Public Risk Management of Florida v One Beacon Insurance Co

8/11/2019 Public Risk Management of Florida v One Beacon Insurance Co.

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West[aw

--- Fed.Appx.----,2014WL2853754(C.A.lI (Fla.))(Cite as: 2014 WL2853754 (C.A.ll(Fla.)))

Only the Westlaw citation is currently available.Thiscase was not selected

forpublication

in the FederalReporter.

Not for Publication in West's Federal Reporter. SeeFed. Rule of Appellate Procedure 32.1 generallygoveming citation ofjudicialdecisions issued on orafter Jan. 1,2007 - See also Eleventh CircuitRules36-2,36-3. (FindCTAII Rule 36-2 and Find CTAl1Rule 36-3)

United States Court of Appeals,

Eleventh Circuit.PUBLICzuSK MANAGEMENTOF FLOzuDA,

Plaintiff-Appellant,

ONE BEACONINSU CE CO., a foreign corpo-ration authorized to do business in Florida,Defend-

ant-Appellee.

No. 13-15254Non-ArgumentCalendar

June24,2Ol4.

Donovan Adam Roper, Andrew Ian Dayes, Roper &Roper, P.4., Apopka, FL, for PlaintifAppellant.

Thomas James Judge, Unam Peter Oh, Loss Judge &Ward, LLP, Washington, DC, J. Charles lngram, EstesIngram Foels &Gibbs, P.4., Orlando, FL, for De-fendant-Appellee.

Appeal from the United States DistrictCourt for the

MiddleDistrictof Florida. D.C. Docket No.6: 1 3-cv-0 1067-GAP-TBS.

Before CARNES,Chief Judge, HULLand FAy,CircuitJudges.

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PERCURIAM:*1

Public Risk Management of Florida appealsthe districtcourt's decision to dismiss its complaintwithprejudice. Public Riskcontends that its complaintstated two claims for relief,one based on breach ofcontract and one based on equitable estoppel.

I.This case is a dispute about insurance coverage in

an underlying lawsuit.Public Risk is an intergov-emmental risk management association that insuresvarious local governmental entities in Florida.NtSee

Fla. Stat. S 768.28(16). Public Risk insures itselfthrough a reinsurance policypurchased from One-Beacon Insurance Company. Public Risk has filed aclaimwithOneBeacon seeking coverage for the legalfees that Public Riskincurred defending one of itsmembers, the C of Wintergarden, in an underlyinglawsuit. OneBeacon refuses to pay on that claim be-cause it believes that Public Riskhad no duty to de-fend the Cityfrom that suit. We willbegin by outlin-ing the facts of that underlyinglawsuitbecause theyare necessary to understand the dispute before us.

FNl. Because Public fusk challenges theRule l2(b)(6)dismissal of its complaint,wetake these facts from PublicRisk's complaint,accepting its account as true and construingits facts in the lightmost favorable to PublicRisk, see Doe v. Pryor, 344 F.3d 1282, 1284(l lth Cir.2003).

ln 2009 the City reached an agreement withtheFlorida Department of Transportation (FDOT)toremove the utilitieslocated along State Road 50 sothat the FDOTcould widen and improve the road.Under the agreement, the Citywould removeall of theCity-ownedutilities,and the FDOT would-beforethe City's removal began-remove all of thenon-C-owned utilities.The Citysolicited bidson

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--- Fed.Appx. ----,2014 WL2853754 (C A.l I (Fla.))(Cite as: 2014 \ryL 2853754 (C.A.ll (Fla.)))

the job and awarded the contract to Dewitt Excavat-ing, [nc. The contract called for Dewitt to complete thejob in 240 days and included a liquidated damagesclause that required Dewitt to pay the City $5,000 for

each extra day it took to furish the project. The con-tract softened that deadline by allowing for equitableextensions in the event that outside forces delayed,disrupted, or complicated Dewitt's work. Dewitt en-tered its bid and agreed to the contract based largelyon two representations by the C: (1) the projectdrawings that the C provided to all the biddingcontractors, which identified the location of the utili-ties that Dewitt would have to move; and (2) Ad-dendum No. l to the City's request for bid proposals,which informed the bidders that the FDOT would

remove the non-City-owned utilities by January 23,2010. Dewitt used that information to estimate howmuch time and money it would take to finish the pro-ject, as well as to plan where to dig.

