[00:00:00] Speaker 03:
The third case that we'll hear this morning is a case called Chelsea versus Auto Owners 251120.

[00:00:06] Speaker 03:
We'll hear from counsel whenever you're ready.

[00:00:13] Speaker 02:
May it please the court, my name is Gideon Irving.

[00:00:15] Speaker 02:
I'm appearing on behalf of the plaintiff's appellants.

[00:00:18] Speaker 02:
Our clients were added as defendants in the underlying litigation by way of the second amended complaint.

[00:00:23] Speaker 02:
For auto owners to be able to avoid its duty to defend against that complaint,

[00:00:28] Speaker 02:
They needed to prove that there was no arguable, plausible, or even doubtful way that the factual allegations alleged against our clients could be construed as property damage caused by an occurrence as defined in the policy.

[00:00:42] Speaker 02:
And I'm going to start with the occurrence issue.

[00:00:44] Speaker 02:
Colorado law recognizes that volitional acts that result in damage that is unintended, unforeseen, or unexpected

[00:00:54] Speaker 02:
can fall within the policy's definition of occurrence.

[00:00:59] Speaker 02:
And when we look at the factual allegations alleged against our three clients as distinct from the seven other defendants in the underlying case, it's unclear what our clients are alleged to have actually done.

[00:01:10] Speaker 02:
It's unclear that our clients, or I should say it rather, it's unalleged that our clients actually knew about Vansant, knew Vansant was attempting to operate in RV Park.

[00:01:20] Speaker 02:
And it's absolutely not alleged that our clients intended to prevent Van Sant from doing so.

[00:01:26] Speaker 02:
And that's well within the policy's definition of occurrence.

[00:01:29] Speaker 00:
I'm confused about that, I guess.

[00:01:30] Speaker 00:
It seemed like that's the only thing they alleged.

[00:01:33] Speaker 00:
I mean, they're part of a group.

[00:01:34] Speaker 00:
I get that it's a confusing, this underlying case in state court, very confusing.

[00:01:40] Speaker 00:
But there isn't any question that they've grouped them and your clients with all these other folks that they've sued as defendants in this

[00:01:49] Speaker 00:
kind of nebulous claim, but no question they're alleging intentional acts by all of these defendants.

[00:02:00] Speaker 00:
And your clients may have been a little confused about the complaint, and I don't blame them, but I don't understand how you can suggest that they weren't accusing your clients of intentional action.

[00:02:11] Speaker 02:
Your Honor, I'll start first with the applicable legal standard, which is that the facts of the complaint and not the stylization or the legal claims are what controls the inquiry on the duty to defend.

[00:02:23] Speaker 00:
Right.

[00:02:24] Speaker 00:
I understand.

[00:02:25] Speaker 00:
But you've got to look at the allegations.

[00:02:27] Speaker 02:
Right.

[00:02:27] Speaker 02:
And I'd like to do that.

[00:02:28] Speaker 02:
So as to the factual allegations, and Your Honor, I don't want to belabor it because I know you understand it.

[00:02:33] Speaker 02:
But there are places where it's alleged that the town defendants did something, which does not include our clients.

[00:02:40] Speaker 02:
And then there's the same allegation, and I'm speaking directly to the passage of these ordinances.

[00:02:45] Speaker 02:
One place says the town defendants passed them.

[00:02:48] Speaker 02:
One place says that our defendants as part of a group of Chauci defendants passed them.

[00:02:55] Speaker 02:
And then there's other particular allegations that say specifically Brent, Tyler, Cameron, Chassie were involved in it.

[00:03:01] Speaker 00:
Right.

[00:03:02] Speaker 00:
There's a lot of confusion.

[00:03:03] Speaker 00:
Right.

[00:03:03] Speaker 00:
A lot of lack of specificity.

[00:03:06] Speaker 02:
Exactly.

[00:03:06] Speaker 00:
But that doesn't change the essential nature of the complaint or the petition.

[00:03:13] Speaker 02:
Right.

[00:03:13] Speaker 02:
And so, Your Honor, the point is that it's not that there is a conspiracy claim.

[00:03:17] Speaker 02:
But again, looking at those factual allegations I was just talking about, when our clients are vaguely and ambiguously

[00:03:24] Speaker 02:
included somewhere and excluded elsewhere.

