Goolsby v. Best in Neighborhood LLC

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF OHIO

WESTERN DIVISION

RON GOOLSBY, et al., CASE NO. 3:19 CV 2664

Plaintiffs,

v. JUDGE JAMES R. KNEPP II

BEST IN NEIGHBORHOOD, LLC, et al.,

MEMORANDUM OPINION AND

Defendants. ORDER

INTRODUCTION

Plaintiffs Ron and Allyse Goolsby bring this action on behalf of their minor child against

their landlords, Defendants Best in Neighborhood, LLC, Courtney Brown, and Keith Brown1,

alleging a violation of the Residential Lead-Based Paint Hazard Reduction Act, 42 U.S.C. § 4851

et seq., and state law claims of negligence, negligence per se, loss of consortium, private

nuisance, intentional infliction of emotional distress, negligent infliction of emotional distress,

fraud, negligent misrepresentation, breach of contract, and unjust enrichment. (Doc. 1). The

property’s insurer, Auto-Owners (Mutual) Insurance Company, filed an Intervenor’s Complaint,

seeking declaratory judgment regarding whether it has a duty to defend or indemnify Defendants

in response to Plaintiffs’ claims. (Doc. 38). The Court has jurisdiction under 28 U.S.C. §§ 1331

and 1367. Currently pending before the Court are two related motions: (1) Auto-Owners’s

Motion for Judgment on the Pleadings (Doc. 45) and (2) Auto-Owners’s Motion to Certify

Question to the Ohio Supreme Court (Doc. 52). Both motions are primarily directed at the same

1. Best Home, LLC and Brown CRE were also originally defendants to this case, but were

previously dismissed without prejudice. See Doc. 16.

question – whether the at-issue insurance policy covers Plaintiffs’ claims, and thus requires

Auto-Owners to defend Defendants in this suit. Both are fully briefed and ripe for decision. For

the reasons discussed below, the Court denies the Motion to Certify, and denies the Motion for

Judgment on the Pleadings except as it relates to Auto-Owner’s duty to defend Plaintiffs’ breach

of contract and unjust enrichment claims.

BACKGROUND

The facts relevant to the pending motions are not in dispute. In March 2017, Plaintiffs

agreed to lease the home, for two years, at 540 Collins Street, Toledo, Ohio 43610 from

Defendant Best in Neighborhood. (Doc. 1, at 9). In their Complaint, Plaintiffs assert their minor

child suffered injuries as a result of lead-based paint at the property. See generally Doc. 1.

Best in Neighborhood was insured under a commercial general liability policy by Auto-

Owners for the period April 24, 2017 through April 24, 2018. See Doc. 38, at 1; Doc. 38-1

(policy). That policy contains what is frequently referred to as an “absolute pollution exclusion”.

It provides, in relevant part:

SECTION I – COVERAGES

COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE

LIABILITY

1. Insuring agreement

a. We will pay those sums that the insured becomes legally obligated

to pay as damages because of “bodily injury” or “property

damage” to which this insurance applies. We will have the right

and duty to defend the insured against any “suit” seeking those

damages. We may at our discretion investigate any claim or

“occurrence” and settle any claim or “suit” that may result. But:

(1) The amount we will pay for damages is limited as

described in Section III – Limits of Insurance; and

(2) Our right and duty to defend end when we have used up the

applicable limit of Insurance in the payment of judgments

or settlements under Coverage A or B or medical expenses

under Coverage C.

* * *

2. Exclusions

This insurance does not apply to:

* * *

f. Pollution

(1) “Bodily injury” or “property damage” arising out of the actual,

alleged or threatened discharge, dispersal, seepage, migration,

release or escape of “pollutants”:

(a) At or from any premises, site or location which is or

was at any time owned or occupied by, or rented or

loaned to, any insured. * * *

* * *

SECTION V – DEFINITIONS

* * *

16. “Pollutants” means any solid, liquid, gaseous or thermal irritant or

contaminant, including smoke, vapor, soot, fumes, acids, alkalis,

chemicals and waste.

(Doc. 38-1, at 24-25, 37, 40).

