Crocilla was covered under a master policy of insurance issued to the Associated Bodywork and Massage Professional by Evanston Insurance Company. Crocilla tendered the complaint to Evanston. The insurer denied coverage and filed a declaratory judgment action based on four exclusions in the policy.

 The Evanston insurance policy issued to Crocilla contained provisions that exclude coverage for "any claim or suit arising out of or caused in whole or in part by the actual or alleged physical contact of a sexual nature; assault or battery; any dishonest, fraudulent, criminal or malicious act; or a violation of any statute or governmental rule or regulation". The insurer said that the claims against the insured fall under these exclusions and so, there is no coverage.

 Crocilla did not necessarily disagree that the claims against her contained claims that are excluded. She argued, however, that Evanston must provide defense and indemnification because the complaint contains covered claims, such as professional and general negligence; because it is unclear how the alleged injuries occurred; because she has not been found to have committed any criminal sexual act; and because the policy exclusion relating to criminal activity is ambiguous.

 The United States District Court, District of New Jersey, noted the insured's argument that Wernega claims her injuries arose out of Crocilla's alleged professional negligence as a masseur and also from her alleged sexual assault and battery, so Evanston should defend her. The court also noted that the insurer argued that all of Wernega's claims arose out of alleged improper sexual contact, that the sole predicate act for all the claims was sexual contact, and so, the insured's conduct is clearly excluded under the terms of the policy.

 When the complaint against Crocilla is placed side-by-side with the insurance policy, the court said, it is clear that none of Wernega's claims are covered by the policy. The policy provided that "any claim or suit arising out of or caused in whole or in part by the actual or alleged physical contact of a sexual nature" is excluded. The incidents that gave rise to the claims entail alleged sexually inappropriate touching of Wernega's private parts. The entire complaint therefore arises out of the actual or alleged physical contact of a sexual nature by Crocilla. Thus, even if only this one exclusion applies, the court said, it encompasses the whole of Wernega's claims. Based on this, the court ruled that Evanston was entitled to judgment in its favor and it is not obligate to defend or indemnify Crocilla.

 Editor's Note: The usual procedure in a claims coverage dispute is that the insurer must defend the insured if at least one of the multiple claims against the insured is covered by the policy even while the other claims are not covered. In this instance, the U.S. District Court, New Jersey, decided that all of the claims alleged by the injured party arose out of the one action that was clearly excluded—physical contact of a sexual nature. Therefore, regardless of the other allegations made by the injured party against the insured, the policy did not provide defense or indemnification.