Jonathan Schwartz

All articles by Jonathan Schwartz

 

The Road Less Traveled: In a Case of First Impression, Indiana Court of Appeals Holds SIR Applicable to Additional Insureds

In Walsh Construction Co. v. Zurich American Insurance Co., 2017 Ind. App. LEXIS 137 (Mar. 28, 2017), the Indiana Court of Appeals affirmed the trial court’s grant of summary judgment in favor of Zurich American Insurance Company and against Walsh Construction Company. In a case of first impression, the Court of Appeals held that a self-insured retention (SIR) applied not only to the insurer’s relationship with the named insured, but also, to any additional insureds. Thus, because the named insured
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Minnesota Supreme Court Limits Insurers’ Extracontractual Liability: An Insured’s Recovery of “Proceeds Awarded” for Insurer’s Unreasonable Denial of Benefits Must Consider Policy Limit

In Wilbur v. State Farm Mutual Automobile Insurance Co., No. A15-1438 (Minn. April 5, 2017), the Minnesota Supreme Court greatly limited the insured’s recovery under the First-Party Bad Faith Statute, Section (Minn. Stat. § 604.18). Although State Farm was found to have unreasonably denied John Wilbur benefits under his underinsured-motorist policy, the calculation of his recovery for “proceeds awarded” had to take into account the policy’s limit of liability. As background, on January 10, 2009, Wilbur suffered serious neck injuries
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Plain Language, Surplus, and Reasonable Expectations: Utah Supreme Court Uses Entire Contract Construction Toolbox in Concluding Policy Inapplicable to Botched Real Estate Deal

In Compton v. Houston Casualty Co., 2017 UT 17 (Mar. 23, 2017), the Utah Supreme Court affirmed the district court’s grant of summary judgment in favor of Houston Casualty Company , holding that Houston Casualty had no duty to defend or indemnify its insured in an underlying real estate transaction gone bad. Essentially, Utah’s high court held that because the insured did not provide services “for a fee” in the underlying transaction, the underlying plaintiffs were barred from coverage under
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Frankly, My Dear, I Don’t Give a “Dam”: Seventh Circuit Holds Professional Liability Insurer Off the Hook in Neighborhood Dispute Tangentially Related to Unobtained Dam Permit

In Madison Mutual Insurance Co. v. Diamond State Insurance Co., No. 15-3292 (7th Cir. Mar. 21, 2017), the Seventh Circuit handed down a decision delineating the obligations between a professional liability insurer and a homeowner’s insurer. At bottom, the court refused to hold a professional liability insurer responsible for the defense of a suit that only tangentially referencing the insured’s professional services. As background, Dr. William and Wendy Dribben purchased a house in 1999 at Heartland Oaks, an exclusive development.
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Enough is Enough: Fifth Circuit Holds Duty to Defend Does Not Include Costs of Prosecuting Insured’s Fee-Dispute Counterclaim

Aldous v. Darwin National Assurance Co., No. 16-10537 (5th Cir. Mar. 16, 2017), presents a thicket of coverage issues. However, the clearest and most significant one for the insurance industry is that the duty to defend, under Texas law, does not extend to the cost of prosecuting an insured’s counterclaim. This coverage litigation started as an attorney-client dispute over the non-payment fees and then morphed into a legal malpractice action. Darwin National Assurance Co. insured Aldous under a professional liability
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Professional Services Exclusions Found to Bar Coverage for Insureds’ Administration of Medications Leading to Meningitis Outbreak

In Westfield Insurance Co. v. Orthopedic and Sports Medicine Center of Northern Indiana, Inc. (N.D. Ind. Mar. 28, 2017), an Indiana federal court held an insurer had no duty to defend or indemnify its insured against over scores of malpractice and negligence claims that allegedly caused a meningitis outbreak. The district court concluded that, under the subject CGL and umbrella policies, the underlying claims did not involve an “occurrence” and, further, professional services exclusions precluded coverage entirely. As background, NECC
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Insured Stuck Defending Itself Against Claims of False Advertising an Elastic Tape Product

