Unknowingly making an illegal sale of wheat seed to an undercover investigator was not an intentional act barring coverage. Parker v. Farm Bureau Prop. & Cas. Ins. Co., 2015 U.S. Dist. LEXIS 15273 (D. Kansas Nov. 16, 2015). Parker was the co-owner of D&B Parker Farms, LLC. He held a property and liability policy from Farm Bureau. The policy covered personal injury/advertising injury, which provided coverage for injuries caused by infringement or misappropriation of copyright, trademark, title, or disparagement of an organization's goods or products. In September 2013, Parker advertised wheat seed for sale. The advertisement stated that the wheat consisted of a three-variety blend, including the Fuller variety. Parker did not know that the Fuller variety was a federally protected variety under the Plant Variety Protection Act ("PVPA"). Further, Parker did not know of the existence of the PVPA or the protections that it granted to owners of varieties of seed wheat. The Kansas Wheat Alliance ("KWA") held a certificate giving it the exclusive license to make, use and sell the Fuller variety of wheat. KWA hired an investigator who purchased 172 bushels of wheat from Parker. KWA subsequently sued Parker and D&B Parker Farms for treble damages pursuant to the PVPA. Parker tendered the defense to Farm Bureau, who denied coverage and refused to defend. In the coverage suit that followed, Farm Bureau moved to dismiss the complaint. Farm Bureau's policy contained an "intentional act" exclusion which provided in part: "There is no coverage for any loss [or] damage . . . arising out of any act which is expected or intended by an insured to cause injury to any person or damage to any property belonging to . . . others." Farm Bureau argued the PVPA claims fell within the exclusion because the insureds voluntarily and intentionally advertised and sold Fuller variety wheat seed. The court rejected this interpretation as inconsistent with the plain language of the exclusion. There was no doubt that the insureds intentionally advertised and sold Fuller wheat seed. But the focus of the exclusion was on whether the insured expected or intended to cause an injury, not on whether the insured intentionally did something that resulted in injury. Having never heard of the PVPA, the insureds clearly did not expect or intend their sales of Fuller wheat to cause injury to someone else's property. Nor could it be said that injury to another's property was substantially certain to result from the nature of the insureds' actions. Engaging in a sale of wheat without knowledge that another person had a protected property interest in that variety could not reasonably be characterized as causing "an expected or intended injury." Therefore, the motion to dismiss was denied.
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