Applying New York law, the United States District Court for the Southern District of New York has held that an EPL insurer need not reimburse a CGL insurer for a settlement and defense costs incurred in connection with two lawsuits alleging sexual harassment, discrimination, and assault, concluding that the policy’s criminal act exclusion barred coverage because the suits both arose from alleged sexual assault.  Hamilton Specialty Ins. Co. v. Kinsale Ins. Co., 2020 WL 1876358 (S.D.N.Y Apr. 15, 2020).

Continue Reading Criminal Act Exclusion Bars EPL Coverage for Sexual Harassment, Discrimination, and Assault Suits

Applying New York law, a federal district court has held that an insurer has a duty to defend and provide independent counsel to an insured realtor for claims involving intentional acts and repayment of commissions. Great Am. Ins. Co. v. Houlihan Lawrence, Inc., 2020 WL 1487294 (S.D.N.Y. Mar. 7, 2020).  The court also held that, because the underlying case was still pending, the question of whether the insurer had a duty to indemnify was premature.

Continue Reading Insurer Required to Defend and Provide Independent Counsel for Potentially Covered Claims

Applying Illinois law, the United States District Court for the Central District of Illinois has held that an insurer had no duty to cover defense costs for affirmative claims that involved, but were not brought by, its insured.  Marquis Energy LLC v. Federal Ins. Co., 2020 WL 853503 (C.D. Ill. Feb. 20, 2020).

Continue Reading Insurer Has No Duty to Defend Insured in “Defensive” Arbitration Proceeding

Applying Michigan law, a federal district court has held that common law causes of action for fraud and negligent misrepresentation are not “based on or arising out of actual or alleged violations” of ERISA or securities laws merely because they arise out of the same factual scenario.  Great Am. Fidelity Ins. Co. v. Stout Risius Ross, Inc., 2020 WL 601784 (E.D. Mich. Feb. 7, 2020).

Continue Reading Coverage for Common Law Causes of Action Not Barred Under ERISA/Securities Law Exclusion

Applying California Law, the United States District Court for the Southern District of California has held that an insurer must pay defense costs contemporaneously, even where the policy’s advancement provision merely requires payment “prior to final disposition of a claim,” because the insured became legally liable for defense costs as they were incurred.  Renovate Am., Inc. v. Lloyd’s Syndicate 1458, 2019 WL 6716735 (S.D. Cal. Dec. 10, 2019).  The court further held that the insured was excused from obtaining the insurer’s prior written consent regarding defense arrangements given the insurer’s seven-month delay in responding to the insured’s initial notice.

Continue Reading Insurer Must Advance Defense Costs as Incurred and Cannot Enforce Policy’s Defense Arrangement Consent Provision

The United States District Court for the Western District of New York, applying New York law, held that an insurer did not owe a fiduciary duty to its insured when the insured was represented by independent defense counsel, nor did the insurer breach its contractual duties to its insured in paying defense costs, which ultimately exhausted the policy limit.  Korn v. Federal Ins. Co., 2019 WL 4277187 (W.D.N.Y. Sept 10, 2019).

Continue Reading Insurer Did Not Breach Any Duty to Insured Where Payment of Defense Costs Exhausted Policy Limit

Applying California law, a federal district court has held that a wage and hour endorsement limited the coverage available for two class action lawsuits to $25,000 in defense costs.  Houston Cas. Co v. Great American Chicken Corp., Inc., 2019 WL 3886484 (C.D. Cal. Aug. 12, 2019).

Continue Reading California Court Holds that “Wage and Hour Law” Limitations on Coverage Unambiguously Applied to Labor Code Violations

The Ohio Court of Appeals has held that an “of counsel” attorney was an “Insured Person” under his former law firm’s professional liability policy for purposes of a malpractice action involving allegations that occurred both before and after the attorney worked at the firm.  Gallagher Sharp, L.L.P. v. Miller Goler Faeges Lapine, L.L.P., 2019 WL 2319296 (Ohio Ct. App. May 30, 2019).

Continue Reading Former Of Counsel Is Still “Insured Person” After Leaving Law Firm

The United States District Court for the Western District of Washington, applying Washington law, has held that no Washington state public policy prevents an insurer from enforcing a defense cost recoupment provision.  Massachusetts Bay Ins. Co. v. Walflor Indus., 2019 WL 1651659 (W.D. Wash. Apr. 17, 2019).  The court resolved the issue based on precedent and saw no need to certify the question of the enforceability of such provisions to the Washington Supreme Court as the insured urged.

Continue Reading Defense Cost Recoupment Provisions Enforceable Under Washington Law

The United States District Court for the Central District of California, applying California law, has held that an insured is entitled to independent counsel where an insurer’s coverage action turns on facts that overlap with facts that might establish an insured’s liability in the underlying lawsuit.  Aspen Am. Ins. Co. v. Ou, 2019 WL 1950293 (C.D. Cal. Mar. 14, 2019).

Continue Reading Insured Entitled to Independent Counsel Where Coverage Action Turns on Facts That Could be Used to Establish Underlying Liability