3371 Reading, LLC v. Liberty Mutual Group, Inc.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

WESTERN DIVISION

3371 READING, LLC, : Case No. 1:22-cv-62

:

Plaintiff, : Judge Jeffery P. Hopkins

:

vs. :

:

LIBERTY MUTUAL GROUP, INC., et :

al., :

:

Defendants.

OPINION AND ORDER

The case now before the Court involves a dispute over insurance coverage. Plaintiff

3371 Reading, LLC (“3371 Reading” or “Plaintiff”) sued Defendants The Ohio Casualty

Insurance Company, Liberty Mutual Group, Inc., and Jonathan Jones (together “Ohio

Casualty” or “Defendants”) when coverage was denied after fire destroyed Plaintiff’s building

located at the 3371 Reading address (which also serves as the business’s namesake). The

parties filed cross-motions for summary judgment seeking a determination over

whether 3371 Reading’s builders’ insurance policy covered the loss. Doc. 99, Doc. 105. Also

before the Court are two motions to exclude testimony filed by Plaintiff (Docs. 103, 104) and

a Motion for Leave to File Supplemental Response to Plaintiff’s Motion for Partial Summary

Judgment Instanter (Doc. 112) filed by Defendants.

At the core of the parties’ dispute over insurance coverage is an endorsement contained

in the insurance policy. That endorsement required 3371 Reading to maintain a fenced jobsite

to recover on its insurance policy, which was placed with Ohio Casualty, an underwriting

company for Liberty Mutual. Defendants1 contend that Ohio Casualty properly denied

coverage because 3371 Reading failed to comply with the fenced jobsite requirement. As

explained more fully, below, the Court agrees. Accordingly, the Court GRANTS Defendants’

Motion for Summary Judgment (Doc. 99) and DENIES 3371 Reading’s Motion for Partial

Summary Judgment (Doc. 105). Because the Court reaches this conclusion without relying

on the testimony of the two contested expert witnesses, it need not reach 3371 Reading’s

Motions to Exclude (Docs. 103, 104), which are DENIED AS MOOT. Liberty Mutual’s

Motion for Leave to File Supplemental Response (Doc. 112) is also DENIED AS MOOT.2

I. BACKGROUND

Stanislav Grinberg and Peter Gizunterman are real estate investors. Doc. 105-1, ¶¶ 1–

3. They also are the sole members of two LLCs formed to purchase properties in Cincinnati

for redevelopment: 4588, LLC and Vision & Beyond Group, LLC. Id., ¶ 1-3. On May 1, 2020,

4588, LLC purchased the property at issue in this litigation, 3371 Reading Road. Id., ¶ 1.

Grinberg and Gizunterman bought the building at 3371 Reading Road as part of a larger

acquisition of properties out of receivership in a Hamilton County Court of Common Pleas

case, getting it for “dirt cheap,” in their words. Id., ¶¶ 1, 4. They planned to renovate the

building, which had been an abandoned warehouse in a previous life and to convert it into a

mixed-use building with apartments and commercial use space. Doc. 99, PageID 5417. Three

days after they bought 3371 Reading, Grinberg and Gizunterman transferred it to another

1 Defendants also argue that Liberty Mutual is not a proper defendant because it was not in

privity with 3371 Reading. Doc. 99, PageID 5426 n.6. Because the Court concludes that

Defendants were entitled to deny coverage under the policy, it need not address this

argument.

2 The Court heard oral argument from the parties on pending motions on April 1, 2025.

LLC wholly owned by the two of them, 3371 Reading, LLC, which is the plaintiff here. See

Doc. 105-1, ¶ 2.

Thereafter, Plaintiff procured builder’s risk insurance for the property at 3371 Reading

through its insurance broker, Camargo Insurance Agency. Doc. 99, PageID 5417. Camargo

principal Jacob Mueller and employee Lynn Plona worked with Ohio Casualty underwriter

Jonathan Jones to place coverage for the property. Id. On December 14, 2020, Mr. Jones sent

Camargo a proposal for the policy. Id. at PageID 5418. That December 14 proposal included

the key provisions at issue in this case: a Protective Devices Schedule and a Protective Devices

Endorsement, under the terms of which 3371 Reading would be required to put up a

protective fence in order to receive coverage. Id. Ms. Plona would later tell Ohio Casualty’s

claims investigator that she never saw the Protective Devices Endorsement prior to 3371