STANDARD OF REVIEW

A motion for judgment on the pleadings under Federal Civil Rule 12(c) is reviewed under

the same standard as a Rule 12(b)(6) motion. Coley v. Lucas County, 799 F.3d 530, 536–37 (6th

Cir. 2015). When considering either a Rule 12(b)(6) or 12(c) motion, this Court presumes all

well-pleaded material allegations of the pleadings are true and draws all reasonable inferences in

the non-moving party’s favor. Total Benefits Planning Agency v. Anthem Blue Cross &

Blue Shield, 552 F.3d 430, 434 (6th Cir. 2008). “[O]nly a complaint that states a plausible claim

for relief survives a motion to dismiss.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell

Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)).

DISCUSSION

At issue in both pending motions is whether Auto-Owners has a duty to defend

Defendants pursuant to the at-issue insurance policy. Auto-Owners argues this Court should

either (1) hold it does not have such a duty (Doc. 45), or (2) certify the following question to the

Ohio Supreme Court:

Does an absolute pollution exclusion contained within a standard commercial

general liability coverage form operate to exclude coverage for claims of bodily

injury resulting from exposure to lead-based paint?

(Doc. 52, at 1). Auto-Owners asserts claims regarding lead-based paint are specifically excluded

from the at-issue policy under the pollution exclusion and thus it owes no duty to Defendants.

Alternatively, Auto-Owners asserts this is an unsettled question of Ohio law that should be

certified. Plaintiffs oppose certification (Doc. 53), and both Plaintiffs and Defendants oppose the

motion for judgment on the pleadings (Docs. 59, 60). As to judgment on the pleadings, Plaintiffs

and Defendants contend the pollution exclusion is either ambiguous as applied to lead-based

paint claims or that lead paint is not a “pollutant” as defined by the policy; either way, they

assert, Auto-Owners has a duty to defend. (Docs. 59, 60). Opposing certification, Plaintiffs

contend the standard for certification is not satisfied, and even if it is, this Court should exercise

its discretion to deny such a motion. (Doc. 53).

For the reasons discussed below, the Court denies Intervenor Auto-Owners’s Motion to

Certify (Doc. 52), and grants in part and denies in part Auto-Owners’s Motion for Judgment on

the Pleadings (Doc. 45).

Ohio Insurance Policy Interpretation

“[A]n insurance policy is a contract between an insured and the insurer.” Pilkington N.

Am., Inc. v. Travelers Cas. & Sur. Co., 112 Ohio St. 3d 482, 487 (2006). The interpretation and

construction of a written contract are questions of law. Alexander v. Buckeye Pipe Line Co., 53

Ohio St. 2d 241 (1978). “The purpose of contract construction is to discover and effectuate the

intent of the parties. The intent of the parties is presumed to reside in the language they chose to

use in their agreement.” Graham v. Drydock Coal Co., 76 Ohio St. 3d 311, 313 (1996). The

Court is to “honor the plain meaning of the policy’s language ‘unless another meaning is clearly

apparent from the contents of the policy.’” Ohio N. Univ. v. Charles Constr. Servs., Inc., 155

Ohio St. 3d 197, 199 (2018) (quoting Westfield Ins. Co. v. Galatis, 100 Ohio St. 3d 216, 219

(2003)). “Where exceptions, qualifications or exemptions are introduced into an insurance

contract, a general presumption arises to the effect that that which is not clearly excluded from

the operation of such contract is included in the operation thereof.” Home Indemn. Co. of N.Y. v.

Village of Plymouth, 146 Ohio St. 96, ¶ 2 of syllabus (1945).

“Contract terms are generally to be given their ordinary meaning when the terms are clear

on their face,” and courts must “apply the plain language of the contract when the intent of the

parties is evident from the clear and unambiguous language in a provision.” Coma Ins. Agency v.

Safeco Ins. Co., 526 F. App’x 465, 468 (6th Cir. 2013) (citing, inter alia, Karabin v. State Auto.

Mut. Ins. Co., 10 Ohio St. 3d 163, 166-67 (1984)). Contract language is ambiguous “only where

its meaning cannot be determined from the four corners of the agreement or where the language

is susceptible of two or more reasonable interpretations.” United States Fid. & Guar. Co. v. St.

Elizabeth Med. Ctr., 129 Ohio App. 3d 45, 55 (1998) (citing Potti v. Duramed Pharm., Inc., 938

F.2d 641, 647 (6th Cir. 1991)). “‘The test to be applied is not what the insurer intended by his

words, but what the ordinary reader and purchaser would have understood them to mean.’”

