(1).

III. STANDARD OF REVIEW

We exercise plenary review in determining whether we
have jurisdiction. See In re Fosamax (Alendronate Sodium)
Prods. Liab. Litig. (No. II), 751 F.3d 150, 155-56 (3d Cir. 2014);
Belitskus v. Pizzingrilli, 343 F.3d 632, 639 (3d Cir. 2003). If
“we determine that we do not have jurisdiction over this appeal,
our ‘only function remaining [will be] that of announcing the
fact and dismissing the cause.’” Elliott v. Archdiocese of N.Y.,
682 F.3d 213, 219 (3d Cir. 2012) (alteration in original) (quoting
Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94, 118

4
S.Ct. 1003, 1012 (1998)). If, however, we determine that we
have jurisdiction, our review of the District Court’s
interpretation of the Policy applying Pennsylvania law will be
plenary. See Elec. Ins. Co. v. Rubin, 32 F.3d 814, 815 (3d Cir.
1994). In these circumstances, in determining whether the
underlying complaint triggered an obligation under the Policy on
Westfield to defend Ramara, we view the factual allegations in
the complaint as true and “liberally construe[ ] [them] in favor
of [Ramara].” Frog, Switch & Mfg. Co. v. Travelers Ins. Co.,
193 F.3d 742, 746 (3d Cir. 1999) (citing Biborosch v.
Transamerica Ins. Co., 603 A.2d 1050, 1052 (Pa. Super. Ct.
1992)).

Moreover, we exercise plenary review over a district
court’s grant of summary judgment. Blunt v. Lower Merion
Sch. Dist., 767 F.3d 247, 265 (3d. Cir. 2014), cert. denied, 135
S.Ct. 1738 (2015); Dee v. Borough of Dunmore, 549 F.3d 225,
229 (3d Cir. 2008). Under this standard, a court will “grant
summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(a). There is a
genuine dispute of material fact if the evidence is sufficient for a
reasonable factfinder to return a verdict for the nonmoving
party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106
S.Ct. 2505, 2510 (1986). But a mere “scintilla of evidence” in
the nonmovant’s favor does not create a genuine issue of fact,
id. at 252, 106 S.Ct. at 2512, and the non-movant may not rest
on speculation and conjecture in opposing a motion for
summary judgment. Acumed LLC v. Advanced Surgical Servs.,
Inc., 561 F.3d 199, 228 (3d Cir. 2009).

5
 IV. BACKGROUND

A. Factual Background

As we have indicated, Ramara engaged Sentry to be its
general contractor for work at its parking garage and on or about
February 22, 2014, Sentry contracted with a subcontractor,
Fortress, to install concrete and steel components at the garage.
Sentry and Fortress memorialized their understanding in a letter
(“the Agreement”) which required Fortress to provide all labor
and equipment necessary to “perform the work in a workman-
like manner and in accordance with the acceptable standard of
the trade.” App. 82. The Agreement further required Fortress to
supervise the project until its completion. In addition, the
Agreement stipulated that “Sentry Builders Corporation and or
Ramara, Inc. will NOT be responsible for the procedures or
actions of Fortress Steel in its performance or deliveries to
complete the work.” App. 82. Finally, the Agreement stated
that “Fortress Steel will before commencement of work provide
Sentry Builders Corp. insurance for Workmen’s Compensation
and General Liability with the appropriate limits of coverage,
said certificate(s) of insurance shall also include the landlord
Ramara, Inc. as additional insured.” App. 82.

Westfield issued a Certificate of Liability Insurance
showing that Fortress was the named insured under a policy that
provided $1 million of primary liability coverage for each
occurrence and $9 million of umbrella coverage. App. 173.
Ramara and Sentry were listed as additional insureds under a
typewritten section of the certificate entitled “Description of
Operations/Locations /Vehicles.” App. 68, 173. The
typewritten section reads: “RE: Project 444 City Avenue –

6
Additional Insureds include Ramara Inc. and Sentry Builders
with regard to above referenced project.” App. 68, 173.
Fortress thereafter began work at the job site.

In April 2012, Axe was injured during the course of his
employment by Fortress while working at Ramara’s parking
garage. Axe filed a lawsuit (“Axe”), the underlying action,
seeking damages for his injuries in the Philadelphia County
Court of Common Pleas against Ramara, as the property owner,
and Sentry, as the general contractor, but he did not include
Fortress, his employer, as a defendant, for, as we already have
set forth, it would have had immunity in the action by reason of
the Pennsylvania Workers’ Compensation Act. See 77 Pa.
Cons. Stat. Ann. § 481 (“The liability of an employer under this
act shall be exclusive and in place of any and all other
liability.”). When Ramara sought a defense under the Policy,
Westfield refused to provide that defense as it contended that the
Policy did not insure Ramara for Axe’s claims arising from the
accident.

B. Key Provisions of the Policy

Westfield predicated its denial of coverage on its
interpretation of several provisions in the Policy now at issue on
this appeal. The two provisions that we need consider are the
“Additional Insured – Owners, Lessees or Contractors –
Automatic Status When Required in Construction Agreement
With You” (“the Additional Insured Endorsement”) and an
“Other Insurance Endorsement.” The Additional Insured
Endorsement in relevant part reads as follows:

A. Section II –Who Is An Insured

7
is amended to include as an
additional insured any person or
organization for whom you are
performing operations when you
and such person or organization
have agreed in writing in a contract
or agreement that such person or
organization be added as an
additional insured on your policy.
Such person or organization is an
additional insured only with respect
to liability for ‘bodily injury,’
‘property damage,’ or ‘personal and
advertising injury’ caused, in
whole or in part, by:

1. Your acts or omissions; or

2. The acts or omissions of
those acting on your behalf;

in the performance of your ongoing
operations for the additional
insured.

A person’s or organization’s status
as an additional insured under this
endorsement ends when your
operations for that additional
insured are completed.

8
App. 105 (second emphasis added). Westfield argues that for
this paragraph to require it to defend Ramara in the Axe case,
the complaint in that case must have alleged explicitly that
Fortress’s acts or omissions proximately caused Axe’s injuries.

Ramara responds to Westfield’s interpretation of the
Additional Insured Endorsement by arguing that it conflicts with
the Policy’s Other Insurance Endorsement and therefore
Westfield’s interpretation of the Additional Insured
Endorsement would not be harmonious with the totality of the
insurance contract. The Other Insurance Endorsement provides,
in relevant part:

When required by written contract
with any additional insured owner,
lessee, or contractor to provide
insurance on a primary and
noncontributory basis, Condition
4. of Section IV – Commercial
Liability Conditions is deleted and
replaced by the following:

4. Other Insurance

If other valid and collectible
insurance is available for a loss
we cover under Coverages A or B
of this Coverage Part, our
obligations are limited as follows:

a. Primary Insurance

9
 This insurance is primary
and non-contributory except when
b. below applies.

b. Excess Insurance

This insurance is excess
over any of the other insurance, . . .

