Scottsdale Insurance Company v. Byrne ( 2019 )

United States Court of Appeals
For the First Circuit
No. 18-1526
SCOTTSDALE INSURANCE COMPANY,
Plaintiff, Appellant,
v.
TIMOTHY L. BYRNE, as Co-Chairman of the Board of Trustees for
the Plumbers and Pipefitters Local 51 Pension and Annuity Funds;
ROBERT BOLTON, as Co-Chairman of the Board of Trustees for the
Plumbers and Pipefitters Local 51 Pension and Annuity Funds,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. F. Dennis Saylor, IV, U.S. District Judge]
Before
Lynch, Stahl, and Barron,
Circuit Judges.
Alexis J. Rogoski, with whom Edward C. Carleton and Skarzynski
Black LLC were on brief, for appellant.
Miranda S. Jones, with whom O'Reilly, Grosso, Gross & Jones,
P.C. was on brief, for appellee.
January 16, 2019
STAHL, Circuit Judge. In late 2014, the appellees in
this case brought suit against Wellesley Advisory Reality Fund I,
LLC ("WARF"). Acting in their capacity as representatives of the
Board of Trustees for the Plumbers and Pipefitters Local 51 Pension
and Annuity Funds (the "Funds"), Appellees alleged that WARF had
mismanaged and squandered money that the Funds had invested in
that entity. Following entry of default judgment against WARF in
that case, WARF assigned the Funds its rights in WARF's insurance
policy with Appellant Scottsdale Insurance Company ("Scottsdale"),
which had declined to defend WARF on the basis of several
exceptions within the policy.
Scottsdale brought an action against Appellees seeking
a declaration that it did not owe WARF a duty to defend or indemnify
under the policy and so owed the Funds nothing, and the Funds
counterclaimed. On cross-motions for summary judgment, the United
States District Court for the District of Massachusetts ruled that
the exclusions in Scottsdale's policies did not relieve the insurer
of its duty to defend WARF in the prior action. In a subsequent
order, the district court awarded the Funds $3 million, the full
limits of the insurance policy, plus post-judgment interest.
Scottsdale appeals, arguing both that it did not breach
its duty to defend under the policy under Massachusetts law and
that, even if it did, damages should be limited to the costs of
the defense. After careful consideration, we affirm.
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I.
A. The Policy
The dispute in this appeal stems from a "Business and
Management Indemnity Policy" (the "Policy") issued by Scottsdale
to WARF, a real estate investment vehicle developed by Wellesley
Advisors.1 The Policy covered the period from November 15, 2013,
to December 15, 2014,2 and carries a coverage limit of $3 million.
The Policy contains the following coverage clauses:
1. The Insurer shall pay the Loss of the
Management Insureds for which the Management
Insureds are not indemnified by the [Company
and] which the Management Insureds have become
legally obligated to pay by reason of a Claim
first made against the Management Insureds
during the Policy Period . . . and reported to
the Insurer . . . for any Wrongful Act taking
place prior to the end of the Policy Period.
2. The Insurer shall pay the Loss of the
Company for which the Company has indemnified
the Management Insureds and which the
Management Insureds have become legally
obligated to pay by reason of a Claim first
[made against] the Management Insureds during
the Policy Period . . . and reported to the
Insurer . . . for any Wrongful Act taking place
prior to the end of the Policy Period.
3. The Insurer shall pay the Loss of the
Company which the Company becomes legally
1 The Policy names Wellesley Advisors as the insured, and
explicitly added WARF as an insured "parent company" in an
endorsement dated November 15, 2013. The parties do not dispute
that WARF was an insured under the Policy.
2 Initially, the policy period was set to expire on November
15, 2014. Scottsdale and WARF subsequently extended this period
by one month.
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obligated to pay by reason of a [Claim first]
made against the Company during the Policy
Period . . . and reported to the Insurer . . .
for any Wrongful Act taking place prior to the
end of the Policy Period.
As relevant here, the Policy defines "Claim" as "a civil proceeding
against any Insured seeking monetary damages or non-monetary or
injunctive relief . . . ." "Loss" is defined as "damages,
judgments, settlements, pre-judgment or post-judgment interest
awarded by a court, and Costs, Charges, and Expenses incurred by"
the entities covered under the Policy. "Wrongful Act" is defined
as "any actual or alleged error, omission, misleading statement,
misstatement, neglect, breach of duty or act allegedly committed
or attempted by" the insured entities.
