UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
INGER F. SHEINBAUM,
Plaintiff/Counter-Defendant,
v.
AMERICAN CASUALTY COMPANY OF Civil Action No. 09–273 (CKK)
READING, PENNSYLVANIA,
Defendant/Counter-Plaintiff, and
CNA FINANCIAL CORPORATION,
Defendant.
MEMORANDUM OPINION
(October 1, 2010)
Plaintiff Inger F. Sheinbaum (“Sheinbaum”) filed this action in the Superior Court of the
District of Columbia against Defendants American Casualty Company of Reading, Pennsylvania
(“American Casualty”) and CNA Financial Corporation (“CNA Financial”) (collectively,
“Defendants”) seeking a declaratory judgment that Defendants have a duty to defend her in a
civil action filed against her in Superior Court (the “Feld Action”) pursuant to an insurance
policy issued to Sheinbaum by American Casualty. The case was removed to this Court on
February 11, 2009. American Casualty then filed a counterclaim against Sheinbaum seeking a
declaratory judgment that the insurance policy is void ab initio based on Sheinbaum’s alleged
material misrepresentation that she is a registered nurse or, alternatively, that the policy does not
provide coverage for the Feld Action and therefore there is no duty to defend or indemnify
Sheinbaum. Presently pending before the Court is Defendants’ [17] Motion for Summary
Judgment, to which Sheinbaum has filed an opposition and Defendants have filed a reply. The
Court has considered the parties’ briefs, the accompanying exhibits, and the relevant legal
authorities. For the reasons explained below, the Court shall grant Defendants’ motion for
summary judgment with respect to the issue of policy coverage but shall deny Defendants’
motion with respect to the alleged material misrepresentation.
I. BACKGROUND
Plaintiff Inger F. Sheinbaum is a professionally trained nurse who was educated and
certified as a registered nurse in Denmark in 1972. See Pl.’s Opp’n, Exs. 1 (Authorization as
Registered Nurse), 2 (Dep. of Inger Sheinbaum) at 15-17. According to her Danish certificate,
Sheinbaum is “authorized to describe herself as a registered nurse and to practice as such with
the conscientious observance of the duties incumbent upon a registered nurse.” See Pl.’s Opp’n,
Ex. 1 (Authorization as Registered Nurse). After receiving her education, Sheinbaum practiced
as a nurse internationally, including work for the United States government at the U.S. Mission
to the United Nations in Geneva, Switzerland, and the U.S. Embassy in Colombo, Sri Lanka. See
Pl.’s Opp’n, Ex. 2 (Dep. of Inger Sheinbaum) at 37-39. Sheinbaum moved to the United States
permanently in 1991. Id. at 85-86. Sheinbaum has provided, and continues to provide,
registered nursing services for an organization called SOS International on medevac trips to and
from Scandinavia. See id. at 42-48. Because Sheinbaum is not licensed as a registered nurse in
the United States, she has never provided nursing services in the United States. Id. at 54-55.
However, Sheinbaum has provided services as an “overnight companion” to patients recovering
from a recent medical procedure such as surgery. According to Sheinbaum, she does not perform
2
any nursing-related functions when she serves as an overnight companion. Id. at 52.1
A. Sheinbaum’s Application for an Insurance Policy
In 2004, Sheinbaum applied for a nurses professional liability insurance policy from
American Casualty. See Defs.’ Stmt.2 ¶ 40. Question 1 on the application asked Sheinbaum to
check one of four boxes to indicate whether she was an “RN,” “LPN/LVN,” “Nurse’s Aide,” or
“Home Health Aide.” Id. ¶ 42. Sheinbaum checked the “RN” box to indicate that she was a
registered nurse. Id. ¶ 43. Sheinbaum also stated on the application that she is a resident of
Virginia. Id. ¶ 46. In the application, Sheinbaum signed the following affirmation: “I have
answered these questions to the best of my knowledge. I have not withheld information that
would influence the judgment of the Insurance Company.” Id. ¶ 47.
