Executive Summary Blog

Executive Summary Blog

Legal developments affecting professional liability insurers

Category Archives: Notice of Claim

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Failure to Report EEOC Charge Precludes Coverage for Interrelated Lawsuit

Posted in “Claim”, Notice of Claim, Related Claims and associated exclusions
The United States District Court for the Eastern District of Arkansas, applying Arkansas law, has held that coverage is unavailable for a lawsuit arising out of Interrelated Wrongful Acts at issue in an EEOC charge where the insured failed to report the EEOC charge to its insurer within the claims-made policy’s reporting period.  Pine Bluff… Continue Reading

Letter to Insured Asserting Right to Patent Applications Constitutes a Claim Made Prior to D&O Policy Period

Posted in “Claim”, Notice of Claim, Related Claims and associated exclusions
In a win for Wiley Rein’s client, a California state court has held that an insurer correctly denied coverage under a D&O policy on the basis that the operative “claim” was made before the policy period.  CNEX Labs, Inc. v. Allied World Assurance Co. (U.S.), Inc., Case No. 18-CV-334461 (Cal. Super. Ct., Santa Clara Cty.… Continue Reading

No Coverage Because of Late Notice and Undisclosed Prior Knowledge of Claim

Posted in Notice of Claim, Prior Knowledge/Warranty Exclusion
Applying California law, the United States Court of Appeals for the Sixth Circuit has held that an insurer properly denied coverage under consecutive claims-made-and-reported policies based on the insured’s failure to provide timely notice of a claim and the insured’s failure to disclose the pending claim in its application for coverage.  US HF Cellular Commc’ns.,… Continue Reading

Insurer Lacked Conclusive Evidence of Insured’s Involvement to Trigger I v. I Exclusion; Insured’s Compromise of Favorable Judgment to Settle Multiple Suits Not a “Loss”

Posted in Allocation, Insured v. Insured Exclusion, Loss, Notice of Claim
The United States District Court for the Central District of California, applying California law, has held that an insurer lacked adequate information to deny coverage under an insured vs. insured exclusion in a D&O policy.  MJC Supply, LLC v. Scottsdale Ins. Co., 2019 WL 2372279 (C.D. Cal. June 4, 2019).  The court also held that… Continue Reading

Claim Supplement in Renewal Application Did Not Constitute Proper Notice under Claims-Made-and-Reported Policy

Posted in Notice of Claim
Applying Texas law, a federal district court has held that an insurer owed no duty to defend or indemnify its insured because the insured’s claim supplement to a renewal application did not constitute proper notice of a claim pursuant to the terms of the claims-made-and-reported policy.  Landmark Ins. Co. v. Lonergan Law Firm, PLLC, 2019… Continue Reading

Failure to Give Timely Notice of Arbitration Bars Coverage, Even Where Insured Gave Timely Notice of Related Claim

Posted in Notice of Claim
The United States District Court for the Southern District of Texas, applying Texas law, has granted an employment practices liability insurer’s motion for summary judgment in a lawsuit alleging that it wrongfully denied coverage for an arbitration award, concluding that the insured failed to provide timely notice of the arbitration to its insurer.  Stadium Motorcars,… Continue Reading

Regulatory Warning Notices Asserting Damages Based on Same Acquisition Involve “Related Wrongful Acts”

Posted in Notice of Claim, Related Claims and associated exclusions
In a win for Wiley Rein’s client, a New York appellate court has held that a program of asset management liability insurance afforded no coverage for a UK regulatory “Warning Notice” because the notice and a previous notice issued by the same regulator to the same targets arising from the same transaction involved “Related Wrongful… Continue Reading

Fourth Circuit Holds Virginia Statute Imposing Deadline to Deny Coverage Does Not Apply to Claim Reported Outside Policy Period

Posted in Notice of Claim
Applying Virginia law, the United States Court of Appeals for the Fourth Circuit has held that a Virginia statute imposing a forty-five day deadline for a coverage denial based on an insured’s breach of a liability policy does not apply to a denial based on a claim reported outside the policy period under a claims… Continue Reading