The Policy contains a number of exclusions, three of
which are claimed to be relevant to the present appeal. First,
the Policy includes a "Professional Services Exclusion" which
states:
Insurer is not liable for Loss . . . on account
of any Claim[] alleging, based upon, arising
out of, attributable to, directly or
indirectly resulting from, in consequence of,
or in any way involving the rendering or
failure to render Professional Services. . . .
Solely for purposes of this exclusion,
Professional Services means services as a real
estate broker or agent, multiple listing
agent, real estate appraiser, title agent,
title abstractor or searcher, escrow agent,
real estate developer, real estate consultant,
property manager, real estate inspector, or
construction manager. Such services shall
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include, without limitation, the purchase,
sale, rental, leasing or valuation of real
property; the arrangement of financing on real
property; or any advice proffered by an
Insured in connection with any of the
foregoing.
Second, the Policy provides an "ERISA Exclusion" which states that
Scottsdale
shall not be liable for Loss . . . on account
of any Claim . . . for any actual or alleged
violation of the responsibilities,
obligations or duties imposed by [the]
Employee Retirement Income Security Act of
1974, as amended ["ERISA"], or any rules or
regulations promulgated thereunder, or
similar provisions of any federal, state or
local statutory or common law[.]
Finally, the Policy provides a "Conduct Exclusion" which excludes
coverage for
Loss . . . on account of any Claim . . .
alleging, based upon, arising out of,
attributable to, directly or indirectly
resulting from, in consequence of, or in any
way involving:
. . .
ii. the gaining of any profit, remuneration
or financial advantage to [which any]
Management Insureds were not legally entitled;
provided, however this exclusion [] shall not
apply unless and until there is a final
judgment against such Management Insureds as
to such conduct.
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B. The Underlying Action
On November 10, 2014, Appellees filed suit against WARF3
in the United States District Court for the District of
Massachusetts seeking damages and injunctive relief (the
"Underlying Action"). Appellees claimed that, in 2005, they
invested $5 million with WARF, which WARF subsequently used to
"invest in various real estate parcels . . . ." Specifically, the
complaint avers that WARF purchased "The Stone House," a hotel in
Little Compton, Rhode Island; a residential condominium called
"Eastbourne Lodge" in Newport, Rhode Island; and a housing
development in North Attleboro, Massachusetts.
As to The Stone House, Appellees averred that WARF
entered into several mortgages on the property to fund renovations
therein. Appellees claimed that, despite this debt, WARF retained
all revenue from hotel operations at The Stone House as a "'fee'
for managing the property for [t]he Funds[]." WARF failed to make
required periodic payments on The Stone House mortgages, and the
mortgagee sued for more than $5.6 million to enforce the mortgages
against The Stone House.
3 The complaint in that action addresses allegations to both
"Wellesley Advisors" and "Wellesley Advisors Realty Fund I, LLC,"
seemingly interchangeably. This appears to be a distinction
without a difference, and the parties do not attach any
significance to that point. Accordingly, we refer to allegations
as against WARF for clarity.
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Separately, the complaint averred that "a sister or
parent company" of WARF received notice from a different mortgagee
of its intent to foreclose on and sell the North Attleboro property
due to an unspecified "breach of the conditions of [that]
mortgage."
Through these actions, Appellees averred that WARF
"squandered the entire [$5 million] investment," and that "[t]he
properties were either lost to foreclosure or written down to a
zero value because of taxes or mortgages owed."
Based on these allegations, the Funds brought two claims
in state court against WARF for negligence and violations of ERISA,
respectively. Under the first of these claims, the complaint
contends that WARF was negligent in overleveraging the properties
in excess of their value, failing to pay property taxes, and
retaining income from the investment properties, especially from
The Stone House, for its own use. The second, ERISA-based count
claims that, through its retention of revenues from The Stone
House, WARF took on fiduciary duties to the Funds, which it
subsequently violated through "self-dealing and mismanagement of
[the properties.]"
WARF notified Scottsdale of the Funds' lawsuits against
it on November 14, 2014. Scottsdale replied verbally (and, later,
in writing) that the Funds' claims were excluded from coverage
based on the ERISA and Professional Services Exclusions.
