Revising Prior Order, Georgia Court Holds Two EEOC Charges and Resulting Lawsuit by the Same Claimant Are All Claims “Made or Brought” Before the Applicable Policy Period

The United States District Court for the Northern District of Georgia, applying Georgia law and revising its prior summary judgment order, has held that a restaurant is not entitled to coverage under a claims-made-and-reported policy for two Equal Employment Opportunity Commission (“EEOC”) charges and a resulting lawsuit filed by the same former employee because they are claims because of “one insured event” and therefore are considered “made or brought” on the date of the first EEOC charge before the applicable policy period. PMTD Restaurants, LLC v. Houston Cas. Co., 2022 WL 1398149 (N.D. Ga. Mar. 23, 2022).

A former employee filed an EEOC charge for discrimination against a restaurant on July 19, 2016 and subsequently filed another EEOC charge for retaliation on December 30, 2016. After receiving right-to-sue letters, the employee filed a lawsuit against the restaurant on May 16, 2017. On May 25, 2017, the restaurant provided notice to its insurer under a claims-made-and-reported policy with a December 26, 2016 to December 26, 2017 policy period. The policy provided that claims because of “one insured event,” meaning “insured events” that are related by an unbroken chain of events or made or brought by the same claimant, are deemed “made or brought” on the date of the first such claim.  The insurer denied coverage on the grounds that there was no claim “made or brought” during the applicable policy period. After prevailing at trial, the restaurant filed coverage litigation seeking reimbursement for its defense costs in connection with the EEOC charges and the lawsuit.

In a prior order, the court held that the two EEOC charges were separate “claims” and that the restaurant timely reported the retaliation charge and the lawsuit to the extent based on that charge to the insurer during the applicable policy period. As such, the court concluded that “arguably” the insurer should cover defense costs for the second EEOC charge but not the first. PMTD Restaurants, LLC v. Houston Cas. Co., 2021 WL 5033473 (N.D. Ga. Sept. 15, 2021). The court therefore granted partial summary judgment in favor of both the insurer and the restaurant and invited the parties to submit additional motions for summary judgment addressing the application of a provision in the policy requiring notice of any claim within 60 days or as soon as practicable.

On the insurer’s second motion for summary judgment, the court revised its prior ruling and held that the policy did not provide any coverage for the either of the underlying EEOC charges or the lawsuit. As an initial matter, the court found good cause to reconsider or revise its prior order because the insurer’s arguments were meritorious, and the restaurant was not prejudiced because it had an opportunity to respond to the insurer’s arguments. On the merits, the court held that, because both EEOC charges and the lawsuit were brought by the same claimant, they are claims because of “one insured event” and are therefore deemed “made or brought” on the date of the first EEOC charge before the policy period. Because there was no claim “made or brought” during the policy period, the restaurant was not entitled to coverage.  


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