In the

    United States Court of Appeals
                 For the Seventh Circuit
                     ____________________
No. 23-1847
GRINNELL MUTUAL REINSURANCE CO.,
                                                   Plaintiff-Appellee,
                                 v.

S.B.C. FLOOD WASTE SOLUTIONS, INC. F/K/A FLOOD WASTE
SOLUTIONS, INC., BRIAN J. FLOOD, SHAWN FLOOD, CHRISTOPHER
FLOOD, AND KAREN S. COLEY,
                                      Defendants-Appellants.
                     ____________________

         Appeal from the United States District Court for the
           Northern District of Illinois, Eastern Division.
         No. 1:18-cv-04922 — Harry D. Leinenweber, Judge.
                     ____________________

     ARGUED APRIL 4, 2024 — DECIDED AUGUST 21, 2024
                ____________________

   Before EASTERBROOK, HAMILTON, and KOLAR, Circuit
Judges.
   KOLAR, Circuit Judge. This insurance litigation arises be-
cause of a family business dispute over use of the name
“Flood” in connection with the waste collection and hauling
business in the Chicago area. While the underlying family dis-
pute is rather heated and convoluted, resolution of this case
2                                                 No. 23-1847

comes down to a straightforward application of Illinois insur-
ance law. Shortly after a series of tense meetings and exchang-
ing letters between lawyers, Defendant-Appellant S.B.C.
Flood Waste Solutions, Inc. obtained insurance from Plaintiff-
Appellee Grinnell Mutual Reinsurance Co., without disclos-
ing the family dispute. SBC Flood and other individuals were
soon sued and sought to have Grinnell cover the costs of the
legal defense. Grinnell refused and instead filed this lawsuit
seeking rescission of the insurance policies.
    The district court granted summary judgment in favor of
Grinnell, finding it was entitled to rescind the insurance poli-
cies based on material misrepresentations. SBC Flood and the
individual defendants appeal. We affirm.
                       I.     Background
    Until the end of 2017, Brian Flood and his two sons, Chris
Flood and Shawn Flood, worked in sales at Flood Brothers
Waste Disposal Company (which is not a party to this appeal).
Flood Brothers is a waste collection and hauling business
founded by Brian’s father (and Chris’s and Shawn’s grandfa-
ther) Mike Flood. In addition to working in sales at Flood
Brothers, Chris also owned and operated a side business
known as “Flood, Inc.” beginning in 2014. Flood, Inc. pro-
vided similar waste collection and hauling services, ostensi-
bly for clients that Flood Brothers could not or did not want
to service.
    While the entire history of what happened is not necessary
to resolve this appeal, suffice it to say that by October 2017,
trouble began brewing. After a tense meeting on October 5,
Brian, Shawn, and Chris were all pushed out of the family
business Flood Brothers and were told that Chris needed to
No. 23-1847                                                   3

stop “using the Flood name” in connection with his side busi-
ness, Flood, Inc.
    Matters escalated when Flood Brothers’ attorney sent
Brian and Chris a letter demanding they “cease and desist any
commercial use of ‘Flood, Inc.’” because “[u]se of the name
‘Flood, Inc.’ interferes with the protected proprietary name of
‘Flood Bros Disposal Co. & Recycling.’” Chris tried to smooth
things over with his grandfather, but he was unmoved and
told Chris, “[y]ou are using my name and … stealing from
me.” As for Shawn, when he was fired from Flood Brothers,
he was told it was because he was “the contact for another
firm, which interferes in proprietary rights of Flood Brothers
account obligations.”
    Within 24 hours of his sons’ respective firings for using the
Flood name in connection with another waste collection and
hauling company, Brian’s fiancée Karen Coley filed incorpo-
ration papers with the State of Illinois for a new entity named
“Flood Waste Solutions, Inc.” Brian, Chris, and Shawn all be-
came owners or employees of this new company.
    The recently fired Floods also began to lawyer up. Chris’s
attorney responded to Flood Brothers’ cease-and-desist letter
“for settlement purposes,” contesting Flood Brothers’ asser-
tions that Flood, Inc. interfered with any of Flood Brothers’
rights and claiming that Chris was owed money by his former
employer. The letter further told Flood Brothers that it had “a
legal obligation” to maintain documents and evidence “which
may be relevant to the subject matter of, or discoverable in any
potential action arising from this matter.” Brian met with his
lawyer about the name and logo of “Flood Waste Solutions,
Inc.” His lawyer advised him to add “SBC” to the company’s
name (presumably for Shawn, Brian, and Chris) and to ensure
4                                                 No. 23-1847