B. The Terms of the Policy Issued to Sheinbaum
American Casualty issued Nurse’s Professional Liability Insurance Policy No. HPG
0273225116 (the “Policy”) to Sheinbaum, providing her coverage as a registered nurse effective
January 1, 2004. Defs.’ Stmt. ¶ 1. The Policy was renewed for each successive policy year
through at least 2008. Id. ¶ 3. The Policy includes a Professional Liability Coverage Part and a
1
This evidence in the record regarding Sheinbaum is uncontroverted.
2
The Court strictly adheres to the text of Local Civil Rule 7(h) (formerly Rule 56.1) when
resolving motions for summary judgment. See Burke v. Gould, 286 F.3d 513, 519 (D.C. Cir.
2002) (finding district courts must invoke the local rule before applying it to the case). The
Court has advised the parties that it strictly adheres to Rule 7(h) and has stated that it “assumes
facts identified by the moving party in its statement of material facts are admitted, unless such a
fact is controverted in the statement of genuine issues filed in opposition to the motion.” [13]
Scheduling and Procedures Order at 5 (May 5, 2009). Thus, in most instances the Court shall
cite only to one party’s Statement of Material Facts (“Stmt.”) unless a statement is contradicted
by the opposing party, in which case the Court may cite a party’s Response to the Statement of
Material Facts (“Resp. Stmt.”). The Court shall also cite directly to evidence in the record, where
appropriate.
3
Workplace Liability Coverage Part. Id. ¶ 4. The Professional Liability Coverage Part of the
Policy provides, in pertinent part, coverage for “professional liability claims arising out of a
medical incident by you or by someone for whose professional services you are legally
responsible.” Id. ¶ 5. A “medial incident” is defined as “any act, error or omission in your
providing professional services which results in injury or damage.” Id. “Professional services”
are defined “those services for which you are licensed, certified, accredited, trained or qualified
to perform within the scope of practice recognized by the regulatory agency responsible for
maintaining the standards of the profession(s) shown on the certificate of insurance and which
you perform as or on behalf of, the named insured.” Id. ¶ 6. The profession shown on
Sheinbaum’s certificate of insurance is “Registered Nurse.” Id. ¶ 7. The Professional Liability
Coverage Part excludes coverage for any claim based on, arising out of, or related to “liability
resulting from professional services you provide while your license or certification to practice is
suspended, revoked, or no longer valid” (“Exclusion J”). Defs.’ Stmt. ¶ 8. It also excludes
coverage for claims based on, arising out of, or related to “any liability you have for a business or
profession, including consulting services, other than that named on the certificate of insurance.”
Id. ¶ 9.
The Coverage Agreement of the Workplace Liability Coverage Part provides, in pertinent
part:
Subject to paragraph B below, we will pay all amounts, up to the Workplace Liability
limit of liability stated on the certificate of insurance, which you become legally
obligated to pay . . . as a result of injury or damage to which this coverage part
applies . . . . The injury or damage must be caused by an occurrence that happens at
the workplace during the policy period.
Defs.’ Stmt. ¶ 13. The Policy defines “workplace” as “any location used by you to provide
4
professional services.” Id. ¶ 14. It defines an “occurrence” as “an accident, including continuous
or repeated exposure to conditions, which results in injury or damage.” Id. ¶ 15. The Workplace
Liability Coverage Part excludes coverage for claims based on, arising out of, or related to
“injury or damage resulting from any professional services, placement services, or personal
injury.” Id. ¶ 16. It also excludes coverage for claims based on, arising out of, or related to “any
liability you have for a business or profession . . . other than that named on the certificate of
insurance,” i.e., registered nurse. Id. ¶ 17.
C. The Feld Action
On March 8, 2008, Karen Feld filed a lawsuit against Sheinbaum, styled Karen Feld v.
Inger F. Sheinbaum, Case No. 2008 CA 002002 B, in the Superior Court of the District of
Columbia (the “Feld Action”). Defs.’ Stmt. ¶ 18. In her complaint, Ms. Feld alleges that she is
sixty years old and recently had a craniotomy to remove a brain tumor. Id. ¶ 19. Ms. Feld further
alleges that, prior to her surgery, her doctors advised her to hire an experienced registered nurse
to provide her with full-time care during her hospitalization and subsequent convalescence. Id.