Andersen v. Highland House Co., 93 Ohio St. 3d 547, 551 (2001) (quoting Davis v. M.L.G.

Corp, 712 P.2d 985, 989 (Colo. 1986) (internal quotation omitted) (emphasis added in

Andersen). “Where provisions of a contract of insurance are reasonably susceptible of more than

one interpretation, they will be construed strictly against the insurer and liberally in favor of the

insured.” Lane v. Grange Mut. Cos., 45 Ohio St. 3d 63, 65 (1989).

Insurer’s Duty to Defend

An insurer’s “duty to defend is broader than and distinct from its duty to indemnify.”

Ohio Gov’t Risk Mgmt. Plan v. Harrison, 115 Ohio St. 3d 241, 245 (2007). “The insurer must

defend the insured in an action when the allegations state a claim that potentially or arguably

falls within the liability insurance coverage.” Id. (citing Willoughby Hills v. Cincinnati Ins. Co.,

9 Ohio St. 3d 177, 179 (1984)). This means “where the complaint brings the action within the

coverage of the policy the insurer is required to make defense, regardless of the ultimate outcome

of the action or its liability to the insured.” Motorists Mut. Ins. Co. v. Trainor, 33 Ohio St. 2d 41,

41 (1973).

“However, an insurer need not defend any action or claims within the complaint when all

the claims are clearly and indisputably outside the contracted coverage.” Id. (citing Preferred

Risk Ins. Co. v. Gill, 30 Ohio St. 3d 108, 113 (1987)); see also Beaverdam Contr. v. Erie Ins.

Co., 2008-Ohio-4953, at ¶21 (Ohio Ct. App.) (“In such cases, there is no duty to defend because

the allegations in the pleadings fall squarely within an area of activity specifically excluded from

coverage.”).

Other Courts’ Application of Pollution Exclusions to Lead-Based Paint

As the parties’ briefs evidence, courts around the country are split regarding whether

lead-based paint claims are included in absolute pollution exclusions such as the one at issue

here and thus precluded from coverage. See Claudia Catalano, Annotation, What Constitutes

“Pollutant,” “Contaminant,” “Irritant,” or “Waste” Within Meaning of Absolute or Total

Pollution Exclusion in Liability Insurance Policy, 98 A.L.R. 5th 193, §§ 8[a]-8[c] (Originally

published 2002).

On one side, courts finding lead-based paint claims are not included within the absolute

pollution exclusion hold one or both of the following: (1) lead-based paint does not fall within

the definition of “pollutants” in absolute pollution exclusions similar to the at-issue one (or at

least not unambiguously so); and (2) even if lead paint falls within that definition, cracked,

chipped, or peeling lead paint does not fall within the “discharge, disbursal, seepage, migration,

release or escape” definition requirement of the exclusion. See, e.g., Ins. Co. of Ill. v. Stringfield,

292 Ill. App. 3d 471, 475 (Ill. Ct. App. 1997) (finding it ambiguous whether lead paint fell

within the definition of pollutant, specifically because “the term ‘contaminant’ is susceptible to

more than one reasonable interpretation and thus ambiguous with respect to whether it

encompasses lead-based paint”); Danbury Ins. Co. v. Novella, 727 A.2d 279, 283 (Conn. Super.

Ct. 1998) (finding clause ambiguous because “it is equally reasonable to conclude that lead paint

may or may not be an irritant or contaminant, and therefore may or may not be a pollutant”, and

because “a reasonable insured would interpret it to exclude coverage for claims arising out of

factual circumstances more analogous to classic environmental pollution, but not for claims of

personal injury allegedly sustained as a result of the type of paint covering the surfaces of rented

premises.”); Lefrak Org., Inc. v. Chubb Custom Ins. Co., 942 F. Supp 949, 955-56 (S.D.N.Y.

1996) (finding whether lead paint can be characterized as a “pollutant” “open to dispute”

because, by one interpretation lead can be thought of as “contaminat[ing] the body by injecting

impurities into the blood stream”, but by another – equally reasonable – interpretation, the list of

examples (“smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste”) suggest only “the

products and byproducts associated with the operation of equipment or machinery”, and “[l]ead

paint is neither among the listed examples, nor closely related to a listed example”). Some of

these interpretations come from courts that have – based on the history of the absolute pollution

exclusion – limited it to “traditional environmental pollution”. See, e.g., Am. States Ins. Co. v.