Once the work began, Dewitt ran into significantdelays. The biggest problem was that there were farmore utilities along the road than the City had indi-cated. The FDOT failed to move the non-City-ownedutilities that it had agreed to handle under its agree-ment with the City, and Dewitt found many unknown

or unidentified utilities that did not appear on theproject drawings. Dewitt damaged some of thoseutilities when it dug into what it thought was emptyground. On top of that, the City made numerous revi-sions to its plan that required Dewitt to perform extrawork and incur extra costs that had not been part of itsoriginal bid. Although the City initially granted sev-eral of Dewitt's early requests for equitable exten-sions, it refused to grant further extensions as thedeadline neared and threatened to seek both liquidatedand actual damages if Dewitt did not meet the dead-line. Dewitt tried to finish on time, but the logisticalproblems were too much to overcome and the projectran past the deadline. After the work was complete,the City refused to pay Dewitt for pending changeorders and other amounts under the contract, assertingthat Dewitt was liable for liquidated and actual delay

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damages.

*2 Dewitt sued the Crty in state court in June201 I . Its complaint organized Dewitt's claims into two

general counts, one for breach ofcontract and one forviolation of Florida's Public Records Act. This appealconcerns Count One, which was for breach of con-tract.N2 It alleged, among other things, that the City'sproject drawings omitted some utilities, and that theCity knew the non-City-owned utilities would not beremoved in the timeframe presented in Addendum No.l. Count One claimed that the City had breached itscontract with Dewitt in eleven different ways, identi-fuing the different theories of breach as *26(a)through *26(k). The first two theories faulted the Cfor the errors and omissions in the project drawingsand the false information in Addendum No. l. Para-graph26(a) alleged that the City breach [ed] its im-plied warranty that the plans and design specificationsissued to Dewitt were accurate and suitable for per-forming Dewitt's scope of work. And Paragraph26(b) alleged that the City breach[ed] its impliedobligation not to furnish misleading information. Theremaining nine theories focused on the City's conductafter the work had begun, such as refusing withoutvalid justification to pay change orders and pay ap-

plications and failing to respond to or pay variouswritten requests for payment. Based on those eleventheories ofbreach, Count One sought eleven catego-ries of damages from the City, which the complaintidentified as 27(a) through *27(k). Many of themwere based on payments the City owed Dewitt underthe contract, but two were tied to the inaccuracies inthe City's project drawings and the misstatement inAddendum No. I . Paragraph 27 (f) sought [a]mountsDewitt is and./or becomes obligated to pay owners ofutilities that were damaged as a result of the C'smisrepresentations, erroneous design specifications,and/or refusal to grant warranted time extensions.And Paragraph 27(h) sought [o]ther expenses anddamages associated with the reduction in Dewitt'sexpected productivity as a result of the City's mis-representations and inaccuracies in the bid pack-

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-- Fed.Appx. ----,2014WL2853754 (C.A.l I (Fla.))(Cite as:2014 WL 28s37s4 (C.A.rr Gh.)))age....

FN2. Count Two was based on the City'srefusal to honor a public records request that

Dewitt made in .llfay 20ll in an attempt toacquire documents regarding the City's con-hact with Dewitt. Public Risk concedes thatCount Two does not trigger the duty to de-fend because the City's policy covers onlyclaims for money damages, and Count Twoseeks equitable relief.

Public Risk concluded that Dewitt's allegationscould be covered by the provision in the City's policyinsuring against wrongful acts by the City's off,r-cials. That triggered Public Risk's duty to defend un-der the policy, so it hired a law f,rm to represent theCity.^' Shortly after Public Risk decided that it had aduty to defend the City, it submitted a claim to One-Beacon for coverage under the reinsurance policy. OnIvne 24,201l, Public Risk sent OneBeacon a claimletter and a copy of Dewitt's complaint. OneBeaconresponded by letter on June 29. It concluded that: There is no coverage for [Dewitt's suit] as it is cur-rently pled. Public Risk asked OneBeacon to revisitits coverage analysis and proceed under a full reser-vation of rights. No On September 22, 2}ll, One-Beacon sent Public Risk a supplemental letter doingthat. The letter made clear that OneBeacon did so without conceding that there is at present any poten-tial coverage under the [reinsurance policy] andwithout waiving any of its rights, including the right todeny coverage for the Dewitt Action in its entirety.