Reading making a claim on its policy, but she also confirmed that she sent the complete

policy, including the Protective Devices Endorsement and all other policy documents, to her

contact person at Plaintiff’s business establishment. See id. at PageID 5421–22. According to

Mr. Mueller, no one at Camargo reviewed Ohio Casualty’s proposal with Plaintiff. Doc. 109-

1, ¶ 22. Indeed, no one at 3371 Reading appears to have been aware of the fencing requirement

until Ohio Casualty raised it when investigating 3371 Reading’s claim—when contacted by

Ohio Casualty’s investigator, Mr. Grinberg said he was not aware of any fencing requirement

in the policy. Doc. 109-1, ¶ 51.

While it appears to not have reviewed the draft policy thoroughly, 3371 Reading

purchased the builders’ risk policy, bearing policy number BMO 62480292 and with an

effective date of December 11, 2020 (“the Policy”). Doc. 99, PageID 5419. And by December

16, 2020, both Plaintiff and Camargo had received copies of the Policy. Id.

The Policy provided builders’ risk coverage for the 3371 Reading Road site, with a

building materials coverage limit of $450,000 and a building coverage limit of $700,000. Doc.

76-1. Included with the policy was a “General Endorsement” which included the Protective

Devices Schedule and the Protective Devices Endorsement. Near the top of each page of the

General Endorsement there was a notice that read: “ This Endorsement Changes The Policy. Please

Read It Carefully.” Doc. 76-1, PageID 3761-62 (emphasis added). The Protected Devices

Schedule stated:

PROTECTIVEDEVICES SCHEDULE

(The entries required to complete this schedule will be shown below or on the “schedule of coverages".)

Protective Device or Service

Fenced Jobsite. Fenced jobsite means afence, not less than six (6) feet in height, that completely surrounds

the jobsite, with no openings unless gated. All gates to such fence shall be closed and locked, to secure

against entry to the jobsite, during all non-working hours

Doc. 76-1, PageID 3761.

On the Policy’s following page appears the Protective Devices Endorsement:

PROTECTIVEDEVICES ENDORSEMENT

if indicated on the Protective Devices Schedule, the following conditions apply to the locations described on

the schedule.

OTHER CONDITIONS

Protective Devices - "You" are required to maintain, at all times during the policy period, the protective

devices and services described on the Protective Devices Schedule.

PERILS EXCLUDED

As respects the locations specified in the Protective Devices Schedule,

the following exclusion is added to Perils Excluded:

"We" not pay for loss caused by fire or theft if, prior to the fire or

thefi, "you":

1. had knowledge of any suspension of impairment in any protective

device or service described on the Protective Devices Schedule and

did not notify "us"; or

2. failed to maintain in complete working order, any protective device or

service described on the Protective Devices Schedule which "you" control.

Doc. 76-1, PageID 3762.

These endorsements were included near the beginning of the policy, prior to various

form documents.

With the Policy in place, Plaintiff began construction at the 3371 Reading job site, but

never put up a construction fence around the property. Doc. 109-1, §j 31. Plaintiff also never

applied for a permit to erect a construction fence on the city sidewalk abutting one side of the

property. Jd., § 33. Among the other miscues, Plaintiff never spoke with anyone at Ohio

Casualty about the protective devices endorsement prior to the fire. Id., § 36.

On the evening of August 6, 2021, the building at 3371 Reading Road burned down.

Doc. 108-1, §§ 58-59.* The fire was so severe that the roof collapsed and the walls became

> Mr. Grinberg testified that the project was “fairly close to finished” at the time of the fire

and required only about a month more work. Doc. 94-1, PageID 4549-50.

unstable, so the City of Cincinnati directed the building’s owners to raze it. Id. The Cincinnati

Fire Department investigated the fire but was unable to determine its cause. Id.

3371 Reading notified Ohio Casualty and Liberty Mutual of the loss on August 9.

Doc. 52-2, PageID 2773. Liberty Mutual investigated the claim, and on September 30, 2021,

it issued a denial letter to Plaintiff informing the company that it had denied the claim. Doc.

109-1, ¶ 53. See also Doc. 52-2. That letter stated:

No fencing was placed around the jobsite as required by the Protective Devices

Endorsement on the policy. Based on the above we find no coverage under the terms

and conditions of your policy for the costs claimed in connection with your asserted

claim and therefore deny your claim.