Koloms, 177 Ill. 2d 473, 493 (Ill. 1997); Atlantic Mut. Ins. Co. v. McFadden, 595 N.E.2d 762,

764 (Mass. 1992) (“The definition of ‘pollutant’ in the policy does not indicate that leaded

materials fall within its scope. Rather, the terms used in the pollution exclusion, such as

‘discharge,’ dispersal,’ ‘release,’ and ‘escape,’ are terms of art in environmental law which

generally are used with reference to damage or injury caused by improper disposal or

containment of hazardous waste.”).

On the other side, courts holding that lead-based paint claims do fall within the absolute

pollution exclusion come to the opposite conclusions – (1) lead paint is encompassed within the

definition of “pollution” and (2) exposure to lead paint is necessarily the result of a “discharge,

dispersal, spill, release, or escape” (or something similar). See, e.g., State Farm Fire & Cas. Co.

v. Dantzler, 289 Neb. 1, 14-17 (Neb. 2014) (any manner of exposure to lead-based paint involves

a “discharge, dispersal, spill, release or escape”); Kaytes v. Imperial Cas. & Indem. Co., 1994

WL 780901, at *1 (E.D. Pa.) (applying Pennsylvania law and conclusorily finding the exclusion

“clear and facially unambiguous” because lead is a “chemical” that “irritates” and

“contaminates”); Peace v. Nw. Nat’l Ins. Co., 228 Wis. 2d 106, 125-27 (Wis. 1999) (finding

lead, lead paint, lead paint chips, lead paint fumes, and lead paint dust are an “irritant” or

“contaminant” within the meaning of the exclusion and the words “discharge”, “dispersal”,

“release” or “escape” “covers the release of paint containing lead from a wall or ceiling into the

air or onto the floor” because these words “appear to describe the entire range of actions by

which something moves from a contained condition to an uncontained condition.”).

But this Court is not tasked with weighing the various reasoning in the above cases and

determining which interpretation is “correct” in the abstract. Rather, the Court must predict how

the Ohio Supreme Court would rule.

Ohio Law Regarding Pollution Exclusions

In the absence of direct guidance from Ohio’s highest court, this Court must attempt to

anticipate how that court would resolve the issue of whether lead-based paint falls within the

policy exclusion language. See Meyers v. Cincinnati Bd. of Ed., 983 F.3d 873, 880 (6th Cir.

2020). The Court is bound by controlling decisions of the Ohio Supreme Court, and intermediate

state appellate court decisions are “viewed as persuasive unless it is shown that the state’s

highest court would decide the issue differently.” In re Dow Corning Corp., 419 F.3d 543, 549

(6th Cir. 2005) (citation omitted).

Again, the provision at issue here excludes from coverage “[b]odily injury” or “property

damage” arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration,

release or escape of “pollutants”, where “pollutants” are defined as “any solid, liquid, gaseous or

thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals

and waste. (Doc. 38-1, at 25, 40).

Neither the Ohio Supreme Court nor Ohio’s appellate courts have addressed the precise

claim at issue here – the application of an absolute pollution exclusion in a commercial general

liability policy to a claim regarding lead-based paint. But Ohio courts have addressed similar

exclusions in other contexts.

In 2001, the Ohio Supreme Court addressed the exclusion as applied to a claim regarding

carbon monoxide from a malfunctioning residential gas heater. Andersen v. Highland House Co.,

93 Ohio St. 3d 547 (2001). Confronting a pollution exclusion identical to that at issue here, the

Andersen court first noted the Ohio Supreme Court’s prior holding that “where exceptions . . .

are introduced into an insurance contract, a general presumption arises to the effect that that

which is not clearly excluded from the operation of such contract is included in the operation

thereof.” Id. at 549 (quoting Plymouth, 146 Ohio St. 96, at ¶2 of syllabus) (emphasis in

Andersen). It then held:

In the case at bar, the policy in question never clearly excludes claims for deaths

or injuries caused by residential carbon monoxide poisoning. It is not the

responsibility of the insured to guess whether certain occurrences will or will not

be covered based on nonspecific and generic words or phrases that could be

construed in a variety of ways. Thus, in order to defeat coverage, “the insurer

must establish not merely that the policy is capable of the construction it favors,

but rather that such an interpretation is the only one that can fairly be placed on

the language in question.” Reiter, Strasser & Pohlman, The Pollution Exclusion

Under Ohio Law: Staying The Course (1991), 59 U. Cin. L. Rev. 1165, 1179.