[00:03:27] Speaker 02:
That is where, under the Colorado legal test, there is some doubt that arises as to the level of our client's culpability.

[00:03:38] Speaker 02:
And on that point, I'll direct this court to its own decision.

[00:03:42] Speaker 02:
It's unpublished, but it's the KF103 case that was cited in our briefs.

[00:03:47] Speaker 02:
And as to one of the claims that the court analyzed there,

[00:03:50] Speaker 02:
It specifically explained how there was some allegation of intentional conduct, there was some allegation of unintentional conduct, and that just because intentional allegations were interspersed with unintentional conduct is not enough to remove this.

[00:04:06] Speaker 00:
What allegation was there in this kind of confusing complaint of unintentional conduct?

[00:04:13] Speaker 00:
I get that there was

[00:04:15] Speaker 00:
unclear allegations about a lot of things, but certainly there was nothing that I could see alleged about anybody other than intentional conduct.

[00:04:25] Speaker 00:
So I see this as distinct from that case, where you have a mix of both kinds of conduct alleged.

[00:04:32] Speaker 02:
Your Honor, your question somewhat implicates the question about who bears the burden here, because it's the insurance company's burden.

[00:04:39] Speaker 02:
to prove that the allegations are completely outside of any plausible reading that they could be in occurrence, could even doubtfully be in occurrence.

[00:04:49] Speaker 00:
Nevertheless, could you answer for me what you think the allegations were that alleged unintentional conduct?

[00:04:56] Speaker 02:
Right.

[00:04:56] Speaker 02:
And so again, we have to take into account this ambiguity.

[00:05:00] Speaker 02:
The specific allegations as to our three clients are that they were the grandparents of certain other family members.

[00:05:07] Speaker 02:
that they were property or business owners.

[00:05:10] Speaker 02:
And what I'd like to do to direct the court to a particular allegation that I think kind of sums it up and explains it, it's section 77 and it's a subparagraph B in that underlying complaint where it says that our clients, by exerting their power and influence, ensured that the 2016 and 2018 ordinances were passed.

[00:05:34] Speaker 02:
And so that is, again, at most a general intent alleged to our clients, but it does not rise to that specific intent to cause an injury by preventing Van Sant from operating an RV park.

[00:05:47] Speaker 03:
So just want to make sure that I understand that last part of your answer to my colleague's question.

[00:05:53] Speaker 03:
So when you were asked to identify an allegation

[00:06:00] Speaker 03:
that suggests that their liability was predicated on unintentional conduct, we can refer to paragraph 77b.

[00:06:08] Speaker 03:
And that is, other than allegations about parental relationships, which I don't think it's fair to say that those are unintentional conduct.

[00:06:24] Speaker 03:
I mean, it is unintentional who your family is.

[00:06:28] Speaker 03:
But the only thing that you can put your finger on is 77B.

[00:06:34] Speaker 02:
Well, Your Honor, I can expand on that.

[00:06:37] Speaker 02:
So I point to 77B because to me, when you look at the factual allegations as a whole and recognizing where they're inconsistent and unclear and vague, that to me sums up what this complaint is trying to say.

[00:06:52] Speaker 03:
Well, the reason I'm asking you that is 77b is obviously preceded by the introductory clause, defendants are variously engaged in overt acts in furtherance of that combination or conspiracy.

[00:07:09] Speaker 03:
Paragraph 75 that introduces paragraph 77b

[00:07:17] Speaker 03:
uses verbs involving deliberate conduct, in fact, including the verb deliberately.

[00:07:24] Speaker 03:
Defendants have knowingly by deliberately participating in a shared commitment to a common scheme.

[00:07:30] Speaker 03:
How can you engage in a common scheme or a conspiracy?

[00:07:33] Speaker 03:
Or to take your paragraph, how can you engage in overt facts in furtherance of a combination or conspiracy by accident?

[00:07:46] Speaker 03:
Or to use the first 30 seconds of your argument, when you don't foresee something, you don't subject it.

[00:07:56] Speaker 03:
How can you engage in a combination of conspiracy under the allegation you're hanging your head on to say, well, we didn't foresee that?

[00:08:04] Speaker 02:
So the answer really to your question, Your Honor, is that it's the factual allegations and not the fact that a conspiracy claim was brought against our clients.

