Full Opinion

Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 1 FILED United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS November 3, 2026 FOR THE TENTH CIRCUIT _________________________________ Christopher M. Wolpert Clerk of Court TRI COUNTY TELEPHONE ASSOCIATION, INC., a Wyoming corporation, Plaintiff - Appellant, v. No. 26-8007 (D.C. No. 1:24-CV-00274-KHR) TWIN CITY FIRE INSURANCE (D. Wyo.) COMPANY; THE HARTFORD INSURANCE GROUP, d/b/a Hartford Financial Products, Defendants - Appellees. _________________________________ ORDER AND JUDGMENT * _________________________________ Before EID, CARSON, and FEDERICO, Circuit Judges. _________________________________ Joseph Campbell, then a director of Tri County Telephone Association (TCT), tried to block its acquisition by a different company. His efforts failed, the deal closed, and nearly a year later Campbell filed a class action lawsuit against TCT and some of its former directors and officers. When * This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Federal Rule of Appellate Procedure 32.1 and Tenth Circuit Rule 32.1. Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 2 TCT informed its insurance carrier, Twin City Fire Insurance Company, of the lawsuit and sought coverage for its defense costs, Twin City denied coverage. TCT filed suit against Twin City in the District of Wyoming. It sought a declaratory judgment that its insurance policy with Twin City covered Campbell’s lawsuit. On cross-motions for summary judgment, the district court held the claim was not covered and granted judgment in favor of Twin City. TCT timely appealed. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm. I TCT was a nonprofit telecommunication cooperative with 825 members, with a board of directors consisting of a subset of those members. Joe Campbell was a member of the board. TCT was acquired by BHT Holdings, Inc. and was converted into a privately held Wyoming corporation. Campbell opposed the acquisition but failed to block its passage. For reasons explained below, the dates and sequence of the merger are important to this appeal. The vote approving the merger was certified on December 23, 2014. The former board, including Campbell, tendered its resignation on December 31, 2014, pursuant to a resolution passed at its 2 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 3 final meeting on December 16, 2014. The transaction formally closed on January 2, 2015, the “Effective Time” as defined in the merger agreement. Almost a year after the merger, on December 28, 2015, Joe Campbell and his wife Barbara filed a class action lawsuit against TCT, TCT’s prior board, BHT, Chris Davidson (former CEO), Neil Schnenkler (BHT officer), and outside counsel in Wyoming state court (Campbell Action). The suit alleged breach of fiduciary duty and other claims in connection with the acquisition. The class consisted solely of TCT’s former members, who were also considered as security holders for purposes of the acquisition. On February 8, 2016, Campbell amended the complaint to include Steve Harper, TCT’s former chief financial officer. The amended complaint did not assert new claims. Throughout the litigation, Campbell acted as class representative and actively participated in depositions, class certification, and summary judgment phases. After his death in 2020, he was replaced as class representative. TCT and the individual defendants were granted summary judgment in 2022. TCT had directors and officers (D&O) policy coverage with Twin City that covered both “Entity Claims” and “Insured Person Claims,” as defined in the policy. The policy provided coverage for defense costs for covered claims when there was a duty to defend. The policy also excluded coverage for certain situations, one of which was an insured v. insured exclusion. The 3 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 4 insured v. insured exclusion excluded from coverage claims “brought or maintained by or on behalf any Insureds (in any capacity) or any security holder of an Insured Entity.” Aplt. App. XII at 8. There were several carveouts to the insured v. insured exclusion listed in the policy. Relevant to this appeal is only one: [T]his exclusion shall not apply to the portion of Loss directly resulting from: (5) a civil proceeding by or on behalf of a former Manager who has not served in such capacity for at least one year prior to such Claim being made, provided that such Claim is made without the assistance, participation or solicitation of any current Manager or any former Manager who has served in such capacity during the one year prior to such Claim being made. Id. In the Interrelationship of Claims provision, the policy also provided that “[a]ll Claims based upon, arising from or in any way related to the same Wrongful Act or Interrelated Wrongful Acts shall be deemed to be a single Claim for all purposes under this Policy first made on the earliest date that: (A) any of such claims was first made[.]” Id. at 9 (alterations in original). The policy defines Wrongful Act as “any actual or alleged: (1) error, misstatement, misleading statement, act, omission, neglect, or breach of duty committed by an Insured Person in their capacity as