See Lane v. Grange Mut. Cos. (1989), 45 Ohio St.3d 63, 65, 543 N.E.2d 488, 490

(“Where provisions of a contract of insurance are reasonably susceptible of more

than one interpretation, they will be construed strictly against the insurer and

liberally in favor of the insured”).

Id. The Andersen court examined the history and purposes of the pollution exclusion and

explained it “did not support the notion that if it was created to preclude the kind of claim

involved in this case.” Id. at 549. It thereafter explained:

The court in Am. States Ins. Co. v. Koloms (1997), 177 Ill.2d 473, 492–493, 227

Ill.Dec. 149, 158, 687 N.E.2d 72, 81, best described the real purpose of the

pollution exclusion when it wrote: “Our review of the history of the pollution

exclusion amply demonstrates that the predominate motivation in drafting an

exclusion for pollution-related injuries was the avoidance of the ‘enormous

expense and exposure resulting from the “explosion” of environmental litigation.’

(Emphasis added.) Weaver [v. Royal Ins. Co. of Am. (1996) ], 140 N.H. [780] at

783, 674 A.2d [975] at 977, quoting Vantage Development Corp. v. American

Environment Technologies Corp., 251 N.J.Super. 516, 525, 598 A.2d 948, 953

(1991). * * * We would be remiss * * * if we were to simply look to the bare

words of the exclusion, ignore its raison d'etre, and apply it to situations which do

not remotely resemble traditional environmental contamination.”

Id. at 551-52. Later Ohio appellate decisions have applied this “traditional environmental

contamination” view of the absolute pollution exclusion. See, e.g., Southside River-Rail Terminal

v. Crum & Forster Underwriters of Ohio, 157 Ohio App. 3d 325, 337 (Ohio Ct. App. 2004)

(explaining that “the sudden escape of 990,000 gallons of liquid Uran 28 from a collapsed

storage tank on an industrial site does equate to a traditional release of a pollutant into the

environment.”); Bosserman Aviation Equip., Inc. v. United States Liab. Ins. Co., 183 Ohio App.

3d 29, 39 (Ohio Ct. App. 2009) (“[W]e find dispositive the Supreme Court of Ohio’s discussion

of the history of pollution-exclusion clauses and their intended purpose, namely, to preclude

coverage for traditional environmental contamination”); Rybacki v. Allstate Ins. Co., 2004-Ohio-

2116, at ¶ 11 (Ohio Ct. App. 2004) (“The holding of Andersen is ‘that carbon monoxide emitted

from a malfunctioning residential heater is not a pollutant under the pollution exclusion of a

comprehensive general liability policy unless specifically enumerated as such.’ We think that the

case of an internal heater emitting carbon monoxide within the atmosphere of residential living

quarters does not equate to the environmental degradation of a pollutant leak into the earth.”)

(quoting Andersen, 93 Ohio St. 3d at 334); see also JTO, Inc. v. Travelers Indem. Co. of Am.,

242 F. Supp. 3d 599, 607 (N.D. Ohio 2017) (distinguishing Andersen because “there is no

credible dispute that the underlying governmental Complaints against JTO are Complaints of

‘traditional environmental contamination.’”); but see Pure Tech Sys. v. Mt. Hawley Ins. Co., 95

F. App’x 132, 138 (6th Cir. 2004) (applying Ohio law and Andersen to polychlorinated

biphenyls (“PCBs”) in waste drums and explaining that “[t]he ‘history’ of the exclusion does not

compel this court to disregard the plain language of the exclusion. . . . [and] the court is not at

liberty to graft an additional term onto the exclusion based on the exclusion’s history, especially

a term as vague and potentially unworkable as ‘traditional environmental contamination.’”).

