Underwriters at Lloyds, London v. DVO Inc.

OPINION AND ORDER DENYING PLAINTIFF’S SECOND MOTION FOR SUMMARY JUDGMENT RE: DUTY TO DEFEND AND DUTY TO INDEMNIFY (Doc. 50) Plaintiff, Those Certain Underwriters at Lloyd’s, London, subscribing to policies PGIARK07130-00 (“Policy 7130″) and PGIXS00556-00 (“Policy 556″) (collectively, “Policies”), brings this action against Defendants DVO, Inc. (“DVO”) and Dairy Energy, Inc. (“Dairy Energy”) (collectively, “Defendants”) seeking a declaratory judgment regarding its duties to defend and indemnify DVO in an underlying action in the Virginia Circuit Court for the County of Pittsylvania (the “Virginia Court”) between DVO and Dairy Energy, captioned Dairy Energy, Inc. v. DVO, Inc., Case No. CL18002382-00 (Va. Cir. Ct.) (the “Underlying Action”). Pending before the court is Plaintiff’s second motion for summary judgment filed by Plaintiff in this case. (Doc. 50.) DVO is the insured under Policy 7130 and Policy 556, Policy 7130 contains a professional liability policy (the “7130 Professional Liability Policy”) and a commercial general liability policy (the “7130 Commercial General Liability Policy”). Policy 556 affords excess coverage subject to the same terms and conditions set forth in Policy 7130. In its Complaint, Plaintiff asserts that it is not required to defend or indemnify DVO under the 7130 Professional Liability Policy and that, to the extent that the Underlying Action would otherwise trigger coverage, several exclusions apply. In response, DVO counterclaims for a declaratory judgment that the Policies give rise to a duty to defend the Underlying Action because the Underlying Action concerns professional services to which no exclusions apply. Dairy Energy counterclaims seeking a declaratory judgment that DVO is entitled to defense and indemnity for the Underlying Action under the 7130 Professional Liability Policy and, upon exhaustion of the limits of the 7130 Professional Liability Policy, under Policy 556. Dairy Energy argues that to the extent it recovers from DVO in the Underlying Action, “it would be entitled to the proceeds of the Professional Policy [and the Excess Policy].” (Doc. 29 at 10-11,