In Cincinnati Insurance Company v. KT Health Holdings, LLC et al. (D. Mass. Mar. 27, 2017), a Massachusetts federal district court held that an insurer had no duty to defend or indemnify its insureds, finding that allegations by a putative class that the insureds falsely advertised their product did not trigger bodily injury coverage under a CGL policy. As background, the defendants, KT Health Holdings and KT Health (collectively “KT”), manufacture and sell KT Tape for sports and fitness activities.
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Disparage Me Not: Maryland Federal District Court Finds No Coverage for Phone Unlocking Suit

In Wireless Buybacks, LLC v. Hanover American Insurance Co. (D. Md. Dec. 8, 2016), the U.S. District Court for the District of Maryland held that an insurer had no duty to defend its insured against claims stemming from the company’s unauthorized acquisition and resale of Sprint phones. As background, Sprint accused Wireless of illegally acquiring Sprint phones, unlocking them so they could function on non-Sprint wireless networks, and reselling the phones overseas. Sprint filed a sixteen-count suit against Wireless, alleging
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Heartbreak in the First Circuit: Court Dismisses Suit Against Insurer Over Coverage for Claims Related to Attorney’s Rocky Affair with Client

In Sanders v. The Phoenix Insurance Co. (1st Cir. Dec. 7, 2016), the First Circuit held that a homeowner’s insurance company had no duty to defend or indemnify its insured, a divorce attorney, against claims stemming from his “on-again/off-again intimate relationship” with his client. The First Circuit affirmed the lower court’s dismissal of a complaint filed by the assignee of the insured attorney against his insurer, Phoenix Insurance Company , for its failure to provide coverage. As background, Phoenix issued
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Credit Card Payment Coverage Declined: Cyberinsurer Not Obligated to Reimburse P.F. Chang’s for PCI Liability

In the most significant cyberinsurance coverage decision to date, an Arizona federal district court in P.F. Chang’s China Bistro v. Federal Insurance Co., No. CV-15-01322-PHX-SMM (D. Ari. May 31, 2016), granted summary judgment to Federal Insurance Company, acknowledging it had no duty to reimburse P.F. Chang’s China Bistro for payment card industry liability assessments under the CyberSecurity policy issued by Federal to P.F. Chang’s corporate parent. This decision represents a significant victory for cyberinsurers insofar as it upholds insurers’ marketing
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Another Victory for Insurers Relying on IP Exclusions

Pinnacle Brokers Insurance Solutions LLC v. Sentinel Insurance Co, Ltd., No. 15-cv-02976-JST, 2015 U.S. Dist. LEXIS 117299 (N.D. Cal. Sept. 2, 2015), arose out of a lawsuit filed by Granite Professional Insurance Brokerage, Inc. (Granite) against Pinnacle Brokers Insurance Solutions LLC and employees of Pinnacle (collectively “Pinnacle”). Granite alleged that Pinnacle conspired to steal its customers and prospective customers by carrying out a series of misleading tactics and misappropriating confidential and trade secret information. The underlying complaint sought damages and
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Are You My Agent? Insured’s Notice to Broker Deemed Sufficient

In First Chicago Insurance Company v. Molda and Wilson, 2015 IL App. (1st) 140548, First Chicago appealed an adverse verdict finding that it had a duty to defend its insured in the underlying lawsuit. The Appellate Court affirmed the district court’s ruling, finding, in pertinent part, that the insured’s notice of the claim and suit were proper and timely. The insured’s employee, Molda, was involved in an automobile collision while driving as a salesman for the policyholder, Metrolift. First Chicago
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Untimely Intervention Sinks Insurer Challenge To Allegedly Collusive $20MM Settlement