Doc. 52-2.

Plaintiff originally sued Liberty Mutual and Ohio Casualty in the Hamilton County

Court of Common Pleas on December 25, 2021, alleging breach of contract and bad faith

claim refusal. Doc. 1-2. Liberty Mutual and Ohio Casualty removed the case to federal court

in February of 2022. Doc. 1.4 3371 Reading later sought leave to amend the complaint,

seeking to add claims of fraud and violation of the Ohio Deceptive Trade Practices Act. Doc.

50. This Court granted Plaintiff’s request to amend, Doc. 75, and Plaintiff filed its amended

complaint—which is the presently operative version of the complaint—on June 11, 2024.

Doc. 76. In turn, the parties filed the cross-motions for summary judgment presently under

consideration seeking a determination of whether the fire that destroyed the property at 3371

Reading Road was covered under the Policy and whether Ohio Casualty’s denial of Plaintiff’s

4 When Ohio Casualty first removed this case, it was before Judge Timothy Black. It was

transferred to Judge Matthew McFarland in August 2022, then to the undersigned in

December 2022.

insurance claim was fraudulent, violated Ohio’s Deceptive Trade Practices Act, and was done

in bad faith. Docs. 99, 105.

II. STANDARD OF REVIEW

Ohio Casualty asks the Court to grant summary judgment rejecting all Plaintiff’s

claims for relief, while 3371 Reading seeks summary judgment on its contract claim and

partial summary judgment on its remaining claims. The Court applies the same standard in

evaluating each motion for summary judgment; each movant must “‘inform[] the district

court of the basis for its motion and identify[] those portions’ of the record which demonstrate

‘the absence of a genuine issue of material fact.’” Rudolph v. Allstate Ins. Co., No. 2:18-cv-

1743, 2020 WL 4530600, at *3 (S.D. Ohio Aug. 6, 2020) (quoting Celotex Corp. v. Catrett, 477

U.S. 317, 323 (1986)).

The non-moving party cannot defeat summary judgment merely by pointing to any

factual dispute. Instead, the “mere existence of some alleged factual dispute between the

parties will not defeat an otherwise properly supported motion for summary judgment; the

requirement is that there be no genuine issue of material fact.” Int’l Outdoor, Inc. v. City of Troy,

974 F.3d 690, 697 (6th Cir. 2020) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–

48 (1986)). In other words, the dispute must be “genuine” (i.e., supported by evidence) and

go to a “material fact” (i.e., a fact that could matter to the outcome).

In sum, after reviewing the cited evidence, the Court must determine whether there is

some “sufficient disagreement” that necessitates submitting the matter to a jury. Moore v.

Phillip Morris Cos., Inc., 8 F.3d 335, 340 (6th Cir. 1993) (quoting Anderson, 477 U.S. at 251).

In making that determination, though, the Court must view the evidence in the light most

favorable to the nonmoving party. Cox v. Ky. Dep’t of Transp., 53 F.3d 146, 150 (6th Cir. 1995)

(“In arriving at a resolution, the court must afford all reasonable inferences, and construe the

evidence in the light most favorable to the nonmoving party.”); Matsushita Elec. Indus. Co. v.

Zenith Radio Corp., 475 U.S. 574, 587 (1986).

III. LAW AND ANALYSIS

3371 Reading and Ohio Casualty both ask the Court to interpret the disputed Policy

provision and determine whether 3371 Reading is entitled to coverage under the insurance

Policy. As counsel for the parties professed at oral argument in this matter, all parties agree

that interpretation of the insurance contract is a matter of law, and so should be determined

by this court on summary judgment. To put it another way, no party thinks the insurance

coverage question should go to trial; both parties agree it should be decided by this Court on

the briefing currently before it. The Court agrees and proceeds to interpret the Policy. See

Davis v. GEICO Cas. Co., 659 F. Supp. 3d 843, 852 (S.D. Ohio 2023) (“Interpretation of

insurance contracts may be decided at summary judgment.”)