such or in their Outside Capacity, or, with regard to Insuring Agreement (C) an Insured Entity; or (2) matter claimed against an Insured Person, solely by reason of 4 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 5 their serving in such capacity, including service in an Outside Capacity.” Id. Two days after the Campbell Action was filed, TCT “submitted the Campbell [] Action as a claim for coverage under” its policy. Aplt. App. XII at 12. Twin City denied coverage, citing the insured v. insured exclusion amongst other reasons that are not relevant on appeal. TCT and Twin City were unable to resolve their coverage disagreement despite correspondence throughout the litigation of the Campbell Action. TCT therefore paid its own defense fees and costs related to the Campbell Action. Following the denial of coverage, TCT filed suit against Twin City in the District of Wyoming, bringing claims for declaratory judgment, breach of contract, and bad faith. The parties filed cross-motions for summary judgment. The district court granted summary judgment in favor of Twin City on all claims, holding that Twin City had no duty to defend the lawsuit against TCT because coverage was barred by the insured v. insured exclusion and because a carve out did not apply. 1 The district court also held that a carveout similarly did not apply to the subsequent amendment to the 1On appeal, TCT challenges the district court’s ruling on the declaratory judgment claim. The district court noted in its order that the parties did not brief the breach of contract claim during summary judgment. And TCT does not make any arguments as to the district court’s decision on the bad faith claim on appeal. We therefore do not address the district court’s rulings as to these two other claims. 5 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 6 Campbell Action complaint that added defendant Harper because the amendment did not constitute a separate claim from the originally filed complaint. This appeal timely followed. II This appeal requires us to interpret coverage under TCT’s insurance policy. We review a district court’s rulings on cross-motions for summary judgment de novo, apply the same standard as the district court, and view any inferences to be drawn from the record “in the light most favorable to the party that did not prevail[.]” Allen v. Sybase, Inc., 468 F.3d 642, 649 (10th Cir. 2006) (quotation omitted); see also D.K. v. United Behavioral Health, 67 F.4th 1224, 1235 (10th Cir. 2023). Here, we view inferences to be drawn from the record in the light most favorable to TCT. In this diversity suit, we apply the substantive law of the forum state (here, Wyoming) and federal procedural law. Racher v. Westlake Nursing Home L.P., 871 F.3d 1152, 1162 (10th Cir. 2017). When applying state substantive law, we follow the decisions from the state’s highest court and look to the decisions of the state’s lower courts, the district courts, and other state courts, for guidance in predicting what the highest court would do if there is no controlling authority. Wade v. Emcasco Ins. Co., 483 F.3d 657, 665–66 (10th Cir. 2007). 6 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 7 Under Wyoming law, interpreting an insurance policy is a question of law, with courts interpreting insurance policies just as any other contract, beginning with the plain language. Memorial Hosp. of Sweetwater Cnty. v. Menapace, 404 P.3d 1179, 1182 (Wyo. 2017). Courts may not consider extrinsic evidence in absence of an ambiguous contract term. Doctors’ Co. v. Ins. Corp. of Am., 864 P.2d 1018, 1024 (Wyo. 1993). “Because insurance policies represent contracts of adhesion where the insured has little or no bargaining power to vary the terms, if the language is ambiguous, the policy is strictly construed against the insurer.” Id. (citations omitted). Insurers have a duty to defend the insured against lawsuits, which is broader than their duty to indemnify. Insurers have the duty to defend any alleged claim, which on the face of the complaint, “rationally falls within the policy coverage.” Shoshone First Bank v. Pacific Employers Ins. Co., 2 P.3d 510, 513 (Wyo. 2000) (citations omitted). On appeal, TCT challenges the following rulings of the district court: (1) that the insured v. insured exclusion applies; (2) that the former manager carve out did not apply to the Campbell Action; (3) that the allocation provision does not allow for splitting the Campbell Action into covered and excluded Claims; and (4) that the addition of Harper as a defendant to the Campbell Action in February 2016 arose out of the same Wrongful Act and thus also was excluded from coverage. 