North Star Mutual Insurance Company, Respondent,

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A22-0784

North Star Mutual Insurance Company,
Respondent,

vs.

Christopher Erickson, et al.,
Appellants.

Filed January 9, 2023
Affirmed
Smith, Tracy M., Judge

Wadena County District Court
File No. 80-CV-19-1044

Paul A. Rajkowski, Paul E. Storm, Rajkowski Hansmeier Ltd., St. Cloud, Minnesota (for
respondent)

Jason D. Pederson, Bemidji, Minnesota; and

Jenneane Jansen, Jansen & Palmer, LLC, Minneapolis, Minnesota (for appellants)

Considered and decided by Worke, Presiding Judge; Smith, Tracy M., Judge; and
Florey, Judge.∗

∗ Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
2
NONPRECEDENTIAL OPINION
SMITH, TRACY M., Judge
Respondent-insurer brought a declaratory-judgment action to determine coverage
under appellants’ insurance policies, and, following cross-motions for summary judgment,
the district court granted summary judgment in favor of respondent-insurer. Appellants
argue that the district court erred by determining that the policies’ definition of “bodily
injury” precluded coverage for their negligence-related claims and that the policies’
intentional-acts exclusion precluded coverage for their defamation claim. We affirm.
FACTS
Appellant Laicy Erickson ran a daycare at the home she shared with her husband,
appellant Christopher Erickson. The Ericksons were insured by respondent North Star
Mutual Insurance Company. Appellants Samantha and Trent Walter’s children attended
the daycare. The Walters sued the Ericksons based on conduct allegedly committed by the
Ericksons’ minor son, C.E., against the Walters’ minor daughter, R.W., at the daycare. At
the time, C.E. was approximately seven years old and R.W. was approximately five years
old. The Walters’ complaint alleged that, over several months, C.E. pinned R.W. down,
asked her to take her clothes off so he could spray her with a hose, kissed her and stated
that he intended to marry her, tried to touch her “privates,” “rubb[ed]” and “touch[ed] [her]
vagina,” and, on multiple occasions, tried to put his penis in her mouth.
The complaint also alleged that Laicy failed to supervise C.E. and R.W., that Laicy
knew of certain incidents but did not report them to the Walters, and that, after the Walters
reported the incidents to authorities, Laicy failed to disclose information to the police. The
3
Walters’ complaint asserted twelve claims: (I) physical assault, (II) sexual assault,
(III) battery, (IV) negligent infliction of emotional distress, (V) intentional infliction of
emotional distress, (VI) defamation, (VII) negligence, (VIII) vicarious liability,
(IX) negligent supervision of a minor, (X) failure to report sexual abuse, (XI) giving false
or misleading information to authorities, and (XII) invasion of privacy.
At the time of the alleged conduct, the Ericksons had combination-package policies
from North Star that provided coverage for their home and their in-home daycare. 1 The
policies provided coverage as follows:
Coverage L - Personal Liability – “We” pay, up to “our”
“limit”, all sums for which an “insured” is liable by law
because of “bodily injury” or “property damage” caused by an
“occurrence” to which this coverage applies. “We” will defend
a suit seeking damages if the suit resulted from “bodily injury”
or “property damage” not excluded under this coverage.

The policies defined “bodily injury” as “bodily harm to a person and includes
sickness, disease, or death.” The definition of “bodily injury” also specified certain types
of injuries that did not qualify as “bodily injury” under the policies. The definition of
“bodily injury” stated that the term “does not mean bodily harm, sickness, disease, or death
that arises out of . . . any actual, alleged or threatened sexual misconduct” (sexual-
misconduct provision).

1 The Ericksons had a 2014-2015 policy and a 2015-2016 policy, and the alleged conduct
spanned both time periods.
4
In addition, the policie s contained an exclusion from coverage for bodily injury
“expected or intended” by an insured (intentional-acts exclusion).2
The Ericksons tendered the Walters’ complaint to North Star, and North Star
accepted the tender under a reservation of rights. North Star then commenced a declaratory-
judgment action —the action before us now —against the Ericksons and the Walters to
establish that North Star had no duty to defend or indemnify because the policies did not
provide coverage for the claims against the Ericksons.
Following discovery, North Star, the Ericksons, and the Walters each filed a motion
for summary judgment. The district court granted North Star’s motion for summary
judgment and denied the Walters’ and the Ericksons’ motions, concluding that North Star
had no duty to defend or indemnify the Ericksons against any of the Walters’ claims. The
district court determined that (1) the negligent-infliction-of-emotional-distress, negligence,
vicarious liability, and negligent- supervision-of-a-minor claims did not allege covered
bodily injury because they arose out of sexual misconduct; (2) the physical assault, sexual
assault, battery, intentional-infliction-of-emotional-distress, defamation, and invasion-of-
privacy claims were excluded by the intentional-acts exclusion; and (3) the failure-to-
report and false-or-misleading-information claims were not cognizable causes of action.