A. Choice of Law

First things first. The Court must determine what state’s law to apply in interpreting

the insurance policy. This Court has diversity jurisdiction over this dispute under 28 U.S.C. §

1332, as there is complete diversity between Plaintiff 3371 Reading and Defendants Ohio

Casualty and Liberty Mutual. Doc. 1, PageID 1–2. In a diversity case, the Court applies the

choice of law rules of the state in which it sits, which here is Ohio. See Sec. Ins. Co. of Hartford

v. Kevin Tucker & Assocs., Inc., 64 F.3d 1001, 1005 (6th Cir. 1995). In the absence of a choice-

of-law provision in a contract, Ohio courts apply the law of the state that has the most

significant relationship to the dispute. See Gries Sports Enters., Inc. v. Modell, 15 Ohio St. 3d 284,

287 (1984). Ohio has the most significant relationship to the contract, as the insured property

was located in Ohio and the insured was located in Ohio. Thus, Ohio law governs

interpretation of the insurance policy.5

B. Construction of an Insurance Contract

Under Ohio law, this Court is required to “‘interpret the contract in such a way as to

give effect to the intention of the parties at the time the agreement was entered into, as

evidenced by the provisions of the contract.’ . . . However, because it is typically the insurance

carrier that drafts the policy, ambiguous language is construed in the way most favorable to

the insured.” In re Buckeye Countrymark, Inc., 251 B.R. 835, 839 (Bankr. S.D. Ohio 2000)

(quoting Watkins v. Brown, 97 Ohio App.3d 160, 163 (2nd Dist. 1994) and citing United States

Fidelity & Guaranty Co. v. Lightning Rod Mutual Ins. Co., 80 Ohio St.3d 584, 586 (1997)). The

general principle that ambiguous language is to be construed in favor of the insured “applies

with even greater force to language that purports to limit or to qualify coverage.” Watkins, 97

Ohio App.3d at 164. Thus, “[i]f an exclusionary clause will reasonably admit of an

interpretation that would preserve coverage for the insured, then as a matter of law, a court is

bound to adopt the construction that favors coverage.” Id. At the same time, if the provision

limiting coverage “has only one reasonable interpretation, a court is bound to enforce the

provision accordingly.” Id. Additionally, the fact that a term is not defined does not make it

ambiguous—“[t]erms that are not defined in an insurance policy ‘must be given their natural

5 The insurance policy also mentions Ohio law, as it includes an “Amendatory Endorsement”

for Ohio, Doc. 76-1, PageID 3790. And the parties have briefed the case under Ohio law,

showing their understanding that Ohio law governs the contract. See In re Buckeye

Countrymark, Inc., 251 B.R. 835, 839 (Bankr. S.D. Ohio 2000) (“[A]lthough the insurance

contract contains no choice of law provision, the contract does mention Ohio law. . . .

Further, all parties have pleaded the issues on summary judgment under Ohio law . . . .

Ohio has the most significant contacts with the insurance contract at issue.”).

and commonly accepted meaning.’” Carolina Cas. Ins. Co. v. Canal Ins. Co., 555 Fed.Appx. 474,

477 (6th Cir. 2014) (quoting Fed Ins. Co. v. Exec. Coach Luxury Travel, Inc., 2010-Ohio-6300,

¶ 3).

C. Application

The Court finds that the policy language at issue here is unambiguous. The Protective

Devices Schedule and Protective Devices Endorsement together required that 3371 Reading

maintain a “Fenced Jobsite” in order to receive coverage. “Fenced Jobsite” was defined to

require “a fence, not less than six (6) feet in height, that completely surrounds the jobsite, with

no openings unless gated. All gates to such fence shall be closed and locked, to secure against

entry to the jobsite, during all non-working hours.” Doc. 76-1, PageID 3761. Giving this

contract provision its “natural and commonly accepted meaning,” see Carolina Cas. Ins. Co.,

555 Fed. Appx. at 477, it required 3371 Reading to protect its jobsite with a construction

fence. 3371 Reading contends that the brick walls of the building themselves qualify as a fence

under the policy. See Doc. 105, PageID 5974–75. In support, it cites a Merriam Webster’s

dictionary definition of fence, which provides, “a barrier intended to prevent . . . intrusion or

to mark a boundary.” Id.6 Where a contract term is susceptible of only one reasonable

interpretation, however, the Court need not turn to a dictionary definition. 3371 Reading’s

proposed interpretation of this policy provision—whatever its consistency with one dictionary

6 The full definition 3371 Reading appears to be citing provides: “a barrier intended to prevent

escape or intrusion or to mark a boundary especially : such a barrier made of posts or wire or

boards.” Fence, Merriam-Webster’s, https://www.merriam-webster.com/dictionary/fence

