The U.S. District Court for the District of Massachusetts has held that two liability insurers did not owe coverage for the insured’s SEC investigation defense costs because the SEC investigation was a “claim” first made before the policy period. Jalbert v. The Zurich Servs. Corp., 2018 WL 4232905 (D. Mass. Sept. 5, 2018). Wiley Rein… Continue Reading
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Stockholder Demand Letter for Legal Expenses for Stockholder Dispute Constitutes Covered Claim for Wrongful Act
Posted in Allocation, “Claim”, Notice of Claim, Wrongful ActThe United States District Court for the District of Rhode Island has concluded that a stockholder demand letter for legal expenses in connection with a dispute regarding the rights of different classes of stockholders constitutes a covered claim for a wrongful act. Twin River Worldwide Holdings, Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh,… Continue Reading
No Duty to Defend Under Claims-Made-and-Reported Policy Where Notice of Claim Given Nine Months After Cancellation
Posted in “Claim”, Notice of ClaimAn Illinois appellate court has held that a trial court properly awarded judgment to an insurer because it had no duty to defend or indemnify its insured under its claims-made-and-reported policy where notice of the underlying negligence lawsuit came in more than nine months after the policy was cancelled. Southwest Disabilities Services and Support v.… Continue Reading
6th Circuit Affirms No Coverage Where Insured Concealed Claim and Underlying Facts Before Giving Untimely Notice of Claim
Posted in “Claim”, Late NoticeIn a case that was briefed and argued for the primary carrier by Wiley Rein at the trial court level and on appeal, the U.S. Court of Appeals for the Sixth Circuit unanimously affirmed summary judgment on behalf of the insurers where the insured bank concealed key facts concerning a government investigation until the eve… Continue Reading
Court Holds that Government-Issued Subpoena Constitutes a Claim
Posted in “Claim”, Excess insurance/exhaustionThe United States District Court for the Northern District of Illinois, applying Illinois law, has held that a government-issued subpoena constituted a Claim under the directors and officers liability policies at issue, thus allowing a company’s coverage action to proceed against its primary and excess insurers. Astellas US Holding, Inc. v. Starr Indem. & Liab.… Continue Reading
Pleading in Suit Between Medical Practice Partners Fails to Trigger Duty to Defend Under Employment Practices Liability Policy
Posted in “Claim”The Ohio Court of Appeals has affirmed that an insurer owed no duty to defend under an employment practices liability policy where a lawsuit was brought by employees of the insured who were also former partners and shareholders, and the suit was premised solely on the employees’ rights as former partners and shareholders. Orthopedic &… Continue Reading
Letter Outlining Objections to Excessive Legal Fees Constitutes “Claim”
Posted in “Claim”Applying Pennsylvania law, a federal district court has held that an insurer had no duty to defend or indemnify a judgment for excessive legal fees because a court-ordered letter predating the policy period and previewing objections to the insured law firm’s fees was a “claim” first made prior to the policy’s inception. Allied World Ins.… Continue Reading
DOJ Investigation Constitutes Seven “Claims,” But Specific Litigation and Pending-Or-Prior Litigation Exclusions Bar Coverage
Posted in “Claim”, Defense CostsThe United States Circuit Court of Appeals for the Ninth Circuit, applying California law, has held that an insurer owed no duty to reimburse the insured’s costs of responding to a governmental investigation. Millennium Labs., Inc. v. Allied World Assurance Co., Inc., 2018 WL 1179601 (9th Cir. Mar. 7, 2018). While the court held that… Continue Reading
Notice of Accident Constitutes Timely “Claim” Based on Insurers’ Conduct
Posted in “Claim”, Notice of ClaimThe United States District Court for the Southern District of Mississippi has held that notice of an underlying accident sent to the insured’s three insurance carriers represented a timely “claim” under the claims-made general liability policies at issue in light of the insurers’ course of conduct upon receipt of the notice. Jordan v. Maxfield &… Continue Reading
No Coverage for Criminal Investigation Where Sealed Affidavit Identifying Insured as Target of Investigation Was Not Reported During Policy Period
Posted in “Claim”, Notice of ClaimThe United States District Court for the Middle District of Florida has held that an errors and omissions policy does not provide coverage for a criminal investigation of an insured individual where the affidavit identifying the individual as a target of the investigation was not unsealed or reported to the insurer until after the policy’s… Continue Reading
Lack of Civil Lawsuit Precludes Duty to Defend, While Prior Knowledge Exclusion Bars Indemnity Coverage
Posted in “Claim”, Bad Faith, Prior Knowledge/Warranty ExclusionThe United States District Court for the District of New Mexico, applying New Mexico law, has held that an insurer owed no duty to defend a title and escrow agent against a demand by a title insurer because no civil proceeding had been brought against the insured. The court also held that the insured owed… Continue Reading
Iowa Court Holds that Medical Record Request Does Not Constitute a “Claim”
Posted in “Claim”An Iowa federal district court, in a case of first impression, has held that a medical record request did not constitute a “Claim” under a claims-made medical malpractice policy. Capson Physicians Ins. Co. v. Yates, 2017 WL 6997897 (S.D. Iowa Nov. 8, 2017).… Continue Reading