[00:08:15] Speaker 02:
that determine the question of the duty to defend.

[00:08:18] Speaker 03:
But you answered her question based on an allegation not in the background section involving the historical facts, but you're saying, let's look at 77.

[00:08:30] Speaker 03:
Ignore the prelude, combination or conspiracy.

[00:08:35] Speaker 03:
Ignore 75.

[00:08:36] Speaker 03:
What I want you three judges to rely on

[00:08:42] Speaker 03:
are the background facts that don't say anything about any prep basis for liability, whether it's deliberate or accidental.

[00:08:51] Speaker 03:
All it identifies is parental relationships, sibling relationships, grandparental relationships.

[00:08:59] Speaker 03:
And those family relationships don't provide a factual predicate for liability, whether it's deliberate or accidental.

[00:09:09] Speaker 02:
And, Your Honor, that's where I'll disagree with you.

[00:09:12] Speaker 02:
Because we don't know precisely, when you're talking about the overt acts that our clients are alleged to have taken in furtherance of a conspiracy, we cannot figure out what those overt acts supposedly are.

[00:09:25] Speaker 02:
There are not factual allegations.

[00:09:26] Speaker 00:
Again, you're talking about lack of specifics here.

[00:09:29] Speaker 00:
But that's totally different than saying that this somehow asserts an unintended act.

[00:09:39] Speaker 00:
Well, in your honor... And that even paragraph you point to, that these defendants exerted power over the town to ensure that the amendments were enacted.

[00:09:52] Speaker 00:
That certainly doesn't suggest unintended consequences to me.

[00:09:58] Speaker 00:
I mean, it sounds like they exerted their power in order to ensure that something else happened.

[00:10:03] Speaker 00:
I mean, that's not... I just don't see the...

[00:10:08] Speaker 00:
reading the allegation exactly the opposite.

[00:10:11] Speaker 02:
And perhaps it would shake out that way when the duty to indemnify was later decided.

[00:10:16] Speaker 02:
But here on the duty to defend question, there is some doubt about that.

[00:10:21] Speaker 02:
And Your Honor, I can put some more meat on the bones of this.

[00:10:24] Speaker 02:
And so just conceptually, it's unclear what our clients are alleged to have actually done.

[00:10:29] Speaker 02:
But they are alleged to have done something.

[00:10:31] Speaker 02:
And at most,

[00:10:34] Speaker 02:
Our clients are alleged to have ensured the passage of these amendments, but there are not allegations that show that our clients specifically intended to prevent Van Sant from operating the RV park.

[00:10:44] Speaker 02:
Maybe that's how they shake out in the end, but it is at least doubtful at this stage whether or not the allegations specifically alleged that type of specific intent.

[00:10:54] Speaker 02:
And, Your Honors, I would like to kind of paint this conceptual approach.

[00:11:00] Speaker 01:
Are you sure about that?

[00:11:00] Speaker 01:
Isn't there an allegation in the complaint that the Chowsees

[00:11:04] Speaker 01:
quote, illegally contracted, combined, or conspired and will continue to do so to restrain trade in a relevant market consisting of the long-term rental of RV parking spaces by RV parks.

[00:11:17] Speaker 02:
Yes, Your Honor, and two points about that.

[00:11:19] Speaker 02:
First is that's another general allegation against a group of defendants where it's unclear how our clients actually may have been involved in that.

[00:11:27] Speaker 02:
But the second point is that those allegations, allegations of those nature,

[00:11:33] Speaker 02:
that say that our clients participated in a conspiracy and knowingly did these things.

[00:11:39] Speaker 02:
Those are legal conclusions that are devoid of any actual factual specificity or elaboration as to our clients and district courts

[00:11:48] Speaker 02:
regularly exclude those types of allegations when they're reviewing the sufficiency of the complaint.

[00:11:53] Speaker 01:
Well, except do they, when they're applying Colorado law, when they compare the four corners of the complaint to the terms of the contract, the insurance contract?

[00:11:59] Speaker 02:
They do, Your Honor.

[00:12:00] Speaker 02:
Colorado cannot be more clear that it's the factual allegations and not the legal claims.

