In the

    United States Court of Appeals
                 For the Seventh Circuit
                     ____________________
No. 23-1478
ATAIN SPECIALTY INSURANCE CO.,
                                                    Plaintiff-Appellee,
                                  v.

BAILEY WATSON,
                                                Defendant-Appellant.
                     ____________________

        Appeal from the United States District Court for the
                     Southern District of Illinois.
      Nos. 3:21-cv-00415, 3:21-cv-01259 — J. Phil Gilbert, Judge.
                     ____________________

   ARGUED DECEMBER 8, 2023 — DECIDED MARCH 11, 2024
               ____________________

   Before SYKES, Chief Judge, and RIPPLE and ROVNER, Circuit
Judges.
    PER CURIAM. Bailey Watson was struck and seriously in-
jured by a truck with an attached woodchipper. She then
brought an action against the driver, James Hodge, in Illinois
state court. Her complaint set forth claims of negligence
against Hodge and of vicarious liability against his company,
Riverbend Tree Service (“Riverbend”), a tree removal and
trimming business. Hodge’s insurer, Atain Specialty
2                                                  No. 23-1478

Insurance Company (“Atain”), then filed a complaint for de-
claratory judgment in federal district court, seeking a declara-
tion that it had no obligation to defend or to indemnify
Hodge.
    After obtaining a default judgment against Hodge in state
court, Ms. Watson filed a garnishment action against Atain,
which Atain removed to federal court. The district court con-
solidated the two actions, and later granted Atain the re-
quested declaration, dismissed Ms. Watson’s garnishment ac-
tion, and entered judgment accordingly. We agree that the ac-
cident is excluded from coverage under both of Hodge’s in-
surance policies, and we therefore affirm the judgment of the
district court.
                                 I
                      BACKGROUND
    In August 2020, Ms. Watson was severely injured by
Hodge’s truck with an attached woodchipper. According to
Ms. Watson, when the accident occurred, “Hodge was driv-
ing his 1986 Ford F-150 truck with woodchipper attached”
and “was in the process of leaving [his] property . . . to dump
a load of tree limbs, tree trunks and other tree removal by-
                                     1
product due to his work efforts.” Ms. Watson “was a pedes-
trian walking near [Hodge’s] vehicle when [his] truck and/or
wood chipper struck her, knocked her to the ground, and
                             2
traversed over her body.” Ms. Watson filed suit against
Hodge in Illinois state court.


1 R.1-1 at 2.

2 Id.
No. 23-1478                                                   3

    At the time of the accident, Hodge, doing business as
Riverbend, held two insurance policies with Atain: an errors
and omissions policy and a commercial general liability pol-
icy. Hodge’s errors and omissions policy excluded coverage
for “bodily injury” arising out of the use of an “auto,” which
the policy defined as “a land motor vehicle . . . designated for
travel on public roads, including any attached machinery or
                 3
equipment.” His commercial general liability policy also ex-
cluded coverage for bodily injury arising out of the use of any
auto. But unlike the errors and omissions policy, the commer-
cial general liability policy contained an operation “excep-
tion” to the auto “exclusion.” That operation exception pro-
vided coverage for bodily injury arising out of “[t]he opera-
tion of machinery or equipment that was attached to, or part
of, a land vehicle that would qualify under the definition of
‘mobile equipment’ if it were not subject to a compulsory or
financial responsibility law or other motor vehicle insurance
                                                    4
law where it is licensed or principally garaged.”
   In its action for declaratory relief in federal court, Atain
contended that it had no duty to defend or to indemnify
Hodge for Ms. Watson’s injuries. In her state tort action,
Ms. Watson ultimately obtained a default judgment against
Hodge when he failed to appear. She then filed a garnishment
proceeding against Atain. Atain subsequently removed the
garnishment proceeding to federal court, and the district
court consolidated the two proceedings. The parties filed
cross-motions for summary judgment.


3 R.1-5 at 25.

4 Id. at 61.
4                                                    No. 23-1478

    The district court granted Atain’s motion and denied
Ms. Watson’s. In determining whether Atain had a duty to
defend Hodge in the underlying lawsuit, the district court
viewed the “central question” as whether the woodchipper
was in operation when Ms. Watson was injured. Atain Spe-
cialty Ins. Co. v. Hodge, No. 21-cv-00415, 

, at
*5 (S.D. Ill. Feb. 13, 2023). Because “[t]he woodchipper was not
being actively used, running, or otherwise turned on during
the instant accident,” the district court concluded that “[t]he
undisputed facts indicate[d] the woodchipper was not in op-
eration.” Id. at *6. Therefore, the auto exclusion in each of
Hodge’s insurance policies barred coverage, and Atain had
no duty to defend or to indemnify Hodge in the underlying
lawsuit. The district court dismissed Ms. Watson’s garnish-
ment action on the same ground.
    Ms. Watson timely appealed.
                                II
                        DISCUSSION
    We review the district court’s grant of summary judgment
de novo. Am. Bankers Ins. Co. of Florida v. Shockley, 

 (7th Cir. 2021). Because this dispute comes to us under the
district court’s diversity jurisdiction, we apply state substan-
tive law. Erie R.R. Co. v. Tompkins, 

 (1938); Nat’l
Am. Ins. Co. v. Artisan & Truckers Cas. Co., 

(7th Cir. 2015). The parties do not dispute that Illinois law ap-
plies.
    Our “primary objective in construing the language of [an
insurance policy] is to ascertain and give effect to the inten-
tions of the parties as expressed in their agreement.” Am.
States Ins. Co. v. Koloms, 

 (Ill. 1997). In doing
No. 23-1478                                                      5

so, we “must construe the policy as a whole and take into ac-
count the type of insurance purchased, the nature of the risks
involved, and the overall purpose of the contract.” 

