The U.S. Court of Appeals for the Eighth Circuit, applying Kansas law, has held that a contract exclusion bars coverage for a lawsuit asserting claims for conversion and breach of fiduciary duty for failure to purchase a deceased owner’s stock under a stock repurchase agreement.  Russell v. Liberty Ins. Underwriters, Inc., 2020 WL 812910 (8th Cir. Feb. 19, 2020).  The court also held that the agreement was not an employee benefit plan that would implicate fiduciary liability coverage.

Continue Reading Contract Exclusion Bars Coverage for Lawsuit Over Stock Repurchase Agreement

The United States District Court for the District of Kansas, applying Kansas law, has held that an excess E&O policy was not triggered where coverage
Continue Reading Excess E&O Policy Not Triggered After Exhaustion Of Primary Policy, Where There Is At Least Potential For Coverage Under Separate D&O Policy

The Superior Court of the State of Delaware, applying Delaware and Kansas law, has held that an insurer owed a duty to pay defense costs under a directors and officers liability policy for a lawsuit primarily alleging the misappropriation of trade secrets, despite a misappropriation exclusion, on the basis that the underlying complaint asserted a claim alleging computer fraud not excluded by the policy.  WoodSpring Hotels LLC v. Nat’l Union Fire Ins. Co. of Pittsburgh, PA, Case No. N17C-09-274 (Del. Super. Ct., May 2, 2018).

Continue Reading Computer Fraud Claim Triggers Insurer’s Duty to Pay Defense Costs Despite “Gravamen” of Litigation Involving Excluded Misappropriation Claims

The U.S. District Court for the District of Kansas, applying Kansas law, has held that fact questions regarding application of an investment advising exclusion in a professional liability policy preclude summary judgment. Bridgebuilder Tax + Legal Servs. v. Torus Specialty Ins. Co., 2017 WL 6342229 (D. Kan. Dec. 12, 2017). The court also indicated that if the insurer denied coverage improperly, it could also be liable for bad faith refusal to settle.

Continue Reading Insurer Potentially Liable for Failing to Initiate Settlement Discussions