As Auto-Owners points out, several Ohio appellate courts previously concluded absolute

pollution exclusions are “clear and unambiguous in precluding coverage for claims arising from

pollution.” Selm v. Am. States Ins. Co., 2001 WL 1103509, at *3 (Ohio Ct. App.) (finding

pollution exclusion unambiguous as to asbestos released when removing flooring); Zell v. Aetna

Cas. & Sur. Ins. Co., 114 Ohio App. 3d 677, 681-82 (Ohio Ct. App. 1996) (finding pollution

exclusion unambiguous as to noxious fumes released when waterproofing materials were

applied); W. Am. Ins. Co. v. Hopkins, 1994 WL 559005, at *1 (Ohio Ct. App.) (finding pollution

exclusion unambiguous as to gasoline dumped down a floor drain).

But the above-cited cases pre-date Andersen, and a finding that a pollution exclusion is

unambiguous (or ambiguous) in one context does not mean it is so in every context. See, e.g.,

Pure Tech Sys., 95 F. App’x at 137 (“The Anderson [sic] court held that a particular element of

the exclusion—“pollutant”—was ambiguous as applied to the facts at issue—carbon monoxide

emitted from a faulty heating unit.”) (emphasis added). That is, saying an absolute pollution

exclusion unambiguously precludes coverage for pollution simply begs the question of what falls

within the definition of “pollution”.

The Court finds Andersen instructive in multiple ways regarding the task at hand –

“anticipat[ing] how the relevant state’s highest court would rule in the case”. In re Dow Corning

Corp., 419 F.3d 543, 549 (6th Cir. 2005) (citation omitted). First, Andersen emphasized the need

for policy language regarding exclusions to be “clear[], specific[], and unambiguous[]”, “the

importance of interpreting ambiguities in insurance contracts against the insured”, and explained

“[i]t is not the responsibility of the insured to guess whether certain occurrences will or will not

be covered based on nonspecific and generic words of phrases that could be construed in a

variety of ways.” 93 Ohio St. 3d at 548-49.

Given this guidance, the Court finds the definition of “pollution” in the policy as applied

to lead-based paint “is susceptible of two or more reasonable interpretations”, United States Fid.

& Guar. Co., 129 Ohio App. 3d at 55, and thus ambiguous. The Illinois appellate court in

Stringfield examined the term – with its definition as an “irritant or contaminant”, and cited the

Seventh Circuit Opinion in Pipefitters Welfare Educational Fund v. Westchester Fire Ins.

Co., 976 F.2d 1037 (7th Cir.1992). There, the court cogently stated:

The terms “irritant” and “contaminant,” when viewed in isolation, are virtually

boundless, for “there is virtually no substance or chemical in existence that would

not irritate or damage some person or property.” Without some limiting principle,

the pollution exclusion clause would extend far beyond its intended scope, and

lead to some absurd results.

Pipefitters Welfare Educ. Fund, 976 F.2d at 1043 (internal citation omitted). The Stringfield

court then explained “the term ‘contaminant’ is susceptible to more than one reasonable

interpretation and thus ambiguous with respect to whether it encompasses lead-based paint.” 292

Ill. App. 3d at 475. Looking to dictionary definitions, the court found “[w]ith respect to whether

such a definition encompasses the lead in the lead-based paint, a reasonably prudent layperson

could conclude, based upon the definition alone, that it does not” because “[t]he definition

implies that there must be a contemporaneous association between the contaminating substance

and the time it corrupts the substance, no matter how toxic, dangerous, or undesirable it might

later be determined to be” and it did “not believe that a reasonably prudent layperson would

understand that lead-based paint was contaminated from its time of creation” or “later

contaminated since there was no subsequent corruption by lead”. Id. Stringfield went on to

explain:

A common understanding of a pollutant is a substance that “pollutes” or renders

impure a previously unpolluted object, as when chemical wastes leach into a clean

water supply. Here the lead did not pollute the paint: it was purposefully

incorporated into the paint from the start. The paint was intentionally applied to

the premises. At the time, the paint was legal. It was considered neither impure

nor unwanted. A literal reading of the term as it is used in the exclusionary clause

at issue supports the interpretation favored by the defendants. We hold that, as a

matter of law, the standard pollution exclusion found in general liability policies

does not preclude coverage for personal injuries arising out of a minor's ingestion

of lead.

