United States District Court, W.D. Missouri, St. Joseph Division
NATIONWIDE AFFINITY INSURANCE COMPANY, Plaintiff and Counter-claim Defendant,
SCOTT LADEROUTE and PORTERS BUILDING CENTERS, INC., Defendants.
ORDER GRANTING SUMMARY JUDGMENT
KAYS, UNITED STATES DISTRICT COURT CHIEF JUDGE
declaratory judgment action concerns insurance coverage for a
lawsuit filed by Defendant Porters Building Centers Inc.
(“Porters”) against Defendant Scott Laderoute
(“Laderourte”) in the United States District
Court for the Western District of Missouri, Case No.
16-cf-6055 (“the underlying suit”). The
underlying suit alleges Laderoute conspired with several of
Porters' employees to steal proprietary information from
Porters, and then used the information to solicit business
for Laderoute's business, Sprint Lumber.
Nationwide Affinity Insurance Company
(“Nationwide”) provided Laderoute's home
owner's insurance during the relevant time. Nationwide
provided a defense in the underlying suit to Laderoute under
a reservation of rights. It filed this lawsuit seeking a
declaration that Laderoute is not entitled to coverage or
indemnification in the underlying suit.
before the Court is Nationwide's Motion for Summary
Judgment (Doc. 10). The Court GRANTS the motion because the
“business pursuits” exclusion in Nationwide's
policy denies coverage, and Laderoute's proffered
affirmative defenses fail as a matter of law.
moving party is entitled to summary judgment “if the
movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a
matter of law.” Fed.R.Civ.P. 56(a). The nonmoving party
may resist summary judgment by asserting affirmative
defenses, but it must support these defenses with specific
facts. Hiland Partners GP Holdings, LLC v. Nat'l
Union Fire Ins. Co., 847 F.3d 594, 601 (8th Cir. 2017).
facts here are not in dispute.
issued homeowners policy number HOA 0050277429 (the
“Policy”) to Laderoute. The Policy was in effect
from December 17, 2015, to December 17, 2016.
9, 2016, Porters filed the underlying suit against Laderoute.
On August 10, 2016, Nationwide sent what it purports is a
reservation of rights letter to Laderoute's attorney.
Nationwide's six-page letter accurately summarized the
allegations made in Porters' initial Petition as follows:
The Complaint includes claims for (1) violation of the
Computer Fraud and Abuse Act, 18 U.S.C. § 1030; (2)
violation of the Sherman Antitrust Act, (3) computer
tampering (4) violation of the Missouri Uniform Trade Secrets
Act; (5) breach of restrictive covenants (6) breach of the
duty of loyalty; (7) tortious interference with a business
expectancy; (8) trespass; and (9) civil conspiracy.
The Complaint alleges that former employees of Porters
Building Centers, Inc. resigned to work for a competitor,
Sprint Lumber. (Plf.s' Compl. ¶¶ 26, 27). The
Complaint alleges that the former employees had planned to
begin working for Spring Lumber months prior to resigning
their positions at Porters. (Plf.'s Compl. ¶¶
28). During these months the former employees were allegedly
directly competing against Porters while employed with
Porters. (Plf.'s Compl. ¶¶ 28).
In addition to naming the former employees as defendants, the
suit also names your client as a defendant. The Complaint
contains the following allegations against your client:
• Defendants solicited business of Porters'
customers on behalf of Sprint Lumber. (Plf.'s Compl.
¶¶ 46, 54).
• Trespass by Defendant Downer, on behalf of Defendant
Laderoute and Sprint Lumber, where Mr. Downer entered the
Porters store located in Elwood, Kansas, and accessed a file
cabinet containing customer files. (Plf.'s Compl. ¶
• Defendants attempted to form a monopoly that puts
Porters out of business (Plf.'s Compl. ¶¶
• Defendant Reynolds prepared and Defendant Downey sent
Defendant Laderoute confidential information to Sprint Lumber
about Porters' operations, including current employee
salaries, rental costs, and business structure. (Plf.'s
Compl. ¶ 39).
• Defendant Laderoute affirmatively pressed the former
employees to bring their customers to Sprint Lumber.
(Plf.'s Compl. ¶ 43, 44).
• Sprint Lumber agreed to set up Sprint e-mail accounts,
cell phones, and business cards for the former employees.
(Plf.'s Compl. ¶ 44).
• Defendants planned to copy Porters' protected
trade secrets and confidential information. (Plf.'s
Compl. ¶ 47).
• Defendant Downey sent Defendant Laderoute an email
with detailed information about Porters' inventory, its
delivery operation, and strategies for serving various
localities. (Plf.'s Compl. ¶ 52).
• Defendants Sprint Lumber and Defendant Laderoute
knowingly conspired with Defendant Downy and Higdon to access
Porters' computers and mobile devices, delete
Porters' proprietary information, and take Porters'
proprietary information. (Plf.'s Compl. ¶ 84).
• Defendants disclosed and used Porters' trade
secrets without consent and used trade secrets to compete
against Porters. (Plf.'s Compl. ¶ 90).
• Defendants intentionally interfered with Porters'
business expectancy by undercutting Porters' business and
destroying Porters' information pertaining to its
customers. (Plf.'s Compl. ¶ 110).
• Defendants coordinated and agreed to engage in a
course of conduct in violation of statutory and common-law
duties. (Plf.'s Compl. ¶121).
at 4-5 (Doc. 11-4). After stating that the damages claimed in
the underlying suit were not covered under the policy, the
letter also identified “multiple applicable
exclusions.” Id. at 5. For example,
First, the policy excludes from coverage any damages which
arise out of or in connection with a “business”
conducted by your client, Scott Laderoute. From the
Complaint, it appears that all of the damages either arise
out of or in connection with Sprint Lumber, which is owned by
Mr. Laderoute. Accordingly, this exclusion bars coverage for
Id. at 5-6.
began providing Laderoute with a defense after it received
the initial Petition, and it is still providing him with a
October 3, 2016, Porters filed its Second Amended Petition
(“the Amended Petition”). The Amended Petition
was very similar to the initial Petition, but brought one
less count. It alleged claims for violating the Computer
Fraud and Abuse Act (Count I), Computer Tampering (Count II),
violating the Missouri Uniform Trade Secrets Act (Count III),
Breach of Restrictive Covenants (Count IV), Breach of the
Duty of Loyalty (Count V), Tortious Interference with
Business Expectancy (Count VI), and Civil Conspiracy (Count