2 The intentional-acts exclusions varied between the policies. The 2014-15 policy excluded
bodily injury “which is expected or intended from the standpoint of an ‘insured.’” The
2015-16 policy excluded bodily injury that is
1) expected by, directed by, or intended by an “insured”;
2) the result of a criminal act of an “insured”; or
3) the result of an intentional and malicious act by or at the direction of an
“insured”.
5
The Walters and the Ericksons appeal.3
DECISION
On review of summary judgment, appellate courts analyze whether there are
genuine disputes of material fact and whether the district court erred in its application of
law. STAR Ctrs., Inc. v. Faegre & Benson, L.L.P., 644 N.W.2d 72, 76 (Minn. 2002). The
interpretation of an insurance policy and whether the policy affords coverage for a
particular situation are questions of law reviewed de novo. Depositors Ins. Co. v.
Dollansky, 919 N.W.2d 684, 687 (Minn. 2018). When interpreting an insurance contract,
appellate courts give words their natural and ordinary meaning and construe any ambiguity
about coverage in favor of the insured. Am. Fam. Ins. Co. v. Walser, 628 N.W.2d 605, 609
(Minn. 2001).
On appeal, both appellants and North Star frame the issue in terms of North Star’s
duty to defend. An insurer’s duty to defend is triggered if a claim is arguably within the
policy’s coverage, regardless of the merits of the claim. Meadowbrook, Inc. v. Tower Ins.
Co., Inc., 559 N.W.2d 411, 416, 419 (Mi nn. 1997). Because the relevant facts are
undisputed on appeal, the question for this court is whether the policies afford coverage for

3 Although it is not reflected in the record before us, the parties agree that the Ericksons
and the Walters filed a Miller-Shugart settlement agreement in the underlying action after
the district court issued its order in the declaratory-judgment action. In a Miller-Shugart
settlement, a defendant whose insurer is disputing coverage settles with the plaintiff and
assigns the right to contest insurance coverage to the plaintiff. The plaintiff typically agrees
to satisfy any judgment against the insurer and not the defendant in his or her personal
capacity. See Miller v. Shugart, 316 N.W.2d 729 (Minn. 1982). The notice of appeal
identifies the Walters and the Ericksons as appellants, but the Ericksons did not file a brief
and are not listed on the Walters’ brief.
6
the allegations in the complaint. See Metro. Prop. & Cas. Ins. Co. & Affiliates v. Miller,
589 N.W.2d 297, 299 (Minn. 1999).
Appellants challenge the district court’s coverage determination for four of the
twelve claims. They contend that (1) the negligence, vicarious liability, and negligent-
supervision-of-a-minor claims are not precluded from coverage by the policies’ definition
of bodily injury and (2) the defamation claim may be based on negligent, not intentional,
conduct and thus is not excluded from coverage by the intentional -acts exclusion. We
address each argument in turn.
I. Negligence, Vicarious Liability, and Negligent-Supervision-of-a-Minor Claims

Appellants make two arguments about the negligence, vicarious liability, and
negligent-supervision-of-a-minor claims. First, appellants argue that the express omission
of “sexual misconduct ” from the policies’ definition of bodily injury should not be
interpreted to preclude coverage for C.E.’s conduct because, as a young child, C.E. lacked
the necessary intent to engage in sexual misconduct. Second, in the alternative, appellants
argue that, even if C.E.’s conduct was “sexual misconduct,” the Ericksons’ negligent
conduct caused a separate harm such that coverage is still appropriate for the negligence
and negligent-supervision claims.
A. Intent Under the Sexual-Misconduct Provision

We first address appellants’ argument about the interpretation of “sexual
misconduct” in the policies’ bodily-injury definition. The crux of this dispute is whether
the polic ies’ plain language requires an intent to act sexually or engage in sexual
misconduct. The policies provide:
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‘Bodily injury’ does not mean bodily harm, sickness, disease,
or death that arises out of: . . . any actual, alleged or threatened
sexual misconduct. Sexual misconduct includes, but is not
limited to, sexual molestation, sexual t ouching, sexual
harassment, assault of a sexual nature, unwelcome sexual
advances, requests for sexual favors, sexually motivated
physical contact or any act, conduct or communication which
is of a sexual or seductive nature.