In CE Design Ltd. v. King Supply Co., LLC, No. 12-2930, 2015 U.S. App. LEXIS 11117 (7th Cir. June 29, 2015), the Seventh Circuit denied as untimely the attempted intervention of three insurers (all CNA companies) into the underlying lawsuit. The insurers were, in turn, unable to challenge the approval of a $20 million settlement between the policyholder, King Supply Co., LLC, and Plaintiff CE Design Ltd. (and its co-plaintiff). The underlying case involved a junk fax lawsuit filed by
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Violation of Statutes Exclusion Bars Coverage for Ancillary TCPA Claims

In Emcasco Insurance Co. v. CE Design, Ltd., the U.S. Court of Appeals for the Tenth Circuit Court granted summary judgment to Emcasco, finding it had no duty to defend the insured against a junk fax suit. In doing so, the court joined a number of jurisdictions holding that an ISO exclusion in a commercial general liability policy applies to all claims that arise, even indirectly, from violations of the Telephone Consumer Protection Act (47 U.S.C. § 227). As background,
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A Continuing Trend of Illinois State Courts Finding Trigger for Malicious Prosecution is Initiation of Prosecution — Not Termination of Proceedings

On April 21, 2015, we wrote about the Illinois Appellate Court Second District’s decision in Indian Harbor Insurance Co. v. City of Waukegan, 2015 IL App (2d) 140293 (Mar. 6, 2015). There, the Appellate Court followed its decision in St. Paul Fire & Marine Insurance Co. v. City of Zion, 2014 IL App (2d) 131312, which held that only the date of conviction triggers malicious prosecution coverage. As we noted, this constituted a rejection of the Illinois Supreme Court precedent,
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Illinois Appellate Court Determines Unsigned Agreement Can Still Constitute a Written Contract and Trigger Additional Insured Coverage

In West Bend Mutual Insurance Co. v. DJW-Ridgeway Building Consultants, Inc., 2015 IL App (2d) 140441 (May 19, 2015), the Illinois Appellate Court, Second District affirmed a trial court decision and held that West Bend Mutual Insurance Co. had the duty to defend DJW-Ridgeway Building Consultants, Inc. (Ridgeway) as an additional insured. The underlying dispute arose out of any injury suffered by a construction worker at a worksite where Ridgeway was the general contractor. Ridgeway subcontracted with Jason the Mason,
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Illinois Appellate Court Extends Bridgeview on Choice of Law and Finds No Duty To Defend Against Blast Fax Suit

After vacating its prior decision pursuant to an order by the Illinois Supreme Court, the Appellate Court of Illinois, Second District, in G.M. Sign, Inc. v. Pennswood Partners, Inc. 2015 IL App (2d) 121276-B, determined that the insurers, Maryland Casualty Company and Assurance Company of America (collectively “Zurich”), had no duty to defend or indemnify Pennswood Partners, Inc., with respect to a blast fax case filed by G.M. Sign, Inc. The crux of the Appellate Court’s decision was how to
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Illinois Appellate Court Finds No Duty to Defend Copyright Infringement Suit

In Erie Insurance Exchange v. Compeve Corp., 2015 IL App (1st) 142508, the Illinois Appellate Court held that Erie Insurance Exchange had no duty to defend Compeve Corporation and Slava Packovskis in a copyright infringement lawsuit filed by Microsoft Corporation. Microsoft specifically alleged copyright infringement as a result of the defendants selling computers with unauthorized copies of Windows XP installed. Erie filed a declaratory judgment action. The Erie Policy contained standard CGL Coverage B language. The coverage dispute centered on
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Wisconsin Supreme Court Determines Notice-Prejudice Rule Does Not Apply To Claims-Made-and-Reported Requirement

