Langdale Co. v. National Union Fire Insurance (110 F. Supp. 3d 1285, 2014)

United States District Court for the Northern District of Georgia 2014-06-04

Citations

Full opinion text

ORDER

STEVE C. JONES, District Judge.

This matter appears before the Court on Plaintiffs Motion for Partial Summary Judgment [Doc. No. 50] and Defendant’s Motion for Summary Judgment [Doc. No. 69].

I. Factual Background

On July 12, 2012, Plaintiff, The Langdale Company (“Plaintiff,” “Langdale”, or “TLC”) filed a Complaint against National Union Fire Insurance Company of Pittsburgh, Pennsylvania (“Defendant” or “National Union”). Doc. No. 1. Langdale’s Complaint was amended and recast on August 21, 2012. Doc. No. 7. In its Complaint, Langdale asserts claims for breach of contract (count one); bad faith refusal to advance defense costs (count two); and declaratory judgment (count three).

A review of the record shows the following facts.

Langdale is a Georgia Corporation.

For the calendar year April 1, 2009 to April 1, 2010, Langdale purchased a “claims made” insurance policy issued by National Union, to wit: Policy No.: 01-754-82-11, with an effective date of April 1, 2009, (the “Policy”). A true and accurate copy of the Policy that was issued by National Union is found in the record at Doc. No. 52-1. The Policy was the first policy issued by National Union to Lang-dale. The Policy issued to Langdale replaced an expiring insurance policy that was issued by Chubb Group of Insurance Companies (Federal Insurance Company).

National Union issued a temporary binder for Directors and Officers coverage to Langdale on March 31, 2009. On April 30, 2009, another temporary binder was issued to Langdale. On May 30, 2009, National Union issued a Temporary and Conditional Binder to Langdale. The ef-feetive date of the Policy remained April 1, 2009 with every continuation of the temporary binder. On July 2, 2009, National Union mailed the Policy to Langdale; however, the Policy erroneously included an Endorsement 15. Endorsement 15 never was referenced on any of the binders issued by National Union and was not intended to be a part of the coverage bound. On July 7, 2009, National Union mailed a correct Policy to Langdale as originally bound with an effective date of April 1, 2009. The Policy mailed on July 7, 2009 had a completed Endorsement 8 and removed Endorsement 15.

The Policy included a Directors and Officers (D & O) coverage section with a limit of liability of $10 million and a $100,000.00 deductible. National Union is required under the Policy to advance Defense Costs prior to the final disposition of a Claim (when the Claim is covered). The Policy does not include an allocation provision for Defense Costs.

On May 21, 2009, The Virginia Langdale Miller family filed a lawsuit against Johnny W. Langdale, Jr., Harley Langdale, Jr., and Johnny W. Langdale, Jr., as Executor of the Estate of John W. Langdale, Sr. styled Langdale Miller Nalley, et al. v. John W. Langdale, Jr.; Harley Langdale Jr.; and John W. Langdale Jr., as Executor of the Estate of John W. Langdale, Sr., Civil Action, 2009-CV-1843, Superior Court of Lowndes County, Georgia (hereinafter the “Miller Lawsuit” or “1343 Suit”). A true and correct copy of the Miller Lawsuit is found in the record at Doc. No. 52-4.

The Miller Lawsuit is against two of The Langdale Company’s shareholders, Harley Langdale (“Harley”) and Johnny Lang-dale, Jr. (“Johnny”). The Miller Lawsuit included a Count titled “Count Three Breach of Fiduciary Duty as Director” and was expressly brought against Johnny Langdale in his capacity as a Director of The Langdale Company.

On June 22, 2009, following service of the Miller Lawsuit, Johnny Langdale, Jr. sent a letter seeking indemnification from Langdale. The record testimony indicates that Langdale has fully paid the lawyers for Johnny Langdale.

On October 20, 2009, Langdale filed a Declaratory Judgment action styled The Langdale Company v. Harley Langdale, Jr. et al., Civil Action No. 2009-cv-2747, Superior Court of Lowndes County, State of Georgia (“hereinafter “Declaratory Judgment action” or “2747 Suit” ”). On November 13, 2009, the Virginia Langdale Miller family filed a Counterclaim in the Declaratory Judgment action against Langdale. The Counterclaim alleged that Langdale aided and abetted the alleged Trustees of the purported Trust, made misrepresentations together with the alleged Trustees, and schemed with the alleged Trustees. The Counterclaim filed in the Declaratory Judgment action included a Count V “Respondeat Superior Liability of [Langdale] for its Officers’ Misconduct.”

The Miller Lawsuit, the Declaratory Judgment action, and the Counterclaim were all consolidated into one action, i.e., the Underlying Litigation. These consolidated cases, according to the Georgia Court of Appeals, concern a trust created in 1959 by Judge Harley Langdale, Sr. (“Judge Langdale”) for the benefit of his daughter, Virginia Miller. The plaintiffs, who are beneficiaries under the trust or their legal representatives, filed suit in the Superior Court of Lowndes County, claiming, inter alia, that the trustees breached their fiduciary duties in administering the trust and in distributing the trust corpus, which was comprised of stock held in The Langdale Company.

At all times pertinent, Johnny Langdale, Jr. was an Executive/Employee of Lang-dale.

At all times pertinent, The Langdale Company was an insured under the Policy, as was Johnny Langdale, Jr., to the extent that he qualifies as an “Individual Insured,” as that term is defined in the Policy.

On August 4, 2009, Langdale provided written notice to National Union of the claims made against Johnny Langdale in the Miller Lawsuit. Included with the August 4, 2009 notice to National Union was a copy of the demand for indemnification and advancement of Defense Costs Lang-dale received from Johnny Langdale. Also included with the August 4, 2009 notice to National Union was a copy of the Miller Lawsuit. National Union’s Claims Analyst, Douglas Croland, was assigned to the Claim submitted by Langdale to National Union.

After receiving notice of the Miller Lawsuit, National Union denied coverage under the Policy by letter dated November 12, 2009. In its letter, National Union stated that it had “carefully reviewed the insurance policy ... as well as the allegations asserted.” The two grounds for denying coverage provided by National Union on November 12, 2009 (based on the lawsuit, not the counterclaim) were Endorsement No. 15 and exclusion 4(g). National Union’s November 12, 2009 denial included a reservation of rights which read as follows:

National Union’s coverage position is based on the information presently available to us. This letter is not, and should not be construed as a waiver of any terms, conditions, exclusions or other provisions of the Policy, or any other policies of insurance issued by National Union or any of its affiliates. National Union expressly reserves all of its rights under the Policy, including the right to assert additional defenses to any claims for coverage, if subsequent information indicates that such action is warranted.

Endorsement No. 15 is not an Endorsement in the Policy.