(4) If the loss is caused by
the sole negligence of any
additional insured owner, lessee,
or contractor.

App. 181 (first and last emphasis added). Westfield claims that
there is not a written contract providing additional insured
coverage to Ramara on a “primary and non-contributory” basis.
Thus, it contends that this provision is inapplicable in this case.
Ramara, however, maintains that the Policy should be construed
in its entirety, to give meaning to all of its provisions.
Specifically, Ramara contends, for reasons that we explain
below in detail, that when the contract is analyzed as a
comprehensive document, Westfield’s interpretation of the
Additional Insured Endorsement, in effect, would nullify the
Other Insurance Endorsement. According to Ramara, if we
accept Westfield’s interpretation of the Additional Insured
Endorsement, there never could be excess coverage under the
Other Insurance Endorsement for such coverage would exist
only for losses caused by Ramara’s “sole negligence” but the
Additional Insured Endorsement would provide coverage for
Ramara only for acts or omissions “caused in whole or in part”
by Fortress or someone acting on its behalf.

10
 C. Procedural Background

Ramara claims to have expected that as an additional
insured under the Policy, it would be protected from bodily
injury claims arising out of Fortress’s work at the job site.
Accordingly, after it received the Writ of Summons from the
Axe lawsuit, Ramara tendered its defense to Westfield and
requested that it defend Ramara in the Axe case and indemnify it
from any judgment against it in that case. As we explained
above, Westfield declined to defend Ramara, claiming that
Axe’s suit against Ramara did not trigger its obligation to
defend Ramara under the Policy and its Additional Insured
Endorsement. In response, Ramara filed a declaratory judgment
and breach of contract action against Westfield, Fortress, Sentry,
and Axe in the Philadelphia Court of Common Pleas. But
notwithstanding Ramara’s inclusion of additional parties as
defendants, this case is essentially an action between Ramara
and Westfield. Westfield removed the action to the District
Court.

In the District Court, Ramara moved for partial summary
judgment on its claim that Westfield had a duty to defend it in
the underlying Axe case. Westfield cross-moved for summary
judgment on the claim and sought a ruling that it did not have an
obligation to defend Ramara. Applying Pennsylvania law, the
Court granted partial summary judgment to Ramara and denied
summary judgment to Westfield in an order on November 24,
2014. The order included a provision that if Ramara sought
reimbursement for its fees and costs to date in the Axe case it
should submit an itemized list of these expenses and it gave
Westfield an opportunity to object to Ramara’s claim. Ramara
submitted the list and the Court in a December 19, 2014 order
entered judgment against Westfield for $104,965.71, the agreed

11
upon amount of counsel fees and costs that Ramara had accrued
to date in defending the Axe case. As part of the December 19,
2014 order, the Court also mandated that Westfield
“prospectively . . . provide defense to Ramara in the underlying
action . . . .” App. 21.

Westfield filed a timely Notice of Appeal on December
23, 2014, appealing from the December 19, 2014 order.2 After
the appeal was docketed in this Court, Ramara filed several
motions in the District Court, including a motion to alter or
amend the December 19, 2014 order and a motion to strike
Westfield’s notice of appeal from the December 19, 2014 order.
Westfield opposed both motions. On January 29, 2015, the
District Court issued an order that, among other things, granted
Ramara’s motion to strike Westfield’s notice of appeal from the
December 19, 2014 order and partially granted Ramara’s motion
to alter or amend the December 19, 2014 judgment. On March
2, 2015, Westfield filed an amended notice of appeal that
included an appeal from the January 29, 2015 order.

2
Though the notice of appeal did not include an appeal from the
November 24, 2014 order entered on the summary judgment
motions, the parties have addressed matters that the District
Court considered in its opinion on those motions. In fact,
Westfield starts the statement of the case portion of its brief on
this appeal with the following sentence: “Appellant . . . seeks
reversal of the district court’s orders denying it summary
judgment, and entering partial summary judgment in favor of
Appellee . . . .” Appellant’s br. at 4. Thus, we will consider the
Court’s reasoning in granting partial summary judgment to
Ramara.

12
 Our Clerk by an order on January 5, 2015, directed the
parties to submit briefing on the question of whether we have
jurisdiction to entertain this appeal. The order noted that the
December 19, 2014 order of the District Court from which
Westfield had appealed did not appear to “dismiss[] all claims as
to all parties and [that it] has not been certified under Fed. R.
Civ. P. 54(b).” App. 392. The Clerk subsequently issued a
second order on March 30, 2015, affording the parties the
opportunity to submit briefing on the District Court’s authority
to issue an order “striking the notice of appeal . . . .” App. 404.
With all briefing now completed, we turn to the questions
presented by this appeal.

V. DISCUSSION

We first must decide whether we have jurisdiction to hear
this appeal. See Steel Co., 523 U.S. at 94, 118 S.Ct. at 1012.
After all, “[w]ithout jurisdiction the court cannot proceed at all
in any cause.” Id. (citation omitted). Then, if we conclude that
we have jurisdiction, we will interpret the language of the Policy
to determine whether the factual allegations in the underlying
complaint “potentially” trigger coverage for Ramara in the Axe
case. See Am. Contract Bridge League v. Nationwide Mut. Fire
Ins. Co., 752 F.2d 71, 75 (3d Cir. 1985) (applying Pennsylvania
law). In making these determinations, we view the factual
allegations in the underlying Axe complaint as true and liberally
construe them in Ramara’s favor as the insured. See Frog,
Switch & Mfg. Co., 193 F.3d at 746.

A. We Have Jurisdiction Because the District Court’s
December 19, 2014 Order is a Mandatory Injunction Under 28

13
U.S.C. § 1292(a)(1).

In its December 19, 2014 order the District Court
directed that “[p]rospectively, Westfield shall provide defense to
Ramara in the underlying action . . . .” App. 21. Westfield
appeals from this order and the January 29, 2015 order
amending it. Therefore, the question of whether we have
jurisdiction over this appeal hinges on whether the December
order qualifies as an injunction under 28 U.S.C. § 1292(a)(1), as
that section provides the only possible basis for us to have
jurisdiction, or instead is non-appealable.3 We conclude that the
order is an injunction and thus we have jurisdiction to hear this
appeal.