7 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 8 We will proceed to analyze each contention, noting that on appeal there is no dispute between the parties that: (1) Campbell and the individual defendants in the Campbell Action are Insureds; (2) TCT is an Insured Entity; (3) Campbell is a former Manager and security holder of TCT; (4) all members of the class in the Campbell Action are security holders of TCT; (5) the Campbell Action is an Insured Person Claim and an Entity Claim, and (6) the Campbell Action arose from an alleged Wrongful Act. A TCT’s first argument is that the district court erred by misapplying the insured v. insured exclusion in the policy. As modified to reflect the parties to this case, the insured v. insured exclusion states: [Twin City] shall not pay Loss: *** (H) in connection with any Claim brought or maintained by or on behalf of any Insureds (in any capacity) [e.g., the Campbells] or any security holder [e.g., the Campbells and all class members] of an Insured Entity [TCT.] Aplt. App. V at 122–23. It is undisputed that, as defined in the policy, the Campbell Action is a Claim, Campbell and the individual defendants in the Campbell Action are Insureds, and that TCT is an Insured Entity. Thus, pursuant to the plain language of the policy, the Campbell Action is excluded from coverage. 8 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 9 TCT argues that we should look beyond the plain language of the policy and interpret this exclusion to only bar coverage when there is evidence of collusion or of bitter disputes between board members. For this proposition, TCT principally relies on a Seventh Circuit case, Level 3 Communications, Inc. v. Federal Insurance Company. 168 F.3d 956 (7th Cir. 1999). In Level 3, minority shareholders had brought a securities fraud lawsuit against a company. Id. at 957. Later, a former director of the company joined as a plaintiff. Id. at 957–58. The company’s D&O insurance carrier subsequently denied coverage based on a similarly-worded insured v. insured exclusion in the policy. After some discussion, the Seventh Circuit affirmed the district court’s ruling that the claim arising out of the securities lawsuit was excluded. Id. at 959. In doing so, it explicitly declined to “read the ‘Insured versus Insured’ exclusion in light of its purpose,” which was ostensibly to “exclude coverage both of collusive suits . . . and of suits arising out of those particularly bitter disputes that erupt when members of a corporate . . . family . . . fall to quarrelling.” Id. at 958 (citations omitted). The Seventh Circuit arrived at this decision because “it [was] apparent from the wording [the parties] chose” that they had opted for a “simple, flat rule” that is easily applied rather than a “standard” that “cannot be applied without a potentially costly, time-consuming, and 9 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 10 uncertain inquiry into the nature of the underlying dispute sought to be covered.” Id. (citations omitted). Thus, Level 3 was a textual analysis based upon the plain language of the policy and a holding that cuts the other way from TCT’s argument in this case. Indeed, TCT lacks any support for its argument that the insured v. insured exclusion should be read to only bar coverage when there is evidence of collusion or an intra-board “family feud.” Op. Br. at 23. The policy language doesn’t include those words. Under Wyoming law, we interpret the terms of insurance policies according to their plain language absent an ambiguous term, which TCT does not identify here. Menapace, 404 P.3d at 1182; Ins. Corp. of Am., 864 P.2d at 1024. The district court was correct to find that the Campbell Action was excluded from coverage under the policy’s insured v. insured exclusion. B Finding the Campbell Action falls under the insured v. insured exclusion, our next task is to determine whether a carveout from the exclusion applies. The insured v. insured exclusion contains eight carveouts, but only one is pressed by TCT on appeal. It reads: The insurer shall not pay Loss: *** (H) in connection with any Claim brought or maintained by or on behalf of any Insureds (in any capacity) or any security holder of 10 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 11 an Insured Entity, provided that this exclusion shall not apply to the portion of Loss directly resulting from: *** (5) a civil proceeding by or on behalf of a former Manager who has not served in such capacity for at least one year prior to such Claim being made, provided that such Claim is made without the assistance, participation or solicitation of any current Manager or any Former Manager who has served in such capacity during the one year prior to such Claim being made[.] Aplt. App. V at 122–23. TCT argues that this “former manager” carveout applies here, asserting that Campbell did not serve in the capacity of a director less than a year before the lawsuit was filed. A brief revisit of the acquisition closing timeline is appropriate here. TCT’s final board meeting was December 16, 2014. The board was formally dissolved on December 31, 2014, pursuant to a board resolution unanimously passed at the final board meeting. Campbell filed his lawsuit on December 28, 2015. A common-sense understanding of this timeline is that Campbell served in his capacity as a TCT director until the board was dissolved on December 31, 2014, and thus his lawsuit, brought on December 28, 2015, was less than a year after he ceased to serve in such capacity. This understanding means, upon application of the plain language of the policy, the Campbell Action cannot be carved out from the insured v. insured exclusion pursuant to the former manager carve out. 11 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 12 TCT