those letters were emphasized compared to the word Flood.
Brian was told to make sure that the name Flood didn’t
“jump” out. Brian testified that he consulted with lawyers be-
cause he “didn’t want to get sued” and “wanted to make sure
that everything we did was legal.” On January 15, 2018, less
than two weeks after the email with counsel, Flood Waste So-
lutions, Inc. filed paperwork to change its name to S.B.C.
Flood Waste Solutions, Inc.
    With all these events barely in the rearview mirror, SBC
Flood applied for insurance on February 9, 2018. SBC Flood
submitted a series of applications through a broker with in-
formation regarding its past, present, and planned opera-
tions. When the Commercial General Liability and Commer-
cial Auto applications asked for SBC Flood’s loss history, in-
cluding “all claims or losses (regardless of fault and whether
or not insured) or occurrences that may give rise to claims,”
SBC Flood checked a box indicating “None” on both applica-
tions. The applications did not contain any mention of the dis-
pute with Flood Brothers or the attempts to settle the dispute.
When the same applications asked whether any of the SBC
Flood principals had “other business ventures for which cov-
erage is not requested,” SBC Flood indicated “No” on the ap-
plication, giving no indication as to the existence of Chris’s
company Flood, Inc., which was providing garbage-related
services (through subcontractors and without insurance)
throughout this time. With no loss history, potential claims or
occurrences, or other business ventures referenced in the ap-
plication, Grinnell approved and issued a Commercial
No. 23-1847                                                            5

General Liability and Commercial Auto policy to SBC Flood
effective February 12, 2018. 1
     Less than three months after SBC Flood obtained insur-
ance from Grinnell, the Flood family dispute intensified, and
the threatened litigation came to fruition. Flood Brothers sued
SBC Flood and the individual defendants on May 10, 2018, in
Illinois state court alleging improper and unfair use of the
“Flood” name in connection with waste collection and haul-
ing services in the Chicagoland area. See Flood Bros Disposal
Co. v. S.B.C. Flood Waste Solutions, Inc., et al., No. 2018 CH
000608.
    SBC Flood tendered the lawsuit to Grinnell and sought
coverage to pay for its legal defense. Grinnell in turn filed this
lawsuit seeking a declaration that it had no duty to defend
and to rescind the insurance policies. At the conclusion of dis-
covery, and after the district court ruled the state court law-
suit was within the scope of the policy (assuming it was valid),
Grinnell moved for summary judgment on its policy rescis-
sion claim on the grounds that SBC Flood had made materi-
ally false statements in its insurance applications.
    The district court granted Grinnell’s motion for summary
judgment, finding that the undisputed evidence demon-
strated three categories of false statements in SBC Flood’s in-
surance applications. First, not disclosing any “claims or
losses or occurrences that may give rise to losses.” Second,
failing to disclose the existence of Flood, Inc. as an “other


    1 On June 13, 2018, SBC Flood also submitted a subsequent application

for umbrella liability insurance that likewise omitted any reference to
Flood, Inc. or a potential dispute with Flood Brothers, which by then had
become a pending lawsuit.
6                                                  No. 23-1847