No Coverage for Whistleblower Action or Subpoena Noticed to Insurer After End of Policy Reporting Period

Posted in Notice of Claim
The United States District Court for the Central District of California, applying California law, has held that coverage is unavailable for a whistleblower action and subpoena noticed after the end of the reporting period of a claims-made policy.  PAMC, Ltd. v. Nat’l Union Fire Ins. Co. of Pittsburgh, PA, 2019 WL 666726 (C.D. Cal. Feb.… Continue Reading

Statute of Limitations Period Begins When Insured Can Plead Prima Facie Elements of Bad Faith Case

Posted in Bad faith/duty to settle, Notice of Claim
The Supreme Court of Delaware has held that under Delaware law, the three-year statute of limitations period applicable to a statutory bad faith action governed by Louisiana law commences when the insured could plead a prima facie case and was therefore barred.  Homeland Ins. Co. of New York v. Corvel Corp., 2018 WL 6061261 (Del.… Continue Reading

Stockholder Demand Letter for Legal Expenses for Stockholder Dispute Constitutes Covered Claim for Wrongful Act

Posted in Allocation, “Claim”, Notice of Claim, Wrongful Act
The 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 Claim
An 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

Failure of Insured to Provide Timely Notice Under Claims-Made Policy Bars Suit Against Insurer of Bankrupt Insured

Posted in Bankruptcy, Notice of Claim
The United States Court of Appeals for the Third Circuit, applying Pennsylvania law, has held that an insured’s failure to provide timely notice of a claim under a claims-made policy barred coverage for that suit.  Frazier v. Exide Techs., No. 17-2399, 2018 WL 2727396 (3d Cir. June 6, 2018).… Continue Reading

Amended Complaint Raising Different Legal Theory Is Not a Claim First Made at Time of Initial Complaint

Posted in Notice of Claim, Related Claims and associated exclusions
The Louisiana Court of Appeals has held that a claims-made policy affords coverage for a lawsuit filed before the policy period because an amended complaint alleging a new legal theory was filed during the policy period.  Billeaudeau v. Opelousas Gen. Hosp. Auth., 2018 WL 1835510 (La. Ct. App. Apr. 18, 2018).  The court also rejected… Continue Reading

No Coverage for Underlying Lawsuits Due to Insured’s Failure to Provide Notice as Soon as Practicable

Posted in Notice of Claim
The United States District Court for the Northern District of Georgia, applying Georgia law, has held that there is no coverage for multiple lawsuits under employment practices liability insurance policies where the insured failed to comply with the policies’ notice requirements.  Nat’l Cas. Co. v. Fulton Cnty., Ga., 2018 WL 1523089 (N.D. Ga. Mar. 28,… Continue Reading

Notice of Accident Constitutes Timely “Claim” Based on Insurers’ Conduct

Posted in “Claim”, Notice of Claim
The 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 Claim
The 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

Lawsuit Filed by Company Against Former Officer Does Not Trigger Employment Practices Liability Coverage

Posted in Defense Costs, Notice of Claim, Wrongful Act
The United States District Court for the District of Oklahoma has held that a lawsuit filed by a company against its former president did not implicate its policy’s Employment Practices Liability coverage because the lawsuit was not filed by or on behalf of an employee, as required by the policy.  Statton v. Allied World Specialty… Continue Reading

Insured’s Late Notice of Original Discrimination Charges Bars Coverage for Related Lawsuits

Posted in Notice of Claim
In a win for Wiley Rein’s client, the United States District Court for the Eastern District of North Carolina, applying North Carolina law, has held that an insurer owed no coverage for two underlying lawsuits because the insured failed to provide notice of the EEOC charges of discrimination that arose from the same facts at… 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 Exclusion
The 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

Court Declines to Hold Broker Accountable for Insured’s Failure to Report Known Claims in Application

Posted in Notice of Claim
A Massachusetts federal court has held that, absent special circumstances, an insurance broker does not owe a fiduciary duty of care to its client and therefore is entitled to accept its clients’ representation that all known claims had been reported in its application and has no duty to investigate whether potential claims were not reported. … Continue Reading