On November 25, 2009, Langdale responded to National Union’s coverage denial (by letter from Attorney Thomas S. Richey (“Richey”)) and notified National Union that Endorsement No. 15 was not part of the Policy. Langdale also requested that National Union withdraw its denial of coverage for the Miller Lawsuit. In that letter, Langdale’s counsel stated, “That Endorsement was not in the coverage as offered and bound and is not a part of the Policy now. If you examine the March 19, 2009 quote and the March 31, 2009 binder for the Policy (attached), there was no mention of such an exclusion.”

Also on November 25, 2009, Langdale tendered notice of a Counterclaim in the Declaratory Judgment action that was filed directly against Langdale and for which Langdale sought coverage under the Policy. On November 25, 2009, Langdale advised National Union that Johnny Lang-dale resigned as trustee before the purchase of stock from the Trust, so that [Johnny Langdale] could act on [Lang-dale’s] behalf in consummating the transaction.

National Union responded to Langdale’s November 25, 2009 letters through its coverage counsel, John Jordak of Alston & Bird.

On March 26, 2010, National Union, via Alston & Bird, sent a letter to Langdale that abandoned Endorsement 15 and relied upon Exclusion 4(g) and the Policy’s definition of Wrongful Act to again deny coverage. National Union, through its counsel did not rely upon Endorsement 8 (“Specific Investigation/Claim/Event or Act Exclusion”) in its March 26, 2010 letter, although National Union was in possession of a 2008 State-Suit and 2008 Federal Suit at the time.

On June 25, 2010, Langdale sent another letter to Alston & Bird challenging National Union’s denial.

On July 9, 2010, Alston & Bird sent a letter to Langdale requesting certain documents.

On October 13, 2010, National Union, by letter, agreed to advance reasonable Defense Costs (as defined in the Policy) for the defense of Johnny Langdale, Jr, against the allegations in Count III of the Miller Lawsuit. National Union’s October 13, 2010 letter stated, “based upon National Union’s review, and pursuant to the Policy, National Union agrees to advance reasonable Defense Costs (as defined in the Policy) for the defense of Johnny Langdale, Jr. against the allegations in Count III (and only Count III) of the Complaint in Langdale Miller Nalley, et al. v. John W. Langdale, Jr., et al., Superior Court of Lowndes County, Georgia, Civil Action No.2009-CV-1343.”

On November 3, 2010, National Union agreed to advance reasonable Defense Costs for the defense of The Langdale Company against the allegations in Count V of the Counterclaim.

On February 14, 2011, National Union agreed to advance Defense Costs in the amount of $202,510.55 for the defense of the Underlying Litigation.

On February 16, 2011, National Union agreed to advance Defense Costs in the amount of $102,510.55 for the defense of the Underlying Litigation.

On April 1, 2011, National Union agreed to advance 7.1% ($87,009.69) of the billed Defense Costs to Langdale.

National Union’s 30(b)(6) witness, Reid Kleinle, admitted that the letters speak for themselves and that the language “offer” did not appear in National Union’s letters agreeing to advance reasonable Defense Costs.

National Union has never made any payment to Langdale relating to the defense of the Miller Lawsuit. National Union has never made any payment to Langdale relating to the defense of the Counterclaim filed in the Declaratory Judgment action.

In April 2011, the trial court in the Underlying Litigation granted summary judgment in favor of Johnny Langdale on the plaintiffs’ claims. The trial court also granted summary judgment in favor of Langdale on the plaintiffs’ claims in the Underlying Litigation. On April 20, 2011, Langdale’s counsel notified National Union that the trial court granted summary judgment motions filed by Langdale and Johnny Langdale in the Underlying Litigation. The plaintiffs in the Underlying Litigation appealed those rulings. The Court of Appeals issued an opinion on November 30, 2012, which affirmed in part, and reversed in part, the trial court’s rulings. The Court of Appeals found sufficient evidence from which a jury might infer that Lang-dale — through some of its officers and the majority of its directors' — aided and abetted the trustees in the alleged breach of their fiduciary duties. This matter is now returning to the trial court as the Georgia Supreme Court denied Langdale’s petition for writ of certiorari on April 29, 2013.

National Union replaced Alston & Bird as coverage counsel with Carlton Fields to handle the Langdale claim for coverage.

On November 11, 2011, after the change of counsel, National Union’s current counsel sent a letter to Langdale that contains a coverage denial based on Endorsement 8 and Exclusion 4(d), and a reservation of rights as to several other Policy provisions, including Exclusion 4(g).

On May 7, 2012, Langdale made one final demand on National Union pursuant to O.C.G.A. § 33 — 4—6. This demand was prior to filing the present lawsuit for breach of contract, bad faith, and declaratory judgment on July 12, 2012. National Union responded to Langdale’s May 7, 2012 bad faith demand letter by again refusing to reimburse and advance Lang-dale’s Defense Costs.

Langdale has incurred expenses related to the defense of itself and its indemnity of Johnny Langdale, Jr. for his defense costs in the Underlying Litigation.

Additional facts will be discussed in the next sections of this Order.

On August 21, 2013, in the case sub judice, Langdale moved for summary judgment on its claims for breach of contract and declaratory judgment. Doc. No. 50-1, p. 11. On September 18, 2013, National Union moved for summary judgment on all claims stated in Langdale’s Amended Complaint. Doc. No. 69. These motions have been fully briefed and after the benefit of an April 7, 2014 oral argument, are now ripe for review.

II. Legal Standard

Federal Rule of Civil Procedure 56(a) provides “[t]he court shall grant 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.”

A factual dispute is genuine if the evidence would allow a reasonable jury to find for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A fact is “material” if it is “a legal element of the claim under the applicable substantive law which might affect the outcome of the case.” Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir.1997).

The moving party bears the initial burden of showing the court, by reference to materials in the record, that there is no genuine dispute as to any material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1260 (11th Cir.2004) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). The moving party’s burden is discharged merely by “ ‘showing’ — that is, pointing out to the district court — that there is an absence of evidence to support [an essential element of] the nonmoving party’s case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In determining whether the moving party has met this burden, the district court must view the evidence and all factual inferences in the light most favorable to the party opposing the motion. Johnson v. Clifton, 74 F.3d 1087, 1090 (11th Cir.1996). Once the moving party has adequately supported its motion, the non-movant then has the burden of showing that summary judgment is improper by coming forward with specific facts showing a genuine dispute. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). All reasonable doubts should be resolved in the favor of the non-movant. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir.1993). When the record as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no “genuine [dispute] for trial.” Id. (citations omitted).

III. Analysis

Langdale moves for a grant of partial summary judgment on its claims for breach of contract and declaratory judgment. Doc. No. 50. National Union moves for summary judgment on all claims stated in Langdale’s Amended Complaint. Doc. No. 69. The Court will address the arguments of the parties as follows.

A. Scope of National Union’s defenses

The Court must first determine the scope and number of defenses that National Union may assert in this litigation.