Appellants contend that these examples require the subjective intent to act sexually and
that C.E., because of his age, was incapable of such intent and thus could not commit sexual
misconduct. Thus, they argue that the negligence, vicarious liability, and negligent-
supervision claims are covered.
Appellants’ argument relies on importing the subjective-intent analysis required for
an intentional-acts exclusion into the sexual-misconduct provision here. Specifically,
appellants argue that two supreme court cases interpreting intentional-acts exclusions—
State Farm Fire & Casualty Co. v. Wicka and B.M.B. v. State Farm Fire & Casualty Co.—
control our analysis of the sexual-misconduct provision. Under Minnesota law , “an
intentional acts exclusion applies only where the insured acts with the specific intent to
cause bodily injury.” State Farm Fire & Cas. Co. v. Wicka , 474 N.W.2d 324, 329 (Minn.
1991) (emphasis added). Thus, in Wicka, the supreme court held that an insured’s acts are
“unintentional” for the purposes of the intentional-acts exclusion if the insured’s mental
illness or defect prevented the insured from “know[ing] the nature or wrongfulness of an
act” or deprived the insured “of the ability to control his conduct.” Id. at 331; see also
B.M.B. v. State Farm Fire & Cas. Co., 664 N.W.2d 817, 826 (Minn. 2003) (holding that a
court may not infer an intent to injure from an insured’s nonconsensual sexual contact if
8
there is a genuine dispute of material fact about whether an insured’s acts are
“unintentional” because of mental illness). However, appellants do not cite legal authority
applying the intent requirement—or the related inquiry into whether the insured understood
or could control his conduct—to policy provisions other than an intentional-acts exclusion.
Moreover, this court has declined to inquire into subjective intent when interpreting
policy provisions that do not reference intent. SECURA Supreme Ins. Co. v. M.S.M., 755
N.W.2d 320, 325 (Minn. App. 2008), rev. denied (Minn. Nov. 18, 2008). In SECURA, we
interpreted a criminal- acts exclusion that excluded coverage for a “bodily injury” that
“[r]esults from the criminal acts of any insured.” Id. at 322. We “decline[d] to graft onto
the clause’s plain language an additional, separate inquiry regarding the intent of the
tortfeasor in causing the injury.” Id.
Here, we similarly conclude that this sexual-misconduct provision does not require
an inquiry into the insured’s subjective intent. We come to this conclusion for two reasons:
the provision’s plain language does not explicitly require intent, and the provision’s
examples of sexual misconduct do not create an implicit intent or motivation requirement.
First, the plain language of the sexual-misconduct provision lacks an explicit
reference to intent. In that way, the language of the sexual-misconduct provision differs
from the distinct—and narrower —language of the intentional-acts exclusions in Wicka,
B.M.B., and the policies here. The policies’ bodily- injury definition omits injury that
“arises of out . . . any actual, alleged, or threatened sexual misconduct.” By contrast, the
intentional-acts exclusions in the policies specify that the bodily injury be “expected or
intended” by an insured, “expected by, directed by, or intended by” an insured, or “the
9
result of an intentional and malicious act.” Cf. Wicka, 474 N.W.2d at 326 (excluding
“bodily injury . . . which is expected or intended by the insured”); B.M.B., 664 N.W.2d at
820 n.2 (excluding “personal injury or property damage: a. which is either expected or
intended by [the insur ed]; or b. to any person or property which is the result of [the
insured’s] willful and malicious act, no matter at whom the act was directed”). Thus, unlike
the intentional-acts exclusions, the sexual-misconduct provision does not contain words
invoking intent, e.g., “expected,” “intended,” or “intentional and malicious.” As a result ,
while intentional-act exclusions explicitly require that the person subjectively intended to
cause injury, this sexual-misconduct provision does not explicitly require that the person
intended to act sexually or engage in sexual misconduct.
Second, the examples of sexual misconduct in the policies’ sexual-misconduct
provision do not create an implicit motivation or intent requirement. We are unconvinced
by appellants’ argument that modifying “misconduct” with the word “sexual” creates such
a motivation or intent requirement. Definitions of “sexual” include “[r]elating to,
involving, or characteristic of sex or sexuality, or the sex organs and their functions,” The
American Heritage Dictionary of the English Language 1606 (5th Ed. 2018), or “of,
pertaining to, or for sex,” Random House Webster’s Unabridged Dictionary 1755 (2d Ed.
1998). Thus, the ordinary usage of “sexual” means that the behavior relates to sex or sexual
organs, not that the behavior is sexually motivated or intended to culminate in sexual
intercourse. See Evanston Ins. Co. v. Johns , 530 F.3d 710, 714 (8th Cir. 2008) (applying
Minnesota law and holding that an exclusion for claims “arising out of the actual or alleged
physical contact . . . of a sexual nature” does not require subjective intent). The inclusion
10
of both “sexually motivated physical contact” and “touching of a sexual nature” within the
policies’ scope of sexual misconduct underscores that sexual motivation is distinct from
sexual conduct, and that sexual motivation is not required for conduct to qualify as sexual
misconduct within these policies.
In sum, because the policies’ sexual-misconduct provision does not impose an intent
inquiry for “sexual misconduct,” we do not consider C.E.’s subjective intent when
evaluating whether his conduct constitutes sexual misconduct. We turn next to whether
C.E.’s conduct as alleged by the Walters constitutes sexual misconduct, preclud ing
coverage under the policies.
According to the Walters’ complaint, C.E. pinned R.W. down and engaged in “dry
humping,” requested that R.W. get naked, kissed R.W., “rub[bed]/touch[ed] R.W.’s
vagina,” and, on multiple occasions, tried to put his penis in R.W.’s mouth. We conclude
that these allegations— which involve C.E.’s attempts to stimulate his own genitals and the
actual and attempted touching of another child’s genitals—are consistent with sexual
molestation and touching of a sexual nature , both of which are examples of “sexual
misconduct” identified in the policies. 4 Moreover, the complaint actually alleged that