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Accordingly, Scottsdale refused to either defend or indemnify WARF
as to the Funds' claims. WARF went into receivership and did not
contest the Underlying Action thereafter.
On November 25, 2015, the district court entered default
judgment in the Underlying Action in favor of Appellees, awarding
them $5,005,422.12.4 On May 15, 2016, WARF assigned to Appellees
all rights and claims that it held against Scottsdale.
C. Procedural History
Scottsdale brought the instant action on July 8, 2016,
in the District Court for the District of Massachusetts, seeking
declaratory judgment that Appellees' claims in the Underlying
Action were not covered under the Policy and so that Scottsdale
was not obligated to make any payments on the judgment in that
case. Appellees included in their answer several counterclaims,
including as relevant here claims that Scottsdale breached its
duty to defend and to indemnify WARF in the Underlying Action.
Appellees sought payment of the entire amount of the judgment in
the Underlying Action plus post-judgment interest. The parties
cross-moved for summary judgment.
On March 1, 2018, the district court denied Scottsdale's
motion and granted partial summary judgment to Appellees. The
court found that the allegations raised in the Underlying Action
4
This amount includes both the principal amount claimed
($5 million) as well as costs and attorneys' fees.
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were not "clearly excluded" from coverage under the policy and so
Scottsdale had, at minimum, a duty to defend WARF against those
claims. Based on Scottsdale's uncontested failure to take up
WARF's legal defense in the Underlying Action, the court concluded
that Scottsdale was liable to Appellees and required the parties
to file "motions concerning the form of the judgment," which it
said would "[p]resumably . . . be awarded [in] the amount of the
coverage limit." After the parties submitted the required
motions,5 the court entered judgment for Appellees on May 8, 2015,
in the amount of $3,038,081.10, consisting of the policy limit of
$3 million plus post-judgment interest calculated at the statutory
rate. Scottsdale timely appealed the district court's judgment.
II.
On appeal, Scottsdale argues that the district court
erred in concluding that it had a duty to defend the Underlying
Action. It points to the Policy's Professional Services and ERISA
Exclusions, contending that each of those exclusions clearly
applies to the claims asserted in the Underlying Action and
5
In its motion, Scottsdale also moved for clarification of
the summary judgment order, seeking dismissal of Appellees'
counterclaims for breaches of the implied covenant of good faith
and fair dealing, and violation of the Massachusetts consumer
protection statute, which the district court initially failed to
address. Appellees, on the other hand, sought entry of judgment
in the full amount of damages in the Underlying Action. The court
dismissed the remaining claims and denied the motion for damages
in excess of the policy limit plus interest.
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independently provides a basis for denying coverage. In the
alternative, Scottsdale contends that it is only liable for the
costs of defending the Underlying Action —— not the entire policy
limit —— because the claims are excluded by the Policy's Conduct
Exclusion. We examine these arguments separately and find no
reason to reverse the district court's determination.
A. Standard of Review
Review of the district court's grant of summary judgment
is de novo. Barrett Paving Materials, Inc. v. Continental Ins.
Co., 488 F.3d 59, 63 (1st Cir. 2007). Where, as here, there is no
dispute regarding the material facts, the only issue is whether
the moving party is entitled to judgment as a matter of law. Id.
(citation omitted).
This case comes before us based on our diversity
jurisdiction, and the parties agree that Massachusetts provides
the substantive law to be applied. "The interpretation of an
insurance policy is a question of law for the court." Valley Forge
Ins. Co. v. Field, 670 F.3d 93, 97 (1st Cir. 2012) (citation
omitted). "Under Massachusetts law, [the court] construe[s] an
insurance policy under the general rules of contract
interpretation. . . . begin[ning] with the actual language of the
policies, given its plain and ordinary meaning." Brazas Sporting
Arms, Inc. v. Am. Empire Surplus Lines Ins. Co., 220 F.3d 1, 4
(1st Cir. 2000) (citations omitted).
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The "insurer's duty to defend is independent from, and
broader than, its duty to indemnify," Metro. Prop. & Cas. Ins. Co.
v. Morrison, 951 N.E.2d 662, 667 (Mass. 2011) (internal quotation
marks and citation omitted), and insurers "owe[] a duty to defend
[their insured] if the allegations in the underlying lawsuit are
reasonably susceptible to an interpretation that they state a claim
covered by [the] policy," Scottsdale Ins. Co. v. Torres, 561 F.3d
74, 77 (1st Cir. 2009) (citation omitted); see also Billings v.