FN3. The City's policy creates a general dutyto defend for Public Risk. The policy states: It is understood and agreed [Public Risk]has the right and duty to investigate, handle,settle, or defend any claim, proceeding, orsuit against the [City] or against any personor organization for whom the lcity] is or maybe found to be legally liable. (capitalizationomitted).

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FN4. A reservation of rights is [a] notice ofan insurer's intention not to waive its con-tractual rights to contest coverage or to apply

an exclusion that negates an insured's claim.Black's Low Dictionary (9th ed.2009),available af Westlaw BLACKS.

*3 Dewitt's case was settled before trial for S1.35million. Public Risk did not pay any ofthat settlementfigure, but it did owe $486,941.07 in legal fees to thelaw firm representing the C. The reinsurance policyobligated OneBeacon to pay the legal fees that PublicRisk incwred defending the City in legal actionscovered by its policy with Public Risk, subject to a$200,000 self-insured retention.N5 But when PublicRisk sought $286,941.07 from OneBeacon, the rein-swer refused to pay.

FN5. A self-insured retention is [t]heamount of an otherwise-covered loss that isnot covered by an insurance policy and thatusu[ally] must be paid before the instrer willpay benefits . Black's Law Dictionary (9thed.2009), vailable a Westlaw BLACKS.

Public Risk filed suit in state court in June 2013,asserting claims for breach of contract and equitableestoppel. OneBeacon removed the case to federaldistrict court under 28 U.S.C. S 1441 and shortlythereafter moved to dismiss the complaint under Rulel2(bx6) for failure to state a claim. The court grantedthe motion and dismissed the complaint with prejudice

in October 2012. Public Risk filed a motion for re-consideration, which the court denied. This is PublicRisk's appeal.

II.Public Risk challenges the district court's decision

to dismiss its breach of contract claim. The districtcourt did so after concluding that: (l) Dewitt's com-plaint did not fall under the policy's coverage for

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--- Fed.Appx. ----, 2Ot4 WL 28537s4 (C.A.l I (Fla.))(Cite as: 2014 WL 28s3754 (C.A.rl Gh.)))

wtongful acts, and (2) the policy's exclusion for any []oss arising out ofan intentional breach ofcontracteliminated Public Risk's duty to defend. Our review isde novo. James River Ins. Co. v. Ground Down Eng'g,

Inc., 540 F.3d 1270, 1273J4 (l lth Cir.2008).

This challenge turns on whether Dewitt's com-plaint triggered Public Risk's duty to defend under theCity's policy with Public Risk.N6 Our analysis focuseson the language of two documents: the City's insur-ance policy and Dewitt's complaint. Under Floridalaw, we must construe the terms of the City's policybased on their plain meaning, resolving any ambigui-ties in favor of the insure d. Id. at 127 4. So if a term isambiguous-if it is susceptible to multiple reasonable

interpretations----courts choose the interpretation thatfavors coverage. Auto-Owners Ins. Co. v. Anderson,756 So.2d 29, 34 (F1a.2000). When discerning themeaning of a term, courts must be sure to read the policy as a whole, endeavoring to give every provi-sion its full meaning and operative effect. U.S. FireIns. Co. v. J.S.U.B., Inc., 979 So.2d 871, 877(F1a.2007) (quotation marks omitted). Our assessmentof Public Risk's duty to defend in the underlying suit isalso focused on text-the text of Dewitt's complaint.Because the duty to defend in Florida is broader than