Langdale argues that National Union’s coverage defenses are limited to those contained in the first denial of coverage letter sent November 12, 2009. In support of its argument, Langdale argues in judicio admission and waiver.

a. in judicio admission

“Judicial admissions are ‘formal concessions in the pleadings, or stipulations by a party or its counsel, that are binding upon the party making them.’ ” In re Molia, No. 09-42273, 2012 WL 909738, *2 (Bkrtcy.N.D.Ga. Feb. 8, 2012) (quoting Keller v. United States, 58 F.3d 1194, 1199 n. 8 (7th Cir.1995)). “Judicial admissions must be clear, deliberate, and unequivocal factual assertions — whether made in pleadings, stipulations, responses to discovery, or orally in trial or court proceedings.” Id.

Langdale argues that “[bjecause National Union, through its present counsel, has now made an in judicio admission that the [non-coverage] decision was made and the claims process ended on November 12, 2009, the only analysis that is required is to examine the two bases for the denial ...” as stated in the initial denial letter, dated November 12, 2009. Doc. No. 50-1, p. 12.

In response, National Union denies making an in judicio admission. Doc. No. 68, p. 12. National Union argues that “[gjiving an initial opinion about a contract does not preclude a party to the insurance contract from offering a different opinion based on new information obtained thereafter — irrespective of the ‘mode’ it might be operating under.” Doc. No. 68, p. 12. National Union indicates that operating in a litigation mode, as it understands to be defined by Langdale as a period of anticipating litigation [Doc. No. 68, p. 13], does not change, alter or modify the insurance contract or the complaint/counterclaim filed against Johnny Langdale and The Langdale Company. Id. at p. 13.

For purposes of the present summary judgment ruling, it is not necessary to determine whether National Union made an in judicio admission, as even if National Union is deemed to have made a judicial admission (as to when the first non-coverage decision was made and the claims process ended), based on the case law discussed in the next section of this order (concerning waiver and estoppel), the Court is unable to conclude that the asserted in judicio admission (concerning when the non-coverage decision was made and when the claims process ended) limits the defenses that National Union may raise.

b. waiver

Langdale argues that under Georgia law, recently affirmed by the Georgia Supreme Court in Hoover v. Maxum Indem. Co., 291 Ga. 402, 730 S.E.2d 413 (2012), National Union waived all policy defenses not raised in its first denial of coverage on November 12, 2009. Doc. No. 75, p. 38. In response, National Union argues that it has not waived defenses not raised in its initial denial of coverage letter, and attempts to distinguish Hoover by relying upon the case of Bank of Camilla v. St. Paul Mercury Ins. Co., 939 F.Supp.2d 1299 (M.D.Ga.2013). National Union further argues that the general rule that a party cannot create coverage by waiver or estoppel applies to this case. Doc. No. 69-1, p. 19.

In Hoover, the Georgia Supreme Court stated:

Under Georgia law, where an insurer is faced with a decision regarding how to handle a claim of coverage at the same time a lawsuit is pending against its insured, the insurer has three options. First, the insurer can defend the claim, thereby waiving its policy defenses and claims of non-coverage. Gant v. State Farm Mut. Auto. Ins. Co., 109 Ga.App. 41, 43-44, 134 S.E.2d 886 (1964). Second, the insurer can deny coverage and refuse to defend, leaving policy defenses open for future litigation. Southern Guar. Ins. Co. v. Dowse, 278 Ga. 674(1), 605 S.E.2d 27 (2004). Or, third, the insurer can defend under a reservation of rights. Id. at 676, 605 S.E.2d 27 (insurer “had a choice when timely notified of the claim pending against its insured — either defend under a reservation of rights or decline to defend”). An insurer cannot both deny a claim outright and attempt to reserve the right to assert a different defense in the future. See Browder v. Aetna Life Ins. Co., 126 Ga.App. 140, 144(2), 190 S.E.2d 110 (1972) (“ultimate denial of liability on another ground constitutes a waiver of forfeiture based on the lack of timely notice”). Cf. Morgan v. Guaranty Nat. Cos., 268 Ga. 343, 344, 489 S.E.2d 803 (1997) (insurer cannot deny a claim and then seek declaratory judgment to determine the propriety of the denial; declaratory judgment is only available where the insurer undertakes a defense but is uncertain how to handle the claim).

A reservation of rights is a term of art in insurance vernacular and is designed to allow an insurer to provide a defense to its insured while still preserving the option of litigating and ultimately denying coverage. National Union Fire Ins. Co. v. American Motorists Ins. Co., 269 Ga. 768, 769(1), 504 S.E.2d 673 (1998). “At a minimum, the reservation of rights must fairly inform the insured that, notwithstanding [the insurer’s] defense of the action, it disclaims liability and does not waive the defenses available to it against the insured.” World Harvest Church, Inc. v. Guideone Mut. Ins. Co., 287 Ga. 149, 152(1), 695 S.E.2d 6 (2010) (Citation and punctuation omitted; emphasis supplied.) Thus, a reservation of rights is only available to an insurer who undertakes a defense while questions remain about the validity of the coverage.

291 Ga. at 404-05, 730 S.E.2d at 416.

Langdale argues that Hoover “expressly forbids what National Union has attempted here, that is the outright denial of a claim with a boilerplate reservation of rights and the later (2 plus years later) attempt to assert new and different coverage defenses.” Doc. No. 75, p. 35.

As noted above, National Union attempts to distinguish Hoover by relying upon the case of the Bank of Camilla, 939 F.Supp.2d 1299. In Bank of Camilla, the district court held that Hoover was inapposite where an insurance policy only provided for a duty to pay costs. Id. at 1305. The court stated that because the insurance policy only provided for a duty to pay costs, the defendant’s alleged failure to assert all of its defenses at the time of coverage denial did not prevent it from raising those rights at a later time. Id. at 1305. The court reached this conclusion after noting that “[c]ourts ... have drawn a distinction between the duty to defend and the duty to pay costs, finding that a refusal to defend does not affect the insurer’s right to refuse payment of costs.” Id. In support of this statement, the court cited two Georgia cases: Penn-Am. Ins. Co. v. Disabled Am. Veterans, 224 Ga.App. 557, 481 S.E.2d 850, 852 (1997), aff'd 268 Ga. 564, 490 S.E.2d 374 (1997) (“an insurer’s duty to pay and its duty to defend are separate and independent obligations”); Aetna Cas. & Sur. Co. v. Empire Fire & Marine Ins. Co., 212 Ga.App. 642, 442 S.E.2d 778, 783 (1994) (“While it is true that an insurer loses its opportunity to contest the negligence of the insured or the injured person’s right to recover by refusing to defend, the insurer does not lose its. right to contest the insured’s entitlement to a recovery under its policy”).

National Union argues that a similar finding is warranted here in that it has no duty to defend under the language of the policy (as Langdale did not tender the defense to National Union) — and only has an obligation to advance defense costs. Doc. No. 69-1, p. 21; Doe. No. 85, p. 2, n. I. National Union argues that an obligation to advance defense costs “is simply a part of the duty to indemnify ... and is thus limited by the express terms of the insurance contract.” Id. Langdale argues that the duty to defend and the duty to advance defense costs are the same” and that it is essentially an apples to oranges comparison to equate indemnity with defense costs. Doc. No. 75, p. 36.

