The United States District Court for the Middle District of Tennessee, applying Tennessee law, has held that a fraud exclusion in a professional liability policy did not bar coverage for a breach of contract claim arising out of a franchise agreement.  For Senior Help, LLC v. Westchester Fire Ins. Co., 2020 WL 1532292 (M.D. Tenn. Mar. 31, 2020).  The court determined that the separately awarded damages for the breach were based on the insured’s failure to meet contractual obligations, regardless of the insured’s otherwise fraudulent conduct.

Continue Reading Breach of Contract Claim Not Barred By Fraud Exclusion

A Delaware trial court, applying Tennessee law, has ruled that an insurer was entitled to recover defense costs it advanced under a reservation of rights for a non-covered claim.  Catlin Specialty Ins. Co. v. CBL & Assocs. Props., 2018 WL 3805868 (Del. Super. Ct. Aug. 9, 2018).  In so doing, the court cited the American Law Institute Restatement on the Law of Liability Insurance (Restatement), but it ultimately refused to follow the Restatement, concluding that it did not accurately reflect Tennessee law.

Continue Reading Court Finds Insurer Entitled to Recoupment, Declines to Follow ALI Restatement on the Law of Liability Insurance

In a case that was briefed and argued for the primary carrier by Wiley Rein at the trial court level and on appeal, the U.S. Court of Appeals for the Sixth Circuit unanimously affirmed summary judgment on behalf of the insurers where the insured bank concealed key facts concerning a government investigation until the eve of settlement, holding that the insured failed to provide timely notice of a Claim or adequate notice of a potential Claim.  First Horizon Nat’l Corp. v. Houston Cas. Co., No. 17-5767/5844 (6th Cir. July 10, 2018).

Continue Reading 6th Circuit Affirms No Coverage Where Insured Concealed Claim and Underlying Facts Before Giving Untimely Notice of Claim

A Delaware superior court, applying Tennessee law, has held that a professional liability insurer is entitled to judgment that it has no duty to defend or indemnify its insured because the underlying action against the insured alleged only intentional wrongdoing. Catlin Spec. Ins. Co. v. CBL & Assocs. Properties, Inc., 2017 WL 4173511 (Del. Super. Ct. Sept. 20, 2017).

Continue Reading Insurer Has No Duty to Defend or Indemnify Insured for Action Alleging Solely Intentional Wrongdoing

In a significant victory for Wiley Rein’s client, a Tennessee federal court has held that an insured’s “general, boiler-plate . . . broad, [and] non-specific” notice that purported to give notice of a potential claim was untimely and insufficient to provide notice of an actual claim made during the policy period and omitted from the notice.  First Horizon Nat’l Corp. v. Houston Cas. Co., No. 15-cv-2235-SHL-dkv (W.D. Tenn. June 23, 2017).  In so ruling, the court held that an email that “stated [a] settlement offer of $610 million and requested a counterproposal from” the insured was a written demand for monetary relief, and thus a “Claim,” that should have been reported to the insurers.  Wiley Rein represents the primary carrier and argued the motions before the district court.

Continue Reading “Non-Specific,” “Boiler-Plate” Notice of Potential Claim Insufficient as a Matter of Law

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

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 the inception of the policy, and the claims were all related.  Hanover Ins. Co. v. Clemmons, 2016 WL 5724213 (M.D. Tenn. Sept. 30, 2016).

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

In a favorable ruling for a Wiley Rein client, a Tennessee federal court has rejected an insured’s motion to compel documents and interrogatory responses relating to reserves, reinsurance communications, claims and underwriting manuals, and other claims against other insureds.  First Horizon Nat’l Corp. v. Houston Cas. Co., 2016 WL 5869580 (W.D. Tenn. Oct. 5, 2016).  Wiley Rein represents the primary carrier.

Continue Reading Documents Relating to Other Insureds, Reserves, Reinsurance Communications, Claims Handling and Underwriting Manuals Not Discoverable