the duty to indemniSr, insurers must defend when thecomplaint alleges facts which fairly and potentiallybring the suit within policy coverage. Lime Tree Vill-Cmty. CIub Ass'n, Inc. v. Stqte Farm Gen. Ins. Co.,980 F.2d 1402, 1405 (l lth Cir.l993) (emphasis add-ed). That holds true even where the complaint allegesfacts partially within and partially outside the scope ofcoverage, or when the later true facts show there isno coverage. Trizec Props., Inc. v. Biltmore Constr.Co., |nc.,767 F.2d 810, 811 (llth Cir.l985). Courtstherefore focus solely on the facts and legal theories

alleged in the pleadings and claims against the in-sured, asking whether those allegations arguably fallunder the policy's coverage. James Rver Ins. Co., 540F.3d at 1275. If the allegations of the complaint leaveany doubt as to the duty to defend, the question mustbe resolved in favor of the insured.. Lime Tree Vill.

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Cmty. Club Ass'n, (nc.,980 F.2d at 1405

FN6. The district court's opinion observedthat [t]he parties appear to be in agreement

that if [Public Risk] had no duty to defendunder the [City's] Policy, then OneBeaconhad no duty to reimburse [Public Risk].Neither parfy disputes that characterizationon appeal.

*4 We begin with the language of the coverageprovisions at issue. Public Risk argues that it had aduty to defend based on Section IV of the policy'sprimary coverage, which provides coverage for wrongful acts by C officials. Under Section IV,Public Risk agrees, subject to the Coverage Docu-ment limitations, exclusions, terrns and conditions topay on behalf of the lcityl for all sums which the[C] is legally liable by reason of a wrongful act.(capitalization omitted). Paragraph 23 of the policy'sgeneral coverage provisions defines a wrongful act as any actual or alleged error or miss-statement [sic],omission, act or neglect or breach of duty due tomisfeasance, malfeasance, and non-feasance ... by the

[City]. (capitalization omitted). Nothing in the City'spolicy suggests that a wrongful act cannot be rooted ina duty the City has under a contract. To the contrary,the fact that Paragraph (l) in Section IV's exclusionseliminates coverage for []oss arising out of an in-tentional breach ofcontract establishes that uninten-tional breaches of contract can be covered. Readingthe definition of wrongful act as not includingbreaches ofcontractual duties would render Paragraph(l) superfluous, which would contradict our obligation to give every provision its full meaning and operativeeffect. U.S. Fire Ins. Co.,979 So.2d at 877 (quotationmarks omitted).

When we consider Dewitt's complaint in light ofthose policy provisions, it is clear that its first twotheories ofbreach fairly and potentially bring the suitwithin policy coverage because those theories allegebreaches of contract based on the City's mistakes,

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-- Fed.Appx. ----,2014WL2853754 (C.A.l I (Fla.))(Cite as:2014 WL 2853754 (C.A.ll (Fla.)))

misstatements, or omissions- See Lime Tree Vill.Cmty. Club Ass'n, Inc., 980 F.2d at 1405. Paragraph26(a) assened that the City breach[ed] its impliedwarranty that the plans and design specifications is-

sued to Dewitt were accurate and suitable for per-forming Dewitt's scope of work. And Paragraph26(b) asserted that the C breach[ed] its impliedobligation not to furnish misleading information. Thesame can be said for the two categories of damages inParagraphs 27(t) and 27(h), which sought money topay owners of utilities that were damaged as a result ofthe City's misrepresentations and for [o]ther ex-penses and damages associated with the reduction inDewitt's expected productivity as a result of the City'smisrepresentations and inaccuracies in the bid pack-

age. Because those portions of Dewitt's complaintassert that the City is liable for mistakes or omissionsin drafting the project drawings and misstatements inAddendum No. l, they arguably fall under the cov-erage provision for wrongful acts, which is enough totrigger Public Risk's duty to defend. See id.

The district court reached a different conclusion.Its fnst basis for concluding that Public Risk had noduty to defend was its determination that Dewitt'scomplaint had not alleged a theory of liability based

on a wrongful act. The court declared that it wouldassess Public Risk's duty to defend by analyzing theDewitt Complaint taken as a whole. It then reasonedthat:

*5 The Dewitt Complaint makes clear that the as-serted basis for money damages was Winter Gardennot paying what it allegedly owed under the terms ofthe Construction Contract. As such, there was noallegation of any purported wrongful acts by WinterGarden officials that gave rise to the Dewitt Ac-tion-the Construction Contract was the reasonWinter Garden was obligated to pay Dewitt.