A district court’s injunctive order, even if it is not a final
judgment, is immediately appealable under 28 U.S.C. §
1292(a)(1). See Aleynikov v. Goldman Sachs Grp., Inc., 765
F.3d 350, 356 (3d Cir. 2014). In a determination of whether an
order is injunctive, a district court’s characterization of its order
is not dispositive. Thus, as the cases we discuss will explain,
what counts is what the court actually did, not what it said it did.
See Sampson v. Murray, 415 U.S. 61, 86-87, 94 S.Ct. 937, 951
(1974). Therefore, if a district court grants an interlocutory
injunction, the order granting the injunction is appealable.
Tokarcik v. Forest Hills Sch. Dist., 665 F.2d 443, 447 (3d Cir.
1981).
3
Ramara correctly indicates in its brief that the “District Court’s
December 19, 2014 Order granted only partial summary
judgment because [the Court] held that Westfield owed Ramara
a duty to defend in the underlying action but left outstanding the
question of whether Westfield also owes Ramara a duty to
indemnify.” Appellee’s br. at 15.

14
 We emphasize that rather than using a labeling test, we
use a functional test under which the nature of the relief in the
order on appeal determines if an order is injunctive. Cohen v.
Bd. of Trs. of the Univ. of Med. and Dentistry, 867 F.2d 1455,
1466 (3d Cir. 1989) (en banc). In a functional test analysis, an
order is injunctive if it: (1) adjudicates “some of the relief
sought in the complaint”; and (2) is “of such a nature that if it
grants relief it could be enforced pendente lite by contempt if
necessary.” Id. at 1465; see also Wright, Miller, Cooper &
Gressman, Federal Practice & Procedure § 3922, 29 (3d ed.
1977).

In circumstances similar to those here, we concluded that
a grant of partial summary judgment was injunctive and,
accordingly, was immediately appealable under 28 U.S.C. §
1292(a)(1). See Aleynikov, 765 F.3d at 356-57. In Aleynikov,
the appellee brought suit seeking indemnification and
advancement of his attorney’s fees from the appellant, his
former employer, arising from a criminal prosecution against
him relating to his employment. Aleynikov v. Goldman Sachs
Grp., Inc., No. CIV. 12-5994 KM, 2013 WL 5739137, at *1
(D.N.J. Oct. 22, 2013). Following expedited discovery, the
district court granted the appellee’s motion for summary
judgment with respect to his claims for advancement of certain
fees, but denied his motion with respect to indemnification and
indemnification-related fees. Id. at *22.

On appeal, we stated that although the district court did
not use the term “injunction” in its order granting partial
summary judgment, the “nature of the relief granted” is
determinative in deciding whether a remedy is equitable or legal.
Aleynikov, 765 F.3d at 356. We concluded that an order that
prospectively grants an indeterminate amount of monetary relief

15
is equitable in nature. As we explained in Aleynikov, “where an
order for the payment of money is forward-looking and involves
an amount that cannot be calculated with specificity, it is
equitable.” Because the order for partial summary judgment in
Aleynikov adjudicated “some of the relief sought in the
complaint” and granted relief that “could be enforced pendente
lite by contempt if necessary,” we concluded that it was
immediately appealable under 28 U.S.C. § 1292(a)(1). Id.

Here, the District Court’s December 19, 2014 order
granted relief similar to that in Aleynikov and thus the
December 19, 2014 order is immediately appealable. The order
directing Westfield to defend Ramara prospectively is “an order
for the payment of money” that is “forward-looking” and
currently “indeterminate” because it requires Westfield to pay
defense costs for the duration of the Axe action. See Aleynikov,
765 F.3d at 356-57. The order granted Ramara “some of the
relief” that it sought in the complaint and was enforceable
pendente lite. Nevertheless, Ramara contends that we do not
have jurisdiction to review that order because, unlike the
appellee in Aleynikov, Ramara does not request indemnification
and indemnification-related fees. Ramara’s observation is true
but inapposite.

We reiterate that Aleynikov makes clear that the relief
granted by a district court—not the relief sought by a party—
determines whether an order is injunctive. Therefore, even
though the appellee’s summary judgment motion in Aleynikov
sought both indemnification and indemnification-related fees,
our analysis focused on the nature of the relief that the district
court actually granted by its order to determine whether that
order was immediately appealable. Moreover, Ramara’s
proposed rule would allow a strategically drafted summary

16
judgment motion to block an interlocutory appeal under 28
U.S.C. § 1292(a)(1) from an order entered on the motion any
time the movant sought indemnification and indemnification-
related fees, regardless of the relief that the district court
actually granted. Neither our holding nor our reasoning in
Aleynikov supports such a result.

Ramara’s motion for partial summary judgment in this
case only sought relief with respect to Westfield’s duty to
defend it in the Axe action.4 The District Court specifically
noted in its January 29, 2015 order that the issue of Westfield’s
duty to indemnify “is still outstanding and not yet ripe for
resolution.” App. 24. Nevertheless, the Court’s December 19,
2014 order directing Westfield to defend Ramara prospectively
in the Axe lawsuit granted forward-looking monetary relief of
an indeterminate amount. See Aleynikov, 765 F.3d at 356-57.
In these circumstances, Aleynikov controls, and Ramara’s claim
that our case law does not support Westfield’s position that it
can appeal under 28 U.S.C. § 1292(a)(1) is simply wrong. See
Appellee’s br. at 18.

In reaching our result, we also note that other courts of
appeals have addressed the precise question before us now. For
example, in W Holding Co. v. AIG Ins. Co.-Puerto Rico, the
court found that it had jurisdiction over an appeal from a district
court order directing the appellant insurer to advance the
appellees’ defense costs. 748 F.3d 377, 382 (1st Cir. 2014).
Reasoning that an order’s nature “depends on its operative terms
and effects,” the court concluded that “the [district] judge’s cost-

4
Ramara also moved for summary judgment regarding its
related claim for breach of contract for failure to defend, but we
need not discuss this claim.

17
advancement order certainly seem[ed] to fit the bill” of an
appealable injunction under 28 U.S.C. § 1292(a)(1). Id. at 382-
83 (citations and internal quotation marks omitted). Similarly,
in Westar Energy, Inc. v. Lake the court determined that it had
jurisdiction over an appeal from a district court’s order that
directed the appellant corporation to advance criminal defense
costs to the appellee on a prospective basis. 552 F.3d 1215,
1221, 1224 (10th Cir. 2009). Although the district court granted
relief in that case that “was not labelled an injunction,” the court
of appeals nonetheless concluded that the relief was “equitable
in nature” and therefore the order was immediately appealable
under 28 U.S.C. § 1292(a)(1). Id. at 1223-24.

