[PUBLISH] In the United States Court of Appeals For the Eleventh Circuit

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No. 20-11617 ____________________ JAMES RIVER INSURANCE COMPANY, a foreign corporation, Plaintiff-Appellant, versus RICH BON CORP., a Florida corporation d.b.a. The Mint Lounge, MARQUELL SHELLMAN, an individual, DAINA HILBERT, as Personal Representative of the Estate of David Hilbert, Defendants-Appellees. USCA11 Case: 20-11617 Date Filed: 05/23/2022 Page: 2 of 19

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Appeal from the United States District Court for the Southern District of Florida D.C. Docket No. 1:16-cv-20273-JEM ____________________ Before BRANCH, GRANT, and BRASHER, Circuit Judges. GRANT, Circuit Judge: Ordinarily, federal courts have no margin for error on questions of our jurisdiction. But Declaratory Judgment Act cases are different, because that statute vests courts with discretion to say whether declaratory relief is appropriate in the underlying conflict. Here that meant deciding whether the federal suit would interfere with a pending state action. The district court chose to dismiss the federal case, concluding that it overlapped significantly with the one in state court. But in the process the court overstepped the bounds of its discretion because it fully assessed only one of the claims for declaratory relief, rather than both of them. We therefore vacate and remand. I. Late one Miami summer night at the Mint Lounge, an argument between acquaintances escalated into a shootout. A guest at the nightclub, Marquell Shellman, was shot. So was club employee David Hilbert, who tragically died from his injuries. USCA11 Case: 20-11617 Date Filed: 05/23/2022 Page: 3 of 19

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The nightclub was insured by James River Insurance Company under a general liability policy, which covered “bodily injury and property damage liability.” The policy contained several restrictions on that coverage. To start, it excluded both worker’s compensation liability and employee-injury liability. The policy also imposed limits on coverage for bodily injuries “arising out of, resulting from, or in connection with” assault or battery. The limit per occurrence was $25,000, and the aggregate assault- and-battery limit was $50,000. A few months after the shooting Shellman sued the nightclub in Florida state court, alleging that it was negligent for failing to provide adequate security; a lawsuit from Hilbert’s estate was expected too. So to determine the full extent of its liability under the policy, James River filed a federal declaratory judgment action against Mint, Shellman, and Hilbert’s estate. The insurer raised two claims in its complaint. First, it contended that because the nightclub shooting was an assault and battery, the policy limited recovery for any and all injuries to $50,000. Second, it argued that the worker’s compensation and employee-injury exclusions barred Hilbert from recovery because he was an employee of the nightclub. The district court stayed the case pending resolution of Shellman’s state court suit. Soon after, James River settled the state suit on the nightclub’s behalf for $50,000 minus claim expenses and costs—the total amount available under the assault and battery cap. USCA11 Case: 20-11617 Date Filed: 05/23/2022 Page: 4 of 19

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Ten months later, Hilbert’s estate sued t