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Executive Summary Blog

Legal developments affecting professional liability insurers

Category Archives: Related Claims and associated exclusions

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Insured’s Claims Barred by Res Judicata

Posted in Related Claims and associated exclusions
Applying Maryland law, a federal district court has held that the doctrine of res judicata barred an insured’s claims for coverage under a particular policy, where the insured’s previous efforts to bring those claims in a different proceeding and concerning a different policy failed.  The Humane Society of the United States v. Nat’l Union Fire… Continue Reading

Eleventh Circuit Affirms that Eleven Claims Arising Out Of Negligently Repackaging Two Drugs Are “Related Claims”

Posted in Related Claims and associated exclusions
In a win for an insurer represented by Wiley Rein, the United States Court of Appeals for the Eleventh Circuit, applying Florida law, has held that eleven claims by patients against a pharmacy and pharmacist for negligently repackaging two preservative-free drugs for injections by the same doctor to treat the same condition constituted “related claims.” … Continue Reading

Specific Litigation Exclusion Bars Coverage When Claim Arises “At Least in Part” From Excluded Litigation

Posted in Related Claims and associated exclusions
An Illinois district court, applying Delaware law, has held that a specific litigation exclusion in a company’s directors and officers insurance policy bars coverage for a claim arising “at least in part” from the litigation referenced in the exclusion.  RSUI Indem. Co. v. Worldwide Wagering, Inc, 2017 WL 3023748 (N.D. Ill. Jul. 17, 2017).… Continue Reading

Separate Lawsuits Part of a Single Claim First Made Prior to Policy Period

Posted in “Claim”, Related Claims and associated exclusions
The 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

Insurer Not Estopped from Asserting Policy Defenses Where Insured Had Duty to Defend; Insured-v.-Insured Exclusion Does Not Bar Coverage for Claims by Former Shareholders

Posted in “Claim”, Insured v. Insured Exclusion, Related Claims and associated exclusions
An Illinois federal court, applying Illinois law, has held that an insurer who declined to advance defense costs was not estopped from asserting policy defenses in a coverage action later filed by the policyholder corporation.  Vita Food Prods., Inc. v. Navigators Ins. Co., 2017 WL 2404981 (N.D. Ill. June 2, 2017).  The court also held… Continue Reading

Insured’s Failure to Provide Notice of Demand Letter Precludes Coverage for Related Lawsuit Noticed in Subsequent Policy Period

Posted in “Claim”, Notice of Claim, Related Claims and associated exclusions
A Washington federal court has held that an insured’s failure to provide notice of a demand letter to its insurer during the policy period in which the letter was received precludes coverage under a claims-made and reported policy for a related lawsuit filed during a subsequent policy period. National Union Fire Ins. Co. v. Zillow,… Continue Reading

Prior Acts Exclusion Bars Coverage for Suits Alleging Wrongful Conduct Spanning Prior Acts Date

Posted in Exclusions, Related Claims and associated exclusions
A Maryland intermediate appellate court has affirmed summary judgment in favor of an insurer, holding that a Prior Acts Exclusion applied to bar coverage for two antitrust lawsuits where the suits alleged that the insured conspired to raise prices beginning as early as 2002 and the Prior Acts Exclusion barred coverage for “Interrelated Wrongful Acts,… Continue Reading

Eleven Claims Arising Out of Negligently Repackaging Two Drugs Are “Related Claims”

Posted in Related Claims and associated exclusions
In a win for an insurer represented by Wiley Rein, the United States District Court for the Southern District of Florida, applying Florida law, has held that eleven claims by patients against a pharmacy and pharmacist for negligently repackaging two preservative-free drugs for injections by the same doctor to treat the same condition constituted “related… Continue Reading

Claims Not Related When Prior Demands Would Not Have Been Covered

Posted in “Claim”, Related Claims and associated exclusions
The Court of Appeal of Louisiana, applying Louisiana law, has held that a class arbitration claim that was covered under an errors and omissions policy was not “related” under the policy’s related claim provision to two earlier contractual demands for indemnity and workers compensation first made prior to the policy period.  Williams v. SIF Consultants… Continue Reading

Multiple Clients’ Claims Against Accountant Deemed Related and Subject to Lower Limit of Liability Due to Insureds’ Prior Knowledge of One Client’s Claim

Posted in Prior Knowledge/Warranty Exclusion, Related Claims and associated exclusions
The United States District Court for the District of South Carolina, applying South Carolina law, has held that multiple clients’ claims against an accountant and his former firm constitute a single claim under a professional liability policy because they are logically connected to the accountant’s loss of faculty from Parkinson’s disease.  CAMICO Mutual Insurance Co.… Continue Reading

Court Finds EEOC Charge and Subsequent Lawsuit to Be Two Separate Claims Under Claims-Made Policy