business venture.” Third, the district court found that while
SBC Flood “verified throughout both the CGL and Auto Ap-
plications that SBC [Flood] had not begun any business activ-
ity prior to March 1, 2018,” this was false because the district
court determined SBC Flood in fact operated for months prior
by using Flood, Inc. as an alter ego.
    The district court further found SBC Flood’s false state-
ments material. The judge relied upon an undisputed decla-
ration from Karen Faas, a senior underwriter at Grinnell who
was responsible for the decision to bind and issue the insur-
ance policies for SBC Flood. She outlined how Grinnell con-
siders businesses in the ‘garbage, ash or refuse collecting’ in-
dustry to be a higher risk than most other businesses. She ex-
plained how Grinnell relies on disclosure of any claims his-
tory or occurrences that may give rise to claims in evaluating
an application because companies with prior or pending
claims often represent an increased risk for insurance compa-
nies. The underwriter further testified that had SBC Flood dis-
closed the conversations with Flood Brothers founder Mike
Flood where he accused his son and grandsons of unfair com-
petition or the cease-and-desist letter from Flood Brothers at
the time of the application, she would have rejected the appli-
cations.
    Grinnell’s underwriter did not say that the failure to dis-
close Flood, Inc. would have definitively led her to reject the
application. However, she did indicate she would have re-
quested additional information, including details about the
company’s operations and insurance coverage (which Flood,
Inc. did not have) prior to issuing the policies.
No. 23-1847                                                       7



                           II.    Analysis
    We review a grant of summary judgment de novo, con-
struing the evidence and drawing all reasonable inferences in
the non-moving party’s favor. O'Brien v. Caterpillar Inc., 

 (7th Cir. 2018). Stated differently, we do not de-
fer to the district court’s factual findings or legal conclusions;
we instead review on “a clean slate.” Xiong v. Bd. of Regents of
Univ. of Wis. Sys., 

 (7th Cir. 2023). We are like-
wise not cabined by how the district court decided the case
and may affirm summary judgment “on any ground sup-
ported in the record, so long as that ground was adequately
addressed in the district court and the nonmoving party had
an opportunity to contest the issue.” W. Side Salvage, Inc. v.
RSUI Indem. Co., 

 (7th Cir. 2017).
    The parties agree that Illinois law governs this dispute.
Section 154 of the Illinois Insurance Code, 215 ILCS § 5/154,
“allows insurers to deny coverage and rescind a policy if (1) a
statement in the policy application is false and (2) the false
statement either was made with the intent to deceive the in-
surer or materially affects the acceptance of the risk assumed
by the insurer.” Essex Ins. Co. v. Galilee Med. Ctr. S.C., 

 (7th Cir. 2016) (quoting Ill. State Bar Ass'n Mut. Ins.
Co. v. Law Office of Tuzzolino & Terpinas, 

 ¶ 17.
The second element is disjunctive: a policy may be rescinded
for a false statement that was either (1) “made with intent to
deceive” or (2) “materially affects the acceptance of risk as-
sumed.” Id.; see also Ill. State Bar Ass'n, 

 ¶ 17. “If
the misrepresentation materially affects the insurer’s ac-
ceptance of the risk, it does not matter that one of the parties,
or an insured, might not have been to blame for the
8                                                     No. 23-1847

misrepresentation.” Ill. State Bar Ass’n, 

 ¶ 17. In
other words, “under § 154, ‘a misrepresentation, even if inno-
cently made, can serve as the basis to void a policy’” so long
as it is material. Essex Ins., 

 (quoting Golden Rule
Ins. Co. v. Schwartz, 

 (2003)).
    To determine materiality, Illinois law has long used an ob-
jective test that asks whether a “reasonably careful and intel-
ligent” underwriter “would have regarded the facts as stated
as substantially increasing the chances of the event insured
against, so as to cause a rejection of the application or different
conditions.’” Weinstein v. Metro. Life Ins. Co., 

(1945). “Testimony from an insurer’s underwriter may be
used to establish the materiality of omitted information.” Es-
sex Ins., 

 (citing Small v. Prudential Life Ins. Co.,

 (1993)). An insurer need not “show
that truthful statements by the insured would have caused the
insurer to reject the application entirely.” 

 Instead, a mis-
representation is material if it “‘affects either the acceptance
of the risk or the hazard assumed’ by the insurer.” 