4 This conclusion accords with the limited number of cases that our research has yielded
from other jurisdictions involving the unfortunate circumstances here—conduct by a young
child. For example, in Cmty. Action for Greater Middlesex Cnty., Inc. v. Am. All. Ins. Co.,
the Connecticut Supreme Court held that the allegations that three preschool boys “grabbed
and fondled” their classmate’s “vagina” was “aptly characterized as sexual abuse and
molestation” and rejected the argument that the boys must have “sexual intent or
motivation” for the exclusion to apply. 757 A.2d 1074, 1076, 1083 (Conn. 2000). And in
Erie Ins. Exch. v. First United Methodist Church, a North Carolina federal district court
found that a four-year-old’s “holding or rubbing of genitalia of another child, licking the
genitalia of another child, pulling down clothing to expose the genitalia of another child
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R.W.’s injuries included “physical and sexual assault.” Thus, despite C.E.’s tender age and
regardless of his subjective state of mind, his alleged conduct qualifies as sexual
misconduct within the policies’ definition. Thus, there is no coverage for the negligence,
vicarious liability, and negligent-supervision-of-a-minor claims premised on C.E.’s alleged
conduct.
B. “Arising Out of” Under the Sexual-Misconduct Provision

We turn next to appellants’ alternative argument that Laicy Erickson’s negligent
operation of the daycare—which underlies the negligence and negligent-supervision
claims—caused a separate harm from the harm caused by C.E.’s conduct. They argue that
separate harm did not “arise out of” sexual misconduct within the meaning of that phrase
in the sexual-misconduct provision.
Under Minnesota law, “arising out of” means “causally connected with and not
proximately caused by.” Meadowbrook, 559 N.W.2d at 419 (quotations omitted). The
relevant inquiry when determining whether there is coverage for a claim is the direct cause
of the injuries. SECURA, 755 N.W.2d at 322, 327.
Appellants assert that Laicy Erickson’s negligence caused harm “wholly unrelated
to C.E.’s conduct.” But according to the complaint, the harms that form the basis of the
negligence and negligent-supervision claims were the “physical and sexual assault” of
R.W.; R.W.’s “substantial fright, fear of imminent harm, anxiety, humiliation and