[00:12:05] Speaker 02:
And I might add to your kind of question there, Your Honor, is that the court's required to view the factual allegations in the way that is most likely

[00:12:16] Speaker 02:
to result in possible coverage for our clients.

[00:12:19] Speaker 02:
And so that includes looking at some specific factual allegations on their own or viewing the complaint in toto.

[00:12:27] Speaker 02:
And that is well established in the case law, but especially in the HECLA mining case.

[00:12:33] Speaker 02:
And if the court wants a little more elucidation on that, footnote eight in the HECLA case specifically talks about viewing allegations in toto if there's some doubt

[00:12:42] Speaker 02:
And the text of the opinion itself says if there are any facts that could plausibly be construed as falling within the coverage of the policy, then the duty to defend is triggered.

[00:12:55] Speaker 02:
Unless the court has further questions right now, I'd like to reserve the remainder of my time.

[00:13:12] Speaker 04:
Good morning, Your Honors.

[00:13:13] Speaker 04:
My name is Aaron Bell, and may it please the Court, I represent the defendant Appell E. Auto Owners Insurance.

[00:13:21] Speaker 04:
The policy at issue here requires both that the damage be property damage and that that property damage be caused by an accident.

[00:13:33] Speaker 04:
If either of those is missing, there's no coverage and the district court's order should be upheld.

[00:13:40] Speaker 04:
In this case,

[00:13:41] Speaker 04:
In the underlying suit, the only claims against these appellants were Sherman Act conspiracy claims.

[00:13:50] Speaker 04:
And likewise, the factual allegations in the complaint were of a conspiracy and an intentional conduct, not of an accident.

[00:14:01] Speaker 04:
So insurance is not designed to cover an insurance intentional acts like conspiracy.

[00:14:09] Speaker 04:
There's no way to reasonably price the risks

[00:14:11] Speaker 04:
that an insured will engage in intentional wrongful conduct.

[00:14:16] Speaker 04:
As the Seventh Circuit noted in the Curtis Universal case, insurance companies will not insure against liability for antitrust violations, a liability based on deliberate rather than inadvertent actions.

[00:14:35] Speaker 04:
The policy here requires that there be an occurrence, and the policy then specifically defines

[00:14:42] Speaker 04:
occurrence as an accident.

[00:14:46] Speaker 04:
The allegations in the complaint, and Your Honors, I think, brought this out already, so I won't belabor it, but the allegations over and over again in this complaint are of intentional deliberate conduct, and there simply are no allegations of accidental conduct.

[00:15:06] Speaker 04:
Now, the plaintiff appellant makes the argument

[00:15:11] Speaker 04:
that the pleadings are unclear, that the pleadings are threadbare.

[00:15:18] Speaker 04:
Well, threadbare allegations of a conspiracy are threadbare allegations of a conspiracy.

[00:15:24] Speaker 04:
They don't transform into allegations of an accident.

[00:15:30] Speaker 04:
And there just are no such allegations.

[00:15:34] Speaker 04:
And I think it was very notable that when specifically asked to provide an example, the example provided

[00:15:41] Speaker 04:
was contactually very clearly of intentional contact.

[00:15:44] Speaker 04:
As Your Honor noted, paragraph 77 is immediately preceded by paragraph 75, which uses words like intentional and deliberate and conspiracy.

[00:15:54] Speaker 03:
Can I ask you a hypothetical question?

[00:15:56] Speaker 03:
What if the plaintiff during the pendency of the proceeding in district court said, we want to amend the complaint.

[00:16:04] Speaker 03:
We want to limit the antitrust allegations to the Chelsea

[00:16:12] Speaker 03:
relatives who were in municipal government, and that the plaintiffs in this case who were seeking reimbursement for their defense costs, we the plaintiffs are not alleging that they knew about this conspiracy.

[00:16:31] Speaker 03:
The conspiracy was on the part of their relatives, their kids, but that they were beneficiaries

[00:16:40] Speaker 03:
of this conspiracy.

[00:16:42] Speaker 03:
In other words, the town defendants conspired to promote the business interests of their relatives, the plaintiffs in this case.

[00:16:52] Speaker 03:
And then the district court says, well, you know, this seems to be maybe you're bringing up, this is an entirely different lawsuit than the one you had pleaded earlier.

