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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Don’t Let The Door Hit You on the Way Out: Insurer Loses Coverage Suit Involving Injuries Sustained By Fitting Room Door

In Selective Insurance Co. of South Carolina v. Target Corporation, No. 16-1669, 2016 U.S. App. LEXIS 23370 (7th Cir. Dec. 29, 2016), the Seventh Circuit affirmed an Illinois district court’s decision finding coverage for an additional insured after parsing through the language of two contractual agreements. The coverage dispute arose when a customer shopping at a Target store was injured after a fitting room door came off and fell on her in December 2011. The customer filed suit against Target,
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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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No Magic Words Needed To Trigger Application of the Construction Contract Anti-Indemnification Statute Says Illinois Appellate Court

In Pekin Insurance Co. v. Designed Equipment Acquisition Corp., 2016 IL App (1st) 151689, the Illinois Appellate Court examined a common issue for insurance carriers in disputes involving construction site injuries. In particular, the Appellate Court provided helpful clarification with respect to the application of the Construction Contract Indemnification for Negligence Act (Act), also known as the anti-indemnification statute. The circumstances at issue involved a rental agreement between Abel Building & Restoration and Designed Equipment Acquisition Corporation, whereby Designed leased
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Hold the Sauce: Insurer Must Indemnify Insured for Trade Disparagement and Defamation Claims Arising Out of Indian Sauce Recipe Dispute

Rass Corporation v. The Travelers Companies, Inc., No. 15-P-358, 2016 Mass. App. LEXIS 163 (Nov. 10, 2016), represents a continuation of Massachusetts law in the context of an insurer’s duty to defend, indemnify, and settle in good faith. Since the underlying settlement included covered and non-covered claims, the court concluded The Travelers Companies, Inc. and Travelers Property Casualty Companies of America were obligated to indemnify Rass Corporation for the amount the trial court allocated to covered claims. As background, Ranbir
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No Complaint, No Duty to Defend: An Insurer’s Duty To Defend Does Not Arise from Unfiled Draft Complaints

In Philadelphia Indemnity Insurance Co. v. Pace Suburban Bus Service, 2016 IL App (1st) 151659, the Illinois Appellate Court provided keen insights into when the duty to defend is triggered and when an action for equitable contribution can be maintained. As background, Pace Suburban Bus Services and Countryside Association for People with Disabilities entered into a leasing agreement whereby Pace would provide Countryside with a van, which would be driven by a Countryside employee, for the purposes of transporting disabled
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Seventh Circuit Recognizes Illinois Law to Allow Extrinsic Evidence in Evaluating an Insurer’s Duty to Defend

The Seventh Circuit recently handed down a decision encouraging Illinois courts to consider evidence beyond the complaint and the insurance policy when evaluating an insurer’s duty to defend. In Landmark American Insurance Co. v. Hilger, 838 F.3d 821 (7th Cir. 2016), the Seventh Circuit reviewed a district court’s judgment on the pleadings favor of a purported insured in a declaratory judgment suit filed by Landmark American Insurance Company. At issue was whether Peter Hilger was covered as an insured in
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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,
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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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No, No, No: No Accident, No Property Damage, No Duty to Defend Under Illinois Law

Westfield Insurance Co. v. West Van Buren, LLC, et al., 2016 IL App (1st) 140862 represents a continuation of Illinois law in the context of an insurer’s duty to defend construction defect claims. As articulated in Westfield, accidental events are required to trigger a duty to defend and shoddy workmanship does not constitute property damage. In addition, since the underlying complaint did not seek damages for any personal property damage, the Illinois Appellate Court held Westfield Insurance Company had no
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