Ms. Feld alleges that in the fall of 2007, prior to her craniotomy, she hired Sheinbaum to provide
the nursing care recommended by her doctors and that Sheinbaum represented to her that she was
an experienced registered nurse. Id. Ms. Feld alleges that Sheinbaum’s performance “failed to
meet every relevant standard of care, and caused [Ms. Feld] continuing harm.” Id. ¶ 20. She
claims that Sheinbaum failed to perform the duties for which she was hired and that she breached
her agreement to serve as Ms. Feld’s nurse. Id. Ms. Feld alleges that she relied on Sheinbaum’s
representations that she was a licensed registered nurse and that these representations were false.
Id. ¶ 21.
5
On September 5, 2008, Ms. Feld filed an amended complaint, in which she asserts nine
causes of action against Sheinbaum: (1) return of property; (2) breach of contract; (3) fraud in the
inducement; (4) fraudulent misrepresentation; (5) negligence; (6) gross negligence; (7) fraud; (8)
punitive damages; and (9) violation of the D.C. Consumer Protection Procedures Act. Id. ¶ 27.
In her answer to the amended complaint, Sheinbaum admitted that she is not a licensed,
registered nurse in any jurisdiction in the United States. Id. ¶ 30.
On March 14, 2008, Sheinbaum’s counsel wrote to American Casualty regarding the Feld
Action. Id. ¶ 28. American Casualty contends that it was not until after Sheinbaum was sued
that it realized that Sheinbaum was not licensed as a registered nurse in the United States. Id. ¶
39.
II. LEGAL STANDARD
Defendants have filed a motion for summary judgment under Federal Rule of Civil
Procedure 56. Summary judgment is proper when “the pleadings, the discovery [if any] and
disclosure materials on file, and any affidavits show that there is no genuine issue as to any
material fact and that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(c). Under the summary judgment standard, the moving party bears the “initial responsibility
of informing the district court of the basis for its motion, and identifying those portions of the
pleadings, depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal quotation marks omitted). In
response, the non-moving party must “go beyond the pleadings and by [its] own affidavits, or by
the depositions, answers to interrogatories, and admissions on file, designate specific facts
6
showing that there is a genuine issue for trial.” Id. at 324 (internal quotation marks omitted). All
underlying facts and inferences are analyzed in the light most favorable to the non-moving party.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986).
The mere existence of a factual dispute, by itself, is insufficient to bar summary
judgment. See Liberty Lobby, 477 U.S. at 248. To be material, the factual assertion must be
capable of affecting the substantive outcome of the litigation; to be genuine, the issue must be
supported by sufficient admissible evidence that a reasonable trier of fact could find for the non-
moving party. Laningham v. U.S. Navy, 813 F.2d 1236, 1241 (D.C. Cir. 1987); Liberty Lobby,
477 U.S. at 251-52 (the court must determine “whether the evidence presents a sufficient
disagreement to require submission to a jury or whether it is so one-sided that one party must
prevail as a matter of law”). “If the evidence is merely colorable, or is not sufficiently probative,
summary judgment may be granted.” Liberty Lobby, 477 U.S. at 249-50 (internal citations
omitted). “Mere allegations or denials in the adverse party’s pleadings are insufficient to defeat
an otherwise proper motion for summary judgment.” Williams v. Callaghan, 938 F. Supp. 46, 49
(D.D.C. 1996). The adverse party must do more than simply “show that there is some
metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586 (1986). Conclusory assertions offered without any factual basis for support do
not satisfy an opponent’s burden to set forth “affirmative evidence” showing a genuine issue for
trial. Broaddrick v. Exec. Office of the President, 139 F. Supp. 2d 55, 65 (D.D.C. 2001) (citing
Laningham, 813 F.2d at 1241).
III. DISCUSSION
There are essentially only two legal issues to be addressed in ruling on Defendants’
7
motion for summary judgment. First, did Inger Sheinbaum make a material misrepresentation in
her application for insurance when she identified herself as an “RN”? Second, assuming she did
not, does the Policy cover any of the claims asserted in the Feld Action such that Defendants
have a duty to defend Sheinbaum in that action? Defendants also argue that Defendant CNA
Financial is not a party to the insurance contract and therefore owes no duties to Sheinbaum. The
Court shall address these issues in turn.