Posted in “Claim”, Related Claims and associated exclusions
The United States District Court for the Northern District of Illinois, applying federal and Illinois law, has found that an employment discrimination lawsuit was “first made” within a professional liability policy’s policy period despite the fact that the lawsuit’s required precursor, an Equal Employment Opportunity Commission (EEOC) charge, was filed before the policy period.  John… Continue Reading

Eleventh Circuit Finds Claims to be Related Even Though They Are Based on Different Legal Theories

Posted in “Claim”, Related Claims and associated exclusions
Applying Tennessee law, a federal appellate court has held that pre-policy demands and later-made claims were related notwithstanding the fact that the demands and claims may have relied on different legal theories.  Direct Gen. Ins. Co. v. Indian Harbor Ins. Co., 2016 WL 5437062 (11th Cir. Sept. 29, 2016).… Continue Reading

No Coverage for Claims Arising Out of Attorney’s Theft of Client Funds Before Policy Period

Posted in Dishonesty Exclusion, Personal Profit/Advantage exclusion, Prior Knowledge/Warranty Exclusion, Related Claims and associated exclusions
The United States District Court for the Middle District of Tennessee, applying Tennessee law, has held that an insurer had no duty to defend or indemnify an insured attorney for claims arising out of his theft from his clients’ estates because the attorney had knowledge of the theft and could reasonably foresee a claim before… Continue Reading

One Lawsuit Equals One Claim, Regardless of the Number of Causes of Action

Posted in Related Claims and associated exclusions
The United States District Court for the Eastern District of Pennsylvania has held that a lawyer’s professional liability policy’s per-claim limit of liability, rather than its aggregate limit of liability, applied to an underlying lawsuit because the suit’s multiple causes of action were all related and therefore constituted a single claim under the policy. Westport Ins.… Continue Reading

Fact Issues Regarding “Relatedness of Claims” Preclude Motion for Judgment on the Pleadings

Posted in Prior Knowledge/Warranty Exclusion, Related Claims and associated exclusions
The United States District Court for the District of Arizona has held that mere reference to a “pyramid scheme” in a prior lawsuit is insufficient to warrant judgment on the pleadings regarding the relatedness of a later claim alleging a pyramid scheme. Hanover Ins. Co. v. Vemma Int’l Holdings, Inc., 2016 WL 4059606 (D. Ariz.… Continue Reading

Related Claims Provision Does Not Conflict with Prior and Pending Litigation Exclusion

Posted in Related Claims and associated exclusions
A Florida federal court has held that a set of claims must be deemed first made at the time of the first such related claim in 2008, prior to the relevant policy period, notwithstanding the fact that a prior and pending litigation exclusion in the policies only excluded coverage for lawsuits brought prior to 2003.… Continue Reading

No Coverage for Related Claims Where Insured Received Third-Party Indemnification

Posted in “Claim”, Related Claims and associated exclusions
The United States District Court for the Southern District of Texas, applying Texas law, has held that an insurance broker is not entitled to coverage under its E&O policy because its former corporate parent already indemnified it for the settlement at issue. Southwest Risk LP v. Ironshore Specialty Ins. Co., 2016 WL 2898040 (S.D. Tex.… Continue Reading

Claim for Trademark-Infringing Telephone Scam Not Interrelated with Claim for Internet Scam

Posted in Allocation, Cooperation, Other: Trademark Exclusion, Related Claims and associated exclusions
The United States District Court for the Eastern District of Pennsylvania, applying Pennsylvania law, has held that a telephone marketing scam and an internet false advertising scam were not interrelated wrongful acts precluding coverage because the conduct behind the alleged wrongful acts was different. Connect America Holdings, LLC v. Arch Ins. Co., 2016 WL 1254073… Continue Reading

Coverage Barred For Hedge Fund’s Suit Against Insured Because Related to Prior Securities Class Action

Posted in Related Claims and associated exclusions, Wrongful Act
An Arizona intermediate appellate court, applying Arizona law, has affirmed a trial court’s rulings in favor of an insurer, holding that a lawsuit against the insured’s directors and officers was based in large part on the same or similar “wrongful acts” that were at issue in a previously filed securities fraud class action suit brought… Continue Reading

Seven Civil Lawsuits Constitute a Single Claim Subject to a Single Per-Claim Limit

Posted in Related Claims and associated exclusions
The United States District Court for the Central District of California has held that seven pending civil lawsuits, all of which alleged that the insured had participated in a fraudulent investment scheme, were logically and causally related such that they constituted a single claim subject to a single per-claim limit of liability. Liberty Ins. Underwriters,… Continue Reading

Environmental Claims Arose from Prior Orders and Deemed Not First Made During Relevant Policy Period

Posted in “Claim”, Related Claims and associated exclusions
A federal district court in Washington has held that an insurer had no duty to defend four environmental claims brought against an insured by state and federal agencies because the claims at issue were either first made prior to the policy period or fell within the scope of an exclusion barring coverage for claims related… Continue Reading