(last accessed May 16, 2025). It bears noting that the clause following “especially” supports

Liberty Mutual’s argument.

definition of “fence”—is unreasonable. This provision plainly requires a separate construction

fence, and the walls of a building that is under construction do not qualify as a fence.7

3371 Reading also makes two complaints about the language and mechanics of the

protective devices schedule and protective devices endorsement. First, it argues that the

Fenced Jobsite requirement does not apply to the 3371 Reading Road property, because the

protective devices endorsement language was unartfully drafted. The Protective Devices

Endorsement says: “If indicated on the Protective Devices Schedule, the following conditions

apply to the locations described on the schedule.” Doc. 76-1, PageID 3762. But, 3371 Reading

points out, there aren’t any locations listed on Protective Devices Schedule. Doc. 105, PageID

5970. This argument fails because 3371 Reading fails to offer a reasonable interpretation of

the protective devices endorsement. Given that the policy applied to only one property, 3371

Reading Road, it is evident that the conditions in the Protective Devices Endorsement applied

to that property.8

Next, 3371 Reading takes issue with the Protective Devices Endorsement’s

requirement that 3371 Reading “maintain, at all times during the policy period, the [Fenced

7 Satterlee v. Great Lakes Ins. SE, No. 21-cv-01774, 2023 WL 3607283 (N.D. Cal. Mar. 23, 2023)

supports this conclusion. That case involved an insurance policy for a boat that required

that the boat be kept in a “locked and fenced enclosure.” Id. at *1. The insured argued that

the provision was ambiguous and that that it had complied with the provision because the

boat was on a property protected on one side by a locked gate, the only access point to which

was a “narrow walkway” on the other side. Id. at *3. The court rejected the argument that

the insured’s security provisions, which did not include a fully fenced and locked enclosure,

nonetheless satisfied the terms of the policy. Thus, it granted summary judgment for the

insurer. Id. at *5.

8 Additionally, it is not clear that the disputed phrase, “locations described on the schedule,”

refers to the Protective Devices Schedule. Ohio Casualty contends that it refers instead to

the Policy’s Schedule of Coverages. Doc. 108, PageID 6049. Either way, the Policy, read as

a whole, makes clear that the Protective Devices Endorsement applies to 3371 Reading

Road.

Jobsite].” Doc. 76-1, PageID 3762. It argues that the endorsement only required that 3371

Reading maintain any protective device already in place; there was no fence in place when the

policy went into effect, so there was nothing to maintain and 3371 Reading had no obligations

under the Protective Devices Endorsement. Doc. 105, PageID 5970–71. Ohio Casualty has

the better of this linguistic argument. In this context, “maintain” fairly encompasses any

efforts 3371 Reading needed to take to put in place a Fenced Jobsite, as that term was defined

on the Protective Devices Schedule. As Ohio Casualty points out, the verb “maintain” is

frequently used this way, as when a bank advertises a savings account that requires an

accountholder to “maintain” a minimum balance. Doc. 108, PageID 6050 n.4. In that

context, as in the policy at issue here, the word “maintain” encompasses efforts to initially

come into compliance with the requirement and subsequently remain in compliance.9

The nub of 3371 Reading’s argument, however, is its contention that it was impossible

to comply with the Protective Devices Endorsement, so the Endorsement cannot be enforced

as written. Doc. 105, PageID 5973. To repeat, the Endorsement required 3371 Reading to

“maintain” the Fenced Jobsite, which the Protective Devices Schedule defined as: “a fence,

not less than six (6) feet in height, that completely surrounds the jobsite, with no openings

unless gated.” Doc. 76-1, PageID 3761. 3371 Reading Road abutted another building on one

side and all parties agree that, as a result, it was impossible to erect a fence on that side of the

jobsite. 3371 Reading argues that the Court should not interpret the Protective Devices

9 Additionally, the Protective Devices Endorsement, by its terms, required 3371 Reading to

“maintain, at all times during the policy period,” the Fenced Jobsite, as that term is defined

in the Policy, not to maintain a fence, as 3371 Reading seems to interpret it. Thus, the verb

maintain applies to the jobsite with the required protective device, not to the fence itself.

This cuts in Liberty Mutual’s favor, as the policy specified that 3371 Reading was required

to maintain the jobsite in a particular condition—fenced.

Endorsement in such a way that it would never be entitled to coverage under the policy,

making the coverage illusory.10 Doc. 105, PageID 5973–74.

