FEDERAL: Travelers Indemnity v. Bowling Green Prof (6TH. CIR. 7/20/2007; KY)

Travelers Indemnity v. Bowling Green Prof
    Western District of Kentucky at Bowling Green
07a0273p.06 7/20/2007

JURISDICTION: INSURANCE COVERAGE DISPUTE DECLARATORY JUDGMENT ACTION

GRIFFIN, Circuit Judge. In this insurance coverage dispute, Bowling Green Professional Associates (“Bowling Green”), an out-patient drug treatment facility in Kentucky, appeals a declaratory judgment and summary judgment opinion and order of the district court. The crux of 1 this declaratory judgment action is whether either of two liability policies issued to Bowling Green by two different insurers, Travelers Indemnity Company of Connecticut (“Travelers”), and Evanston Insurance Company (“Evanston”), provide coverage to Bowling Green for a wrongful-death lawsuit brought in Kentucky state court. Following Bowling Green’s demand to its insurers for litigation defense and liability indemnity, Travelers filed this action in federal district court in the Western District of Kentucky seeking a declaratory judgment of whether it owed a duty to defend or indemnify Bowling Green in the underlying state court action. Evanston cross-claimed seeking a similar declaration regarding the Caudill estate claims only. The district court exercised jurisdiction and granted the insurers’ motions for declaratory judgment. Bowling Green timely appealed. For the reasons set forth below, we hold that the district court abused its discretion in exercising declaratory judgment jurisdiction. Accordingly, we vacate the order and judgment of the district court and remand with instructions to dismiss for lack of jurisdiction.

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