 (quoting
215 ILCS § 5/154). “Incomplete answers or a failure to disclose
material information in response to a question in an applica-
tion may thus constitute a material misrepresentation.” N. Life
Ins. Co. v. Ippolito Real Est. P’ship, 

(1992).
    It is undisputed that SBC Flood omitted the dispute over
use of the Flood name from its applications. SBC Flood was
acutely aware of a live dispute based on the events that tran-
spired in the prior three months. This includes the October 5
meeting where Brian learned that his son Chris and Flood,
Inc. stood accused of improper competition by using the
Flood name, the cease-and-desist letter addressed to Brian
No. 23-1847                                                                9

and Chris, Shawn’s termination letter, and conversations be-
tween Chris and Mike Flood about whether use of the Flood
last name was “stealing.” It also includes Chris’s counsel’s re-
sponse letter weeks later “for settlement purposes” and advis-
ing Flood Brothers of its obligations to preserve evidence re-
lating to “any potential action arising from this matter.” 2 Fi-
nally, Brian sought advice from counsel around this same
time regarding the name and logo of SBC Flood because he
had concerns that he or SBC Flood might be sued and he
“wanted to make sure that everything we did was legal.”
    In short, undisputed facts show that the dispute that led
to litigation was clearly on the Flood family’s mind at the time
they applied for insurance. SBC Flood’s failures to disclose
any aspect of these events as potential claims against them or
their company—in insurance parlance, “occurrences which
may give rise to claims”—were misrepresentations, whether
intentional or not. Golden Rule Ins., 

 (“a mis-
representation, even if innocently made, can serve as the basis
to void a policy”).
    The second category of false statements is the failure to
disclose the existence of “Flood, Inc.” when the insurance ap-
plications asked whether SBC Flood had any “other business
ventures” for which coverage was not being sought. While
SBC Flood maintains there was no need to disclose Flood, Inc.
because it was a wholly separate company and therefore not
related to SBC Flood, there was no such qualification in the

    2 While the substance of this letter might be inadmissible under Fed.

R. Evid. 408 for purposes of establishing liability in the underlying matters
as an offer of compromise, it aptly demonstrates how Chris was aware of
the potential for litigation between him and Flood Brothers no later than
December 2017.
10                                                      No. 23-1847

application. Insurance applications are construed in accord-
ance with the plain meaning and from the standpoint of an
ordinary and reasonable person. Gillen v. State Farm Mut.
Auto. Ins. Co., 

 (2005). The application asked
for “other business ventures,” and none were disclosed. That
was a misrepresentation.
    Because SBC Flood made misrepresentations in its insur-
ance application, our inquiry moves on to whether those mis-
representations were material. 215 ILCS § 5/154; Essex Ins., 

. Here, we have no difficulty determining that the
misrepresentations were material based on the undisputed
testimony of Grinnell’s underwriter and our precedent.
    In contesting materiality, SBC Flood and the individual
defendants rely heavily on speculation and their own infer-
ences regarding the subjective state of mind of various Grin-
nell employees who were deposed throughout the litigation.
But as discussed above, Illinois law uses an objective test to
determine materiality in the context of insurance policy re-
scission. Weinstein, 39 Ill. at 577; see 215 ILCS § 5/154; Essex Ins.,

. And rescission is proper when a misstatement
is material or intentional as viewed through this objective
lens. Weinstein, 39 Ill. at 577. Objectively, failing to disclose a
dispute that already had led to the parties exchanging letters
threatening litigation is material.
    SBC Flood further argues that to the extent there was any
dispute or occurrence that may give rise to a claim from use
of a name, Flood Brothers only took issue with the specific
name “Flood, Inc.” and not with use of the shared last name
Flood generally. This argument is not supported by the record
or common sense.
No. 23-1847                                                   11

    It is simply inaccurate to frame the ongoing dispute as
only covering the specific name “Flood, Inc.,” as opposed to
general use of the Flood name in connection with Chicago-
area waste collection and hauling. Any notion that SBC Flood
or the individual defendants understood Flood Brothers’ con-
cern in such a way is contradicted by Brian and Chris’s sworn
testimony and actions. After the initial October 2017 meeting,
Brian immediately told his sons to change “Flood, Inc.” to
something “other than Flood.” In December, Chris’s grandfa-
ther and the founder of Flood Brothers told him “you are us-
ing my name and … stealing from me.” The family name is
Flood and there was no mention of “Inc.”
    This is also not the first insurance rescission case where an
insured failed to disclose brewing litigation in their insurance
applications. For example, in TIG Ins. Co. v. Reliable Research
Co., 

 (7th Cir. 2003), a title insurance and es-
crow issuing agent failed to disclose a permanent injunction
barring it from unauthorized practice of law in its insurance
application. When the title company was later sued for violat-
ing the injunction and sought to have its insurer cover the
costs of its defense, the insurer sought rescission. 

 at 632–
633. We affirmed the district court’s grant of summary judg-
ment in favor of the insurer and said “it borders on surreal to
think that the nondisclosure [of the injunction] was immate-
rial.” 