Georgia courts have not had the opportunity to address this issue first hand; however, the case of George L. Smith II Georgia World Congress Ctr. Auth. v. Miller Brewing Co., 255 Ga.App. 643, 566 S.E.2d 361 (2002) provides guidance. In the Smith case, the Georgia Court of Appeals used language that suggests to the Court that Georgia courts consider the duty to defend or pay the expenses of litigation analogous, but separates these duties from the duty to indemnify. Said language is as follows: “[t]he language [of the indemnity agreement] focuses only on ... duty to indemnify ... for liabilities and claims of liability, not on the legally separate duty to defend .... or to pay for expenses of litigation or attorney fees.” Id. at 363 (emphasis added). There is also persuasive authority that suggests that a duty to pay defense costs and' the duty to defend are different, but similar in result, then concludes that the parameters of the duty to defend guide the analysis of a duty to pay defense costs. See Liberty Mut. Ins. Co. v. Pella Corp., 650 F.3d 1161, 1170-71 (8th Cir.2011).

Returning to the Bank of Camilla case, the Court finds that it is not binding upon this court, nor is it controlling on this issue. See McGinley v. Houston, 361 F.3d 1328, 1331 (11th Cir.2004) (“The general rule is that a district judge’s decision neither binds another district judge nor binds him.”). The Court concludes that the Georgia cases relied upon in Bank of Camilla for the distinction between a duty to defend and a duty to pay costs refer to the duty to pay claims against the insurance policy, not a duty to pay the costs of litigation, which is at issue here. See Henning v. Cont’l Cas. Co., 254 F.3d 1291, 1295 (11th Cir.2001) (“[t]he duty to defend a suit, however, is an independent obligation from the duty to pay claims against the insurance policy” (citing Colonial Oil Indus. v. Underwriters, 268 Ga. 561, 491 S.E.2d 337, 339 (1997))).

The Court concludes that the duty to defend and the duty/obligation to pay costs of litigation should be treated as analogous for purposes of consideration of the applicability of the holding in Hoover; therefore, the holding of the Hoover case is not distinguishable on this ground. The Court must now turn its attention to National Union’s second argument, i.e., that Langdale’s interpretation of Hoover is contrary to the general rule that a party cannot create coverage by waiver or estop-pel and there is no basis for finding waiver under Hoover. Doc. No. 69-1, pp. 19, 22.

National Union is correct in that there is a “longstanding general rule [in Georgia law] ... that neither waiver nor estoppel can be used to create liability not created by an insurance contract and not assumed by the insurer under the terms of the policy.” Andrews v. Ga. Farm Bureau Mut. Ins. Co., 226 Ga.App. 316, 317, 487 S.E.2d 3, 4 (1997); see also Colonial Oil Indus., Inc., 268 Ga. at 562, 491 S.E.2d at 339 (“The breach of the duty to defend, however, should not enlarge indemnity coverage beyond the parties’ contract.”) and Danforth v. Gov’t Emps. Ins. Co., 282 Ga.App. 421, 427, 638 S.E.2d 852, 858-59 (2006) (“An insurer may waive any provision in an insurance policy inserted for its benefit, and may waive any condition or limitation in the policy upon which it could otherwise rely. It is well established, however, that the doctrines of implied waiver and estoppel, based upon the conduct or action of the insurer, or its agent, are not available to bring within the coverage of a policy risks not covered by its terms, or risks expressly excluded therefrom. Here, [there was no] right to expect coverage under [the] policy for the collision at issue because the express language of the policy foreclosed coverage.”) (internal citations and alterations omitted).

In response to National Union’s general rule argument, Langdale argues that the issue of whether a breach of duty to defend results in a waiver of defenses to the duty to indemnify is not present here because there is no issue as to indemnity at this time. Doc. No. 75, p. 37. Langale argues that the Court should apply a liability standard, as opposed to an indemnity standard — with the result being, there is' no creation of coverage by estoppel, as National Union’s arguments only apply when a person is trying to create coverage that otherwise does not exist. Langdale argues that here, there is coverage, but National Union is asserting that an exclusion to said coverage applies.

. The Court must reconcile, Langdale’s arguments, the general rule asserted by National Union, and Hoover.

As to Langdale’s argument as to the distinction between liability and indemnity standards, the Court is unable to uphold said argument as even in Hoover, the seminal duty to defend case, the Georgia Supreme Court recognizes forfeiture and waiver principles in the duty to defend context and states that “courts infer waiver of non-essential parts of an insurance contract that are penal in nature.” See Hoover, 291 Ga. at 407, 730 S.E.2d at 418. The Hoover court did not state that there would be waiver of essential parts of the contract. To this regard, the Court is not convinced that waiver and estoppel principles should not be applied in the present context of ascertaining whether there has been a breach of the duty to advance defense costs. The Court further notes that Langdale’s argument does not address the latter part of the applicable authority found in the above-stated Danforth case in which the Court held that “[i]t is well established, however, that the doctrines of implied waiver and estoppel, based upon the conduct or action of the insurer, or its agent, are not available to bring within the coverage of a policy ... risks expressly excluded therefrom.” Danforth, 282 Ga.App. at 427, 638 S.E.2d at 858-59. Allowing Langdale’s Hoover argument would bring within coverage (in terms of the duty to defend standard that will be applied by analogy, infra) the risks described in the exclusions of 8 and 4(d), even though said risks were expressly excluded therefrom.

Next, the Court must reconcile the general rule that a party cannot create coverage by waiver or estoppel and Hoover. To perform this task, the Court starts with the first section of the above-stated quote from Hoover, which states;

Under Georgia law, where an insurer is faced with a decision regarding how to handle a claim of coverage at the same time a lawsuit is pending against its insured, the insurer has three options. First, the insurer can defend the claim, thereby waiving its policy defenses and claims of non-coverage.

291 Ga. at 404, 730 S.E.2d at 416 (emphasis added).

It has been noted that in Georgia, defenses to an insurer’s obligation to pay a claim fall into two general categories, policy defenses and coverage defenses. Yeagley v. Allstate Ins. Co., No. 1:09-cv-19, 2009 WL 2486320, at *6 (N.D.Ga. Aug. 12, 2009). A “policy defense” is one in which “an insurer denies coverage based on the insured’s failure to fulfill a procedural condition of the insurance policy.” Id. A “coverage defense,” is a defense in which the insurer “argues that the insurance policy does not cover the specific injury in question.” Id.