Id. at 476. Therefore, the court concluded, “there is a reasonable interpretation of the pollution

exclusion clause other than that it applies to claims for injuries arising out of the ingestion of

lead-based paint—that the clause applies only to claims for injuries arising out of environmental

pollution. Thus, the provision is ambiguous and the ambiguity is resolved in favor of the

insured.” Id. at 476-77; see also McFadden, 413 Mass. at 92 (“We conclude that an insured

could reasonably have understood the provision at issue to exclude coverage for injury caused by

certain forms of industrial pollution, but not coverage for injury allegedly caused by the presence

of leaded materials in a private residence” in part because “[t]here simply is no language in the

exclusion provision from which to infer that the provision was drafted with a view toward

limiting liability for lead paint-related injury.”); Lefrak Org., 942 F. Supp. at 956 (“Lead paint is

neither among the listed examples, nor closely related to a listed example”, therefore policy

exclusion is at least ambiguous).

To be sure, the definition of the term “pollutant” can also be read broadly to include

claims related to lead-based paint as evidenced by the cases previously cited. But the Court finds

both are equally reasonable interpretations of the definition of “pollution” in the policy as

applied to lead-based paint. And given the Ohio Supreme Court’s strong emphasis in Andersen

regarding the need for exclusions to be “clear[], specific[], and unambiguous[]”, and that “[i]t is

not the responsibility of the insured to guess whether certain occurrences will or will not be

covered based on nonspecific and generic words of phrases that could be construed in a variety

of ways”, 93 Ohio St. 3d at 548-49, the Court finds a reasonable insured could read the policy

and understood it to cover lead-based paint claims.

Second, in Andersen, the Ohio Supreme Court signaled (even though it did not explicitly

hold), that it views the absolute pollution exclusion through its “traditional environmental

pollution” history. 93 Ohio St. 3d at 334. Other state courts taking such an approach have found

lead paint outside of such a definition. See, e.g., Novella, 727 A.2d at 283; McFadden, 595

N.E.2d at 764. Auto-Owners attempts to distance the instant case from much of Plaintiffs’ and

Defendants’ cited caselaw, arguing these cases come from courts that have adopted such a view

and “[n]either the Ohio Supreme Court, nor any of Ohio’s appellate courts, have expressly found

that standard pollution exclusion language applies only to ‘traditional environmental’ losses.”

(Doc. 62, at 6) (emphasis in original). This is true so far as it goes. But Ohio appellate courts

post-dating Andersen have taken this “traditional environmental pollution” history as cited by

Andersen into account. See, e.g., Southside River-Rail Terminal, 157 Ohio App. 3d at 337;

Bosserman Aviation Equip., 183 Ohio App. 3d at 39. And the court’s analysis in Andersen

certainly suggests it views the exclusion through such a lens and is willing to graft that history

onto the language of the exclusion. See 93 Ohio St. 3d at 551 (“We would be remiss if we were

to simply look to the bare words of the exclusion, ignore its raison d’etre, and apply it to

situations which do not remotely resemble traditional environmental contamination.” (internal

quotation and citation omitted).

Third and finally, the Court finds support for its conclusion in the many conflicting

rulings cited by the parties regarding whether lead-based paint is included in such absolute

pollution exclusions. That is, this wide-ranging conflict itself is – although not definitive – at

least supportive persuasive evidence of the exclusion’s ambiguity as applied to lead-based paint.

As the Ohio Supreme Court explained in 1928:

Without analyzing, or approving, or disapproving the logic of these several

decisions or attempting to say where the weight of authority prevails, the fact that

such respectable authority is in irreconcilable conflict, and was so long prior to

the execution of the insurance contracts here under consideration, coupled with

the fact that the lower courts in the instant case are in disagreement as to whether

the clause is a covenant or a condition, presents such persuasive argument of the

ambiguity of the clause that if this court were in accord as to the unambiguity of

the clause it would hesitate to so declare.

