FILED
NOT FOR PUBLICATION
FEB 23 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
A&T SIDING, INC., No. 12-35180
Plaintiff - Appellant, D.C. No. 3:10-cv-00980-AC
v.
MEMORANDUM*
CAPITOL SPECIALTY INSURANCE
CORPORATION,
Defendant - Appellee.
Appeal from the United States District Court
for the District of Oregon
John V. Acosta, Magistrate Judge, Presiding
Argued and Submitted July 10, 2013
Portland, Oregon
Before: PREGERSON, MURGUIA, and CHRISTEN, Circuit Judges.
A&T Siding appeals the district court’s order granting summary judgment in
favor of Capitol Specialty Insurance Corporation. A&T maintains that Capitol, its
insurer, is liable for the $1.1 million balance of an amended settlement agreement
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
between A&T and the Brownstone Homes Condominium Association. We
certified the following question to the Oregon Supreme Court:
The parties’ original settlement agreement, under which
Brownstone Homes Condominium Association released
A&T from liability and signed a covenant not to execute
the stipulated judgment against A&T, was construed
pursuant to Stubblefield v. St. Paul Fire & Marine Ins. Co.,
517 P.2d 262 (Or. 1973), also to release A&T’s insurer,
Capitol Specialty Insurance Co., from liability. The parties
assert that such a construction was contrary to the parties’
original intent. Under Oregon law, may the parties amend
the settlement agreement to reflect their original intent, and
thereby restore the insurer’s duty to provide coverage for
A&T’s resulting liabilities to the extent its policy provides
coverage for the loss alleged by Brownstone?
The Oregon Supreme Court answered the question in the negative, ruling that A&T
and Brownstone’s amendment did not reform the agreement so as to restore any
liability released by the original settlement agreement. A&T Siding, Inc. v. Capitol
Specialty Ins. Corp., 358 Or. 32, 48 (2015). But the Oregon Supreme Court later
overruled Stubblefield and held that A&T and Brownstone’s original settlement
agreement did not extinguish Capitol’s liability. Brownstone Homes Condo. Ass’n
v. Brownstone Forest Heights, LLC, 358 Or. 223, 246-47 (2015). We vacate the
order granting summary judgment to Capitol because the original settlement
agreement did not extinguish whatever liability Capitol may have to A&T under
the insurance policy. We recognize that, upon remand, there will be parallel
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federal and state suits litigating Capitol’s liability to A&T. We leave it to the
district court to decide on remand whether to exercise its discretion to abstain in
favor of the parallel state proceedings. See Colo. River Water Conservation Dist.
v. United States, 424 U.S. 800, 817-18 (1976).
We VACATE and REMAND for proceedings consistent with this
disposition.
Each party shall bear its own costs and fees in this case.
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