A. Rescission of the Insurance Contract Based on a Material Misrepresentation
Defendants contend that the Policy should be rescinded as void ab initio because
Sheinbaum’s indication that she was an “RN” on her application was a material
misrepresentation. Under Virginia law,3 “[a]n insurance company is entitled to rescind a policy
of insurance based on a representation in the application only if it clearly proves that (1) the
insured’s representation in the application was untrue; and (2) the insurance company’s reliance
on the false statement was material to its decision to assume the risk and issue the policy.”
Carolina Cas. Ins. Co. v. Draper & Goldberg, P.L.L.C., 138 F. App’x 542, 547 (4th Cir. 2005)
(citing Va. Code Ann. § 38.2-309 and Commercial Underwriters Ins. Co. v. Hunt & Calderone,
P.C., 540 S.E.2d 491, 493 (Va. 2001)); see also Va. Code Ann. § 38.2-309 (“No statement in an
application . . . shall bar recovery upon a policy of insurance unless it is clearly proved that such
3
Defendants argue, and Sheinbaum does not dispute, that Virginia law governs the
interpretation and enforcement of the Policy. The Court agrees that Virginia law should apply.
The District of Columbia’s choice-of-law rules (which this Court must apply in exercising its
diversity jurisdiction) require the Court to consider a variety of factors in determining which
jurisdiction has the most significant relationship to the contract, including the place of
contracting, the place of negotiation, the place of performance, the location of the subject matter
of the contract, the residence and place of business of the parties, and the principal location of the
insured risk. See Adolph Coors Co. v. Truck Ins. Exchange, 960 A.2d 617, 620 (D.C. 2008).
These factors overwhelmingly point to the application of Virginia law.
8
. . . statement was material to the risk when assumed and was untrue.”). Sheinbaum does not
argue that her representation was immaterial to Defendants’ decision to issue the Policy,4 but she
vigorously disputes that her representation was untrue. Accordingly, the Court shall focus on the
requirements for proving the untruthfulness of a statement under Virginia law.
Under Virginia law, “[a]n insurer is entitled to receive truthful and full representations
from prospective insureds.” Parkerson v. Fed. Home Life Ins. Co., 797 F. Supp. 1308, 1315
(E.D. Va. 1992); see also Inter-Ocean Ins. Co. v. Harkrader, 67 S.E.2d 894, 897 (Va. 1951)
(“Representations in an application for a policy of insurance should not only be true but full. The
insurer has the right to know the whole truth.”). “However, it is clear under Virginia law that an
insured has no affirmative duty to volunteer information; rather, an insured is only required to
disclose information that is asked of him.” St. Paul Fire & Marine Ins. Co. v. Jacobson, 48 F.3d
778, 780-81 (4th Cir. 1995) (citing Greensboro Nat’l Life Ins. Co. v. Southside Bank, 142 S.E.2d
551, 555 (Va. 1965)). Moreover, although an insurer generally must prove only the falsity of the
representations to prove that they are untrue, when “the insurer asks the insured to aver only that
the representations are true to the best of the insured’s knowledge and belief, the insurer must
clearly prove that the insured’s answers were knowingly false.” Parkerson, 797 F. Supp. at 1315
4
Defendants have produced a declaration from Michael A. Scott, an official who
manages and oversees the underwriting process for nurses’ professional liability policies issued
by American Casualty, who avers that American Casualty would not have issued an insurance
policy to someone it knew did not have a registered nursing license in the state where she
practices. See Defs.’ Mot., Ex. 1 (Decl. of Michael A. Scott) ¶¶ 1, 8. Sheinbaum has not
rebutted or contradicted this statement. Materiality is a question of law, Chitwood v. Prudential
Ins. Co. of Am., 143 S.E.2d 915, 918 (Va. 1965), and “an underwriter’s sworn statements,
particularly when uncontradicted, are sufficient to demonstrate the materiality of the
misrepresentation.” TIG Ins. Co. v. Robertson, Cecil, King & Pruitt, 116 F. App’x 423, 426 (4th
Cir. 2004).