The district court never specifically addressed thefour paragraphs from the complaint discussedabove-none of which are based on the City's refusal

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to make payments.

The district court's reductive as a whole analy-sis has no support under Florida law and is contrary to

this Court's binding precedent. In Lime Tree Village,we held that insurers have a duty to defend underFlorida law where some of the complaint's allegationstrigger the duty to defend and some are excluded. See980 F.2d at 1405-{6. OneBeacon attempts to distin-guish Lime Tree Village on the grounds that it in-volved two suits bringing eleven separate counts,while Dewitt's complaint brought all of its breach ofcontract claims under one count. See id. at l4O5 ( Thisis not a case where there is a single cause of actionbased wholly on acts expressly excluded by the poli-

cy. ). But that mathematical distinction makes nojurisprudential difference. Nothing in Lime Tree Vil-lage suggests that the duty to defend is so formalisticthat an allegation cannot trigger the duty unless it isbrought under a separately headed count that segre-gates it from allegations not covered by the policy. Infact, Lime Tree Village rejected an argument verysimilar to OneBeacon's. The insurance policy at issuethere excluded coverage for intentional acts. Id. at1404. The defendant argued that all the plaintiffs'counts were excluded because every count incorpo-

rated by reference all of the complaint's factual alle-gations, and the allegations included intentional acts.Id. at 1405- We rejected that argument because all thatmattered under Florida law was that some of the fac-tual allegations set forth unintentional acts. See id.

Furthermore, Florida law imposes a duty to de-fend whenever the underlying facts contained in thecomplaint can be fairly read to support a claim cov-ered by the indemnification provision. Nat'l R.R.Passenger Corp. v. Rountree Transp. & Rigging, Inc.,

286 F.3d 1233, 126l (l lth Cir.2002) (emphasis add-ed) (citing Metro. Dade Cnty. v. CBM Indus. of Minn.,Inc., 776 So.2d 937,938 (Fla. 3d DCA 2001)). Theeleven theories of breach that Dewitt's complaintalleges can be fairly read as effectively raising elevendistinct claims. Paragraphs 26(a) and 26(b) assert

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-- Fed.Appx. ----,2014WL2853754 (C.A.l I (Fla.))(Cite as: 2014WL2853754 (C.A.rl Gh.)))liability based on factual allegations that fall under thepolicy's coverage for wrongful acts. That triggers theduty to defend regardless ofwhether Paragraphs 26(c)through 26(k) rely on facts that fall outside the policy'scoverage.

The district court also relied on an exclusionclause in the City's policy. It concluded that Dewitt'scomplaint was not covered because Paragraph (l) ofSection IV excluded coverage for "[]oss arising out ofan intentional breach of contract." We disagree. InFlorida, "exclusionary clauses are construed evenmore strictly against the insurer than coverage claus-es." Auto-Owners Ins. Co. v. Anderson,756 5o.2d29,34 (F1a.2000). OneBeacon thus "has the burden of

demonstrating that the allegations of the complaint arecast solely and entirely within the policy exclusion andare subject to no other reasonable interpretation."Hartrd Acc. & Indem. Co. v. Beqver, 466F.3d 1289,1296 (l lth C.2006) (quotation marks omined). It hasnot met that burden.

*6 OneBeacon argues that Paragraph (l)'s use ofthe phrase "arising out of'-which is a term of art inFlorida insurance law meaning "originating from" or"growing suf sf'-makes the exclusion broad enough

to exclude coverage here. See James River Ins. Co.,540 F.3d at 1275 (quotation marks omined). Bur thatargument overlooks the fact that Paragraph (l) ex-cludes coverage for "loss" as opposed to coverage for"claims." N7 Florida insurance law distinguishesclaims from losses-the former being the suits them-selves, and the latter being the damages that are as-sessed. That is why an insurer can be obligated todefend against a claim even if it is not ultimately ob-ligated to pay for the losses arising from that claim.See Allstate Ins. Co. v. Ginsberg,863 So.2d 156, 163

n. 4 (F1a.2003) ("An insurer's duty to defend is broaderthan the duty to pay or indemniff and it involves dis-tinct responsibilities beyond the coverage issues."). Sothe only way that Paragraph (l) could negate One-Beacon's duty to defend here is if all of the lossessought in Dewitt's complaint grew out of an inten-

