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Planet Earth Foundation v. Gulf Underwriters Insurance Co.12/5/2005
Planet Earth Foundation, a nonprofit provider of advertising and public relations services, was insured under a nonprofit management and organization liability policy with Gulf Underwriters Insurance Company. The policy contained a professional services exclusion. Gulf Underwriters declined to defend Planet Earth Foundation in a lawsuit brought by one of its clients. Planet Earth brought suit against Gulf Underwriters and moved for partial summary judgment on the duty to defend. We affirm.
The trial court correctly ruled that the professional services exclusion encompassed the claims against Planet Earth and that Gulf did not have a duty to defend. The professional services exclusion unambiguously encompassed public relations and advertising services; the claims brought against Planet Earth, including the fraud, trademark infringement, and unfair competition claims, all arise from Planet Earth's rendering or failure to render professional services. The insurance policy therefore did not require Gulf Underwriters to defend Planet Earth.
FACTS
Planet Earth Foundation is a nonprofit foundation that provides advertising and public relations services. Between December 13, 2002, and December 13, 2003, Planet Earth was insured by Gulf Underwriters Insurance Company under a nonprofit management and organization liability insurance policy ('the Policy').
The Policy imposes on Gulf 'the right and duty to defend any Claim governed by the Policy, even if any of the allegations are groundless, false or fraudulent.'
Gulf Underwriters issued Endorsement No. 3 to Planet Earth in December 2002. It reads,
{T}he Insurer shall not be liable to make any payment for Loss in connection with any Claim made against any of the Insureds for, based upon, arising out of, directly or indirectly resulting from, in consequence of, or in any way involving any actual or alleged act, error or omission by any Insured with respect to the rendering of, or failure to render professional services for any party.
(Emphasis added.)
In June and July 2002, Planet Earth Foundation contracted with New York University ('NYU'), the umbrella organization of the NYU Child Study Center ('the Center'), to produce paid advertisements and public service announcements. In June 2003, NYU filed suit for breach of contract, fraud, trademark infringement, and unfair competition against Planet Earth and against director and president Keith Blume and director and chief economic officer Lisa Blume ('the Blumes'). The amended complaint alleged that Planet Earth and the Blumes committed numerous breaches of the contract. It also alleged that Lisa Blume made numerous misrepresentations to Center staff so that Planet Earth could acquire the Center as a client. It additionally contended that Planet Earth incorporated the Center's trademark 'About Our Kids' into the tagline 'Caring About Our Kids' for an advertising campaign for the Center, that Keith Blume later signed an 'Intent to Use' trademark application on behalf of Planet Earth for the phrase 'Caring About Our Kids,' and that the Blumes' trademark application indicated that Planet Earth would use the phrase in competition with the Center.
Planet Earth and the Blumes tendered defense of the NYU action to Gulf. Gulf denied coverage and refused to defend. Planet Earth and the Blumes brought suit against Gulf, alleging a breach of a duty to defend and a breach of the duty of good faith and fair dealing. They moved for partial summary judgment on the issue of the duty to defend. The trial court denied the motion. The parties moved for a CR 54(b) order. The court granted the motion. Planet Earth and th
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