Thomas J. Seery
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A Window Opens? Are Defective Product Construction Defect Claims Covered Under Pennsylvania Law?
A recent decision from a Pennsylvania court highlights tension in Pennsylvania law regarding whether a construction defect claim involving consequential damages caused by a defective product involves a covered “occurrence.” Sapa Extrusions, Inc. v. Liberty Mut. Ins. Co., 2018 WL 2045496 (M.D. Pa. May 1, 2018). In this coverage action, the insured, a window frame manufacturer, sought a declaratory judgment that it was owed coverage for an underlying action brought by a customer that used the window frames to manufacture
Massachusetts Court Holds that All Excess Policies are Created Equal
In Massachusetts, competing excess insurance policies will apply equally to provide excess coverage even if one policy is a true excess policy and the other is a hybrid policy that provides either primary or excess coverage depending on the circumstances. See Great Divide Ins. Co. v. Lexington Ins. Co., 2017 WL 4969942 (Mass. Nov. 1, 2017). In a November 1, 2017 opinion, the Supreme Judicial Court of Massachusetts held that the plain language of the insurance policies was the determinative
Pennsylvania Court Rejects Manifestation Trigger for Latent Property Damage Claims
The Commonwealth Court of Pennsylvania recently determined that the multiple trigger rule, and not the manifestation rule, is the proper standard to use when determining whether an insurance policy is triggered in an environmental property damage claim involving a long latency period between exposure and manifestation. See Pennsylvania Manufacturers’ Association Insurance Company v. Johnson Matthey, Inc., et al., 2017 WL 1418401 (Pa. Commw. Ct. Apr. 21, 2017), This decision, which is at odds with statements by the Pennsylvania Supreme Court
Ninth Circuit Confirms the FDIC Cannot Avoid the Insured-Versus-Insured Exclusion
In recent years, courts frequently have held that a D&O policy’s “insured-versus-insured” exclusion bars coverage for claims by the FDIC, as receiver of a failed bank, against the bank’s former directors and officers because the FDIC stands in the shoes of the insured bank. Therefore, the FDIC has tried to circumvent this exclusion by arguing that a policy’s shareholder derivative suit exception to the insured-versus-insured exclusion brought the FDIC’s claim back within coverage. A recent decision by the Ninth Circuit
Proof’s in the Pudding: Sexual Misconduct Exclusions Do Not Preclude Coverage for Defamation Claims, Massachusetts Federal District Court Says
A federal district court in Massachusetts determined that Bill Cosby’s insurer has a duty to defend the former entertainment icon in three defamation suits despite potentially applicable policy exclusions because the defamation claims did not necessarily “aris[e] out of” sexual misconduct. In AIG Property Casualty Co. v. Green, Civil Action No. 15-30111-MGM, 2016 U.S. Dist. LEXIS 154881 (D. Mass. Nov. 8, 2016), the court dismissed an insurer’s attempt to obtain a determination that it had no duty to defend Cosby,
Court Finds Ambiguity Over When Property Damage Commenced
Ambiguity surrounding the term “commencing” led a court to deny an insurer’s motion seeking to dismiss an insured’s property damage claim, despite the insured’s inability to state when the property damage at issue first occurred. In a question of first impression, a federal district court in Illinois denied an insurer’s motion for summary judgment earlier this month, ruling that the term “commencing” during the policy period was ambiguous when applied to the circumstances of the case. Temperature Serv. Co. v.
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.
Presumed Innocent: But Rescission Still Available to Void Coverage Due to Misrepresentations
A court rescinded a Georgia attorney’s professional liability coverage after his partner stole more than a million dollars from clients and lied about it on their firm’s insurance application. A federal district court in Georgia granted an insurer’s motion for summary judgment earlier this month, permitting rescission of the professional liability insurance policy issued to the attorney’s law firm. ProAssurance Cas. Co. v. Smith, No. CV415-051, 2016 U.S. Dist. LEXIS 105033 (S.D. Ga. Aug. 9, 2016). From 2013 to 2014, the attorney’s