and kissing” was consistent with the plain and ordinary meaning of abuse and molestation
under the policy’s exclusion, regardless of the child’s intent or motivation. 690 F. Supp.
2d 410, 413-15 (W.D.N.C. 2010).
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indignity, culminating in severe emotional injury”; and the Walters’ “anxiety, humiliation,
and emotional injury.” Appellants do not offer an alternative cause for R.W.’s physical
assault, sexual assault, or other injuries besides C.E.’s conduct, nor do they cite authority
for the proposition that a daycare owner’s negligence or negligent supervision can cause
an independent harm under these circumstances. Thus, because the injuries alleged in the
negligence and negligent-supervision claims were directly caused by—and thus arose out
of—C.E.’s alleged sexual misconduct, we conclude that the negligence and negligent-
supervision claims are outside of the policies’ coverage. See id. at 327.
This determination accords with our prior caselaw evaluating coverage for
negligence and negligent-supervision claims against an insured for injuries caused by a
third party when the insurance policy excludes coverage for injuries that arise out of certain
types of conduct. We concluded that such claims are excluded from coverage when there
is a causal connection between the excluded conduct and the injuries, even if negligence
by the insured also contributed to the injuries. Id. at 322, 327 (excluding negligent-
supervision and negligent-entrustment claims from coverage when injuries were
“undeniably causally connected” to excluded conduct even though “negligence may have
also contributed to the same injuries”); Amos ex rel. Amos v. Campbell, 593 N.W.2d 263,
267, 269 (Minn. App. 1999) (excluding negligent-hiring, negligent-supervision, and
negligent-retention claims from coverage because of the “causal connection” between the
injuries and excluded conduct). Similarly, here, appellants cannot obtain coverage by
alleging that Laicy Erickson was negligent in operating the daycare.
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We are also guided by the supreme court’s decision in Miller. There, the supreme
court held that there was no coverage for negligence claims premised on sexual assault
where the policy’s definition of bodily injury “does not include: . . . the actual, alleged, or
threatened molestation of a person.” Miller, 589 N.W.2d at 299. The sole issue was the
insurer’s duty to defend and indemnify an insured against negligence and negligent-
infliction-of-emotional-distress claims premised on the insured’s failure to prevent sexual
abuse of a child committed by the insured’s husband. The supreme court held that “[t]he
plain language of the policies provides no coverage for injury in the form of sexual
molestation regardless of whether the injury was caused by an insured or the injury could
have been prevented by an insured.” Id. at 300. Likewise, R.W.’s injuries are not covered
even if the Ericksons’ negligence allegedly contributed to those injuries.
In sum, we conclude that the district court properly determined that the negligence,
vicarious liability, and negligent-supervision- of-a-minor claims are not covered by the
Ericksons’ policies because the sexual-misconduct provision does not require the
subjective intent to act sexually and because C.E.’s conduct was the direct cause of the
alleged harms.
II. Defamation Claim
Appellants also contend, for the first time on appeal, that there is coverage for the
defamation claim based on a negligence theory. They argue that the intentional- acts
exclusion does not bar coverage because the claim may be based on the Ericksons’
negligent—rather than intentional—false statements.
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The Walters’ complaint did not specifically identify the allegedly defamatory
statements, but the defamation claim appears to be based on denials by the Ericksons that
C.E.’s conduct occurred. Appellants do not dispute that the Walters’ complaint alleged
only that the Ericksons intentionally made false statements. But appellants claim that a
North Star investigatory report—in which Laicy Erickson denies that C.E. engaged in the
alleged conduct—indicates that she may have believed at the time that her statements were
truthful and thus may have made the false statements negligently.
We decline to reach the merits of this argument. Appellate courts generally do not
consider an issue not raised before the district court, and a party may not “obtain review
by raising the same general issue litigated below but under a differe nt theory.” Thiele v.
Stich, 425 N.W.2d 580, 582 (Minn. 1988). Appellants assert that they raised the negligent-
defamation theory in the district court, but we did not find any reference to this theory in
the record. Although appellants argued in the district court that the defamation claim did
not arise out of intentional sexual misconduct, appellants did not argue that Laicy
Erickson’s alleged defamatory statements were made negligently rather than intentionally.
Thus, because appellants did not advance a negligent-defamation theory before the district
court, this argument is forfeited.
Affirmed.