In Anderson v. Aul, 2015 WI 19 (2015), the Wisconsin Supreme Court reversed the decision of the court of appeals and held that Wisconsin’s notice-prejudice statutes did not apply to the reporting requirements in claims-made-and-reported policies. The underlying case involved a malpractice lawsuit filed by Melissa and Kenneth Anderson against their former attorney, Thomas Aul, alleging that Mr. Aul continued to represent the Andersons in a purchase of commercial property transaction, although he had an unwaivable conflict of interest. On December
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Northern District of Illinois Draws Line Between Trademark Infringement and Trade Dress Infringement

In AU Electronics, Inc. v. Harleysville Group, Inc., No. 13 C 5947, 2015 U.S. Dist. LEXIS 2887 (N.D. Ill. Mar. 10, 2015) the U.S. District Court for the Northern District of Illinois granted summary judgment in favor of Harleysville Group, Inc. and Harleysville Lake States Insurance Co. (collectively Harleysville), finding, in pertinent part, that the underlying complaint did not allege “personal or advertising injury.” AU Electronics, Inc. was sued by Sprint and T-Mobile for allegedly buying cellphones in bulk, unlocking
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Wisconsin Federal District Court Chides Insurers for Inaction, Deems Insurers Estopped from Asserting Their Right To Defend

In Haley v. Kolbe & Kolbe Millwork Co., Inc., No. 14-cv-99-bbc, 2015 U.S. Dist. LEXIS 42584 (W.D. Wis. Apr. 1, 2015) the U.S. District Court for the Western District of Wisconsin granted summary judgment in favor of the insured, Kolbe & Kolbe Millwork Co. (Kolbe), holding that Fireman’s Fund Insurance Company and United States Fire Insurance Company (collectively the “insurers”) were estopped from having the right to select counsel to represent Kolbe in a class action lawsuit alleging the sale of
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Eighth Circuit Deems MCS-90 Endorsement Applicable To Subrogation Claims

The United States Court of Appeals for the Eighth Circuit confronted a case of first impression and decided that the MCS-90 endorsement for motor carriers requires a tortfeasor’s insurer to compensate an injured party even if the injured party has already been compensated by its own insurer. More to the point, the Eighth Circuit allowed a subrogor to pursue relief against a tortfeasor’s insurer in accordance with the MCS-90 endorsement. As background, a semi-tractor and trailer operated by Yelder collided
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Illinois Appellate Court Continues To Rollback Seventh Circuit Rulings on Trigger of Coverage for Wrongful Conviction Claims

In yet another decision eviscerating the line of cases from the Seventh Circuit holding that the trigger of coverage for a wrongful conviction claim is the date of favorable termination, and not the date of conviction, the Illinois Appellate Court, Second District in Indian Harbor Insurance Co. v. City of Waukegan, 2015 IL App (2d) 140293 (Mar. 6, 2015), sided with the majority of courts to have addressed this issue, holding that only the date of conviction triggers malicious prosecution
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Violation of Statutes Exclusions Bars Coverage Entirely for TCPA Claims

In Addison Automatics, Inc. v. Hartford Casualty Insurance Co., No. 13-cv-1922 (N.D. Ill. Mar. 31, 2015) the United States District Court for the Northern District of Illinois granted summary judgment in favor of the Hartford Casualty Insurance Co. and Twin City Fire Insurance Co. (collectively “Hartford”) and against Addison Automatics, Inc. (“Addison”). The district court held that Hartford had no duty to defend their insured, Domino Plastics, Inc. (“Domino”), because the Violation of Statutes Exclusions in the policies barred coverage
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Seventh Circuit Holds Insurance Adjusters Owe No Legal Duty to the Insured

In Lodholtz v. York Risk Services Group, Inc. (Feb. 11, 2015), the Seventh Circuit afforded liability protection to outside claims adjusters by holding that they owe no legal duty to the insured. As background, York Risk Services Group, Inc. (“York”) was an insurance adjuster retained by Granite State Insurance Company (“Granite”), the insurer of Pulliam Enterprises, Inc. (“Pulliam”). Robert Lodholtz, the plaintiff, sustained injuries in a factory belonging to Pulliam and subsequently sued Pulliam. There was some confusion with regard
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Wisconsin Court of Appeals Affirms Summary Judgment in Favor of Insurer on Bad Faith Claims