In seeking to give effect to the intent of the parties to an insurance contract, Ohio courts

avoid interpretations of insurance policies that render them illusory. See, e.g., Talbert v. Cont’l

Cas. Co., 2004-Ohio-2608, ¶ 36 (2nd Dist.) (“[W]e are not inclined to give the insurance policy

a reading that would render it useless.”). See also Coleman v. Progressive Preferred Ins. Co., 2008-

Ohio-3568, ¶ 13 (1st Dist.). The fact that an insured failed to comply with the terms of a policy

and thus was denied coverage does not, however, mean the policy was illusory. And even

when an insurance policy, read strictly literally, would entitle the insurer to deny coverage in

all cases—making the policy illusory—courts reject that literal reading, because it is unlikely

to be what the parties intended. For example, Coleman v. Progressive Preferred Insurance Company

involved uninsured motorist coverage in an auto insurance policy. The policy’s incidental use

coverage excluded accidents that occurred while the insured was driving a vehicle that was

available for the insured’s “regular use” but not listed on the policy. Coleman at ¶ 2. The policy

was drafted, however, in such a way that, grammatically, it appeared to exclude coverage

whenever the insured was driving a car “furnished to” him, which would make the exclusion

apply in all cases of incidental use. Id. at ¶ 8. Because that literal reading was evidently not

what the parties intended, the court declined to interpret the policy that way. Instead, it read

the provision “as it was obviously meant to read,”11 excluding coverage for vehicles available

10 See Coleman v. Progressive Preferred Ins. Co., 2008-Ohio-3568, ¶ 13 (1st Dist.) (“An insurance

provision is illusory when it appears to grant a benefit to the insured, though in reality it

does not.”).

11 The uninsured motorist coverage at issue in Coleman was modeled on sample policy terms

provided at Ohio Revised Code § 3937.18. This gave credence to the insurer’s argument that

for the insured’s regular use. Id. at ¶ 16. Applying that analysis, the exclusion applied, so the

Ohio appellate court ruled for the insurer. Id. at ¶ 24.

Here, too, the Court concludes that under the best reading of the insurance policy,

coverage was available to 3371 Reading if it complied with the policy’s terms. Preferring an

interpretation that “gives the contract vitality,” Thomas v. Am. Elec. Power Co., 2005-Ohio-

1958, ¶ 32 (10th Dist.), the Court concludes that 3371 Reading could have complied with the

Fenced Jobsite provision. Specifically, it could have put up a fence around the three sides of

the building that did not abut an adjacent building. See Doc. 108, PageID 6052 (depicting

where fence could have been constructed).

This reading is the better interpretation of the plain language of the policy. Such a

three-sided fence would have “completely surround[ed]” the jobsite, see Doc. 76-1, PageID

3761, because there would have been no portion of the jobsite exposed to the outside world

that was not protected by a fence. While it appears this reading is possibly inconsistent with

the Court’s rejection of 3371 Reading’s argument that the brick walls of its building qualified

as a “fence”—because, the argument goes, one brick wall is considered a fence but the others

are not—it is not in fact inconsistent. The jobsite is identified in the policy as 3371 Reading

Road, see Doc. 76-1, PageID 3758—not the interior of the building at 3371 Reading Road.

Thus, the jobsite includes the interior and the exterior of the building. No fence was necessary

on the side of the building where it abutted its neighbor, because the building was fully

protected on that side by the neighbor. Were a three-sided fence to have been erected, the

the coverage was not illusory, as “[s]urely, it was not the legislature’s intent to specifically

allow useless coverage.” Coleman at ¶ 12. Nonetheless, the court’s task was one of contract

interpretation rather than statutory interpretation. The statute was only an aid in

determining the parties’ intent.

exterior of the jobsite would have been fully protected as required by the Protective Devices

Endorsement. This reading of the Endorsement—not requiring that a fence be erected

through the wall between the buildings—is how the Endorsement was “obviously meant to

be read,” Coleman at ¶ 16. It “gives . . . vitality,” Thomas at ¶ 32, to the agreement the parties

made, under which 3371 Reading agreed to install a fence around the jobsite as a condition

of receiving coverage.12

3371 Reading insists that the insurance policy is ambiguous and any ambiguity should

be interpreted in its favor. The caselaw it cites, however, in which courts construed policy

language in favor of the insured, relates mostly to exclusions, where an insurer disclaims

liability for a certain class of claims, rather than endorsements requiring the insured to abide

by certain conditions in order to receive coverage. See, e.g., Andersen v. Highland House Co., 93

Ohio St.3d 547 (2001) (holding that pollution exclusion in apartment owner’s commercial

insurance policy did not apply to claims arising from residential carbon monoxide poisoning).