Commerce Ins. Co., 936 N.E.2d 408, 414 (Mass. 2010) ("An insurer
has a duty to defend an insured when the allegations in a complaint
are reasonably susceptible of an interpretation that states or
roughly sketches a claim covered by the policy terms." (footnote
and citation omitted)). Said somewhat differently, "[i]n order
for the duty of defense to arise, the underlying complaint need
only show, through general allegations, a possibility that the
liability claim falls within the insurance coverage. There is no
requirement that the facts alleged in the complaint specifically
and unequivocally make out a claim within the coverage." Sterilite
Corp. v. Cont'l Cas. Co., 458 N.E.2d 338, 341 (Mass. App. Ct. 1983)
(internal quotation marks and citation omitted). Courts look to
"the source from which the plaintiff's personal injury originates
rather than the specific theories of liability alleged in the
complaint" to determine whether the policy covers the claim under
this standard. Bagley v. Monticello Ins. Co., 720 N.E.2d 813, 817
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(Mass. 1999) (internal quotation marks, citation, and emphasis
omitted).
Where, as here, an insurer asserts that it is not
obligated to defend due to some policy exclusion or exclusions, it
bears the initial burden of demonstrating that the exclusion
applies.6 See Saint Consulting Grp., Inc. v. Endurance Am. Spec.
Ins. Co., Inc., 699 F.3d 544, 550 (1st Cir. 2012) (citation
omitted). In order to meet this requirement, "the facts alleged
in the third-party complaint must establish that the exclusion
applies to all potential liability as matter of law." Norfolk &
Dedham Mut. Fire Ins. Co. v. Cleary Consultants, Inc., 958 N.E.2d
853, 862 (Mass. App. Ct. 2011) (citation omitted); see also Saint
Consulting Grp., 699 F.3d at 550 ("If even one of the counts in
either of the complaints falls within the coverage provisions but
outside any exclusion, [the insurer] would have a duty to defend
the entire lawsuit."). "[W]hether an exclusion applies to relieve
an insurer of its duty to defend [] depend[s] on whether the
insured would have reasonably understood the exclusion to bar
6 Generally, the insured bears the initial burden of "showing
that the overall coverage provisions of the insurance policy
apply[.]" Clark Sch. for Creative Learning, Inc. v. Phila. Indem.
Ins. Co., 734 F.3d 51, 55 n.1 (1st Cir. 2013). Where, as here,
the dispute centers only on the effect of coverage exclusions, the
court can bypass this initial showing and proceed directly to
evaluating the reach of those exclusions. See id. at 55.
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coverage." Essex Ins. Co. v. BloomSouth Flooring Corp., 562 F.3d
399, 404 (1st Cir. 2009).
B. The Professional Services Exclusion
Scottsdale first contends that all of the allegations in
the Underlying Action fall within the purview of the Professional
Services Exclusion. In particular, it contends that all of the
allegations in that case "arose out of" or "involved" "real estate
development, property management, the purchase of real property,
or the arrangement of financing on real property," all of which
Scottsdale argues fall "within the plain meaning of the
Professional Services Exclusion." In support of this position,
Scottsdale relies on the broad readings afforded by Massachusetts
law to the terms "arising out of" and "in any way involving," both
of which are used to preface the substantive scope of the
Professional Services Exclusion (as well as the other relevant
exclusions). See Bagley, 720 N.E.2d at 816 (explaining that the
phrase "arising out of" "must be read expansively, incorporating
a greater range of causation than that encompassed by proximate
cause under tort law" (citations omitted)); Clark Sch. for Creative
Learning, 734 F.3d at 56 (holding that "in any way involving" acts
as a "mop-up clause, intended to exclude anything not already
excluded by the other clauses," including "arising out of").