In Norman-Nunnery v. Artisan & Truckers Casualty Co., No. 2013AP1465, 2015 Wisc. App. LEXIS 149, 2015 WL 789731 (Wis. Ct. App. Feb. 26, 2015), the Wisconsin Court of Appeals affirmed summary judgment on a bad faith claim against an auto insurer. The plaintiff was involved in two car accidents approximately six months apart. After the second accident, the insurer deemed the automobile a total loss and paid the amount owed under the policy to the vehicle’s lienholder rather than the
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Arizona Appellate Court Refuses To Vitiate the Attorney-Client Privilege When Insurer Does Not Advance Defense Based on Advice of Counsel

In Everest Indemnity Insurance Co. v. Rea, 2015 Ariz. App. LEXIS 9 (Ariz. Ct. App. Jan. 15, 2015), an Arizona appellate court held that Everest Indemnity Insurance Company (“Everest”) had not waived its attorney-client privilege by admitting that it had settled a case in good faith after consulting with counsel. As background, Rudolfo Brothers Plastering and Western Agriculture Insurance Company (collectively “Rudolfo”) alleged that Everest committed bad faith by entering into a settlement agreement that exhausted the liability coverage of
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Texas Supreme Court Rejects Additional Insured Coverage for BP To the Tune of $750 Million

In a decision handed down by the Supreme Court of Texas on Friday, the court determined that BP was not entitled to additional insured coverage under several insurance policies issued to Transocean by a variety of insurers.  In re:  Deepwater Horizon, No. 13-0670 (Tex. Feb. 13, 2015).  The opinion also provides significant insights regarding the relationship between insurance and indemnity as risk transfer mechanisms, namely, that:  (1) a named insured can purchase a greater amount or scope of coverage for
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Fifth Circuit Finds No “Personal Injury” or “Advertising Injury” in Trade Secret Misappropriation Suit

In Nationwide Mutual Insurance Co. v. Gum Tree Property Management, LLC, No. 14-60302, 2015 U.S. App. LEXIS 595 (5th Cir. Jan. 14, 2015), the Fifth Circuit affirmed the district court’s grant of summary judgment in favor of Nationwide and certain third-party defendants, finding that Nationwide did not have a duty to defend or indemnify the insureds in the underlying lawsuit. Lexington Relocation Services, LLC (“Lexington”) brought the underlying lawsuit against three related insureds (“Gum Tree Defendants”) alleging that one of
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Illinois Appellate Court Penalizes Insurer for Not Re-Asking Questions in Renewal Application the Insured Already Answered Incorrectly in Prior Application

In Illinois State Bar Association Mutual Insurance Co. v. Brooks, Adams & Tarulis, 2014 IL App (1st) 132608, the Illinois Appellate Court held, in relevant part, that the Illinois State Bar Association Mutual Insurance Company (“ISBA”) could not rescind a renewal policy based on a misrepresentation in the initial policy application when there was no incorporation of the initial application of insurance into the renewal policy. As background, Douglas Tibble learned of a claim by Tango Music, LLC (“Tango”) in
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Illinois Federal District Court Refuses To Consider Extrinsic Evidence In Evaluating Insurer’s Duty To Defend

In American Alternative Insurance Corp. v. Metro Paramedic Services, 2014 U.S. Dist. LEXIS 171841 (N.D. Ill. Dec. 12, 2014), the United States District Court for the Northern District of Illinois held that American Alternative Insurance Corporation (“AAIC”) had a duty to defend Metro Paramedic Services, Inc. (“Metro”).  The claimants had filed suit against Metro and Antioch Rescue Squad (“ARS”) alleging sexual harassment and discrimination, negligent supervision and retention, assault and battery, and retaliation, while serving as joint employees of ARS
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Wisconsin High Court Gets Its Hands Dirty by Ringing in the New Year with Two Decisions about Coverage for Feces Contamination