There are other courts of appeals’ decisions supporting
our result. For example, in Pacific Insurance Co. v. General
Development Corp. the court found that it could exercise
jurisdiction over a district court’s order granting partial
summary judgment to appellees and directing the appellant
insurer to pay their defense costs pending resolution of its
rescission claim. 28 F.3d 1093, 1095-96 (11th Cir. 1994).
Because the interlocutory order mandated that the “insurer pay []
defense costs,” the court held that it was an immediately
appealable injunction for purposes of § 1292(a)(1).5 Id. at 1096
(citation omitted); see also Abercrombie & Fitch Co. v. Fed. Ins.
Co., 370 F. App’x 563, 567, 568 (6th Cir. 2010) (holding that a
district court’s order “enjoining [the insurer] from failing and
refusing to pay” the appellee’s defense costs “fit[s] the
requirements . . . . [of] an injunctive order, over which we have
jurisdiction under 28 U.S.C. § 1292(a)(1)”); Gon v. First State
Ins. Co., 871 F.2d 863, 866 (9th Cir. 1989) (finding that an order
5
The court of appeals dismissed the appeal as moot for reasons
that we need not explain as they are immaterial here.

18
directing an insurer to pay the insured’s defense expenses as
they were incurred “met the general definition of an injunction”
and was immediately appealable).

In light of our reasoning buttressed by decisions of other
courts of appeals, we are satisfied that we have jurisdiction over
the District Court’s December 19, 2014 order directing
Westfield to defend Ramara prospectively. Although the order
did enter judgment in Ramara’s favor against Westfield for
$104,965.71 in already-accrued legal fees and costs—relief that
is legal in nature—the order also directed Westfield to defend
Ramara going forward and thus it granted equitable relief and
was immediately appealable. Though Ramara moved to amend
the December 19, 2014 order by striking its forward-looking
language as it contends that it did not seek that relief in the
District Court, the Court’s January 29, 2015 order clarified that
the December order had not terminated the entire action and did
not remove the forward-looking relief.6 App. 26.
6
The District Court said in its January 29, 2015 order that the
December 19, 2014 order should not be “considered a dismissal
of this action.” App. 26. We are confident that the Court
intended to say that the order did not terminate the action.
Though, as we explain below, the District Court did not have
jurisdiction to alter or amend the December 19, 2014 order after
Westfield filed its initial appeal, nevertheless we see no reason
why we should not consider the January 29, 2015 order when we
determine the Court’s intent in entering the December 19, 2014
order. It may seem strange that Ramara moved to strike the
seemingly favorable, forward-looking relief from the December
19, 2014 order, but it may have done so in the hope of that order
being a final order subject to execution. We do not address the
possible question of whether if Westfield challenged the

19
 It is clear that the relief the District Court granted by its
December 19, 2014 order is prospective, grants some of the
relief that Ramara requested, and could be enforced pendente
lite by contempt, if necessary. See Cohen, 867 F.2d at 1466.
Despite the District Court’s characterization of the December
19, 2014 order in its January 29, 2015 order as one granting
“specific performance of a contract term,” App. 25-26, the relief
granted in the December 19, 2014 order was in part equitable.
Consequently, the District Court’s December 19, 2014 order
includes a mandatory injunction and is immediately appealable
at least to the extent that it granted equitable relief under 28
U.S.C. § 1292(a)(1).7

$104,965.71 judgment on the ground that it was excessive we
could review that noninjunctive aspect of the December 19,
2014 order for the parties agreed on the computation. As a
practical matter, we do not doubt that if Westfield prevailed on
the merits on its injunctive appeal it would seek relief in the
District Court from the monetary judgment.

7
The Clerk of this Court issued an order on March 30, 2015,
affording the parties the opportunity to submit argument relating
to whether the District Court had authority to issue orders
striking Westfield’s notice of appeal, and whether it had
authority to strike Westfield’s then-pending amended notice of
appeal. The parties submitted arguments on the topic, but on
April 20, 2015, the District Court issued an order denying
Ramara’s motion to strike Westfield’s amended notice of appeal
as moot because this appeal was pending. In any event, it is
clear that we have jurisdiction over this appeal and thus the
District Court lacked authority to strike Westfield’s notice of
appeal. See Murphy v. Fed. Ins. Co., 206 F. App’x 143, 147 (3d

20
 B. Ramara as an Additional Insured under the Policy
is entitled to a Defense in the Axe Case.

With the jurisdictional issue behind us, we turn now to
the question of whether the underlying complaint supported the
District Court’s conclusion that Westfield owed Ramara a duty
to defend it in the Axe lawsuit. An insurer’s duty to defend “is a
distinct obligation” that is “different from and broader than the
duty to indemnify.” Sikirica v. Nationwide Ins. Co., 416 F.3d
214, 225 (3d Cir. 2005) (citations omitted). Because an
insurer’s duty to defend its insured in a lawsuit is broader than

Cir. 2006) (“In Venen v. Sweet, 758 F.2d 117, 120 (3d Cir.
1985), we pointed out that as a general rule ‘the timely filing of
a notice of appeal is an event of jurisdictional significance,
immediately conferring jurisdiction on a Court of Appeals and
divesting a district court of its control over those aspects of the
case involved in the appeal.’”); Sheet Metal Workers’ Int’l
Ass’n Local 19 v. Herre Bros., Inc., 198 F.3d 391, 394 (3d Cir.
1999) (“It is well established that ‘[t]he filing of a notice of
appeal . . . confers jurisdiction on the court of appeals and
divests the district court of its control over those aspects of the
case involved in the appeal.’” (citation omitted)); cf. Fed. R.
App. P. 42(a) (stating that a district court’s ability to grant a
motion to withdraw an appeal is limited to the time “before an
appeal has been docketed by the circuit clerk”). Importantly,
Ramara filed its first motion in the District Court to strike
Westfield’s notice of appeal on January 6, 2015, which was after
the Clerk docketed Westfield’s notice of appeal. Finally, we
point out that inasmuch as we have jurisdiction any ruling on the
District Court’s authority to issue such orders would not change
or alter our result.

21
its duty to indemnify, it necessarily follows that it will not have
a duty to indemnify an insured for a judgment in an action for
which it was not required to provide defense. Id. (citations
omitted).8 Under Pennsylvania law, which is applicable on the
insurance coverage issue, a court ascertaining whether an insurer
has a duty to defend its insured makes its determination by
defining the scope of coverage under the insurance policy on
which the insured relies and comparing the scope of coverage to
the allegations of the underlying complaint. Id. at 226; see also
Gen. Accident Ins. Co. of Am. v. Allen, 692 A.2d 1089, 1095
(Pa. 1997). If the allegations of the underlying complaint
potentially could support recovery under the policy, there will be
coverage at least to the extent that the insurer has a duty to
defend its insured in the case. Sikirica, 416 F.3d at 226 (citing
Gen Accident Ins. Co. of Am., 692 A.2d at 1095).