9
(citing Old Republic Life Ins. Co. v. Bales, 195 S.E.2d 854, 856 (Va. 1973)). Generally, whether
a statement is true or not and whether an untrue statement was knowingly made are questions of
fact for the jury. Id. However, “where the record shows clearly that the insured gave statements
that were not true and correct to the best of the insured’s knowledge and belief, the Supreme
Court of Virginia has held that a trial court errs in submitting that question to the jury.” Id.
(citing Mut. of Omaha Ins. Co. v. Echols, 154 S.E.2d 169, 172 (Va. 1967)).
Defendants argue that Sheinbaum’s representation was knowingly false because she knew
at the time of the application that she was not licensed as a registered nurse in the United States,
and therefore she made a misrepresentation when she checked the “RN” box on the application
for the Policy. Sheinbaum disagrees, pointing out that she is a registered nurse in Denmark and
that the application did not define “RN” so as to apply only to registered nurses who are licensed
in the United States. The question, then, is whether the term “RN” as used in the application
clearly and unambiguously refers to a registered nurse who is licensed to practice by some
jurisdiction in the United States. “Language is ambiguous when it may be understood in more
than one way or when such language refers to two or more things at the same time.” Salzi v. Va.
Farm Bureau Mut. Ins. Co., 556 S.E.2d 758, 760 (Va. 2002). Any ambiguity in the language
must be construed in favor of the insured. Res. Bankshares Corp. v. St. Paul Mercury Ins. Co.,
407 F.3d 631, 636 (4th Cir. 2005) (applying Virginia law).
The application does not define the term “RN.” However, Defendants argue that
Sheinbaum’s representation that she was an “RN” was necessarily false because Virginia law
restricts the use of the designation “RN” to persons who are licensed to practice as a registered
nurse in Virginia:
10
Any person who holds a license or a multistate licensure privilege to practice
professional nursing in Virginia shall have the right to use the title “registered nurse”
and the abbreviation “R.N.” No other person shall assume such title or use such
abbreviation or any other words, letters, signs or devices to indicate that the person
using the same is a registered nurse.
Va. Code Ann. § 54.1-3016. The problem with this argument is that it proves too much. The
application does not specifically ask in which jurisdiction Sheinbaum is licensed to practice, and
Virginia law does not require her to volunteer that information. Under Defendants’ theory, if
Sheinbaum held a license to practice in the District of Columbia, she still could not truthfully
check the “RN” box because she would not be a registered nurse as defined by Virginia law.
Even if Sheinbaum violated Virginia law by stating that she was an “RN” on the application—a
question this Court need not decide—that does not mean that her statement was false as a matter
of law. Sheinbaum has provided evidence to show that she is a registered nurse in Denmark.
There is nothing on the face of the application that indicates a geographic limitation to Virginia
or even to the United States. Based solely on the application, Sheinbaum could have concluded
that she was applying for professional liability insurance for services rendered in Denmark or
anywhere else she may lawfully practice, which would make her representation entirely
reasonable.
The parties both refer to the following definition of “registered nurse” in support of their
position: “a graduate nurse who has been legally authorized (registered) to practice after
examination by a state board of nurse examiners or similar regulatory authority, and who is
legally entitled to use the designation R.N.” See Pl.’s Opp’n at 9 (quoting Dorland’s Illustrated
Medication Dictionary 909 (John P. Friel ed., W.B. Saunders Co. 1985) (1900)); Defs.’ Reply at
11. Defendants argue that this definition cannot be fairly read to encompass registered nurses
11
from jurisdictions outside the United States. The Court disagrees. Defendants have not shown
that the plain meaning of “registered nurse” is limited those persons licensed as such within the
United States. Therefore, the Court finds that the meaning of “RN” on the application is not
limited to persons licensed to practice in Virginia or in any other particular jurisdiction.