The doctrine of illusory coverage on which 3371 Reading relies is more comfortably applied

12 Additionally, The Protective Devices Endorsement required 3371 Reading to notify Ohio

Casualty of any “suspension or impairment” of a Protective Device listed on the Protective

Devices Schedule. Doc. 76-1, PageID 3762. To the extent 3371 Reading believed it was

unable to construct a fence because of the neighboring building—or for any other reason—

it was required to notify Ohio Casualty of that, which it failed to do. Doc. 109-1, ¶ 36. Ohio

Casualty was also entitled to refuse coverage as a result of 3371 Reading’s noncompliance

with this notification requirement.

3371 Reading’s arguments to the contrary, Doc. 105, PageID 5972–73, are unavailing. As

to Ohio Casualty’s purported knowledge of impairment of the device, the policy language

does not make exceptions based on the insurer’s supposed knowledge of the impairment.

As to 3371 Reading’s argument that this only required it to notify Ohio Casualty of problems

with a fence that had already been installed, its reading of the policy language is

unpersuasive. To the extent 3371 Reading believed it was unable to install the required

fence, this was an “impairment,” Doc. 76-1, PageID 3762, of which it was required to notify

Ohio Casualty.

in that domain—categorical exclusions from coverage—rather than endorsements that

require the insured to satisfy certain conditions in order to receive coverage. When an insured

is denied coverage based on such an endorsement, it may be inclined to argue that the insurer

intended to deny coverage all along—that it could never comply with the terms of the

endorsement. But it is not this Court’s role to speculate as to what Ohio Casualty would have

done had 3371 Reading made efforts to comply with the Protective Devices Endorsement.

Where such an endorsement unambiguously requires a particular protective measure be

taken, and the insured fails to take that protective measure, the insured is not in compliance

with the policy and coverage may be denied on that basis. See New Hamilton Liquor Store, Inc.

v. AmGuard Insurance Co., No. 20-2189, 2021 WL 5974158 (6th Cir. 2021) (affirming summary

judgment for insurer where insured failed to install an automatic fire alarm system, as was

required by a policy endorsement).

D. Remaining Claims

3371 Reading has also brought claims for bad faith denial of coverage, Doc. 76,

PageID 3747, fraud in the inducement, id. at PageID 3748, and violation of the Ohio

Deceptive Trade Practices Act, id. at PageID 3750–52. Each of these claims is premised on

3371 Reading’s argument that Ohio Casualty was barred by law from denying coverage under

the policy. The Court has concluded that the insurance contract was valid and 3371 Reading

failed to comply with its terms. Accordingly, Ohio Casualty was entitled to deny coverage.

As explained in more detail below, these claims fail for that reason.

Bad Faith

3371 Reading asserts that Ohio Casualty acted in tortious bad faith by denying its

insurance claim. Under Ohio law, an insurer has an obligation to act in good faith in

processing claims. Breach of that duty can give rise to a cause of action in tort against the

insurer. Hoskins v. Aetna Life Ins. Co., 6 Ohio St.3d 272, 276 (1983). To prevail on a bad faith

claim, the insured must show: “that the insurer had (1) no lawful basis for the refusal [of the

insurance claim] coupled with actual knowledge of that fact or (2) an intentional failure to

determine whether there was any lawful basis for such refusal.” Waldren v. Allstate Vehicle and

Prop. Ins. Co., No. 3:18-cv-290, 2020 WL 5214608 at *5 (S.D. Ohio Sept. 1, 2020) (internal

quotation marks and citation omitted). Because there was a lawful basis for Ohio Casualty to

deny coverage, 3371 Reading cannot prevail on its claim for bad faith refusal. Ohio Casualty

is entitled to summary judgment on this claim.