As the Pennsylvania Supreme Court has explained, “[i]f
the complaint filed against the insured avers facts which would
support a recovery that is covered by the policy, it is the duty of
the insurer to defend until such time as the claim is confined to a
recovery that the policy does not cover.” Erie Ins. Exch. v.
Transamerica Ins. Co., 533 A.2d 1363, 1368 (Pa. 1987)
(citations omitted); see also Stidham v. Millvale Sportsmen’s
Club, 618 A.2d 945, 953-54 (Pa. Super. Ct. 1992) (“If coverage
(indemnification) depends upon the existence or nonexistence of
8
We are concerned here with a situation in which the insured,
Ramara, in this litigation is relying on only a single insurance
policy for coverage. Thus, we do not suggest that when multiple
policies cover a single loss, such as when there is excess
coverage over basic coverage, that the excess insurer cannot
have a duty to indemnify an insured even though it did not have
a duty to defend the insured against the action.

22
undetermined facts outside the complaint, until the claim is
narrowed to one patently outside the policy coverage, the insurer
has a duty to defend claims against its insured.”). Importantly,
Pennsylvania adheres to the “four corners” rule (also known as
the “eight corners” rule), under which an insurer’s potential duty
to defend is “determined solely by the allegations of the
complaint in the [underlying] action.” Kvaerner Metals Div. of
Kvaerner U.S., Inc. v. Commercial Union Ins. Co., 908 A.2d
888, 896 (Pa. 2006) (“Kvaerner”) (emphasis in original)
(citation omitted). Under the four corners rule, a court in
determining if there is coverage does not look outside the
allegations of the underlying complaint or consider extrinsic
evidence. Id.9

To determine whether based on its factual allegations an
underlying complaint triggers an insurer’s duty to defend, a
court views the allegations as true and “liberally construe[s
them] in favor of the insured.” Frog, Switch & Mfg. Co., 193
F.3d at 746 (citation omitted). An insurer must defend its
insured until it becomes absolutely clear that there is no longer a
possibility that the insurer owes its insured a defense. See Am.
& Foreign Ins. Co. v. Jerry’s Sport Ctr., Inc., 2 A.3d 526, 541
(Pa. 2010) (“As long as the complaint might or might not fall
within the policy’s coverage, the insurance company is obliged
to defend . . . . [I]t is the potential, rather than the certainty, of a
claim falling within the insurance policy that triggers the
insurer’s duty to defend.”) (citation and internal quotation marks
omitted). Thus, an insurer has a duty to defend if there is any

9
There will be eight corners because a court in deciding if there
is coverage will look at both the insurance policy and the
underlying complaint.

23
possibility that its coverage has been triggered by allegations in
the underlying complaint. Id. With these principles in mind,
and after reviewing the Policy with its endorsements, we
conclude that Westfield has a duty to defend Ramara in the Axe
action because based on the factual allegations in the complaint
the Axe complaint potentially triggers coverage.

1. The Allegations of the Axe Complaint
Potentially Implicate Fortress Under Both a “Proximate Cause”
or “But For” Causation Standard.

At bottom, this case concerns whether the Axe complaint
sufficiently alleges, as required by the Additional Insured
Endorsement, that Axe’s injuries potentially were “caused, in
whole or in part” by Fortress’s acts or omissions or the acts or
omissions of someone acting on Fortress’s behalf. If it does,
then Ramara is an additional insured under the Policy with
respect to the Axe action and is entitled to a defense in that case.
If it does not, then Ramara is not an additional insured with
respect to the Axe action and Westfield does not have a duty to
defend Ramara. We decide this question by comparing the
allegations of the Axe complaint to the language of the Policy.
See Kvaerner, 908 A.2d at 896. We reiterate that our
interpretation of the Policy is a question of law over which we
exercise plenary review. See 401 Fourth Street v. Investors Ins.
Co., 879 A.2d 166, 170 (Pa. 2005). In addition, we must
construe any ambiguities in the Policy “in favor of the insured to
further the contract’s prime purpose of indemnification and
against the insurer, as the insurer drafts the policy, and controls
coverage.” Kvaerner, 908 A.2d at 897 (citation omitted).

In support of its contention that the allegations of the Axe

24
complaint fall outside of the Policy, Westfield first relies on
language in the Additional Insured Endorsement. Specifically,
Westfield claims that under Dale Corp. v. Cumberland Mutual
Fire Insurance Co., No. 09-1115, 2010 WL 4909600 (E.D. Pa.
Nov. 30, 2010), the endorsement’s language that requires Axe’s
“bodily injury” to be “caused, in whole or in part” by Fortress’s
acts or omissions, or someone acting on its behalf, limits
coverage to situations in which Axe explicitly alleges that
Fortress proximately caused his injuries. Westfield contends
that the Axe complaint does not contain such allegations and
therefore it does not have a duty to defend Ramara in the Axe
action.

In response, Ramara largely repeats the arguments that it
made in the District Court. Ramara starts from the premise that
Pennsylvania courts have not interpreted the “caused, in whole
or in part” language of the Additional Insured Endorsement.
Ramara then asserts that the interpretation advanced by the
district court in Dale Corp. and on which Westfield relies is
more restrictive than that which the Pennsylvania Supreme
Court likely would adopt. Ramara contends that Fortress’s
conduct need only have been a “but-for” cause of Axe’s injuries
to entitle it to a defense in the Axe case. Moreover, Ramara
maintains that even if we adopt Westfield’s “proximate cause”
argument with respect to Fortress’s conduct, the allegations of
the Axe complaint still would entitle it to that defense.

Like the District Court, we find that Westfield must
defend Ramara under either the “but-for” or “proximate cause”
interpretation of the Additional Insured Endorsement. Because
a proximate cause requirement is more demanding than a but-for
cause requirement—meaning that allegations satisfying the
former necessarily will satisfy the latter, though the opposite is

25
not true but is possible—we first will consider whether the
allegations of the Axe complaint suffice under the proximate
cause test. Proximate causation is defined as a cause which was
“a substantial factor in bringing about the plaintiff’s harm.”
Bouriez v. Carnegie Mellon Univ., 585 F.3d 765, 771 (3d Cir.
2009); see also Hamil v. Bashline, 392 A.2d 1280, 1284 (Pa.
1978); Restatement (Second) of Torts § 431 (1965). The
concept is essentially a limiting principle that functions as
“shorthand for the policy-based judgment that not all factual
causes contributing to an injury should be legally cognizable
causes.” CSX Transp., Inc. v. McBride, 131 S.Ct. 2630, 2642
(2011).10 We therefore must determine whether the Axe
complaint potentially alleges that Fortress’s acts or omissions
were a substantial factor in Axe being injured.