George H. Olmsted & Co. v. Metro. Life Ins. Co., 118 Ohio St. 421, 427–28 (1928); see also

Sullins v. Allstate Ins. Co., 340 Md. 503, 516-17 (1995) (“Some courts hold that the existence of

conflicting judicial interpretations of insurance policy terms is evidence of ambiguity, while

others hold such conflict is not conclusive.”) (citing Charles C. Marvel, Annotation, 4 A.L.R. 4th

1253 (1981)); WILLISTON ON CONTRACTS § 49:18 (4th ed.) (“This rule is based on the

understanding that one cannot expect a lay person to understand the meaning of a clause where

judicial minds are in disagreement.”); Cf. Fireman’s Fund Ins. Cos. v. Ex-Cell-O Corp., 702 F.

Supp. 1317 (E.D. Mich. 1988) (“Conflicting judicial interpretations may indeed be some

evidence of ambiguity. But if the policies are unambiguous, conflicting judicial interpretations

do not prevent [the court] from so finding.”).

The Court finds the conflicting, reasonable, judicial interpretations of whether lead-based

paint is a “pollutant” within the meaning of an absolute pollution exclusion in a commercial

general liability insurance policy provide further support for finding the terms of the policy as

applied here ambiguous.

In conclusion, for the reasons stated above, the Court believes the Ohio Supreme Court

would find the absolute pollution exclusion in this case ambiguous as to the instant claims

regarding lead-based paint. As ambiguities must be “construed strictly against the insurer and

liberally in favor of the insured” Lane, 45 Ohio St. 3d at 65, Auto-Owners owes Defendants a

duty to defend in the instant case.

Motion to Certify

Recognizing the above question is not a definitively settled question of Ohio law, Auto-

Owners – four months after the filing of its Motion for Judgment on the Pleadings – filed a

Motion to Certify “to afford this Court an alternative regarding the coverage issues raised in this

matter.” (Doc. 52, at 5).

Under Ohio Supreme Court Rule of Practice 9.01, “[t]he Supreme Court may answer a

question of law certified to it by a court of the United States.” Ohio S. Ct. Prac. R. 9.01(A). A

federal court may certify an issue when a question of Ohio law may be determinative of the

proceeding and there is no controlling precedent in the decisions of Ohio Supreme Court. Id. The

“mere difficulty in ascertaining local law is no excuse” for the district court to certify a

question. Lehman Bros. v. Schein, 416 U.S. 386, 390 (1974). Certification “is most appropriate

when the question is new and state law is unsettled.” Transam. Ins. Co. v. Duro Bag Mfg. Co., 50

F.3d 370, 372 (6th Cir. 1995). However, “the federal courts generally will not trouble our

sister state courts every time an arguably unsettled question of state law comes across our desks.

When we see a reasonably clear and principled course, we will seek to follow it

ourselves.” Pennington v. State Farm Mut. Auto. Ins. Co., 553 F.3d 447, 450 (6th Cir. 2009)

(internal quotation and citation omitted). Ultimately, the decision to certify a question to a state

supreme court “rests in the sound discretion of the federal court.” Lehman Bros., 416 U.S. at 391.

For the reasons stated above, the Court sees a “reasonably clear and principled course”,

Pennington, 553 F.3d at 450, in the instant case based on Ohio precedent and therefore exercises

its discretion not to certify this question to the Ohio Supreme Court.

Breach of Contract / Unjust Enrichment Claims

Finally, Auto-Owners asserts (and no other party disputes) Plaintiffs’ claims for breach of

contract and unjust enrichment (Doc. 1, at 25-29) do not fall within the policy’s coverage

because they are not claims for “bodily injury” or “property damage” as defined therein. See

Doc. 38-1, at 37 (defining bodily injury to mean “bodily injury, bodily sickness, or bodily

disease sustained by a person, including death resulting from any of these at any time” and

defining “property damage” to mean “[p]hysical injury to tangible property, including all

resulting loss of use of that property” and “[l]oss of use of tangible property that is not physically

injured”). As such, Auto-Owners is under no duty to defend these claims.

CONCLUSION

For the foregoing reasons, good cause appearing, it is

ORDERED that Auto-Owners’s Motion for Judgment on the Pleadings (Doc. 45), be and

the same hereby is, GRANTED in part and DENIED in part as described herein; and it is

FURTHER ORDERED that Auto-Owners’s Motion to Certify Question to the Ohio

Supreme Court (Doc. 52), be and the same hereby is DENIED.

s/ James R. Knepp II

UNITED STATES DISTRICT JUDGE