Robert Mau; Eagle Well Services, Inc. Plaintiffs-Appellants
Twin City Fire Insurance Co. Defendant-Appellee
Submitted: October 18, 2018
from United States District Court for the District of North
Dakota - Bismarck
SMITH, Chief Judge, LOKEN and GRUENDER, Circuit Judges.
GRUENDER, Circuit Judge.
Mau and Eagle Well Services, Inc. ("EWS") appeal
the district court'sgrant of Twin City Fire Insurance
Company's ("Twin City") cross-motion for
summary judgment. The district court found that Twin City did
not owe Mau or EWS a duty to defend under a Twin City
insurance policy. We affirm.
complicated facts of this case are set out fully in the
district court's order, Mau v. Twin City Fire Ins.
Co., No. 1:16-CV-325, 2017 WL 4479731, at *1-3 (D.N.D.
Oct. 3, 2017), so we relate only the most relevant facts
here. Twin City insured Eagle Operating, Inc. and its
subsidiaries. Endorsement No. 2 of the policy defined Eagle
Operating's subsidiaries to include EWS and MW
Industries, Inc. During the relevant period, Mau was
president of Eagle Operating, shareholder and president of
EWS, director and president of MW, and an owner of American
Well Services ("AWS").
February 2012, EWS sold its assets to a predecessor of Sun
Well Services ("Sun Well") through an Asset
Purchase Agreement ("Agreement"). EWS and Mau were
parties to the Agreement, which included a noncompetition
covenant. After the Agreement was signed, MW sold equipment
to AWS. Claiming that the sale violated the noncompetition
covenant, Sun Well sued Mau for breach of contract, fraud,
and civil conspiracy, and it sued EWS for breach of contract
and fraud. Twin City refused to defend the
EWS sued Twin City, seeking a declaration that they were
insured under the policy. They also sued Twin City for breach
of contract and breach of the implied covenant of good faith
and fair dealing. Mau filed a motion for partial summary
judgment. Twin City filed a response in opposition and a
cross-motion for summary judgment, asking the court to find
that Twin City had no duty to defend Mau or EWS. The district
court denied Mau's motion for partial summary judgment,
and it granted Twin City's cross-motion for summary
review a grant of summary judgment de novo,
considering the facts "in the light most favorable to
the nonmoving party." Hiland Partners GP Holdings,
LLC v. Nat'l Union Fire Ins. Co. of Pittsburgh,
PA, 847 F.3d 594, 597 (8th Cir. 2017). A motion for
summary judgment will be granted where "the movant shows
that there is no genuine dispute as to any material fact and
the movant is entitled to judgement as a matter of law."
Fed.R.Civ.P. 56(a). We review "the district court's
construction of an insurance policy and interpretation of
state law de novo." Philadelphia Consol. Holding
Corp. v. LSI-Lowery Systems, Inc., 775 F.3d 1072, 1076
(8th Cir. 2015).
parties agree that North Dakota law applies in this case.
"[T]he parameters of [an insurer's] duty to defend
are governed by the allegations in the complaint against the
insured." Pennzoil Co. v. U.S. Fid. & Guar.
Co., 50 F.3d 580, 583 (8th Cir. 1995) (applying North
Dakota law). "[A]n insurer has no duty to defend an
action if there is no possibility of coverage under the
policy." Schultze v. Cont'l Ins. Co., 619
N.W.2d 510, 513 (N.D. 2000). "[A]ny doubt about whether
a duty to defend exists must be resolved in favor of the
insured." Tilbert v. Nodak Mut. Ins. Co., 816
N.W.2d 31, 42 (N.D. 2012).
district court properly granted summary judgment to Twin City
as to both Mau and EWS. Mau argued before the district court
that Twin City owed him a duty to defend because Sun Well
sued him in his capacity as a director and officer of MW, an
insured subsidiary of Eagle Operating. The district court
rejected his argument, and so do we. Sun Well's claims do
not depend on any actions Mau took as president of MW. This
is evidenced by the fact that Sun Well did not sue MW. While
Sun Well's complaint mentions MW contextually, MW is not
a party to the suit.
Sun Well's claims depend on the alleged breach of the
noncompetition covenant in the Agreement between EWS and Sun
Well, an agreement to which MW was not a party. Sun Well
would have no claim for breach of contract, fraud, or civil
conspiracy against Mau were it not for the Agreement, which
he signed as president of EWS, not as a director and officer
of MW. Thus, Sun Well sued Mau in his capacity as president
of EWS. Because Sun Well's complaint contains no claims
based on any actions Mau took as a director and officer of
MW, Twin City owes him no duty to defend on that basis.
first time on appeal, Mau argues that Twin City owes him a
duty to defend because he was sued in his capacity as
president of EWS. But before the district court he argued
only that he was entitled to coverage in his capacity as
officer and director of MW. "It is well settled that we
will not consider an argument raised for the first time on
appeal." Eagle Tech. v. Expander Ams., Inc.,
783 F.3d 1131, 1138 (8th Cir. 2015). Because Mau did not give
the district court the opportunity to consider whether he was
entitled to coverage in his capacity as president of EWS, we
decline to do so here.
even had Mau raised this argument before the district court,
Eagle Operating's insurance policy with Twin City
includes an exclusion that applies to Mau in his capacity as