Fraudulent Inducement

3371 Reading also brings a claim for fraudulent inducement against Ohio Casualty,

asserting that it made material misrepresentations to 3371 Reading while negotiating the

Policy. Doc. 76, PageID 3748. Plaintiff identifies eight purported misrepresentations made by

Ohio Casualty, each of which is a statement in the Policy itself. Id. at PageID 3748–49.13 The

statements in the Policy that 3371 Reading cites are the terms of the policy under which it

later denied coverage, but as the Court has explained, coverage was properly denied based on

3371 Reading’s failure to comply with the terms of the policy. Accordingly, none of the

statements Plaintiff identifies, which promised that coverage would be provided according to

13 The typical fraudulent inducement claim, by contrast, “asserts that a misrepresentation of

facts outside the contract or other wrongful conduct induced a party to enter into the

contract.” ABM Farms, Inc. v. Woods, 81 Ohio St.3d 498, 503 (1998).

the Policy’s terms, were false, so no fraud was committed on 3371 Reading. Ohio Casualty is

likewise entitled to summary judgment on this claim.14

Ohio Deceptive Trade Practices Act

3371 Reading also brings claims against Ohio Casualty for violations of the Ohio

Deceptive Trade Practices Act, Ohio R.C. 4165.01, et seq. (ODTPA), alleging that Ohio

Casualty “deceptively s[old] insurance policies that provide no coverage.” Doc. 76, ¶ 77.

More specifically, 3371 Reading claims that Ohio Casualty represented that the Policy it sold

to 3371 Reading had “characteristics, . . . uses [or] benefits” that it did not have, because it

represented that the Policy provided fire and theft coverage when the Policy “would never,

according to [Ohio Casualty’s] interpretation, ever provide such coverage. Id., ¶ 73 (quoting

Ohio R.C. 4165.02(7)).

In order to succeed on an ODTPA claim, a plaintiff must prove: “(1) a false statement

or statement that is misleading, (2) which statement actually deceived or has the tendency to

deceive a substantial segment of the target audience, (3) the deception is material in that it is

likely to influence a purchasing decision, and (4) the plaintiff has been or is likely to be injured

as a result.” Torrance v. Rom, 2020-Ohio-3971, ¶ 48 (8th Dist.)

3371 Reading’s ODTPA claim fails to satisfy the first requirement because there was

no false statement. The claim relies on 3371 Reading’s assertion that the coverage was

illusory—that Ohio Casualty would never have provided coverage in any circumstances—but

14 3371 Reading does not claim that it intended to procure insurance without a fencing

requirement and that Ohio Casualty misled it by failing to mention that requirement. Such

a claim, too, would likely be unavailing absent misrepresentations outside the contract, as

“[t]he law does not require that each aspect of a contract be explained orally to a party prior

to signing.” ABM Farms, 81 Ohio St.3d at 503.

the Court has rejected this argument for the reasons set out above. Instead, the terms of 3371

Reading’s insurance contract with Ohio Casualty required it to put up a protective fence

around the building; 3371 Reading failed to satisfy that requirement, so Ohio Casualty denied

coverage. Thus, Ohio Casualty made no misrepresentation upon which an ODTPA claim

could be grounded. 3371 Reading fails to raise a genuine issue of material fact as to the validity

of its ODTPA claim, and Ohio Casualty is entitled to summary judgment.

IV. CONCLUSION

The terms of 3371 Reading’s Policy required it to put up a fence around its property.

3371 Reading does not dispute that it never did so. As a result, Ohio Casualty was within its

rights to deny coverage.

In reaching this conclusion, the Court has not relied on any expert testimony proffered

by the parties, including the two experts challenged by 3371 Reading (Docs. 103, 104), as the

Court has concluded that expert testimony is not helpful in determining the meaning of the

Policy terms. Nor has the Court relied on Defendants’ Supplemental Response to Plaintiff’s

Motion for Summary Judgment (Doc. 112), as this response relates primarily to issues the

Court did not need to reach in disposing of the case.

Accordingly, the Court GRANTS Defendants’ Motion for Summary Judgment (Doc.

99), and DENIES Plaintiff’s Motion for Partial Summary Judgment (Doc. 105). Plaintiff’s

Motions to Exclude (Docs. 103, 104) are DENIED AS MOOT. Defendants’ Motion for

Leave to File Supplemental Response (Doc. 112) is also DENIED AS MOOT.

The Court ORDERS the clerk to ENTER JUDGMENT for Defendants and

TERMINATE this matter from the docket.

IT IS SO ORDERED.

May 16, 2025 C Pi f. Lhyhen—

Jeffery ?. Hopkins

United States District Judge

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