It appears to the Court that in Hoover, the opinion writer, the Honorable Carol Hunstein, recognized these two categories by utilizing the terms “policy defenses” and “claims of non-coverage,” instead of the word “coverage defense.” 291 Ga. at 404, 730 S.E.2d at 416. By not using the term “coverage defense” and considering the facts of Hoover (concerning a policy/notice defense), it appears to this Court that Justice Hunstein’s further use of the word “defense” in the opinion must be referenced back to her initial use of the word and accordingly, limited as applying to policy defenses. This interpretation of Hoover, allows the general rule that neither waiver nor estoppel can be used to create liability not created by an insurance contract and the holding in Hoover prohibiting the assertion of a different defense in the future to exist symbiotically. In essence, the Court reads the sentence of Hoover at issue as follows: “[a]n insurer cannot both deny a claim outright and attempt to reserve the right to assert a different [policy] defense in the future.”

Additional support for this understanding of Hoover is found in the Southern Guar. Ins. Co. v. Dowse, 278 Ga. 674(1), 605 S.E.2d 27 (2004), cited by Justice Hun-stein in Hoover when setting forth the insured’s second choice of denying coverage. Justice Hunstein relied upon section one of the holding in Dowse, which discusses denial of coverage, waiver, and reservation of rights; ’ however, this Court finds subsection two of the Dowse opinion, which has not been overruled, to be particularly enlightening as to the present issue before the Court. In subsection two of the Dowse opinion, the Georgia Supreme Court stated:

By refusing to defend, however, [insurer] did not waive it's right to contest its insured’s assertion that the insurance policy provides coverage for the underlying claim. Obviously, if the underlying claim is outside the policy’s scope of coverage, then [insurer’sjrefusal to indemnify or defend was justiñed and it is not liable to make payment within the policy’s limits. This question of whether the policy provides coverage for the claim is separate from the legal consequences of an insurer’s refusal to indemnify or defend.

Southern Guar. Ins. Co. v. Dowse, 278 Ga. 674, 676, 605 S.E.2d 27, 29 (2004) (emphasis added).

After review, the Court finds that National Union has not waived its claims of non-coverage. Accordingly, the Court finds that there has been no waiver of National Union’s claims of non-coverage, which include its summary judgment arguments concerning Endorsement 8, Exclusion 4(d), and statutory material misrepresentations.

B. Breach of contract

Under Georgia law, “[i]n an action to collect on an insurance policy, the insured must show that the occurrence was within the type of risk insured against to make a prima facie case.” Pa. Millers Mut. Ins. Co. v. Heule, 140 Ga.App. 851, 852, 232 S.E.2d 267, 268 (1976). “To recover in a suit on a contract, the complaining party must establish both a breach of the contract and resulting damages.” Graphics Prods. Distribs., Inc. v. MPL Leasing Corp., 170 Ga.App. 555, 555, 317 S.E.2d 623, 624 (1984); see also Norton v. Budget Rent A Car Sys., 307 Ga.App. 501, 502, 705 S.E.2d 305 (2010) (“The elements for a breach of contract claim in Georgia are the (1) breach and the (2) resultant damages (3) to the party who has the right to complain about the contract being broken.”) (citation omitted). “A contract is breached by a party to it who is bound by its provisions to perform some act toward its consummation and who, without legal excuse on his part and through no fault of the opposite party, declines to do so.” CCE Fed. Credit Union v. Chesser, 150 Ga.App. 328, 330, 258 S.E.2d 2, 4 (1979).

In this case, Langdale argues that National Union breached its contract of insurance on November 12, 2009 by failing and refusing to pay Langdale’s defense cost for the Underlying Litigation. Doc. No. 50-1, p. 7. Langdale states that National Union was required, under the policy, to advance Defense Costs prior to the final disposition of the claim. Doc. No. 75, p. 19. Langdale states that “[c]omparing certain allegations to the Policy, it is clear that the allegations implicate coverage.” Doc. No. 50-1, p. 21. In response, National Union argues that the insurance contract purchased by Langdale excludes coverage under the circumstances present here, specifically the Policy’s exclusions 4(g), Endorsement 8, and 4(d). Doc. No. 69-1, pp. 11, 22.

The parties disagree on whether the Court should apply a duty to defend (i.e., look only to the allegations of the complaint) standard or entitlement to coverage standard (i. a, look to all known facts). Doc. Nos. 68, p. 11; 75, p. 20.

Neither party has cited to binding authority that is on all fours with the facts of this case in which there is a Policy that provides for advancement of defense costs, but also provides for the insured to repay the insurer such advanced payments in the event that the insured is not entitled to payment of such Loss [Doc. No. 52-1, p. 31],

The Court has wrestled with the decision as to the correct standard to apply and ultimately concludes that it will apply the parameters pf the duty to defend standard.

Under the duty to defend standard, “whether an insurer has a duty to defend depends on the language of the policy as compared with the allegations of the complaint. If the facts as alleged in the complaint even arguably bring the occurrence within the policy’s coverage, the insurer has a duty to defend the action.” Hoover, 291 Ga. at 407-08, 730 S.E.2d 413 (internal citations omitted). “Where the claim is one of potential coverage, doubt as to liability and insurer’s duty to defend should be resolved in favor of the insured.” Penn-Am. Ins. Co. v. Disabled Am. Veterans, Inc., 268 Ga. 564, 565, 490 S.E.2d 374, 376 (1997) (citations omitted). “To excuse the duty to defend the [complaint] must unambiguously exclude coverage under the policy.” BBL-McCarthy, LLC v. Baldwin Paving Co., 285 Ga.App. 494) 497, 646 S.E.2d 682, 685 (2007).

“Under Georgia law, an insurer seeking to invoke a policy exclusion carries the burden of proving its applicability in a given case. An insurer can carry its burden of showing that a policy exclusion applies by relying exclusively upon the allegations against the insured in the underlying complaint.” First Specialty Ins. Corp., Inc. v. Flowers, 284 Ga.App. 543, 544, 644 S.E.2d 453, 455 (2007). “[A]ny exclusion from coverage sought to be invoked by the insurer is to be strictly construed.” Cunningham v. Middle Ga. Mut. Ins. Co., 268 Ga.App. 181, 185, 601 S.E.2d 382 (2004); see also Barrett v. Nat’l Union Fire Ins. Co. of Pittsburgh, 304 Ga.App. 314, 321, 696 S.E.2d 326, 331 (2010) (“exclusions in an insurance policy are ... interpreted narrowly, in favor of the insured.”) (citations omitted). “If the insurer meets its burden, ‘the burden then shifts to the [insured] to come forward with other evidence creating a genuine issue of fact over whether the exclusion is applicable.’ ” First Specialty, Ins., 284 Ga.App. at 544 n. 2, 644 S.E.2d at 455 (internal citations omitted).

