## Facts

- Zurich American Insurance Company and Valley Forge Insurance Company filed a declaratory-judgment action in the U.S. District Court for the District of Colorado.
- The insurers sought a declaration that their insurance policies provided no coverage—no duty to defend or indemnify—for claims asserted by the United States and the State of Colorado.
- The underlying claims were brought against the operators of O’Hara Regional Center for Rehabilitation (a nursing-home/rehabilitation facility) and related individuals.
- In 2006, the district court entered judgment for the insurers, holding there was no duty to defend or indemnify, and certified the judgment as final under Federal Rule of Civil Procedure 54(b).
- The insureds appealed, and on June 18, 2008, the U.S. Court of Appeals for the Tenth Circuit affirmed.

## Issues

1. Whether the district court correctly granted declaratory relief that the insurers had no duty to defend the insureds against the federal and state claims.
2. Whether the district court correctly granted declaratory relief that the insurers had no duty to indemnify the insureds for liability arising from those claims.
3. Whether the Rule 54(b) certification properly permitted immediate appellate review of the no-coverage judgment.

## Decision

- The Tenth Circuit affirmed the district court’s Rule 54(b) final judgment.
- The court upheld the declaration that the insurers owed no duty to defend.
- The court upheld the declaration that the insurers owed no duty to indemnify.

## Legal Principles

- A federal court may resolve insurance-coverage disputes through a declaratory-judgment action, including disputes over duties to defend and indemnify.
- When a district court certifies a coverage determination as final under Federal Rule of Civil Procedure 54(b), the appellate court may review that final judgment.
- An insurer has no duty to defend or indemnify when the governing policies do not provide coverage for the claims asserted against the insured.

## Conclusion

The Tenth Circuit affirmed a Rule 54(b) declaratory judgment that Zurich and Valley Forge had no duty to defend or indemnify the O’Hara facility-related defendants against the United States’ and Colorado’s claims, leaving the no-coverage determination intact.


Zurich Am. Ins. Co. v. O'Hara Reg'l Ctr. for Rehab., 529 F.3d 916 (10th Cir. 2008)