Because Sheinbaum has produced evidence that she is licensed as a registered nurse in
Denmark and Defendants have not produced any evidence to the contrary, the Court finds that
there is no disputed issue of material fact as to Sheinbaum’s credentials as a Danish registered
nurse. Based on that fact, no reasonable finder of fact could conclude that Sheinbaum’s
representation on the Policy application was knowingly false. Accordingly, the Court finds that
Sheinbaum is entitled to judgment as a matter of law on this issue, and the Court shall deny
Defendants’ motion for summary judgment and dismiss American Casualty’s claim for
rescission.5
B. The Scope of the Policy’s Coverage in Relation to the Feld Action
Defendants contend that they have no duty to defend the Feld Action because the Policy
excludes coverage for the claims asserted therein. Specifically, Defendants argue that there is no
coverage under the Professional Liability Coverage Part because (a) Sheinbaum did not hold a
valid license when she rendered services to Ms. Feld; (b) Sheinbaum was engaged in a business
or profession other than as a registered nurse; (c) Sheinbaum was acting as an unsupervised home
healthcare aide; and (d) Sheinbaum willfully violated the law by holding herself out as a
registered nurse. Defendants also argue that there is no coverage under the Workplace Liability
5
In light of the Court’s resolution of this claim, it need not address Sheinbaum’s
argument that additional discovery is necessary as to this issue pursuant to Rule 56(f).
12
Coverage Part because (a) the Feld Action arises out of Sheinbaum’s alleged provision of (or
failure to provide) “professional services”; (b) Sheinbaum was engaged in a business or
profession other than as a registered nurse; and (c) Sheinbaum willfully violated the law by
holding herself out as a registered nurse. Defendants further argue that the claims asserted in the
Feld Action are not covered because they do not arise from a “medical incident” (Professional
Liability Coverage Part) or from an “occurrence” (Workplace Liability Coverage Part). The
Court shall not address all of these arguments, however, because it finds that coverage is
excluded because Sheinbaum did not hold a valid license to provide services as a registered
nurse.
1. The Duty to Defend
Under Virginia law, an insurer’s “‘obligation to defend is broader than [its] obligation to
pay, and arises whenever the complaint alleges facts and circumstances, some of which would, if
proved, fall within the risk covered by the policy.’” Virginia Elec. & Power Co. v. Northbrook
Property & Cas. Ins. Co., 475 S.E.2d 264, 265 (Va. 1996) (quoting Lerner v. Safeco, 245 S.E.2d
249, 251 (Va. 1978)). Thus, “an insurer’s duty to defend is triggered if there is any possibility
that a judgment against the insured will be covered under the insurance policy.” Bohreer v. Erie
Ins. Group, 475 F. Supp. 2d 578, 584 (E.D. Va. 2007). “Virginia and other states have adopted
the Eight Corners Rule, which requires courts to look primarily at the underlying complaints and
the insurance policy to determine if there is a potential for coverage.” CACI Int’l, Inc. v. St. Paul
Fire & Marine Ins. Co., 566 F.3d 150, 155 (4th Cir. 2009). Courts are constrained to the four
corners of the complaint and may not examine additional documents, even if attached to the
complaint. See id. at 155-56. The Eight Corners Rule “prevents courts from conducting an
13
intensive factual analysis at an early stage of the proceedings, which would only increase
litigation costs and needlessly tax parties and courts before the underlying suit had barely begun.”
Id. at 155. However, “‘if it appears clearly that the insurer would not be liable under its contract
for any judgment based upon the allegations,’ the duty to defend will not attach.” Id. (quoting
Brenner v. Lawyers Title Ins. Corp., 397 S.E.2d 100, 102 (Va. 1990))
Although the Eight Corners Rule largely constrains a court’s inquiry, the rules of contract
interpretation remain intact. See, e.g., Salzi v. Va. Farm Bureau Mut. Ins. Co., 556 S.E.2d 758,
760 (Va. 2002) (“[A]n insurance policy is a contract, and, as in the case of any other contract, the
words used are given their ordinary and customary meaning when they are susceptible of such
construction” (internal quotation omitted)). Under Virginia law, “when interpreting a[n]
[insurance] policy courts must not strain to find ambiguities . . . or examine certain specific
words or provisions in a vacuum, apart from the policy as a whole.” Res. Bankshares Corp., 407
F.3d at 636 (internal citations omitted). For it is not a court’s “function to ‘make a new contract
for the parties different from that plainly intended and thus create a liability not assumed by the
insurer.’” Blue Cross & Blue Shield of Va. v. Keller, 450 S.E.2d 136, 140 (Va. 1994) (quoting
Pilot Life Ins. Co. v. Crosswhite, 145 S.E.2d 143, 145 (Va. 1965)). However, when language
“may be understood in more than one way or when it refers to two or more things at the same
time,” the language is ambiguous and “will be given an interpretation which grants coverage,
rather than one that withholds it.” Smith v. Allstate Ins. Co., 403 S.E.2d 696, 697 (Va. 1991)
(quoting Am. Reliance Ins. Co. v. Mitchell, 385 S.E.2d 583, 585 (Va. 1989)).
