Wedding bell blues: No defense for drone injury

A federal district court in California has ruled that an insurance company had no duty to defend its insured against claims that a drone it was operating at a wedding had severely injured a guest.

Related: Keeping up with commercial drone risks

The case

Philadelphia Indemnity Insurance Company received notice from Darshan Kamboj that she had been injured when a drone operated by Satyam Sukhwal on behalf of his employer, Hollycal Production, Inc., to photograph a wedding that Kamboj was attending made contact with her eye.

Kamboj claimed she lost sight in her eye as a result of the collision.

Philadelphia Indemnity declined to provide coverage to its insureds, Hollycal Production and Sukhwal, for the lawsuit filed against them by Kamboj. The insurer based its decision on, among other things, its insurance policy’s aircraft exclusions.

Kamboj’s counsel responded to Philadelphia Indemnity’s denial of coverage and argued that a drone did not fall within the aircraft exclusions because a “drone equipped with a camera” was “not capable of transporting persons or cargo” but, rather, was “unmanned and operated remotely.” Thus, Kamboj’s counsel argued that the drone was “a piece of equipment,” not “an aircraft or vehicle.”

In response, Philadelphia Indemnity’s counsel reiterated its position that the aircraft exclusions applied to the claim.

Philadelphia Indemnity filed an action seeking a declaration that its insurance policy did not cover Ms. Kamboj’s claims.

Philadelphia Indemnity moved for summary judgment.

The Philadelphia Indemnity insurance policy

The aircraft exclusion in the Philadelphia Indemnity insurance policy stated that the policy did not apply to:

“Bodily injury” or “property damage” arising out of the ownership, maintenance, use or entrustment to others of any aircraft, “auto” or watercraft owned or operated by or rented or loaned to any insured. Use includes operation and “loading or unloading.” This exclusion applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, if the “occurrence” which caused the “bodily injury” or “property damage” involved the ownership, maintenance, use or entrustment to others of any aircraft, “auto” or watercraft that is owned or operated by or rented or loaned to any insured.

Another exclusion established that the policy did not apply to bodily injury:

[a]rising out of the ownership, operation, maintenance, use, loading, or unloading of any flying craft or vehicle, including, but not limited to, any aircraft, hot air balloon, glider, parachute, helicopter, missile or spacecraft.

The district court’s decision

The district court granted Philadelphia Indemnity’s motion for summary judgment.

In its decision, the district court explained that the Philadelphia Indemnity insurance policy specifically excluded any bodily injury arising out of the use of an “aircraft” operated by an insured. The district court observed that the policy did not define the term “aircraft,” but it found the term “unambiguous” and that its ordinary meaning was “a vehicle (such as an airplane or balloon) for traveling through the air.”

The district court then ruled that a drone, as a “vehicle . . . for traveling through the air,” was an “aircraft” under the term’s ordinary and plain definition.

In the opinion of the district court, the “ordinary definition” of an aircraft did not require the carrying of passengers or cargo. Additionally, the district court decided, the fact that a drone was “unmanned and operated remotely” did not make it any less of an aircraft.

The district court concluded that “Ms. Kamboj’s injury only resulted from the operation of a drone and thus could not possibly be covered by the [Philadelphia Indemnity policy].”

The case is Philadelphia Indemnity Ins. Co. v. Hollycal Production, Inc., No. ED CV 18-768 PA (SPx) (C.D. Cal. Dec. 7, 2018).

Related: Top four wedding insurance claims of 2017

For more coverage like this, explore our Drones & insurance Instant Insights page.

Steven A. Meyerowitz, Esq., (smeyerowitz@meyerowitzcommunications.com) is the director of FC&S Legal, the editor-in-chief of the Insurance Coverage Law Report, and the founder and president of Meyerowitz Communications Inc.