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tional breach.Ns If some of the alleged losses could beindependent ofthe alleged intentional breach, the dutyto defend would still exist.Ne

FN7. Nine of the exclusions in Section IVexclude coverage for claims. For example,Paragraph O excludes coverage for "[a]nyclaim based upon or attributable to any fail-ure or omission of the [City] to effect ormaintain coverage of any kind." (capitaliza-tion omitted and emphasis added). Paragraph(l)'s contrasting use of the term "loss" impliesthat it has a different scope than the exclu-sions that use the term "claim." Cf,, State v.Mark Marks, P.A., 698 So.2d 533, 541

(Fla.l997) ("The legislative use of differentterms in different portions ofthe same statuteis strong evidence that different meaningswere intended.") (quotation marks omitted).

The policy's own definitions reinforce thedistinction. Section IV defines "claim" tomean "all notices or suits demandingpayment of money, or charges filed withthe Equal Employment OpportunCommission or comparable State agencybased on, or arising out of the samewrongful act or a series ofrelated wrongfulacts by one or more assureds." (capitaliza-tion omitted). While the City's policy doesnot define the term "loss," it does dehne"ultimate net loss" to mean'the total sumwhich the fcity] is obligated to pay be-cause of loss or damage covered under anySection of this Coverage Document, eitherthrough adjudication or compromise, aftermaking proper deductions for all recover-

ies and salvages." So the policy uses"claim" to refer to suits, which implicatethe duty to defend, and uses "loss" to referto damages, which implicate the duty toindemni .

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FN8. We have our doubts about whetherParagraph (l) can ever negate the duty todefend because we find no language in thepolicy that suggests the duty to defend de-pends on the damages

a claim seeks. Thepolicy simply states that OneBeacon has aduty to defend against any claim, proceed-ing, or suit against the [C] or against anyperson or organization for whom the [City] isor may be found to be legally liable. (capi-talization omitted). The use of any claimimplies that the duty to defend will applyunless there is an exclusion for that particularkind of claim (as opposed to that kind ofloss). But the City does not raise that argu-ment, and

both sides' briefs assume thatParagraph (l) can exclude coverage for someclaims. So we will assume it as well since itdoes not affect the outcome here.

FN9. The distinction between coverage forclaims and coverage for loss means thatOneBeaconls heavy reliance onTransamerica Insurance Co. v. Snell is mis-placed. See 627 So.2d 1275 (Fla. lst DCA1993). The exclusion provision n Snell ap-

plied to [a]ny claim arising out of insol-vency, receivership, or bankruptcy. Id. at1276 (emphasis added). The court did notaddress whether an exclusion limited to loss can negate the duty to defend againstclaims.

Four paragraphs in the complaint extend beyondthe scope ofParagraph (l). Paragraphs26(a) and 26(b)fall outside its scope because they claim the City mademistakes in the project drawings and a misstatement in

Addendum No. l, not that the City intentionallybreached the contract. Likewise, Paragraphs 27(f) and27(h) seek damages that do not depend on or relate toany intentional breach of the contract. Paragraph27(f)seeks money for [a]mounts Dewitt is and/or becomesobligated to pay owners of utilities that were damaged

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as a result of the City's misrepresentations, effoneousdesign specifications, and./or refusal to grant war-ranted time extensions. Similarly, Paragraph 27(h)seeks money for [o]ther expenses and damages as-

sociated with the reduction in Dewitt's expectedproductiv as a result of the City's misrepresenta-tions and inaccuracies in the bid package.... ^to Themoney Dewitt had to pay those utility owners, as wellthe dip in productiv it suffered, had nothing to dowith the City's decision to withhold the payments thatit owed Dewitt. So those four paragraphs, in concert,seek out damages that do not entirely depend on,originate from, or relate to an intentional breach by theCity, which means they cannot be excluded by Para-gaph (l). OneBeacon does not point to any provision

in the City's insurance policy or the contract that es-tablishes otherwise.