[00:17:07] Speaker 03:
And the reply from the plaintiff is, well, tell us what is inconsistent with that between that and the complaint that we're here on.

[00:17:18] Speaker 03:
It's entirely consistent.

[00:17:20] Speaker 03:
Wouldn't that complaint have triggered an arguable duty to defend?

[00:17:29] Speaker 03:
Because that would be an accidental benefit to the Chelsea defendants

[00:17:35] Speaker 03:
that in the Van Sant litigation, where there was no allegation of a conspiracy on their part, they were the beneficiaries of the conspiracy by their relatives.

[00:17:47] Speaker 04:
Well, I think in that hypothetical, which is, of course, very different from what was pleaded in this case, there still needs to be an occurrence.

[00:17:56] Speaker 04:
So in that hypothetical amended complaint, there's really no allegation that these Josse appellants did anything at all.

[00:18:09] Speaker 03:
Well, that's exactly the point of my hypothetical.

[00:18:14] Speaker 03:
In other words, if you accept that an occurrence or an accident has to be not subjectively foreseen and not have been the part of deliberate conduct, under my hypothetical, the Chelsea defendants, the plaintiffs in this case, did not do anything wrong.

[00:18:33] Speaker 03:
But it would be, let's say, an equitable claim for unjust enrichment.

[00:18:36] Speaker 03:
They were unjustly enriched.

[00:18:38] Speaker 03:
because they were the beneficiaries of the violation of the Sherman Act perpetrated by their relatives.

[00:18:44] Speaker 03:
The relatives participated in the conspiracy solely to benefit fortuitously on these particular plaintiffs.

[00:18:53] Speaker 03:
And so there would be no deliberate conduct, there would be no actual foresight

[00:19:00] Speaker 03:
of what the Black Sheeps and their families and their relatives had done.

[00:19:07] Speaker 03:
But they would be the beneficiaries and potentially subject to liability under an unjust enrichment theory, all of which arguably would trigger a duty to defend, or would it?

[00:19:21] Speaker 04:
Well, I think to have the duty to defend or to have coverage at all, what is needed is an occurrence.

[00:19:31] Speaker 04:
And in this case, given that in this hypothetical amended complaint, these Chelsea appellants did nothing whatsoever.

[00:19:40] Speaker 04:
I don't think there's an occurrence there.

[00:19:45] Speaker 03:
It was an accidental benefit that was bestowed on them by virtue of their relatives.

[00:19:55] Speaker 04:
But in that hypothetical, there's no allegation that they

[00:19:59] Speaker 04:
did anything accidentally either.

[00:20:01] Speaker 00:
There's no allegation of an act in this hypothetical.

[00:20:04] Speaker 04:
Correct.

[00:20:05] Speaker 04:
In that hypothetical, they just did nothing whatsoever, which of course is very different than what was alleged here.

[00:20:11] Speaker 04:
I just briefly, if I may, would like to address the unjust enrichment, because that's something that the plaintiffs brought up in their reply brief we didn't have a chance to address in our briefing.

[00:20:23] Speaker 04:
And they suggest that this case could somehow be construed as an unjust enrichment case.

[00:20:30] Speaker 04:
Obviously, it wasn't an unjust enrichment case.

[00:20:32] Speaker 04:
It was very explicitly a conspiracy case.

[00:20:35] Speaker 04:
But in addition, unjust enrichment is a quasi-contractual theory of recovery.

[00:20:44] Speaker 04:
And one, there's just no relationship whatsoever between

[00:20:50] Speaker 04:
that these Jossi appellants and Van Sant accept that they intentionally conspired against Van Sant, which is certainly not accidental.

[00:21:01] Speaker 04:
And furthermore, unjust enrichment requires that there be a conveyance of a benefit.

[00:21:09] Speaker 04:
There was no conveyance of a benefit by Van Sant to the Jossis.

[00:21:15] Speaker 04:
The only thing that happened allegedly in the underlying complaint was that the Chassis conspired to enact these ordinances in order to restrain trade, and then that ended up harming Van Sant.

[00:21:29] Speaker 04:
There's no conveyance such that it would be inequitable for the Chassis to retain it without paying fair value for it.

[00:21:41] Speaker 04:
And another point that was brought up is that

[00:21:45] Speaker 04:
We need to look at the allegations in the complaint as a whole.