“[I]n construing an insurance policy, a court must first decide whether the language is clear and unambiguous.” Club Libra, Inc. v. R.L. King Props., LLC, 324 Ga.App. 547, 548, 751 S.E.2d 418, 419 (2013) (internal quotations omitted). “Ambiguity exists when ‘more than one reasonable construction may be placed upon the language of an agreement.’” Estate of Pitts v. City of Atlanta, 323 Ga.App. 70, 75-76, 746 S.E.2d 698, 702 (2013) (citations omitted). “[I]f an insurance contract contains ‘contradictory clauses or other ambiguities ... they must be construed favorably to the insured and against the insurer.’ ” Eells v. State Farm Mut. Auto. Ins. Co., 324 Ga.App. 901, 905, 752 S.E.2d 70, 74 (2013) (citations omitted). “If [the insurance policy] is [clear and unambigous], the court simply enforces the contract according to its clear terms; the contract alone is looked to for its meaning.’ ” Club Libra, Inc., 324 Ga.App. 547, 548, 751 S.E.2d 418, 419 (citations omitted).

In the case sub judice, the only ambiguity argument that has been raised by Lang-dale is as to Endorsement 8. Doc. No. 48, p. 60. The Court will address those arguments, infra. As to the remainder of the policy, as it appears that neither side is arguing ambiguity, the Court will enforce the contract as written. Banks v. Bhd. Mut. Ins. Co., 301 Ga.App. 101, 102-03, 686 S.E.2d 872, 874 (2009).

The Court must now “compare the terms of the insurance contract to the allegations in the complaint to determine whether the underlying suit seeks damages for covered claims.” Bank of Camilla, 939 F.Supp.2d at 1308. Then, the Court must consider whether National Union has carried its burden of showing that the policy exclusions that it has asserted over time apply to this case, i.e., Endorsement 15, Exclusion 4(g), Endorsement 8, Exclusion 4(d). The Court will also consider National Union’s statutory material misrepresentation arguments.

1. Whether facts as alleged in the complaint arguably bring the occurrence within the policy’s coverage

The Policy provides coverage as follows: COVERAGE A: INDIVIDUAL INSURED INSURANCE This D & O Coverage Section shall pay the Loss of an Individual Insured of the Company arising from a Claim made against such Individual Insured for any Wrongful Act of such Individual Insured, except when and to the extent that the Company has indemnified such Individual Insured. The Insurer shall, in accordance .with and subject to Clause 7 of this D & 0 Coverage Section, advance Defense Costs of such Claim prior to its final disposition.

Doc. No. 52-1, p. 20 (emphasis in original) COVERAGE B: PRIVATE COMPANY INSURANCE

This D & O Coverage Section shall pay the Loss of the Company arising from a:

(i) Claim made against the Company, or

(ii) Claim made against an Individual Insured,

for any Wrongful Act, but, in the case of Coverage B(ii) above, only when and to the extent that the Company has indemnified the Individual Insured for such loss. The Insurer shall, in accordance with and subject to Clause 7 of this D & O Coverage Section, advance Defense Costs of such Claim prior to its final disposition.

Id.

Langdale argues that as an Executive/Employee of Langdale, Johnny Lang-dale is an Individual Insured as defined by the Policy and there is no question that the allegations in the Underlying Litigation fall under the definitions of a Claim and a Wrongful Act. Doc. No. 50-1, p. 23. Lang-dale states that in comparing the allegations of the Complaint and Counterclaim in the Underlying Litigation to the Policy, it is clear that the allegations implicate coverage. Id. at p. 21. Langdale states that the Miller Lawsuit includes claims alleging wrongful acts made by Johnny Langdale as an Executive/Employee of Langdale and expressly seeks recovery from Mr. Langdale in Count Three captioned “Breach of Fiduciary Duty as Director,” for alleged conduct in his capacity as an Executive/Employee of Langdale. Id. at pp. 19-20; Doc. No. 68-1, p. 5, ¶ 10; Doc. No. 84, p. 57, ¶ 127. Langdale states that the complaint contains numerous other allegations made against Mr. Langdale in his capacity as an Executive/Employee of Langdale as the complaint alleges: (1) “at all pertinent times, Johnny and Harley, Jr. were officers and directors of [Langdale], were active in the management of the corporation”; (2) “Harley Jr. as longtime Chairman of [Langdale], and Johnny Langdale, as President of [Langdale], knew more about the true value of [Lang-dale] than anyone”; (3) “on May 27, 1999, Johnny Langdale and his lawyers obtained a Court Order authorizing him to resign as trustee”; (4) “in the activities recited herein, Defendants were, at various times, acting as individuals and/or officers and directors of [Langdale], and/or as Trustees of the 1959 Trust”; and (5) “in the activities recited herein, Defendants were, at times, acting both as Trustees and in one or the other of their other capacities.” Doc. No. 50-1, p. 20.

Langdale further states that the November 13, 2009 Counterclaim that was filed in the Underlying Litigation against Lang-dale- contained several allegations against Langdale and Johnny Langdale. Id. at p. 20. Langdale states that the Counterclaim alleged that Langdale aided and abetted the Trustees, made misrepresentations together with the Trustees, and schemed with the Trustees. Id. The Counterclaim also sought to hold Johnny Langdale liable as an Executive/Employee of Langdale and in Section E of the Counterclaim, it was alleged that Johnny Langdale was at various times acting as an individual and/or as Officer and Director of Lang-dale. id. at pp. 20-21.

The Counterclaim also included a Count V, “Respondeat Superior Liability of [The Langdale Company] for its Officers’ Misconduct.” Doc. No. 68-1, p. 8, ¶ 17.

In response, National Union argued that “[i]f the Claim is the Virginia Miller Trust Complaint/Counterclaim (as defined by the Policy), then [Langdale] satisfies the initial burden for the Complaint/Counterclaim. ...” Doc. No. 85, p. 5 n. 4. However, if the “Claim” were defined by the Policy as “a” cause of action most of the causes of actions listed in the Complaint and the Counterclaim are only about the trustees. [Thus, Langdale] cannot satisfy its initial burden of proving coverage for those causes of action.” Doc. No. 85, p. 5 n. 4, p. 6.

The Court finds that under the policy and its definitions, the claim (as defined by the Policy) is the Complaint/Counterclaim in the Underlying Litigation, as the Complaint/Counterclaim is a “civil ... proceeding for monetary ... relief which is commenced by ... service of a complaint or similar pleading.” Doe. No. 52-1, p. 21, ¶ b(ii). The Policy, in essence, provides coverage for the loss of an individual insured or the company arising from a claim made against the individual insured or the company for a wrongful act of such insured or the company (ie., any breach of duty, neglect, error, misstatement, misleading statement or omission, or act by such Executive/Employee in their respective capacity as such or by a company). The Court declines to uphold National Union’s cause of action arguments to the contrary for purposes of this initial coverage determination.

Here, the claims and allegations seeking relief in the Underlying Litigation, concerning wrongful acts made by Johnny Langdale as an Executive/Employee of Langdale (through breach of director duty and other allegations) and wrongful acts of Langdale (by aiding and abetting, misrepresentation, and scheming) implicate coverage under the coverage sections of the policy at Doc. No. 52-1, p. 20. The Court accordingly finds that Langdale has satisfied its initial burden of proving arguable coverage for the Underlying Litigation Complaint/Counter Claim. The Court now considers National Union’s arguments concerning exclusions.