FNIO. It might be argued that some of thedamages sought by Paragraphs 27(f) and27(h) were losses excluded by Paragraph 0).In full, Paragraph 27(f) sought:

Amounts Dewitt is and.ior becomes obli-gated to pay owners of utilities that weredamaged as a result of the C's misrep-resentations, effoneous design specifica-tions, and/or refusal to grqnt warrantedtime extensions.

(emphasis added). Similarly, Paragraph27(h) sought:

Other expenses and damages associatedwith the reduction in Dewitt's expectedproductiv as a result of the C's mis-representations and inaccuracies in the bidpackage, the City's actve interference withDq,vitt's worh and the City's knowtngfailure to cooperqte in good faith in re-solving hindrances within its control.

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(emphasis added). But even if the empha-sized clauses of each paragraph weredamages arising out of intentional breach,all that matters in terms of the duty to de-fend is that part

of eachparagraph

raisesallegations that fall outside the scope ofParagraph (l)'s exclusion. See HartfordAcc. & Indem. Co., 466 F.3d at 1296. Theallegation of erroneous design specifica-tions in Paragraph 27(f) and the allegationof inaccuracies in the bid package inParagraph 27(f) are outside the Paragraph(l) exclusion.

III.

Public Risk also contends the district court erredin dismissing its equitable estoppel claim. That claimalleged that OneBeacon's letters on June 29 and Sep-tember 22 tndicated that Public Risk had a duty todefend the City, and that Public Risk relied on thoserepresentations to its detriment. This contention isfrivolous. Under Florida law, every estoppel claimmust assert, among other things, that the defendantmade a representation as to a material fact that iscontrary to a later-asserted position. State v. Hawis,881 So.2d 1079, 1084 (F1a.2004).NlrNothing in ei-

ther letter is contrary to a position that OneBeaconasserted later. Both letters make clear from their be-ginnings that OneBeacon did not believe the C'spolicy covered Dewitt's claims. The first paragraph ofthe June 29 lehIer says-point blank- There is nocoverage for [Dewitt's suit] as it is currently pled.And the first paragraph of the September 22 letterannounces that it will discuss the general terms of theCity's policy without conceding that there is at pre-sent any potential coverage under the [reinsurancepolicyl. Public Risk's complaint does not identifu an

instance in which OneBeacon wavered from that po-sition.

FNll. For claims such as Public Risk's,where promissory estoppel is being utilizedto create insurance coverage, Florida law

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requires the plaintiff to go even funher andshow that refusing to find coverage wouldsanction fraud or other injustice. Crown LifeIns. Co. v. McBride, 517 So.2d 660, 662

(Fla.1987).

*7 Instead, by taking several portions of theSeptember 22 letler out of context and mischaracter-izing them, the complaint tries to create the impressionthat OneBeacon changed positions. For example, theSeptember 22 lelter says: OneBeacon understandsthat Public Risk Management of Florida ('PRM')contends that Paragraphs 19 and 24 of the DeWittAction complaint create a small sliver of potentialcoverage that at least triggers PRM's duty to defend.

Public Risk tries to claim that this sentence, whichmerely acknowledges Public Risk's position, is anaffirmative statement by OneBeacon that Public Riskdoes in fact have a duty to defend. Allegations basedon obvious misreadings of OneBeacon's letters do notsatis$ Rule l2(b)(6)'s facial plausibility standard.See Ashcrofi v. Iqbal, 556 U.S. 662,678,129 S.Ct.1937, 1949, 173 L.Ed.zd 868 (2009).

IV.The district court's judgment is reversed as to

Public Risk's breach of contract claim and affirmed asto its promissory estoppel claim.

AFFIRMED in part; REVERSED in part.

C.A.l I (Fla.),2014.Public Risk Management of Florida y. One BeaconIns. Co.-- Fed.Appx . ---, 2014 WL 28537 54 (C.4. I I (Fla.))

END OF DOCUMENT

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Public Risk Management of Florida v One Beacon Insurance Co