.
   Likewise, in Essex Ins. Co. v. Galilee Medical Ctr. S.C., 

 (7th Cir. 2016), a weight loss medical service provider
answered “no” when an insurance application asked if it
“use[d] drugs for weight reduction for patients” or if it per-
formed “experimental procedures.” 

. Yet at the same
time and thereafter, the company and its physicians regularly
12                                                   No. 23-1847

administered experimental weight loss treatments and drugs.

 When a patient sued for medical negligence after she suf-
fered adverse side effects, the medical provider tendered the
lawsuit to its insurer for defense, and the insurer sought re-
scission. 

. Once again, we affirmed the district court’s
grant of summary judgment under the circumstances and re-
peated that it “borders on the surreal” to think nondisclosure
of the very experimental drug procedure the medical pro-
vider was sued for was somehow immaterial to the insurer’s
acceptance of risk. 

.
    Here, Flood Brothers’ unambiguous demand to cease and
desist use of the Flood name in the Chicago-area waste collec-
tion and hauling business led directly to the lawsuit that SBC
Flood sought to have its insurer defend. There is, thus, an
even greater connection between the non-disclosure and the
risk that materialized than there was in TIG or Essex. Arguing
that an ongoing dispute with a former employer concerning
use of its company name, in the same industry, in the same
geographic area, and that results in a lawsuit alleging exactly
this less than three months after an insurance policy “borders
on the surreal.” TIG Ins., 

; Essex Ins. 

.
    Concerning the materiality of failing to disclose the exist-
ence of Flood, Inc., we are similarly unpersuaded by SBC
Flood’s arguments. While one could imagine instances where
a party’s other business ventures may not be material to an
insurer’s risk, we need not engage in speculation because the
companies were so similar. Here, the other business venture
in question, Flood, Inc., was operating in the same industry,
in the same geographic area, for at least three years at the time
of the applications. What’s more, Flood, Inc. operated without
No. 23-1847                                                       13

ever being insured. This is information that an insurance un-
derwriter would reasonably expect to know before issuing an
insurance policy and not something that any reasonable per-
son would think could be omitted from an insurance applica-
tion for a new company intending to operate in the same in-
dustry and in the same geographic area.
     Lastly, we briefly mention the district court’s conclusion
that from December 2017 to February 2018, SBC Flood and
Flood, Inc. operated as alter egos and should have their cor-
porate separateness disregarded. See Van Dorn Co. v. Future
Chem. & Oil Corp., 

, 569–70 (7th Cir. 1985) (“Under
Illinois law, a corporation … will be disregarded and the veil
of limited liability pierced when two requirements are met:
[F]irst, there must be such unity of interest and ownership
that the separate personalities of the corporation and the in-
dividual [or other corporation] no longer exist; and second,
circumstances must be such that adherence to the fiction of
separate corporate existence would sanction a fraud or pro-
mote injustice.”) (brackets in original).
    Throughout its briefing and at oral argument, SBC Flood
argues that the district court’s decision cannot be affirmed un-
less we affirm the district court’s finding that SBC Flood and
Flood, Inc. operated as alter egos. SBC Flood is incorrect. As
laid out above, there were multiple material misrepresenta-
tions in SBC Flood’s insurance applications—and that re-
mains so without wading into any alter ego analysis, which is
“a highly fact-intensive inquiry.” Cont’l Cas. Co. v. Symons, 

 (7th Cir. 2016); see also Sea-Land Servs., Inc. v. Pep-
per Source, 

 (7th Cir. 1991) (discussing the po-
tential evidentiary difficulties in finding companies are alter
egos of one another at summary judgment). Finding that SBC
14                                                No. 23-1847

Flood’s failure to disclose the existence of Flood, Inc. or the
very real prospect of litigation with Flood Brothers once SBC
Flood started operating in the same industry, does not require
any alter ego finding. We need not go further.
                       III.   Conclusion
     The judgment of the district court is AFFIRMED.