asserts that the phrase “serv[ing] in such capacity” has a different meaning that should be read in favor of the insured. That is, TCT says this phrase means “actively” serving in the capacity of a director, which means Campbell would have ceased serving in his capacity as director following the final board meeting on December 16, 2014, where Campbell took his last active action as a director by voting on the resolution to dissolve the board. Conveniently, under this interpretation, that also means the Campbell Action was filed just over a year after Campbell ceased to serve as a director and should be carved out from the insured v. insured exclusion. TCT’s argument does not persuade. First, Wyoming courts do not read plain policy language in favor of the insured as TCT asserts – they only read ambiguous language in favor of the insured. See Ins. Corp. of Am., 864 P.2d at 1024. “In the absence of any ambiguity,” as here, “the contract will be enforced according to its terms because no construction is appropriate.” Gumpel v. Copperleaf Homeowners Association, Inc., 393 P.3d 1279, 1290 (Wyo. 2017) (quoting Claman v. Popp, 279 P.3d 1003, 1013 (Wyo. 2012)). Second, TCT’s preferred interpretation of serving in the capacity of a director is contrary to “the plain meaning that a reasonable person would give” to that phrase. Id. (quoting Claman, 279 P.3d at 1013). A general description of the role of a director and some examples are helpful in 12 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 13 illustrating this point. Directors serve for a period or terms, and they meet as a board periodically. Sometimes, board meetings are scheduled and routine, other times they are special, unscheduled meetings. Directors may have other jobs and generally take action as directors at board meetings only. By the very nature of the role of director, there are some, in TCT’s words, “dead duck” periods of their service. Op. Br. at 29. TCT would have us interpret the policy language to mean that directors only serve in such capacity during the limited time when they meet and act as directors. This contention fails the commonsense test. Take this counterfactual for example – if a special board meeting had been called on December 29, 2014, less than a year prior to Campbell’s lawsuit, Campbell would have had to attend that meeting as a director because he was to continue to serve out his term until December 31, 2014, when the board was formally dissolved. Whether a special board meeting was called or not is not the point; the point is that he continued to serve as a director until the date his resignation became effective, even if no meetings were called or action required during that short period of time. Another example comes to mind. Consider an officeholder who is serving in office and who serves the remainder of the term in office following an election in which they are defeated. This officeholder remains in the position until the moment their successor takes office despite being a “lame 13 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 14 duck” after losing that election. This officeholder does not cease serving in office just because the end of the term is contemplated or just because they may not take much, if any, action during the remaining months of the term. Having no legal support for its argument, TCT provides a selection of dictionary definitions for the word “serve” to bolster their contention that the word “connote[s] some activity.” Op. Br. at 29. But these definitions do not counsel a reading that differs from the common sense understanding of the word in this context. Even so, TCT quotes definitions of “serve” as “to work through or complete a period of service,” “be of service or use,” or “meet requirements or needs.” Id. (emphasis added). TCT’s former board completed its period of service when it was dissolved. Its members met requirements or needs and were of service or use by sheer existence, in the event of an unforeseen need for board action between the final board meeting and the dissolution of the board. These definitions simply do not require constant activity on the part of the person who serves. Campbell served in his capacity as director until TCT’s board was dissolved on December 31, 2014, and therefore the Campbell Action, filed December 28, 2015, does not fall under the former manager carve out to the insured v. insured exclusion. 14 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 15 C We now consider TCT’s argument that some smaller portion of the Campbell Action can be allocated coverage under the policy. In support of its argument, TCT again relies on Level 3. The policy in Level 3 had an insured v. insured exclusion that “exclude[d] liability on account of any ‘Claim made against an Insured Person’ if the Claim [was] ‘brought or maintained by or on behalf of any Insured.’” 