[00:21:49] Speaker 04:
And I completely agree with that.

[00:21:51] Speaker 04:
I think that's exactly right.

[00:21:53] Speaker 04:
And I think in this case, what the allegations in the complaint as a whole show over and over again is that this is about intentional conduct.

[00:22:05] Speaker 04:
And it's not about an accident or an occurrence, which are synonymous in the policy.

[00:22:16] Speaker 01:
So following up on the unjust enrichment hypothetical that my colleague put to you, let me ask, what do you think is the state of Colorado law on the duty to defend where there is some plausible potential amendment to a complaint that might implicate the policy?

[00:22:35] Speaker 01:
And what authority would you cite for what the state of the law is?

[00:22:41] Speaker 01:
Does the duty to defend not become implicated until an amendment is filed and a claim is asserted?

[00:22:46] Speaker 01:
And new facts are alleged or?

[00:22:49] Speaker 04:
Correct.

[00:22:50] Speaker 04:
I think an insurer has an ongoing duty to evaluate the claims that are being made against its insurers.

[00:22:57] Speaker 04:
So if a complaint is filed and it alleges conspiracy Sherman Act violations, as in this case, that may not be covered.

[00:23:07] Speaker 04:
If in some hypothetical, there's an amended complaint and now it alleges common law and

[00:23:14] Speaker 04:
that the insurer has an ongoing duty to evaluate those new allegations.

[00:23:18] Speaker 04:
And if those new allegations changes the coverage position, then the insurer has a responsibility to act accordingly, which in that case might well mean providing a defense.

[00:23:31] Speaker 04:
I think that the duty to defend while broad is not completely

[00:23:42] Speaker 04:
open-ended and unlimited such that an insurer has to defend against claims for clearly intentional conduct because of the hypothetical possibility that at some point in the future additional claims for accidental negligent conduct might be added.

[00:24:01] Speaker 04:
At that point, there's simply no limitations on the duty to defend whatsoever.

[00:24:12] Speaker 04:
One other point, if I may, in the time that's remaining.

[00:24:19] Speaker 04:
So one thing I was struck by is that there were complaints here about the non-specificity of the underlying complaint and how we should understand it to have been insufficient.

[00:24:34] Speaker 04:
And perhaps that's true.

[00:24:36] Speaker 04:
But I think it's worth noting that the reason these chastity appellants prevailed

[00:24:42] Speaker 04:
in the underlying action wasn't because of lack of specificity of the complaint.

[00:24:48] Speaker 04:
It was because of the North Pennington Doctrine.

[00:24:51] Speaker 04:
And the North Pennington Doctrine is a creature of the First Amendment.

[00:24:56] Speaker 04:
There's a First Amendment right to petition the government, and thus that doctrine states that there can't be antitrust liability for petitioning activity.

[00:25:08] Speaker 04:
And that's how these appellants prevail below.

[00:25:12] Speaker 04:
based on a doctrine that is specific to the antitrust conduct or context.

[00:25:20] Speaker 04:
And that doctrine has no relevance in the context of accidental negligent conduct.

[00:25:28] Speaker 04:
So effectively, what these Jossey appellants are arguing here is that they were sued under Sherman Act claims.

[00:25:38] Speaker 04:
They asserted a defense.

[00:25:41] Speaker 04:
that arises only in the context of Sherman Act claims.

[00:25:44] Speaker 04:
They prevailed on that defense.

[00:25:46] Speaker 04:
They prevailed again on that defense on appeal.

[00:25:49] Speaker 04:
But now, they want to argue that the underlying complaint was really about accidental conduct.

[00:25:56] Speaker 04:
And that's not a change of position that we think should be undertaken.

[00:26:00] Speaker 01:
Well, Colorado law doesn't invite us to consider potential defenses that may be asserted when evaluating whether the policy, the duty to defend is implicated by the allegations in the complaint.

[00:26:10] Speaker 01:
Do you agree with that?

[00:26:14] Speaker 01:
I'm sorry, Your Honor.

[00:26:15] Speaker 01:
Could you say that again?

[00:26:16] Speaker 01:
I mean, I think Colorado law seems pretty clear.

[00:26:18] Speaker 01:
We look at the complaint.

