UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

┐ SHH HOLDINGS, LLC, │ Plaintiff-Appellee, │ > No. 22-3283 │ v. │ │ ALLIED WORLD SPECIALTY INSURANCE COMPANY, │ Defendant-Appellant. │ ┘

Appeal from the United States District Court for the Northern District of Ohio at Cleveland. No. 1:19-cv-02900—James S. Gwin, District Judge.

Argued: March 9, 2023

Decided and Filed: April 21, 2023

Before: GIBBONS, BUSH, and MATHIS, Circuit Judges.

_________________

COUNSEL ARGUED: Charles W. Chotvacs, DYKEMA GOSSETT, PLLC, Washington, D.C., for Appellant. Michael P. O’Donnell, BROUSE MCDOWELL, LPA, Cleveland, Ohio, for Appellee. ON BRIEF: Charles W. Chotvacs, DYKEMA GOSSETT, PLLC, Washington, D.C., Monica A. Sansalone, GALLAGHER SHARP, LLP, Cleveland, Ohio, for Appellant. Michael P. O’Donnell, David Sporar, BROUSE MCDOWELL, LPA, Cleveland, Ohio, for Appellee. _________________

OPINION _________________

JULIA SMITH GIBBONS, Circuit Judge. Plaintiff-appellee SHH Holdings, LLC, sued defendant-appellant Allied World Specialty Insurance Company (“Allied World”) after Allied World declined insurance coverage for SHH’s settlement of certain employees’ retaliation claims No. 22-3283 SHH Holdings, LLC v. Allied World Specialty Ins. Co. Page 2

under the False Claims Act. SHH sued for breach of contract and breach of the duty of good faith and fair dealing, seeking a declaratory judgment and money damages. The district court granted summary judgment to SHH on its breach of contract and declaratory judgment claims and to Allied World on the bad faith claim. The district court also granted attorney fees to SHH, finding that Ohio law permits fees when an insured party is forced to litigate to obtain coverage. Allied World appeals both the grant of summary judgment and the award of attorney fees. Because the plain language of SHH’s policy excluded coverage for the retaliation claims, we reverse.

I.

On November 1, 2016, a False Claims Act qui tam action was filed under seal1 in the Eastern District of Virginia and named as defendants SHH Holdings, LLC, its subsidiaries, and several nursing facilities allegedly owned by or that contracted with SHH (collectively “SHH”). The sealed complaint alleged that SHH violated the False Claims Act by providing unreasonable and unnecessary services to patients for the purpose of claiming the highest possible Medicare reimbursement. The qui tam action had been brought by three co-relators,2 who also alleged in the complaint that SHH retaliated against them for internally reporting the fraudulent billing practices. The qui tam complaint included four counts—three counts alleging fraudulent claims- submission practices and one count alleging retaliation against employees who reported the fraudulent activity.

On January 20, 2017, SHH received a Civil Investigation Demand (“CID”) from the United States Department of Justice (“DOJ”). The CID informed SHH that it was the subject of a pending False Claims Act investigation for fraudulent cl