The U.S. District Court for the Southern District of New York, applying New York law, has held that no coverage is available for related claims reported to the insurer after the end of the policy period in which the first claim was made. Berkley Assurance Co. v. Hunt Constr. Group, Inc., 2020 WL 3000399 (S.D.N.Y. June 4, 2020).
Continue Reading No Coverage for Related Claims Reported After Policy Period During Which Claim Was First Made
Applying the law of Puerto Rico, a federal district court held that coverage was unavailable for an underlying lawsuit under a claims-made policy because the claim was deemed first made prior to the inception of the policy period. Galarza-Cruz v. Grupo HIMA San Pablo, Inc., 2020 WL 2843028 (D.P.R. May 28, 2020).
Continue Reading No Coverage for Claim Deemed First Made Prior to Inception of Policy Period
The U.S. Court of Appeals for the Third Circuit, applying California and Virginia law, has found that wrongful acts alleged in two ERISA class actions comprising different class periods are causally and logically related. Northrop Grumman Corp. v. AXIS Reinsurance Co., 2020 WL 1933264 (3rd Cir. Apr. 22, 2020).
Continue Reading Class Actions Comprising Different Class Periods Causally and Logically Related
An Illinois federal district court has ruled that a technology company’s failure to provide timely notice of a computer outage and related email demand barred coverage for a later-filed lawsuit. Hartford Fire Ins. Co. v. iNetworks Servs., LLC, 2020 WL 1491139 (N.D. Ill. Mar. 27, 2020).
Continue Reading Untimely Notice of Server Outage and Related Client Communications Bars Coverage for Claim Filed against Technology Service Provider
The United States District Court for the Northern District of Illinois, applying Illinois law, has held that there is no coverage under a D&O policy where the insured did not timely report a declaratory judgment lawsuit and instead sought coverage only after an amended complaint was filed in the successive policy period. Hanover Ins. Co. v. R.W. Dunteman Co., 2020 WL 1275002 (N.D. Ill. Mar. 17, 2020). The court held that the complaints were part of a single “claim” and not separate “claims” even though the amended complaint added insured defendants and theories of liability.
Continue Reading Declaratory Judgment Complaint Constitutes a Reportable Claim for a Wrongful Act; Subsequent Amended Complaint Adding Insured Defendants Not a Separate Claim
The United States Court of Appeals for the Ninth Circuit, applying Washington law, has held that a district court erred in concluding that a demand letter and suit alleging the same wrongful act constituted a “single claim” where the applicable professional liability policy lacked a related claims provision. Nat’l Union Fire Ins. Co. v. Zillow, Inc., 2020 WL 774366 (9th Cir. Feb. 18, 2020). The court of appeals declined, however, to find that the absence of a related claims provision resolved the coverage issue and remanded for consideration of extrinsic evidence to determine the parties’ intent.
Continue Reading Ninth Circuit Holds Demand Letter and Suit Alleging Same Wrongful Acts Are Not Necessarily a Single Claim Where Policy Lacks Related Claims Provision
The United States Court of Appeals for the Fifth Circuit, applying Texas law, has held that an insurer could not deny coverage due to the insured’s failure to comply with “immaterial” conditions of notice, absent a showing of prejudice, where an insured complied with its “material” obligation to report a claim. Landmark Am. Ins. Co. v. Lonergan Law Firm, P.L.L.C., 2020 WL 833068 (5th Cir. Feb. 19, 2020); Landmark Am. Ins. Co. v. Lonergan Law Firm, P.L.L.C., 2020 WL 3024842 (5th Cir. June 4, 2020) (denying petition for rehearing en banc and issuing substitute opinion).
Continue Reading Absent Prejudice, Breach of Notice Conditions Does Not Relieve Insurer of Coverage Obligations
Applying New York law, the United States District Court for the Southern District of New York has held that, because a subpoena duces tecum previously issued to the insured by a post-judgment creditor of a non-insured entity was not a “Claim” against the insured, the subpoena and a later-filed lawsuit against the insured could not qualify as “Related Claims” deemed first made when the subpoena was issued. Protective Specialty Ins. Co. v. Castle Title Ins. Agency, Inc., 2020 WL 550700 (S.D.N.Y. Feb. 3, 2020). The court also held that the “warranty exclusion” in the application for the policy (in which the insured warranted that it was “not aware of any incident or circumstance which may result in a claim”) did not bar coverage for the lawsuit, even though the insured failed to disclose the subpoena in the application.
Continue Reading Subpoena Not a ‘Claim’ When Issued in Litigation Not Involving Insured’s Professional Services
Applying Maryland law, the Court of Special Appeals of Maryland has held that an insurer had no right to allocate a global settlement of two underlying lawsuits between covered and non-covered claims, where the damages sought in each action were identical and based on the same misconduct. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. The Fund for Animals, Inc., 2019 WL 7369221 (Md. Ct. Spec. App. Dec. 30, 2019).
Continue Reading Court Holds Insurer Cannot Allocate Settlement Between Covered and Non-Covered Claims
The U.S. Court of Appeals for the Ninth Circuit, applying California law, has held that an insurer is not required to show prejudice to deny coverage under a claims-made-and-reported policy based on an insured’s late notice. Euraupair Int’l, Inc. v. Ironshore Spec. Ins. Co., 2019 WL 6817593 (9th Cir. Dec. 13, 2019).
Continue Reading Notice Prejudice Rule Not Applicable to Claims-Made-And-Reported Policies