The Axe complaint is rife with allegations satisfying the
proximate cause test. In his complaint, Axe alleges that Fortress
employed him at the time of his accident, and that Sentry
engaged Fortress as an independent contractor.11 He claims that
10
A clear example of a “but-for” cause of an injury that is not its
proximate cause is if a cab is late in picking up a fare and, while
taking the fare to his destination, is involved in an accident
while being driven without any negligence or excess speed. The
driver’s tardiness would be a but-for cause of the accident
because the accident would not have happened if the cab had
been on time for if it had been on time it would not have been at
the scene of the accident. Nevertheless, the driver would not be
liable on a theory that he was late, because his lateness would
not be regarded as a proximate cause of the accident.

11
Westfield emphasizes that the Axe complaint characterizes
Fortress as Sentry’s “independent contractor” rather than its

26
he was injured severely when he fell through an opening in the
garage deck while attempting to set beam clips in the course of
his normal duties at the job site. Axe also alleges that Ramara
“act[ed] by and through its agents, servants and/or employees”
and “fail[ed] to adequately inspect and monitor the work
performed.” App. 47; App. 49. As the District Court observed,
if Axe was injured during the course of his normal duties at the
job site, and the injury was caused by the acts or omission of
Ramara’s “agents,” “contractors,” or “subcontractors”—of
which Fortress was one—these allegations raise at least the
potential that Fortress’s conduct was a proximate cause of his
injuries. Ramara, 69 F. Supp. 3d at 496.

In addition, Axe pleads that Ramara “failed to provide
and require that equipment be used in accordance with industry
standards.” App. 49. He further avers that Ramara “employed
and/or retained, or [was] obligated to employ field personnel,

subcontractor. Appellant’s br. at 18; Appellant’s reply br. at 7
n.1. But an analysis of the allegations of the Axe complaint
makes it clear that Fortress potentially is implicated as one of
Ramara’s contractors or subcontractors and the circumstance
that it may have been an “independent contractor” would not
change that result. After all, the Axe complaint hinges liability
on Ramara’s acts and omissions by and through its “contractors
and subcontractors,” and thus the complaint has at least the
potential to implicate Fortress. This result is especially clear
inasmuch as we must liberally construe the factual allegations of
the underlying complaint in favor of Ramara. See Frog, Switch
& Mfg. Co., 193 F.3d at 746 (citation omitted) (explaining that
to determine whether an underlying complaint triggers an
insurer’s duty to defend, its factual allegations must be “liberally
construed in favor of the insured”).

27
project supervisors and safety inspectors to inspect the work
being performed” at the job site. App. 49. Yet, Fortress’s
employees used equipment that Fortress owned and performed
work that Axe asserted necessarily fell within the scope of
Ramara’s supervision. App. 82. Finally, Axe claims that
Ramara was negligent by failing to: (1) hire competent
contractors and subcontractors; (2) perform “construction
services” in manner consistent with the prevailing standard of
care in the construction industry; (3) supervise the construction
work; (4) coordinate with the other entities and subcontractors
on the premises; and (5) enforce a site specific fall protection
plan. App. 52-53.

Taken together and construed liberally in favor of
Ramara for purposes of this insurance coverage case, these
allegations partially base Ramara’s liability on its failure to
supervise the work of its contractors or subcontractors who used
equipment improperly and disregarded a site specific fall
protection plan, all while performing their work in violation of
the industry’s standard of care. Fortress, though engaged by
Sentry, was one of Ramara’s subcontractors, and Axe’s
employment by Fortress was the sole reason that Axe was at the
job site and was injured. Clearly, Axe made factual allegations
that potentially would support a conclusion that Axe’s injuries
were “caused, in whole or in part” by Fortress’s acts or
omissions. Of course, we need not and, indeed, cannot decide
whether Axe will succeed on these claims at trial. Ramara only
must show that the Axe complaint, when liberally construed in
favor of Ramara, includes allegations to support a conclusion
that Fortress was potentially negligent and that its negligence
was a proximate cause of Axe’s injuries. We conclude that it
does. Accordingly, Ramara comes within the Additional

28
Insured Endorsement of the Policy with respect to the Axe case.
Therefore, Ramara is entitled to a defense in the Axe case even
under Westfield’s narrow interpretation of the Additional
Insured Endorsement limiting coverage to situations in which an
insured’s contractor’s actions proximately caused a plaintiff’s
injuries.

2. The Other Insurance Endorsement Supports
Ramara’s Interpretation of the Additional Insured Endorsement.

Although Ramara qualifies as an additional insured under
either the “but-for” or “proximate cause” interpretation of the
Additional Insured Endorsement, we point out that Ramara’s
but-for causation interpretation is correct. In the District Court,
Ramara argued that the language of the Additional Insured
Endorsement was not easy to reconcile with the Other Insurance
Endorsement under Westfield’s proximate cause interpretation.
The District Court agreed, concluding that the language of the
Other Insurance Endorsement supported Ramara’s
interpretation. We also conclude that the Other Insurance
Endorsement supports Ramara’s but-for reading.

A court’s function when interpreting an insurance policy
under Pennsylvania law, is “to ascertain the intent of the parties
as manifested by the language of the written instrument.” Am.
Auto. Ins. Co. v. Murray, 658 F.3d 311, 320 (3d Cir. 2011)
(citation and internal quotation marks omitted). A court must
read the policy “as a whole and construe[ ] [it] according to the
plain meaning of its terms.” C.H. Heist Caribe Corp. v. Am.
Home Assurance Co., 640 F.2d 479, 481 (3d Cir. 1981). A
court construes commonly used words and phrases “in their
natural, plain, and ordinary sense, with [the] court free to consult
a dictionary to inform its understanding of terms.” Am. Auto.

29
Ins. Co., 658 F.3d at 320-21 (citations and internal quotation
marks omitted). But if those terms are open to more than one
interpretation, they are regarded as ambiguous. Med. Protective
Co. v. Watkins, 198 F.3d 100, 103 (3d Cir. 1999). It is well
established that “[a]mbiguous provisions in an insurance policy
must be construed against the insurer and in favor of the
insured; any reasonable interpretation offered by the insured,
therefore, must control.” Id. at 104 (citation omitted).
Pennsylvania courts apply this rule liberally. Id.

