Legal Blog

Grammar – Interpretation

Paloma Resources LLC v. Axis Insurance Company 2025 US C of A

The plaintiff sued its insurer for denying coverage in a prior lawsuit in which a third party alleged that the plaintiff’s employee stole confidential information. The plaintiff settled the third party’s action and wanted the insurer to cover the settlement. The trial court granted summary judgment for the insurer, finding the insurance policy’s intellectual property exclusion applied. The Court of Appeals vacated the summary judgment regarding the exclusion. The interpretation turned on the grammatical effect of the insertion of the determiner “the” before another phrase in a list. The clause was over 5 lines long in one sentence and demonstrated the effect of bad drafting.

Written by Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.