Although the Feld action contains nine causes of action, under the Eight Corners Rule,
the Policy need only cover one of the claims to trigger Defendants’ duty to defend. See Lerner,
14
245 S.E.2d at 251. Sheinbaum argues only that Ms. Feld’s negligence claim (count five)
provides a basis for coverage under the Policy because it asserts a breach of a duty to provide
nursing services at the highest standard. See Pl.’s Opp’n at 21-22. Accordingly, the Court may
analyze only the negligence cause of action and consider Sheinbaum to have conceded that the
other eight causes of action are not covered under the Policy. See Hopkins v. Women’s Div.,
Gen. Bd. of Global Ministries, 284 F. Supp. 2d 15, 25 (D.D.C. 2003), aff’d, 98 F. App’x 8 (D.C.
Cir. 2004) (“It is well understood in this Circuit that when a plaintiff files an opposition to a
dispositive motion and addresses only certain arguments raised by the defendant, a court may
treat those arguments that the plaintiff failed to address as conceded.”).
2. The Professional Liability Coverage Part
Defendants argue that there is no coverage for the Feld Action under the Professional
Liability Coverage Part because the undisputed facts show that (1) Ms. Feld alleges that she was
injured or damaged by Sheinbaum’s acts, errors or omissions in providing registered nursing
services; (2) Sheinbaum did not have a valid license to provide registered nursing services in the
District of Columbia when she worked for Ms. Feld; and (3) the Policy excludes coverage for any
liability arising from or related to the provision of registered nursing services without a valid
license. Sheinbaum does not dispute that the allegations in the Feld Action pertain to her
registered nursing services or that she did not have a valid license in the Virginia or the District
of Columbia. Rather, Sheinbaum argues the Policy exclusion does not apply because she did
have a valid license from Denmark when she provided services to Ms. Feld.
The exclusion at issue, Exclusion J, provides in relevant part: “We will not defend any
claim for, or pay any amounts, including claim expenses, based on, arising out of, or related to . .
15
. liability resulting from professional services you provide while your license or certification to
practice is suspended, revoked, or no longer valid.” See Defs.’ Mot., Ex. 3 (Policy), Prof’l
Liability Coverage Part, § V(J). Sheinbaum argues that the restrictive phrase “no longer valid”
does not apply to her because her Danish license was still valid. According to Sheinbaum, “[b]y
its plain terms, Exclusion J does not apply where the insured has a valid license in at least one
jurisdiction somewhere in the world.” The Court finds that Sheinbaum’s interpretation of
Exclusion J is contrary to its plain meaning and unreasonable in the context of the Policy as a
whole.
The purpose of Exclusion J is to exclude coverage for the practice of nursing services
without a valid license. The word “valid” means “legally sufficient.” Black’s Law Dictionary
1586 (8th ed. 2004). Because the profession of nursing is regulated separately through licensing
requirements by each jurisdiction, the validity of a nursing license is jurisdiction-specific.
Therefore, it does not make sense to say, for example, that a person who is licensed only in
California has a “valid” license to practice in the District of Columbia. When a nurse who is
licensed only in one jurisdiction moves to another jurisdiction to practice, her license is “no
longer valid.” Sheinbaum’s interpretation of Exclusion J would mean that Defendants agreed to
provide professional liability coverage for nurses who practice anywhere in the United States or
Canada (the geographic limits of the Policy) so long as some jurisdiction, somewhere in the
world, had licensed them as a registered nurse. Sheinbaum’s interpretation is contrary to the
plain meaning of the exclusion and conflicts with the public policy of all the jurisdictions in the
16
United States that have established specific licensing requirements for registered nurses.6
Sheinbaum argues in the alternative that Exclusion J is ambiguous and that the ambiguity
should be construed in her favor to permit coverage. However, the Court must not “strain to find
ambiguities . . . or examine certain specific words or provisions in a vacuum, apart from the
policy as a whole.” Res. Bankshares Corp., 407 F.3d at 636. The Court must give the
provision’s terms “their ordinary and customary meaning when they are susceptible of such
construction.” CACI Int’l, 566 F.3d at 158 (quoting Salzi, 556 S.E.2d at 760). As explained
above, the “ordinary and customary” definition of “valid license” is a license that is legally
sufficient for one to practice in a particular jurisdiction. Therefore, Exclusion J is not
ambiguous.