Under the Policy, the Other Insurance Endorsement
provides that an additional insured such as Ramara is entitled to
excess coverage for a loss caused by its sole negligence. The
District Court concluded that under Westfield’s proximate cause
interpretation of the Additional Insured Endorsement it would
be impossible for an additional insured to have excess coverage
under the Other Insurance Endorsement. The District Court
reasoned that a loss caused by Ramara’s sole negligence—which
is necessary to trigger excess coverage under the Other
Insurance Endorsement—could not be proximately caused
simultaneously by Fortress’s acts or omissions which Westfield
contended was necessary for Ramara to have coverage. Ramara,
69 F. Supp. 3d at 497. On appeal, Westfield argues that: (1) the
apparent discrepancy between the Other Insurance and
Additional Insured Endorsements under its interpretation is
immaterial because the former endorsement is inapplicable to
this case; and (2) as a result, the District Court’s discussion of
the Other Insured Endorsement constituted an advisory opinion.
We cannot agree on either of these points.

Courts must interpret an insurance policy as one,
harmonious document and resolve ambiguities in favor of
coverage. See Med. Protective Co., 198 F.3d at 104; C.H. Heist

30
Caribe Corp., 640 F.2d at 481. In interpreting a policy as a
whole, and resolving potential ambiguities, a court often must
compare the language used in one provision of the policy with
the language in another provision. Indeed, it would be difficult
for a court to read a policy as a comprehensive document and
unearth potential ambiguities if the court was required to
interpret the provisions of a policy in isolation. Moreover, if a
relevant provision is shown to be ambiguous, other policy
provisions can assist a court in assessing whether the insured
party’s interpretation of that provision is reasonable. Inasmuch
as the District Court’s understanding of the Other Insured
Endorsement supported its result, its discussion of the point
cannot be dismissed as an advisory opinion.

3. The Pennsylvania Workers’ Compensation Act.

Finally, Westfield argues that coverage was not triggered
because one party is conspicuously absent from the allegations
in the Axe complaint: Fortress. Indeed, Axe explicitly names
Fortress only once in his underlying complaint, stating that
Fortress was his employer at the time that he was injured. As a
result, Westfield maintains that the Axe complaint is “silent as
to any acts or omissions by Fortress,” and thus Westfield does
not have a duty under the Policy with the Additional Insured
Endorsement to defend Ramara when Pennsylvania’s four
corners rule is applied.

The District Court disagreed, finding that the sparse
reference to Fortress in the Axe complaint was understandable
in light of the Workers’ Compensation Act’s grant of tort
immunity to employers for workplace injuries to their
employees. Ramara, 69 F. Supp. 3d at 500-01; see also 77 Pa.
Cons. Stat. Ann. § 481 (“The liability of an employer under this

31
act shall be exclusive and in place of any and all other liability
to such employes.”). Due to the immunity from tort liability
afforded to employers for injury to their employees in
circumstances in which compensation is provided by the Act,
the District Court reasoned that Westfield’s narrow
interpretation of the underlying complaint “ignore[d] the
realities of the worksite” and “the effect of the Pennsylvania
Workers’ Compensation Act.” Ramara, 69 F. Supp. 3d at 499.
On appeal, we must decide whether the District Court’s
consideration of the Act and its effect on pleading violated
Pennsylvania’s four corners rule.

At the outset, we find it instructive to retrace the
boundaries of the four corners rule. In Pennsylvania, a
determination of whether an insurer has a duty to defend is made
“solely by [consideration of] the allegations of the complaint in
the [underlying] action.” Kvaerner, 908 A.2d at 896 (emphasis
in original) (citation omitted). However, “[i]f coverage
(indemnification) depends upon the existence or nonexistence of
undetermined facts outside the complaint, until the [plaintiff’s]
claim is narrowed to one patently outside the policy coverage,
the insurer has a duty to defend claims against its insured.”
Stidham, 618 A.2d at 953-54. If the complaint “might or might
not fall within the policy’s coverage, the insurance company is
obliged to defend.” Am. & Foreign Ins. Co., 2 A.3d at 541
(citations and internal quotation marks omitted). It is therefore
“the potential, rather than the certainty, of a claim falling within
the insurance policy that triggers the insurer’s duty to defend.”
Id.

This understanding of the four corners rule is important,
because neither our own research nor the parties’ briefing has
revealed a case in which we previously have spoken on how a

32
court should deal with the practical effects of the Workers’
Compensation Act on pleadings where Pennsylvania’s four
corners rule is relevant. In a factually analogous case, however,
a district court persuasively emphasized substance over form
while making a determination faithful to the four corners rule.
The court explained:

The purpose behind [the four
corners rule] is that an insurer
should not be required to defend a
claim when it is apparent on the
face of the complaint that none of
the injuries fall within the purview
of the insurance policy. Given the
circumstances of this case, that
purpose would not be well served
by blindly following Plaintiff’s
insistence that the Court apply the
most restrictive interpretation of the
four corners rule. Due to the
immunity conferred by the
Workmen’s Compensation Act,
[the plaintiff in the underlying
action] could not have sued his
employer, . . . and, thus, would not
have included any allegations about
[it] in his underlying complaint.
Nonetheless, [the insurer] has
expressly stipulated that it knew
[the plaintiff] was injured while
performing duties on a job site in
the scope of his employment with

33
 [the insured]. . . . Given [the
insurer]’s obvious knowledge of
the existence of facts that could
trigger coverage and its awareness
of [the plaintiff]’s reason for not
including them, it would be both
illogical and unjust for this Court to
find that [the insurer]’s duty to
defend was not triggered.

Selective Ins. Co. v. Lower Providence Twp., No. 12-0800,
2013 WL 3213348, at *10 n.6 (E.D. Pa. June 26, 2013)
(“Selective Insurance”); see also Dale Corp., 2010 WL 4909600,
at *7 n.6.

Importantly, the Selective Insurance court considered the
Workers’ Compensation Act’s effects as part of the broader
context within which the factual allegations of the underlying
complaint were made, and within which the insurer denied
coverage. But the court considered the Act only to the extent
that the consideration was useful in a determination of whether
the factual allegations of the complaint potentially fell within the
scope of coverage. We find this analytical approach to be
consistent with Pennsylvania’s four corners rule and applicable
to this case.