2. The Policy exclusions

a. Endorsement 15

The Policy that National Union has stipulated to be the true and correct copy of the Policy does not contain an Endorsement 15 and there is no genuine issue of material fact that Endorsement 15 is not a part of the Policy. Doc. No. 50-1, p. 26; Doc. No. 68-1, p. 15, ¶ 34. Accordingly, Endorsement 15 is not a basis upon which National Union can deny coverage,

b. Exclusion 4(g)

(i.) applicability

Exclusion 4(g) states:

The Insurer shall not be liable to make any payment for Loss in connection with any Claim made against an Insured:

... alleging, arising out of, based upon or attributable to any actual or alleged act or omission of an Individual Insured serving in any capacity, other than as an Executive or Employee of a Company, or as an Outside Entity Executive of an Outside Entity;

Doc. No. 52-1, pp. 25-26.

National Union argues that there is no coverage pursuant to Exclusion 4(g) because the Claim “ ‘made against’ [Lang-dale] and its former and current chief executive officers, Johnny and Harley, is a Claim ‘alleging, arising out of, based upon or attributable to any actual or alleged act or omission of Johnny and Harley serving in their capacities as trustees.” Doc. No. 69-1, p. 11. National Union argues that Georgia courts have concluded that the “arising out of’ language of an insurance policy excludes coverage for “ancillary acts” that might have been covered “but for” the fact that the “genesis” of the matter was excluded. Doc. Nos. 68, p. 17; 85, p. 7 n. 5 (citing Cont’l Cas. Co. v. H.S.I. Fin. Servs., Inc., 266 Ga. 260, 466 S.E.2d 4, 5-6 (1996); Manning v. USF & G Ins. Co., 264 Ga.App. 102, 589 S.E.2d 687 (2004); Dynamic Cleaning Srv., Inc. v. First Fin. Ins. Co., 208 Ga.App. 37, 430 S.E.2d 33 (1993), and Nat’l Reimbursement Grp., Inc. v. Gemini Ins. Co., No. 5:13-CV-145, 2013 WL 4495846 (M.D.Ga. Aug. 21, 2013)).

National Union states that “[t]he gravamen of the Virginia Miller Trust Litigation is the assertion that Johnny and Harley, as trustees, breached their duties to the Trust beneficiaries. Thus, ‘but for’ the acts of the trustee, the Claim against [Langdale] and its directors and officers would not have been made.” Doc. No. 69-1, pp. 11-12. National Union asserts that it was the actions of the two trustees that resulted in the Claim. Doc. No. 68, p. 18, National Union states: “ ‘But for’ the alleged breach of fiduciary duty by the trustees, the allegations of wrongdoing against Langdale and its executives and employees would never exist.” Id. National Union further states: “[irrespective of whether ancillary, wrongful acts of [Lang-dale] and its directors and officers contributed to the loss, those acts were not the ‘genesis’ of the trust beneficiaries’ Claim; it was the acts of the trustees who controlled the trust. Thus, there is no coverage because the complaint/counterclaim arises out of the actual or alleged actions of the current and former [Langdale] chief executive officers' serving in their capacities as trustees — no matter how many ancillary wrongful acts by the company and its current and former chief executive officers are alleged.” Doc. No. 68, p. 18. National Union argues that “[w]here the ancillary conduct (here, the alleged negligent acts of [Langdale] and its officers and directors) is a concurrent cause of the harm, the exclusion bars coverage.” Doc. No. 85, p. 7.

In response, Langdale argues that National Union “purposefully misinforms this Court by ignoring Count Three of the 1343 Suit, titled ‘Breach of Fiduciary Duty as Director’ which sought to hold Mr. Lang-dale and Harley Langdale, Jr. liable as Directors of Langdale.” Doc. No. 75, p. 17 (emphasis omitted). Langdale also states that National Union does not mention “the several allegations specifically directed to Mr. Langdale’s conduct as an officer and director of Langdale.” Id. Langdale further argues that National Union has failed “to acknowledge the claims brought directly against Langdale in the Counterclaim, including a Count V ‘Respondeat Superior Liability of [Langdale] for its Officers’ Misconduct.’ ” Id. Langdale states that “[t]hese facts flatly contradict the statements National Union has made to this Court.” Doc. No. 75, p. 17.

Langdale argues that “[exclusion 4(g) only bars coverage for Wrongful Acts committed exclusively in a capacity other than as an Executive/Employee. It does not purport to exclude conduct in dual capacities, i.e., simultaneously in insured and uninsured capacities as trustee and Executive/Employee.” Doc. No. 50-1, p. 27 (emphasis in original). Langdale states that “[u]nder a plain reading of the Policy, National Union is contractually obligated to advance Defense Costs if any Claim (as opposed to all Claims) alleges any breach, omission, or act by an Executive/Employee of Langdale in their capacities as such.” Id. at p. 28 (emphasis omitted). Lang-dale states that “the plain language of the Policy provides coverage for ‘any breach of duty, neglect, error, misstatement, misleading statement, omission or act by such Executive or Employee in their respective capacities as such.’ ” Id.

In reply, National Union argues that Exclusion 4(g) does not contain the word “exclusively,” and Langdale offers no legal support for this pronouncement. Doc. No. 68, p. 18. National Union states that Langdale’s pronouncement is the opposite of Georgia courts’ interpretation of the “arising out of’ language. Id. National Union further argues -that Langdale’s attempt to focus on “acts” to circumvent Exclusion 4(g) “ignores the language of the policy.” Doc. No. 85, p. 4. National Union states that “the Exclusion is worded as excluding the Claim — not individual acts,” as the “term Claim is defined as ‘a civil ... proceeding for monetary ... relief which is commenced by ... service of a complaint or similar pleading.’ ” Id.

The Court finds that National Union has set forth the correct interpretation of Georgia law in terms of the “arising out of’ language. As recently stated by the Georgia Court of Appeals:

When the phrase “arising out of’ is found in an exclusionary clause of an insurance policy, we apply the “but for” test traditionally used to determine cause-in-fact for tort liability. Notwithstanding tort liability theories, the underlying facts and circumstances of the claims asserted determine whether or not a policy exclusion applies, because

[t]he exclusionary clause is focused solely upon the genesis of the underlying plaintiffs claims — if those claims arose out of the excluded acts ... then coverage need not be provided. Claims arise out of [t]he excluded conduct when ’ “but for” that conduct, there could be no claim against the insured.

Hays v. Ga. Farm Bureau Mut. Ins. Co., 314 Ga.App. 110, 114, 722 S.E.2d 923, 927 (2012) (citations omitted).