Scottsdale's argument fails, however, to account for all
of the claims raised in the Underlying Action. As noted above,
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the Underlying Action concerned losses stemming from WARF's
investment in three properties: The Stone House, and properties in
North Attleboro and Newport. Were those allegations limited to
claims regarding the mismanagement of The Stone House, we might
agree: claims stemming from WARF's renovation of that property and
retention of revenues from its operation of the hotel as a
"management" fee fit seemingly well within the exclusion for
actions taken "as a . . . real estate developer [or] . . . property
manager." As Appellees observed at oral argument, however, the
complaint offers no similar allegations that WARF was developing,
improving, or managing operations at the investment properties in
North Attleboro or Newport. Beyond alleging that WARF invested in
those parcels, the only additional claims are that the properties
were "lost to foreclosure or written down to a zero value because
of tax or mortgages owed" and, generally, that WARF "engaged in
self-dealing by retaining investment income from the properties
for its own use." These limited allegations preclude any
meaningful evaluation of whether the loss of the Newport and North
Attleboro properties was attributable to WARF's actions as a
property manager, developer, investor, or otherwise. As the
district court observed, "[a]t the very least, it is ambiguous
whether in fact all of WARF's purported misconduct stemmed from"
WARF's provision of professional services. Thus, the allegations
concerning the Newport and North Attleboro properties are not
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clearly within the Professional Services Exclusion, and, where
there is ambiguity, there is a duty to defend.
Scottsdale attempts to argue around this shortcoming,
claiming that all of the allegations fall within the broad
definition of "services" —— especially the "arrangement of
financing on real property" —— included in the Professional
Services Exclusion. Scottsdale misreads its own policy, however:
the plain language of the Policy is clear that, in order to fall
within the Professional Services Exclusion, the "services" as
defined must be provided "as a real estate broker or agent,"
"property manager," or another of that exclusion's enumerated
roles. As noted above, the allegations set forth in the Underlying
Action do not offer any meaningful basis from which we can conclude
that WARF was acting in any one of those roles with respect to
either the North Attleboro or Newport properties.
We therefore conclude that Scottsdale failed to meet its
burden of establishing that the Professional Services Exclusion
applies to all claims of liability within the Underlying Action.
C. The ERISA Exclusion
Scottsdale next turns to the ERISA Exclusion. As
discussed, the Underlying Action asserted both a negligence claim
and, separately, a claim that WARF's actions violated duties
imposed by ERISA. The parties do not dispute that the latter of
these claims falls outside of the Policy's coverage, and that count
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is not at issue here. Scottsdale goes a step further, however,
contending that because the negligence and ERISA claims arise from
the same set of facts, the negligence claim is therefore preempted
by ERISA.
At the outset, we note that none of the categories of
excluded "Claims" —— "actual or alleged violations" of (1) ERISA;
(2) "rules or regulations promulgated" pursuant to ERISA; or (3)
"similar provisions of federal, state or local statutory or common
law" —— explicitly remove "preempted" state law claims from the
Policy's coverage. Recognizing this shortcoming, Scottsdale
attempts to shoehorn preempted state-law claims into this clause
as a "similar provision[] of . . . state . . . common law." In
our view, however, the question of whether that language could
extend to a common law action for negligence, stated without
reference to ERISA-like fiduciary duties, is ambiguous at best.
That observation alone settles the issue before us: Scottsdale has
the burden of demonstrating the exclusion's application to the
Underlying Action, and all ambiguities must be read against the
insurer. See Valley Forge Ins. Co., 670 F.3d at 97. Accordingly,
we see no basis for excusing Scottsdale from its duty to defend
based on the ERISA Exclusion.7
7 Because we find that neither of the exclusions cited by
Scottsdale excuse it from its duty to defend, we do not reach
Appellees' alternate argument that, under its terms, the Policy's
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D. The Conduct Exclusion
In its final argument, Scottsdale contends that its
liability is limited by the Policy's Conduct Exclusion. Unlike
the Professional Services and ERISA Exclusions, Scottsdale does
not claim that the Conduct Exclusion excuses it from its duty to
defend: by its terms, that exclusion is not implicated "unless
and until there is a final judgment against [the] . . . Insureds
. . . ." Rather, Scottsdale contends that, even if it breached
the duty to defend, it should be permitted to contest and limit
its indemnity obligation based on that exclusion's application to
financial gains to which WARF was not entitled, specifically WARF's
alleged retention of "investment income from the properties" at
issue in the Underlying Action.
