Authored by Melissa White of Cozen O’Connor

In Capitol Specialty Insurance v. JBC Entertainment Holdings, Inc., et al. (pdf), the Washington Court of Appeals held that a firearms exclusion in a commercial general liability policy bars coverage for all claims arising out of a shooting, including pre-shooting negligence.  The Court confirmed that the exclusion is not ambiguous and rejected the insured’s arguments that the firearms exclusion should not apply if the firearm was not actually used by the insured.

 BACKGROUND

An unknown person fired a gun at Jillian’s nightclub in Seattle, injuring a patron.  The patron filed suit to recover damages related to the shooting.  One of the defendants was JBC Entertainment Holdings, Inc. (JBC), which operates Jillian’s.  The patron alleged that JBC failed to provide enhanced security “such as `wanding’ for firearms, given the large number of hip hop/rap patrons in order to keep the Plaintiff safe.” 

JBC’s commercial general liability insurance policy issued by Capitol Specialty Insurance (Capitol) contains a firearms exclusion that states:  “This insurance does not apply to . . . `[b]odily injury’ or `property damage’ that arises out of, relates to, is based upon or attributable to the use of a firearm(s).”  JBC tendered the claim to Capitol, which provided a defense under a reservation of rights and filed this declaratory judgment action to obtain a legal ruling on coverage. 

 The trial court concluded that the firearms exclusion “is binding, applicable and wholly precludes coverage for all claims, injuries and damages asserted by [the patron].”  JBC appealed, and the Court of Appeals affirmed. 

 ANALYSIS

• When concurrent causes of injury are alleged, the injury arises out of the use of a firearm if pre-shooting negligence wholly depends upon — and cannot be proved without first establishing — the firearm use. 
• Policy language that is unequivocal is not ambiguous, notwithstanding a contrary result in another jurisdiction interpreting different policy language. 
• Applying these principles, the Court of Appeals rejected JBC’s argument that the firearm exclusion applies only if the insured uses a firearm.  Relying on the plain language of the firearms exclusion, the Court concluded that the firearms exclusion applies regardless of who used the firearm.
• The Court of Appeals held that JBC’s alleged liability for pre-shooting negligence, which was wholly dependent upon the shooting, was excluded from coverage.