The Wisconsin Supreme Court recently addressed the pollution exclusion in two similar decisions involving contaminated well water. First, in Preisler v. General Casualty Insurance Co. et al., 2014 WI 135, the Supreme Court affirmed an order of summary judgment in favor of Rural Mutual Insurance Company, Regent Insurance Company, and General Casualty Company, finding that the pollution exclusion barred coverage. The underlying suit arose out of tainted well water that caused Fred and Tina Preisler’s cattle to die at an
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Wisconsin Court Will Not Enforce Intentional Acts Exclusion For Intellectual Property Infringement Claim

In Boehm v. Zimprich, 2014 U.S. Dist. LEXIS 174330 (W.D. Wis. Dec. 17, 2014), the United States District Court for the Western District of Wisconsin held that American Family Mutual Insurance Company (“American Family”) had a duty to defend its insureds against a copyright infringement claim.  The plaintiffs filed suit against Dan and Ciara Zimprich, owners of sports memorabilia vendor “On 2 the Field”, alleging they made and sold prints and photo canvases of approximately two dozen of plaintiffs’ photographs
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Sixth Circuit Interprets ‘Direct Action’ Provision of 28 U.S.C. 1332 in the Context of Michigan’s No-Fault Insurance Law

In Ljuljdjuraj v. State Farm Mutual Automobile Ins. Co., 2014 U.S. App. LEXIS 24108 (6th Cir. Dec. 19, 2014), the U.S. Court of Appeals for the Sixth Circuit held that the ‘direct action’ provision of 28 U.S.C. § 1332(c)(1) does not destroy diversity jurisdiction in an action brought against an insurer pursuant to Michigan’s No-Fault Insurance Law where a “contract of liability insurance” was not implicated. Elvira Ljuljdjuraj (EL) was driving a car owned by her friend, Bardhyl Mullalli, when
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Illinois Appellate Court Rejects Professional Liability Coverage for Junk Fax Claim

In Margulis v. BCS Insurance Co., 2014 IL App (1st) 140286, the Illinois Appellate Court affirmed a circuit court’s grant of summary judgment in favor of BCS Insurance Company (BCS), finding that it was not obligated to defend or indemnify its insured, Bradford & Associates (Bradford), under an insurance agents and brokers professional liability policy.  The Appellate Court concluded that Bradford’s alleged conduct did not arise out of Bradford’s business in “rendering service for others” as an insurance agent. The
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The Tenth Circuit Clarifies the Terms “Broadcasting” and “Telecasting” in Exclusions under the “Advertising Injury” Section in CGL Policies

In Dish Network Corp. v. Arrowood Indemnity Co., et al., D.C. No. 1:09-CV-00447-JLK-MEH (10th Cir. Nov. 25, 2014), the Tenth Circuit affirmed a district court’s grant of summary judgment in favor of the insurers, Arrowood Indemnity Company, Travelers Indemnity Company of Illinois, XL Insurance America, Inc., and National Union Fire Insurance Company of Pittsburgh, finding that the insurers were not obligated to defend and indemnify Dish Network Corporation or Dish Network, LLC (collectively Dish Network) due to exclusions present in
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Drafting History or Purpose Does Not Undermine Plain Language: Illinois Federal Court Enforces Insured-Versus-Insured Exclusion

In Travelers Casualty & Surety Co. of America v. Bernhardt, 2014 U.S. Dist. LEXIS 152416 (N.D. Ill. Oct. 28, 2014), the Northern District of Illinois granted summary judgment in favor of Travelers Casualty and Surety Company of America (Travelers), finding it had no duty to defend or indemnify Andrew Bernhardt in a breach of fiduciary duty and negligence lawsuit brought by Town Center Bank (TCB).  The underlying complaint involved several claims by TCB against Bernhardt originating from Bernhardt’s issuance of
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Illinois Federal District Court Concludes Prior Knowledge Exclusion Precludes Coverage for Legal Malpractice Suit