An insurer's breach of its duty to defend "may also
trigger a duty to indemnify because an insurer in breach of its
duty to defend is bound by the result of the underlying action as
to all matters therein decided which are material to recovery by
the insured in an action on the policy." Metro Prop. & Cas. Ins.,
951 N.E.2d at 669 (internal quotation marks, alterations, and
citation omitted); see also Liberty Mut. Ins. Co. v. Metro. Life
Ins. Co., 260 F.3d 54, 63 (1st Cir. 2001) ("[T]he general rule
under Massachusetts law is that if the insurer fails to defend the
exclusions do not relieve the insurer of its duty to defend in any
event.
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lawsuit, it is liable for all defense costs and (assuming policy
coverage) the entire resulting judgment or settlement, unless
liability can be allocated among covered and uncovered claims.")
(citations omitted). "Where [the insured] defendant defaults, the
factual allegations in the complaint as to liability are deemed to
be admitted . . . and treated as if they are true" as to both the
defendant and those insurers who wrongfully decline to defend the
case. Metro. Prop. & Cas. Ins., 951 N.E.2d at 669.
Subject to these provisos, "insurer[s] that wrongfully
decline[] to defend a claim" may contest their indemnity under
their policy, provided, however, that they "have the burden of
proving that the claim was not within [the] policy's coverage."
Polaroid Corp. v. Travelers Indem. Co., 610 N.E.2d 912, 922
(Mass. 1993). Moreover, where some of the claims fall within a
policy's coverage and others do not, "an insurer that breaches its
duty to defend bears the burden of allocating a judgment against
its insured between covered and noncovered claims." Palermo v.
Fireman's Fund Ins. Co., 676 N.E.2d 1158, 1163 (Mass. App. Ct.
1997); see also Liquor Liab. Joint Underwriting Ass'n of Mass. v.
Hermitage Ins. Co., 644 N.E.2d 964, 968-69 (Mass. 1995).
Similar to the Professional Services Exclusion,
Scottsdale's attempt to escape its indemnity obligation fails to
account for all of the claims made in the Underlying Action.
Scottsdale maintains a narrow focus on allegations that WARF
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engaged in self-dealing when it retained fees from the investment
properties. Self-dealing, however, is just one component of the
many allegations in the Underlying Action. Much of the complaint
is concerned not with WARF's improper gain or pecuniary advantage,
but rather the squandering of Appellees' investment through, among
other things, negligently overleveraging and failing to pay taxes
and service mortgages on the properties.8 Those allegations were
"conclusively establishe[d]" by the entry of default as to
Scottsdale, Metro. Prop. & Cas. Ins., 951 N.E.2d at 669, and they
offer a theory of Appellees' loss that is entirely separate from
any improper gain by WARF. Scottsdale provides no basis from which
we could conclude that the Conduct Exclusion covers all of the
material allegations established in the Underlying Action, and it
further fails to demonstrate any grounds for allocating the
judgment award between portions attributable to WARF's improper
8 Scottsdale's reliance on Winbrook Communication Services
Inc. v. United States Liability Insurance Company, 52 N.E.3d 195
(Mass. App. Ct. 2016), is misplaced. There, the insured company's
negligent misstatements about its own financial stability induced
the judgment creditor to provide a benefit in the form of services
for which it was never paid. Id. at 197. Examining a conduct
exclusion similar to that in the Policy, the court concluded that
evidence in the record indicated that, through its
misrepresentations, the insured might have "received goods or
services that created an opportunity for gain or advantage . . . .
[such as] credit, investors, or customers." Id. at 203. In other
words, the insured's negligence might have directly contributed to
its receipt of an advantage to which it was not legally entitled.
In this case, however, we see no basis to conclude that WARF's
negligence in squandering Appellees' investment led to any
demonstrable gain.
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gains and negligent losses. As such, we see no basis from which
to relieve Scottsdale of its obligation to pay the policy limit.9
III.
The judgment of the district court is AFFIRMED.
9 In their opposition brief, Appellees hint that the district
court erred in limiting their recovery to the policy limits, rather
than the full judgment. Because Appellees failed to cross-appeal
on that issue, we do not address the merits of their claim. See
Jennings v. Stephens, __ U.S. __, 135 S. Ct. 793, 798 (2015) ("[A]n
appellee who does not cross-appeal may not attack the [judgment of
the lower court] with a view either to enlarging his own rights
thereunder or lessening the rights of his adversary." (internal
quotation marks and citation omitted)).
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