With Selective Insurance in mind, it is clear that the
District Court properly considered the effect of the Workers’
Compensation Act. The four corners rule—even under
Pennsylvania’s strict construction—does not permit an insurer to
make its coverage decision with blinders on, disclaiming any
knowledge of coverage-triggering facts. Quite the opposite,
knowledge that an injured employee has a claim under the

34
Workers’ Compensation Act must be factored into a
determination of whether his allegations in an underlying tort
complaint potentially trigger an obligation on an insurer to
provide coverage for a defendant in the underlying case. If an
insurer fails to account for the Act it may construe the factual
allegations of an underlying complaint too narrowly, and “the
insurer who refuses to defend at the outset does so at its own
peril.” Aetna Cas. & Sur. v. Roe, 650 A.2d 94, 99 (Pa. Super.
Ct. 1994).

It is also proper to consider the Workers’ Compensation
Act because the factual allegations of an underlying complaint
must “be taken as true and liberally construed in favor of the
insured.” Post v. St. Paul Travelers Ins. Co., 691 F.3d 500, 517
(3d Cir. 2012) (citation and internal quotation marks omitted).
In cases in which the Act is relevant, a liberal construction of
the factual allegations of the underlying complaint often may
result in the complaint triggering coverage where the same
allegations might appear insufficient in the absence of the Act.
Indeed, Westfield’s narrow interpretation of the factual
allegations of the Axe complaint provides an apt example of
how proceeding as though the Act is irrelevant risks leaving an
insured party without the coverage to which it is entitled.
Westfield’s approach would turn what is meant to be a liberal
construction rule on its head; it would disfavor insured parties
and permit insurers to deny coverage under the Additional
Insured Endorsement in all but the most clear-cut cases in which
the plaintiff pleads his underlying complaint so as to avoid
attributing his injury to his employer’s acts or omissions. But
the courts have made clear that ambiguities in insurance policies
with respect to the scope of coverage are resolved in favor of
there being coverage, and Westfield cannot escape its obligation

35
to defend Ramara under any interpretation of the four corners
rule or the Policy language.

We emphasize that in affirming the District Court’s
analytical approach we do not intend our opinion to be read as
an expansion or modification of Pennsylvania’s strict
interpretation of the four corners rule. See, e.g., Kvaerner, 908
A.2d at 896; see also State Farm Fire & Cas. Co. v. Estate of
Mehlman, 589 F.3d 105, 108 n.3 (3d Cir. 2009). Indeed,
inasmuch as we are applying Pennsylvania law we could not do
so. Clearly, a court taking into account the four corners rule
must take care to base its analysis of the complaint on its factual
allegations. Rather, we hold that where the Workers’
Compensation Act is relevant to a coverage determination,
insurers (and the courts that review their determinations) must
interpret the allegations of an underlying complaint recognizing
that the plaintiff’s attorney in the underlying action drafted the
complaint taking the existence of the Act into account.12 In this
way, the Act operates as an interpretive constraint, making it
more difficult for insurers to claim that the allegations of an
underlying complaint fall patently outside the scope of

12
We are not suggesting that insurers have a duty to make
investigations to find facts or information beyond those set forth
in the complaint in order to find a basis for triggering coverage.
Thus, we cannot agree with Mortgage Express Inc. v. Tudor
Insurance Co., 771 N.W.2d 137, 147 (Neb. 2009), to the extent
that it broadly indicated that “[i]n determining its duty to defend,
an insurer must not only look to the petition or complaint filed
against its insured, but must also investigate and ascertain the
relevant facts from all available sources.”

36
coverage.13 This result is consistent with the four corners rule
and the principles underlying policy interpretation itself. See
Kvaerner, 908 A.2d at 897 (explaining that if any provision of
an insurance policy is ambiguous, “the policy is to be construed
in favor of the insured to further the contract’s prime purpose of
indemnification and against the insurer, as the insurer drafts the
policy, and controls coverage”).
The District Court simply reaffirmed what should be
obvious: an insurer cannot bury its head in the sand and disclaim
any knowledge of coverage-triggering facts. See, e.g.,
Revelation Indus., Inc. v St. Paul Fire & Mar. Ins. Co., 206 P.3d
919, 928 (Mont. 2009) (“An insurer cannot ignore knowledge of
facts that may give rise to coverage under the policy simply
because the complaint—which is, after all, drafted by a claimant
over whose draftsmanship the insured has no control—does not
allege these facts of which the insurer has knowledge.”).
Westfield was certainly aware of the Workers’ Compensation
Act’s limitation on the type of allegations that Axe could bring
when it decided to deny coverage to Ramara. Westfield also
surely knew that despite the circumstance that the Act does not
contain pleading limitations in third party actions, the practical
effect of its grant of tort immunity to employers was that Axe’s
attorney in drawing the complaint neither would explicitly name
Fortress nor feature it prominently in the complaint’s
allegations. Within this context and applying Pennsylvania law,

13
We do not question the right of an insurer to undertake a
defense of its insured under a reservation of rights or to bring a
declaratory action to settle the scope, if any, of its obligations
under its policy.

37
Westfield could not have determined reasonably that the
allegations of the Axe complaint were patently outside the
Policy’s coverage. The District Court properly compared the
allegations of the Axe complaint to the language of the Policy
under Pennsylvania’s four corners rule, and it correctly found
that Ramara qualifies as an additional insured entitled to a
defense in the Axe case under the Policy. It did not err by not
making this determination in a vacuum.

VI. CONCLUSION

We conclude our opinion with a disposition of
Westfield’s appeal with respect to the January 29, 2015 District
Court order. As we indicated, that order purported to alter or
amend the December 19, 2014 order even though Westfield
already had appealed from the December 19, 2014 order. As we
further indicated, the District Court did not have jurisdiction to
alter or amend the December 19, 2014 order with respect to the
aspects of that order on appeal. See infra note 7. Consequently
we will vacate the January 29, 2015 order to the extent that it
purported to alter or amend the December 19, 2014 order.
Inasmuch as there are no issues on this appeal with respect to
the January 29, 2015 order other than those with which we have
dealt, except to the extent that we are vacating the January 29,
2015 order, we will dismiss the appeal from that order.

In dealing with the merits of this appeal from the
December 19, 2014 order, for the reasons we have stated we will
affirm the District Court’s order to the extent that it provided
that Westfield has a duty to defend Ramara in the underlying
Axe action. Though we recognize that we are not in terms
affirming the order for the payment of fees and costs accrued to

38
date in the amount of $104,965.71, the effect of our opinion is to
uphold that order. We are not dealing in express terms with that
aspect of the December 19, 2014 order, see infra note 6, because
it is not an award of forward-looking injunctive relief and the
parties have not briefed the question of whether Westfield can
appeal at this time from that portion of that order.

39