Applying the,“but for” analysis in the case sub judice, after review of the allegations of the Underlying Litigation, the Court concludes that the genesis of the underlying plaintiffs’ claims involve the acts of the trustees and further concludes that the Claims (or allegations of wrongdoing) against Langdale and Johnny would not have occurred but for the acts (in the form of breach of fiduciary duty) of the trustees. Because the insurance policy specifically excludes any claim “arising out of’ an act of an Insured serving in any capacity other than as an Executive/Employee, National Union had no duty to advance defense costs to Johnny or to Langdale.

To the extent that the Underlying Litigation includes Count Three of the 1343 Suit, titled “Breach of Fiduciary Duty as Director,” several allegations specifically directed to Mr. Langdale’s conduct as an officer and director of Langdale, and a Count V, alleging “Respondeat Superior Liability of [Langdale] for its Officers’ Misconduct,” the conclusion does not change, as the facts that gave rise to these causes of action arose out of the trustee’s alleged wrongful actions. These counts/allegations are within the policy exclusion of 4(g). The Court also notes, as stated by National Union, that Langdale’s arguments focusing on the individual counts in the complaint and the acts of the officers is not determinative, as “the Exclusion is worded as excluding the Claim — not individual acts,” and the “term Claim is defined as ‘a civil ... proceeding for monetary ... relief which is commenced by ... service of a complaint or similar pleading.’ ” Doc. No. 85, p. 4.

The Court is also unable to uphold Langdale’s exclusively/dual capacity arguments [Doc. No. 50-1, p. 27] as Exclusion 4(g) does not contain such language.

(ii.) prior admission (as to Exclusion 4(g))

Langdale argues that “National Union has acknowledged the inapplicability of Exclusion 4(g) by unconditionally agreeing to advance reasonable Defense Costs under the Policy on at least five occasions spanning from October 13, 2010 to April 1, 2011.” Doc. No. 50-1, pp. 26, 29.

In response, National Union states that it made an “offer” and that Langdale never accepted its “offer” to advance part of the defense costs. Doc. No. 68, p. 9. Lang-dale states that “National Union’s unconditional agreement to advance Defense Costs was neither an offer of compromise nor an offer.” Doc. No. 75, p. 17.

For purposes of the Court’s present analysis, it is not necessary to resolve whether National Union made an unconditional agreement or an offer, as the Georgia Court of Appeals has held that an insurer is not estopped to dispute its defense obligations by reason of having sent letters to the insured in which the insurer initially agreed to defend the underlying suit. Ga. Farm, Bureau Mut. Ins. Co. v. Vanhuss, 243 Ga.App. 26, 26, 532 S.E.2d 135, 136 (2000). In Vanhuss, the court held that where the insured did not claim that he relied to his detriment on the insurer’s initial decision to defend the suits and no such reliance appears, the insured is not estopped from later denying coverage. Id.; see also Mahens v. Allstate Ins. Co., No. 1:10-cv-174, 2011 WL 1321578, at * 4 (N.D.Ga. Apr. 1, 2011) (citing Danforth v. Gov’t Emps. Ins. Co., 282 Ga.App. 421, 638 S.E.2d 852 (2007) (holding that insurer’s assurances that it would pay for repairs, including its attempt to settle with [a third-party], did not waive right to deny coverage)).

Here, as in the Vanhuss case, there is evidence of letters from the insurer, National Union, indicating that defense costs would be advanced; however, there is no claim by Langdale that it relied on said letters to its detriment and no such reliance appears from the record. Accordingly, National Union is not estopped from its present arguments in which it denies coverage under 4(g).

c. Endorsement 8

Endorsement 8 provides in relevant part:

SPECIFIC INVESTIGATION/CLAIM/LITIGATION/EVENT OR ACT EXCLUSION (D & O, EPL AND FLI COVERAGE SECTIONS)

In consideration of the premium charged, it is hereby understood and agreed that, solely with respect to Loss as may have otherwise been covered under the D & 0 Coverage Section, ... the Insurer shall not be liable to make any payment for any Loss in connection with: (i) any Claim(s), notices, events, investigations or actions referred to in any of items listed below (hereinafter “Events”); (ii) the prosecution, adjudication, settlement, disposition, resolution or defense of: (a) any Event(s); or (b) any Claim(s) arising from any Event(s); or (iii) any Wrongful Act, underlying facts, circumstances, acts or omissions in any way relating to any Event(s):

Events:

1. Claim # 145329, William Pope Langdale. Sr. et al. 2/20/2007

2. Claim # 178423, Robert H. Langdale et al, 8/14/2008

3. Claim # 186670, Natasha Sutton, 10/28/2008 (Race / Discharge) •

4. Claim # 186763, Rickey Stacey, 08/01/2008 (Race / Discharge)

It is further understood and agreed that the Insurer shall not be liable for any Loss in connection with any Claim(s) alleging, arising out of, based upon, attributable to or in any way related directly or indirectly, in part or in whole, to an Interrelated Wrongful Act (as that term is defined below), regardless of whether or not such Claim involved the same or different Insureds, the same or different legal causes of action or the same or different claimants or is brought in the same or different venue or resolved in the same or different forum.

For the purposes of this endorsement an “Interrelated Wrongful Act” means: (i) any fact, circumstance, act or omission alleged in any Event(s) and/or (ii) any Wrongful Act which is Related Wrongful Act to any Wrongful Act alleged in any Event(s).

Doc. No. 52-1, pp. 72-73.

National Union argues that there is no coverage for the present Claim because the facts alleged in the Underlying Litigation is “in any way related” to, “arises out of’, and/or “refers to” the facts alleged in Paragraphs 38-42 of the 2008 State Suit (Johnny’s Answer to which is attached as an exhibit to the 2008 Federal Suit). Doc. No. 69-1, p. 12. National Union further states: the Underlying Litigation “arises out of’ and is “in any way related” to the same facts alleged and the wrongful acts identified in Paragraphs 38-42 of the 2008 State Suit. Doc. No. 68, p. 23. National Union states: in the 2008 State Suit, the plaintiff alleged that, “Harley Langdale, Jr. and Johnny Langdale convinced the Virginia Miller Langdale family that they should sell their shares of stock out of their trust back to the Company for a price far below the market value of the shares at the time,” and “Harley Langdale, Jr. has been led to believe that he must work with Johnny Langdale in and [sic] effort to secure Johnny Langdale and his son’s full and absolute control and ownership over the Company.” Doc. No. 69-1, p. 15; Doc. No. 68-5, pp. 9-10, ¶¶ 40, 42. In the Underlying Litigation (counterclaim), the Virginia Miller Trust beneficiaries stated, “[T]he Trustees ... embarked on a scheme ... to make the Trustees’ control over TLC permanent, to have TLC redeem the Trust’s stock and to do so at an absurdly low price.” Doc. No. 69-1, p. 15; Doc. No. 52-8, p. 36, ¶ 59.

National Union further argues that the Policy makes clear in Endorsement # 8 that regardless of whether the 2008 Sta