[00:26:19] Speaker 01:
We look at the allegations.

[00:26:20] Speaker 01:
We look at the coverage.

[00:26:21] Speaker 01:
We look at the contract.

[00:26:22] Speaker 01:
And I think pregnant in your argument, at least, is the idea that we also consider potential affirmative defenses.

[00:26:28] Speaker 01:
Or maybe I guess what I mean to say is I understand your argument to say potential defenses an insured may assert in an underlying claim are also relevant in deciding the duty to defend.

[00:26:40] Speaker 01:
But there's no case law for that, is there?

[00:26:43] Speaker 04:
I'm sorry if that was unclear, Your Honor.

[00:26:45] Speaker 04:
My point isn't about affirmative defenses further informing the duty to defend argument.

[00:26:53] Speaker 04:
Although, in this case, I think the allegations in the complaint are pretty crystal clear.

[00:26:59] Speaker 01:
You assert that it's an estoppel argument?

[00:27:01] Speaker 01:
Correct, Your Honor.

[00:27:02] Speaker 04:
My point is that it's a naked change in position that these Jossey appellants made and prevailed on.

[00:27:11] Speaker 04:
an argument in the underlying case is predicated entirely on this case being about antitrust liability.

[00:27:17] Speaker 04:
And now we're arguing that really, substantively, if you ignore almost everything that's in the complaint, that this case really is about accidental conduct.

[00:27:28] Speaker 04:
And that's what we think is wrong and should not be entertained.

[00:27:34] Speaker 04:
And unless Your Honors have any further questions, I will ask

[00:27:39] Speaker 01:
Respectfully request that the district courts order be upheld No, thank you very thank you And as your way to the as you're on your way to the podium to save you some time Let me pose the follow-up question to my the last exchange you and I had you talked about Colorado law inviting us judges considering the duty to defend to strip out of complaints and

[00:28:08] Speaker 01:
Conclusory allegations and I suppose it comes back to the point that my colleagues were stressing earlier I don't understand how your argument gets any stronger the more argued the more paragraphs we strip out of the underlying complaint Assuming your point that they're conclusory that still doesn't get us any closer to an allegation about Accidental conduct or for unforeseen consequences does it?

[00:28:31] Speaker 02:
Your Honor, it does, actually, because the actual, if you look at these very sparse, specific allegations of fact against our clients, they are alleged to have done something.

[00:28:44] Speaker 02:
And the ambiguity as to what they actually did is precisely what's contemplated by the duty to defend and the complaint rule.

[00:28:51] Speaker 02:
This is the Colorado public policy articulated by the Supreme Court in HECLA, which is that the insureds have an expectation of defense.

[00:29:00] Speaker 02:
And that risk that maybe eventually the duty to indemnify does not appear, that's shifted to the insurer who is supposed to assume the defense and actually allow going to the exchange that we just had, allow our clients to assert defenses like the Noor-Pennington doctrine, et cetera.

[00:29:19] Speaker 02:
On the complaint as pleaded, the Noor-Pennington doctrine and any sort of defenses are not implicated.

[00:29:25] Speaker 02:
And so, Your Honor, again, we have to look at the allegations

[00:29:29] Speaker 02:
in a way as whether there's doubtful, plausible, possible factual allegations that could be construed as our clients doing an act in which they didn't intend to restrain Van Sant from operating in RV Park and that that resulted in property damage.

[00:29:49] Speaker 02:
And as it goes to that question on whether this really was accidental, whether they intended these

[00:29:57] Speaker 02:
these restraints of trade that they were alleged to have intended.

[00:30:01] Speaker 02:
Also speaking to the underlying litigation, it was resolved by a published decision of this court, which I would invite the judges to look at.

[00:30:11] Speaker 02:
And it found that there was an innocent explanation for passing these amendments.

[00:30:15] Speaker 02:
And that was the desire to keep the town clean.

[00:30:19] Speaker 02:
And I will stop there unless the court would allow me more time or has any further questions.

[00:30:26] Speaker 03:
Okay, thank you very much.

[00:30:28] Speaker 03:
I also want to thank both counsels for your excellent briefing and your excellent attitude to see you today.

[00:30:37] Speaker 03:
We greatly appreciate it.

[00:30:39] Speaker 03:
This matter will be submitted.