    When determining whether an insurer has a duty to de-
fend under Illinois law, we compare the allegations in the un-
derlying complaint to the provisions of the insurance policy.
Pekin Ins. Co. v. Wilson, 

, 1016–17 (Ill. 2010)
(citing Koloms, 

). “The allegations in the un-
derlying complaint must be liberally construed in favor of the
insured,” Outboard Marine Corp. v. Liberty Mut. Ins. Co., 

 (Ill. 1992), and “[a]n insurer may not justi-
fiably refuse to defend an action against its insured unless it
is clear from the face of the underlying complaints that the
allegations fail to state facts which bring the case within, or
potentially within, the policy’s coverage.” U.S. Fidelity &
Guar. Co. v. Wilkin Insulation Co., 

 (Ill. 1991)
(emphasis removed). Illinois courts thus apply the so-called
“eight-corners rule,” comparing “the four corners of the un-
derlying complaint with the four corners of the insurance con-
tract.” Pekin Ins. Co. v. St. Paul Lutheran Church, 

,
951 (Ill. App. Ct. 2016); Farmers Auto. Ins. Ass’n v. Country Mut.
Ins. Co., 

 (Ill. App. Ct. 2000). We there-
fore compare Ms. Watson’s complaint to both of Hodge’s in-
surance policies, and ask whether it is clear that the accident
is not covered by either policy.
    Because Hodge’s errors and omissions policy contains no
exclusion to its auto exception, the accident is not covered by
that policy, which forecloses coverage when bodily injury
arises out of the use of an auto. Hodge’s Ford F-150 truck fits
the policy’s definition of an auto, which it describes as “a land
motor vehicle . . . designated for travel on public roads,
6                                                  No. 23-1478

                                                        5
including any attached machinery or equipment.” Atain
therefore has no duty to defend based on Hodge’s errors and
omissions policy.
    Nor does Hodge’s commercial general liability policy pro-
vide coverage. Coverage under this policy requires that two
conditions be met: (1) the woodchipper must have been in op-
eration at the time of the accident, and (2) the truck must have
qualified as mobile equipment had it not been subject to a
compulsory or financial responsibility law or other motor ve-
hicle insurance law. Because we conclude that the woodchip-
per was not in operation, we need not reach the question of
whether the truck would have constituted mobile equipment
had it not been subject to certain vehicle laws.
   We agree with our colleague in the district court that the
woodchipper cannot be considered in operation at the time of
the accident. The policy does not define “operation,” and so
we look to the “plain, ordinary, and popular meaning” of the
term. Founders Ins. Co. v. Munoz, 

 (Ill.
2010). According to one dictionary definition, “operation”
means “the quality or state of being functional or operative.”
Merriam-Webster’s Collegiate Dictionary 869 (11th ed. 2020).
Here, the truck itself was in operation, but that is not enough.
The operation exclusion applies—and therefore an accident is
covered by the policy—when bodily injury arises out of “[t]he
operation of machinery or equipment that is attached to, or part
                      6
of, a land vehicle.” The woodchipper was not being operated
at the time of the accident, but rather passively pulled behind


5 R.1-5 at 25.

6 Id. at 61 (emphasis added).
No. 23-1478                                                    7

the truck. The operation exception, therefore, does not apply.
See Rakestraw v. S. Guar. Ins. Co. of Georgia, 

 (11th Cir. 2008) (holding that operation exception to the
auto exclusion did not apply to accident involving pickup
truck transporting air compressor because “transportation of
the air compressor did not constitute its operation”); Berkley
Reg’l Specialty Ins. Co. v. Dowling Spray Serv., 

 (S.D. 2015) (holding that road accident between motorcy-
cle and John Deere tractor used for spraying crops was not
covered under operation exception because sprayer was not
in operation but rather traveling as land vehicle); cf. Artisan &
Truckers Cas. Co. v. Burlington Ins. Co., 

 (7th
Cir. 2024) (noting that power crane attached to truck was in
operation when actively being used to install roof trusses).
Atain had no duty to defend Hodge from Ms. Watson’s un-
derlying lawsuit.
                          Conclusion
   Because the woodchipper was not in operation at the time
of Ms. Watson’s accident, the district court correctly deter-
mined that Atain had no duty to defend or to indemnify
Hodge in the underlying lawsuit.
                                                    AFFIRMED