Because Sheinbaum did not hold a valid registered nursing license when performing
services for Ms. Feld in the District of Columbia, the Policy does not cover Sheinbaum’s alleged
provision of nursing services in the District of Columbia. Therefore, there is no coverage for the
Feld Action under the Professional Liability Coverage Part.
3. The Workplace Liability Coverage Part
Defendants argue that there is no coverage for the Feld Action under the Workplace
Liability Coverage Part of the Policy because (1) the Feld Action arises out of Sheinbaum’s
alleged provision of, or failure to provide, “professional services”; and (2) the Policy excludes
coverage for claims based on “[i]njury or damage resulting from any professional services.”
Sheinbaum agrees that the Feld Action arises out of her provision of professional services and
6
The parties agree that every jurisdiction in the United States requires that a person be
licensed in order to be a registered nurse. See Defs.’ Stmt. ¶ 50.
17
therefore argues that there is coverage under the Professional Liability Coverage Part.
Sheinbaum does not argue in her opposition that there is any coverage for the Feld Action under
the Workplace Liability Coverage Part. Accordingly, the Court shall treat this argument as
conceded and find that the Feld Action is excluded under the Workplace Liability Coverage Part.
4. Conclusion
Because the Court finds that the claims in the Feld Action are excluded from coverage
under both the Professional Liability Coverage Part and the Workplace Liability Coverage Part of
the Policy, the Court shall grant Defendants’ motion for summary judgment and declare that
Defendants have no duty to defend Sheinbaum in the Feld Action.
C. CNA Financial’s Status As a Party to the Contract
Defendants argue that CNA Financial must be dismissed a defendant in this action
because there is no evidence that CNA Financial was a party to the Policy and therefore there is
no evidence that it owes a duty to defend. The Court agrees. American Casualty is listed as the
insurer on the Policy, not CNA Financial. See Defs.’ Mot., Ex. 3 (Policy) at 1. Sheinbaum’s
only evidence that CNA Financial is a party to the Policy is the fact that American Casualty is
listed as a “CNA Company” on the Policy application and that there is a “CNA” logo displayed
throughout the Policy. See Pl.’s Opp’n at 34-35.7 Moreover, there is no dispute that even if
CNA Financial were a party to the Policy, it would owe the same duties to Sheinbaum as
American Casualty. Therefore, because American Casualty has no duty to defend, CNA
7
Sheinbaum argues that additional discovery is needed on this issue and therefore
summary judgment is improper under Rule 56(f). However, the Court notes that Sheinbaum had
an opportunity to obtain discovery on this issue but failed to do so in a timely manner in
accordance with the Court’s scheduling order. Therefore, the Court declines to defer its ruling on
this issue pursuant to Rule 56(f).
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Financial also has no duty to defend.
IV. CONCLUSION
As explained above, the Court finds that Sheinbaum did not make a material
misrepresentation that renders the Policy void ab initio. The Court also finds that the Policy
excludes coverage for the claims asserted in the Feld Action. Therefore, the Court shall declare
that neither American Casualty nor CNA Financial have a duty to defend Sheinbaum with respect
to the Feld Action. For the foregoing reasons, the Court shall GRANT-IN-PART Defendants’
[17] Motion for Summary Judgment with respect to Defendants’ duty to defend and DENY-IN-
PART the motion with respect to American Casualty’s claim for rescission. This action shall be
dismissed. An appropriate Order has been issued to this effect.
Date: October 1, 2010
/s/
COLLEEN KOLLAR-KOTELLY
United States District Judge
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