In Cardenas v. Twin City Fire Insurance Company, No. 13 C 8236, 2014 U.S. Dist. LEXIS 132420 (N.D. Ill. Sept. 19, 2014), Judge Virginia Kendall of the Northern District of Illinois determined that the Prior Knowledge Exclusion in the subject legal malpractice insurance policies barred the insurer’s duty to defend. The dispute between Twin City Fire Insurance Company (Twin City) and Maria Cardenas arose when Cardenas’ attorney, John Ambrose of Ambrose & Associates, unsuccessfully represented Cardenas in a civil rights
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Illinois Federal Court Finds Advertising Injury Coverage Not Implicated by Business Competition and Intellectual Property Claims

In Lemko Corp. v. Federal Insurance Co., No. 12 C 03283, 2014 U.S. Dist. LEXIS 138667 (N.D. Ill. Sept. 30, 2014), the Northern District of Illinois granted summary judgment in favor of Federal Insurance Company (Federal) and Cincinnati Insurance Company (Cincinnati), finding that they had no duty to defend Lemko Corporation in a business competition and intellectual property infringement lawsuit brought by Motorola. The underlying complaint involved several claims by Motorola against Lemko originating from Lemko accessing “Motorola computers without
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Illinois Appellate Court Applies Broad and Harsh Interpretation of Estoppel Doctrine

In Mt. Hawley Insurance Co v. Certain Underwriters at Lloyd’s, London, 2014 IL App (1st) 133931 (Sept. 9, 2014), the Illinois Appellate Court broadly applied the estoppel doctrine against Underwriters. The trial court had entered summary judgment against Underwriters, finding that it had breached its duty to defend the putative additional insureds. Underwriters did not challenge that finding on appeal. Instead, Underwriters appealed the finding that it was estopped from asserting certain defenses to indemnification because it was conclusively established
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Goldberg Segalla’s Jonathan Schwartz to Chair DRI’s Insurance Coverage and Practice Symposium

The Insurance Law Committee’s Insurance Coverage and Practice Symposium (ICP) will take place on December 4-5 at the New York Marriott Marquis in New York City. The event will be chaired by Jonathan L. Schwartz of Goldberg Segalla’s Global Insurance Services Group. ICP features top-notch education for coverage attorneys and claims professionals, with sessions by an associate judge of the New York Court of Appeals, insurance industry leaders, and nationally renowned counsel. ICP also offers opportunities for networking with the hundreds of attorneys
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Backroom Dealings Impair Coverage For High Stakes TCPA Class Settlement

In Central Mutual Insurance Co. v. Tracy’s Treasures, Inc., No. 1-12-3339, 2014 IL App (1st) 123339 (Sept. 30, 2014), the Illinois Appellate Court expressed great skepticism regarding an insured’s settlement of an underlying TCPA without the insurer’s knowledge. Central insured Tracy’s Treasures under primary and excess liability policies from 1997 – 2005 and 2002 – 2005, respectively.  Idlas filed suit in March 2007 against Tracy’s on behalf of himself and the putative class, asserting violations of the TCPA resulting from
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TCPA Lawsuit Quacks Again: Courts Continue to Apply Violation of Statutes Exclusion in Favor of Insurers

The Illinois Appellate Court recently modified and reissued an earlier ruling involving an insurer’s duty to defend and indemnify against an underlying TCPA lawsuit.  G.M. Sign, Inc. v. State Farm Fire & Cas. Co., No. 2-13-0593, 2014 IL App (2d) 130593 (Modified September 2, 2014). We previously reported on this important decision on May 19, 2014.  See, If It Walks Like a Duck and Talks Like a Duck … IL Appellate Court Applies Violation of Statutes Exclusion To Preclude Coverage for
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District of Columbia Ruling Highlights Importance of Reservation of Rights, but Preserves Potential Application of Deductibles