168 F.3d at 957. The lawsuit had been brought against a company and one of its directors by six of its shareholders, so it was not subject to the insured v. insured exclusion. However, a former director was later added as a plaintiff to the lawsuit, rendering the entire lawsuit subject to the exclusion. Id. at 957–58. The Seventh Circuit, after finding the claim was excluded from coverage under the plain language of the policy’s insured v. insured exclusion, separately held that the language of the allocation clause in the policy meant that the lawsuit as a whole could be split into covered and uncovered claims, with loss being allocated to the covered claims only. Id. at 960. This, the Seventh Circuit said, would avoid “the odd result that a claim fully covered when made could become fully uncovered when another plaintiff was permitted to join it.” Id. Here, TCT argues that most class members in the Campbell Action were only security holders, not former officers or directors like Campbell, 15 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 16 and so those class members’ claims should be considered covered under the policy. But, unlike the language of the policy in Level 3, the insured v. insured exclusion in TCT’s policy applies to Insureds and to “any security holder of an Insured Entity[.]” Aplt. App. V at 123. Therefore, TCT’s argument on this point also fails. All members of the class were at least security holders of TCT, the Insured Entity. So, the insured v. insured exclusion applies to the entire class by its plain terms. There is therefore no need to decide how the allocation clause in the policy operates because it is inapplicable in this case. D TCT’s final argument is that the addition of Harper, TCT’s former CFO, as a defendant in February 2016 should be considered a covered claim. Specifically, TCT argues that Harper’s addition would fall under the former manager carveout since the lawsuit was brought against him over a year after he ceased to serve in his capacity as an officer. We note again that, when the complaint was amended to add Harper as a defendant, no new claims were added to it. The district court was not persuaded by TCT’s argument because the plain text of the policy states that “[a]ll Claims based upon, arising from or in any way related to the same Wrongful Act or Interrelated Wrongful Acts shall be deemed to be a single Claim for all purposes under this Policy first 16 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 17 made on the earliest date that[] . . . any of such claims was first made.” Aplt. App. V at 111. Wrongful Acts under the policy are “any actual or alleged[] . . . error, misstatement, misleading statement, act, omission, neglect, or breach of duty committed by an Insured Person in their capacity as such[.]” Id. at 121. And Interrelated Wrongful Acts under the policy are “Wrongful Acts that have as a common nexus any fact, circumstance, situation, event, transaction, goal, motive, [or] methodology or cause[.]” Id. at 106. Here, the Campbell Action consisted of several claims, primarily for breach of fiduciary duty, brought collectively against TCT and its directors and officers. Again, that complaint was later amended to add Harper, a former officer, without adding additional claims or facts. The allegations brought against Harper were the same as those originally brought against TCT and the other individual defendants, and therefore “arose from” the same Wrongful Act underlying the Campbell Action. The plain language of the policy required that the amendment to add Harper be “deemed to be a single Claim . . . first made” on December 28, 2015, the date the Campbell Action alleging the Wrongful Act was filed. Id. at 111. TCT once more tries to avoid the plain language of the policy by arguing that the claims against Harper constituted a separate Wrongful Act because a Wrongful Act refers to an act by “an” Insured, not “any” Insured 17 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 18 – meaning that Wrongful Acts are person specific. 2 Even assuming TCT’s distinction is correct, it has no answer for the fact that the Interrelationship of Claims provision groups all claims “arising from or in any way related to the same Wrongful Act or Interrelated Wrongful Act.” Aplt. App. V at 111 (emphasis added). So even if claims brought against Harper are a separate Wrongful Act from claims brought against TCT, for instance, the claims against Harper are related to the claims brought against TCT because they arose from the acquisition and are based on the entirely same set of facts using entirely the same legal theories. And because the policy plainly states that claims relating to the same Wrongful or Interrelated Wrongful Acts are to be deemed one Claim first made on the earliest date that any of the claims were first made, the Campbell Action, even as amended to add Harper, is one Claim first made on December 28, 2015. Therefore, the February 2016 amendment to the Campbell Action remained completely excluded from coverage under the insured v. insured exclusion. 2 TCT also attempts to avoid the unambiguous plain language of the terms by appealing to policy arguments. Policy arguments cannot overcome the plain reading of unambiguous contract language. See Copperleaf Homeowners Association, Inc., 393 P.3d at 1290 (“In the absence of any ambiguity, the contract will be enforced according to its terms[.]” (quotation omitted)). 18 Appellate Case: 26-8007 Document: 31-1 Date Filed: 11/03/2026 Page: 19 AFFIRMED. Entered for the Court Richard E.N. Federico Circuit Judge 19