Securities Exclusion Bars Coverage for Claims Bearing “Incidental Relationship” to Excluded Conduct
Posted in “Claim”, Wrongful ActApplying Texas law, a federal district court has held that a broadly-worded securities exclusion bars coverage of claims “incidental” to alleged misrepresentations made in connection with the sale of securities. Gleason v. Markel Am. Ins. Co., 2018 WL 538324 (E.D. Tex. Jan. 24, 2018). The court further held that an exception for claims involving transactions… Continue Reading
Former Director Not Covered for Wrongful Acts Committed in Uninsured Capacity
Posted in “Claim”, Wrongful ActThe U.S. District Court for the Eastern District of Pennsylvania, applying Pennsylvania law, has held that a former board member of a company is not entitled to coverage when the company was dismissed with prejudice from the underlying action. Palmer v. Twin City Fire Ins. Co., 2017 WL 5571051 (E.D. Pa. Nov. 20, 2017).… Continue Reading
Washington Court Holds that Statutory Notice of Intent to Sue Letter is Not a “Claim”
Posted in “Claim”The U.S. District Court for the Eastern District of Washington has held that a statutory notice of intent to sue letter received by an insured prior to a claims-made policy period did not constitute a “claim,” because it was not a “written demand for monetary, non-monetary or injunctive relief.” Tree Top, Inc. v. Starr Indem.… Continue Reading
Letter Alleging Wrongful Termination and Seeking Reinstatement Constitutes a “Demand for Damages or Other Relief”
Posted in “Claim”In a win for Wiley Rein’s client, the U.S. District Court for the District of Colorado has held that a liability insurer had no duty to defend an Equal Employment Opportunity Commission (EEOC) charge and related lawsuit on the basis that a letter predating the charge and lawsuit was a “claim” first made prior to… Continue Reading
No Coverage Available Where Insured Fails to Provide Notice of Potential Claim During First Policy Period and Knew About, But Failed to Disclose, Potential Claim Prior to Second Policy Period
Posted in “Claim”, Notice of Claim, Prior Knowledge/Warranty ExclusionThe United States District Court for the District of Maryland has held that where notice of a potential claim is not reported during the first policy period and the insured knew about, but failed to disclose, the potential claim prior to the second policy period, coverage is precluded under both policies. James River Ins. Co.… Continue Reading
SEC Subpoenas & Formal Investigative Order Are Not “Claims” Alleging “Wrongful Acts”
Posted in “Claim”The United States Court of Appeals for the Tenth Circuit, applying Colorado law, has held that a formal investigative order issued by the U.S. Securities & Exchange Commission (“SEC”) and related subpoenas did not constitute “Claims” alleging “Wrongful Acts” as defined under a D&O policy. MusclePharm Corp. v. Liberty Ins. Underwriters, Inc., 2017 WL 4675701… Continue Reading
Fee Arrangement Exclusion Bars Coverage for Claims Arising from Alleged Force-Placed Insurance Scheme
Posted in “Claim”, Personal Profit/Advantage exclusionA New York state trial court, applying New York law, has held that a fee arrangement exclusion contained in a professional liability insurance policy precludes coverage for claims arising from an insured’s force-placed insurance business. QBE Americas, Inc. v. Ace Am. Ins. Co., 2017 WL 4122651 (Sup. Ct., N.Y. County Sept. 18, 2017). The court… Continue Reading
SEC Subpoenas & Formal Investigative Order Are “Claims”
Posted in “Claim”The United States District Court for the Southern District of New York has held that subpoenas and a formal investigative order issued by the U.S. Securities & Exchange Commission (“SEC”) constituted “Claims” as defined under a D&O policy. Patriarch Partners LLC v. AXIS Ins. Co., 2017 WL 4233078 (S.D.N.Y. Sept. 22, 2017).… Continue Reading
Single Lawsuit Alleging Multiple Wrongful Acts Constitutes Single Claim
Posted in “Claim”The United States Court of Appeals for the Third Circuit, applying Pennsylvania law, has held that a single lawsuit alleging three causes of action and up to eight discrete wrongful acts constituted a single claim under a professional liability insurance policy. Westport Ins. Corp. v. Mylonas, 2017 WL 3327798 (3d Cir. Aug. 4, 2017).… Continue Reading
No E&O Coverage Where Insured Failed to Report Claim During Policy Period When It Was First Made
Posted in “Claim”, Notice of ClaimThe Appellate Court of Illinois, applying Illinois law, has held that an insurer has no duty to defend or indemnify an insurance agent under an errors and omissions liability policy where the agent failed to provide notice of the claim during the policy period in which the claim was first made. James River Ins. Co.… Continue Reading
Separate Lawsuits Part of a Single Claim First Made Prior to Policy Period
Posted in “Claim”, Related Claims and associated exclusionsThe United States District Court for the District of Colorado, applying Colorado law, has held that two lawsuits were connected by the “single scheme” of a contractor to interfere with a government contract for a surveillance camera system. Ciber, Inc. v. Ace Am. Ins. Co., 2017 WL 2537092 (D. Colo. June 9, 2017). The district… Continue Reading
“Non-Specific,” “Boiler-Plate” Notice of Potential Claim Insufficient as a Matter of Law
Posted in “Claim”, Notice of ClaimIn a significant victory for Wiley Rein’s client, a Tennessee federal court has held that an insured’s “general, boiler-plate . . . broad, [and] non-specific” notice that purported to give notice of a potential claim was untimely and insufficient to provide notice of an actual claim made during the policy period and omitted from the… Continue Reading