A Contract by Any Other Name Would … Still Be a Contract: Wisconsin Court of Appeals Enforces Breach of Contract Exclusions to Preclude Coverage for Business Competition Claim

In Great Lakes Beverages, LLC v. Wochinski (Jan. 18, 2017), the Wisconsin Court of Appeals held that AMCO had no duty to defend or indemnify its insured against the underlying third-party tortious interference with contract claim because the breach of contract exclusions applicable to personal and advertising injury squarely applied. As background, K-Way Systems contracted with Wochinski to purchase his company. The purchase agreement contained an asset purchase agreement, a covenant not to compete, and a supply agreement. Relations between
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Don’t Skip Steps When Analyzing the Foundation for a Covered Claim: No Publication and No Use of Advertising Ideas Means No Duty to Defend Beauty School Dispute

Desabato v. Assurance Co. of America et al., No. 2:15-cv-484, 2016 U.S. Dist. LEXIS 135389 (W.D. Pa. Sept. 30, 2016) represents a continuation of Pennsylvania law in the context of an insurer’s duty to defend personal and advertising injury claims. As articulated in Desabato, Pennsylvania adheres to a strict four-corners analysis of an insurer’s duty to defend. Since the underlying complaint failed to allege the elements of defamation or misappropriation of advertising ideas, the court held Assurance Company of America,
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Fax Blast From the Past: Third Circuit Denies Coverage in TCPA Action

The Third Circuit denied coverage for alleged violations of the Telephone Consumer Protection Act (TCPA), while also ruling on a jurisdictional question regarding the amount in controversy applicable to declaratory judgment actions when they emanate from a class action lawsuit. This case reminds that even without a TCPA exclusion, blast fax suits may not present covered property damage or advertising injury claims. In Auto-Owners Insurance Co. v. Stevens & Ricci, Inc., No. 15-2080, 2016 U.S. App. LEXIS 16182, (3d Cir.
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Illinois Appellate Court Rejects Coverage for Junk Fax Class Action Settlement and Calls TCPA Class Action Attorneys to Task

The Illinois Appellate Court recently offered greater protection to insurance companies from liability emanating from the Telephone Consumer Protection Act of 1991 (TCPA) and fervently condemned the reality of class action settlements rewarding only class counsel. In First Mercury Insurance Co. v. Nationwide Security Services., 2016 IL App (1st) 143924 (May 18, 2016), the Appellate Court affirmed the trial court’s judgment that First Mercury had no duty to indemnify the class (as assignees) with respect to a settlement reached in
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Say What You Mean and Mean What You Say, Says California Federal District Court

A California federal district court determined a standard Breach of Contract Exclusion under Coverage B of a CGL policy did not preclude the duty to defend for alleged disparagement. In MedeAnalytics, Inc. v. Federal Insurance Co., the United States District Court for the Northern District of California interpreted the exclusion very narrowly, finding it applied only to actual — and not alleged — breaches of contract and found a duty to defend. As background, the claimant alleged the policyholder made
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Don’t Believe the Hype: Over-Touting One’s Own Products Triggers Non-Conformity Exclusion

A Virginia federal court rendered an important decision on product disparagement coverage, holding that a policy’s Non-Conformity Exclusion barred coverage for the underlying false advertising claim. In Selective Way Insurance Co. v. Crawl Space Door System, Inc., the United States District Court for the Eastern District of Virginia was confronted with the question of whether there was coverage for a suit between two competing vent vendors, Crawl Space Door System, Inc. (CSD) and Smart Vent Products. Smart Vent had sued
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Another Nail in the Junk Fax Coffin: Wisconsin Joins Illinois, California, Michigan, and Oklahoma in Finding No Coverage for TCPA Suits

The Wisconsin Court of Appeals held in a recent decision that a standard TCPA exclusion precludes coverage for all causes of action brought by the plaintiff that emanated from the unauthorized sending of faxes. This includes a common law conversion cause of action, as well as a cause of action for violations of the Telephone Consumer Protection Act (TCPA). As background, in State Farm Fire & Casualty Co. v. Easy PC Solutions, LLC, No. 2014AP2657, 2015 Wisc. App. LEXIS 855
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A Sporting Retailer’s Bid for Coverage Gets Punted by the Ninth Circuit

The Ninth Circuit recently handed down a decision holding that insurers did not have a duty to defend their policyholder, a sporting goods retailer, in several ZIP code class action lawsuits.  The class action lawsuit all arose out of alleged violations of the Song-Beverly Act, a California statute which prohibits retailers from collecting customer ZIP code information as a purported requirement of credit card transactions. The court held that policy exclusions negated coverage. In Big 5 Sporting Goods Corp. v.
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Non-Party’s Claim of Employment Relationship with Plaintiff Creates Question of Fact in DJ Action

A complaint clearly and repeatedly alleges the plaintiff was the employee of the defendant, but for purposes of the employment practices exclusion, was she really? At this point, it’s unclear after her “real” employer claims her as its own in the declaratory judgment action. Bikram Choudhury founded the popular Bikram (or hot yoga) in the 1970s. A former student accused Bikram of raping her in 2010. As Bikram’s legal counsel was looking into that rape accusation, she alleges that Bikram
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Holy Stromboli! Grocer Loses Coverage and Bad Faith Battle Against Excess Carrier

In Charter Oak Insurance Company v. Maglio Fresh Foods, No. 14-4094, 2015 U.S. App. LEXIS 19268 (3d Cir. Nov. 4, 2015), the Third Circuit held that because the underlying lawsuit did not present a covered “advertising injury” claim, and there was no exhaustion of the primary policy, the insured’s excess carrier could not have acted in bad faith. As background, the underlying plaintiff, Leonetti’s, a supplier and competitor of Maglio Fresh Foods, brought a lawsuit against Maglio. First, the “Maglio
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