The district court for the District of Columbia recently ruled an insurer must reserve its rights for each lawsuit, despite the similarities or relatedness of lawsuits for which the insurer has reserved rights to disclaim coverage, at the risk of waiving coverage defenses. Yet, notwithstanding the insurer’s failure to properly reserve its rights, the court held that the insurer still maintains the ability to assert that policy deductibles apply on a per claim, per claimant basis in TCPA cases. Cincinnati Ins.
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Standing On Its Own: CT Supreme Court Expands Insurers’ Ability to Sue Another Insurer

In Travelers Casualty & Surety Co. of America v. The Netherlands Insurance Co., 2014 Conn. LEXIS 262, 312 Conn. 714 (Aug. 5, 2014), the Connecticut Supreme Court broadened an insurance company’s ability to sue another insurance company pursuant to the state’s declaratory judgment statute. The coverage dispute arose as follows.  Lombardo Brothers Mason Contractors was hired by the state of Connecticut to perform masonry for the construction of the law library for the University of Connecticut School of Law.  The
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Not All Policy Provisions Play Nicely Together

The dispute arose when Western Heritage sought reimbursement from Century Surety for settlement payments Western Heritage made on behalf of Century Surety’s named insured, which was also the indemnitee of Western Heritage’s named insured.  The district court held in denying Western Heritage’s summary judgment motion, in pertinent part, that Western Heritage’s other insurance provision did not create a mechanism for it to seek contribution for payments made pursuant to its Supplementary Payments provision. As background, an employee of a subcontractor
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Hobby Lobby Precedent Already Undermined, Says Justice Sotomayor

Thursday, July 3, the United States Supreme Court granted an application for injunction pending appeal by Wheaton College, overriding its requirements for exemption from the contraceptive mandate under the Affordable Care Act, while calling into question the extent of the court’s holding in Burwell v. Hobby Lobby, Inc.  In her dissent, Justice Sotomayor writes that this order “evinces disregard for even the newest of this Court’s precedents and undermines confidence in this institution.” Wheaton v. Burwell, 573 U.S. ____ (2014). 
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Federal Courts Again Unwilling To Hear TCPA Disputes

Less than two weeks after the Sixth Circuit used the anti-aggregation rule to dismiss a TCPA coverage action on grounds that it failed to satisfy the amount in controversy requirement, for purposes of diversity jurisdiction, the First Circuit likewise dismissed a TCPA action on substantially similar grounds.  In CE Design, Ltd. v. American Economy Insurance  Co. (1st Cir. Jun. 19, 2010), the First Circuit Court of Appeals held that the claimant-initiated insurance coverage action did not satisfy the amount in
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Ninth Circuit Upholds Prior Publication Exclusion To Bar Coverage for Trademark Infringement Action

In Street Surfing, LLC v. AG MLG Great American E&S Insurance Co. (9th Cir. June 10, 2014), the Ninth Circuit, applying California law, held that the policy’s prior publication exclusion barred coverage for the underlying trademark infringement action.  The court concluded that the extrinsic evidence confirmed that Street Surfing published at least one advertisement using the claimant’s advertising idea, i.e., by affixing an allegedly infringing logo to its skateboard product, prior to the inception of the first Great American policy
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The Streak Continues: Insurers Again Shut Out of Federal Court in Contesting Coverage for a TCPA Class Action Settlement

The Sixth Circuit ruled sua sponte in Siding and Insulating, Inc. v. Acuity Mutual Insurance Co. (6th Cir. June 10, 2014), that the subject coverage dispute, which arose out of the settlement of an underlying TCPA blast fax suit, did not satisfy the amount in controversy requirement for purposes of diversity jurisdiction.  Following the Seventh Circuit’s recent holding in Travelers Property Casualty v. Good, 689 F.3d 714 (7th Cir. 2012), the Sixth Circuit concluded that the interests of the plaintiff
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