On July 30, 2020, the Eleventh Circuit Court of Appeals in AEGIS Electric & Gas International Services Ltd. v. ECI Management LLC reversed the trial court's grant of summary judgment in favor of an insurer, AEGIS Electric & Gas International Services Ltd. In that case, AEGIS issued a real estate services professional liability policy to ECI Management LLC. Subsequently, ECI was named as a defendant in a putative class action in which the plaintiff alleged that ... Keep Reading »
Business Interrupted: Policyholders Seek to Avoid the “Direct Physical Loss or Damage” Requirement for Business Interruption Insurance in the Wake of the COVID-19 Pandemic
The COVID-19 pandemic has swept the world, altering every aspect of daily life — whether it be a morning trip to the gym, a day at the office, a dinner at the Italian restaurant across the street, or a Friday night concert in the park. Businesses, particularly those in the service sector, have halted or restricted their operations, either voluntarily or by government order, in an effort to curb the spread. In these uncertain times, many businesses want to seek coverage ... Keep Reading »
Look No Further Than the Insuring Clause: Ill-Gotten Gains Do Not Constitute Covered “Loss”
On August 26, 2019, the Eleventh Circuit Court of Appeals, applying Florida Law, held that ill-gotten gains do not constitute covered “loss” within the meaning of a D&O policy. In Philadelphia Indemnity Insurance Co. v. Sabal Insurance Group, Inc., No. 17-14844 (11th Cir. Aug. 29, 2019), the Miami-Dade County Office of the Inspector General investigated Sabal Insurance Group and its CEO/president Ian Norris for overcharging the Miami-Dade Aviation Department for ... Keep Reading »
When Should an Insurer Deny Coverage? The Second Circuit Provides Guidance on What Constitutes a Reasonable Time by Which to Deny Coverage Under New York Law
Under New York law, a liability insurer is required to deny coverage for bodily injury resulting from an auto accident “as soon as is reasonably possible.” N.Y. Ins. Law § 3420(d)(2). The Second Circuit recently shed light on what constitutes a reasonable time within the meaning of this statute in United Financial Casualty Co. v. Country-Wide Insurance Co., No. 18-3022 (2d Cir. July 1, 2019). In that case, Juan Pineda was involved in a three-vehicle accident while ... Keep Reading »
No Offer, No Rejection, No Bad Faith: Georgia Supreme Court Limits Liability for an Insurer’s Bad Faith Refusal to Settle
On March 11, 2019, the Georgia Supreme Court handed down an important decision in First Acceptance Insurance Company of Georgia, Inc. v. Hughes, which further clarifies the circumstances under Georgia law for when an insurer may be liable for bad faith in refusing to settle a claim within policy limits. In Hughes, the insured caused a multi-vehicle accident and resulting injury to five individuals. An attorney who represented two of those individuals – Julie An and ... Keep Reading »
Six Degrees of Separation: Eleventh Circuit Upholds a Broad ‘Related Claims’ Provision
“Related Claims” provisions in directors and officers (D&O) and errors and omissions (E&O) policies, while common, can spawn disagreement as to scope and application. Beyond these substantive questions, an issue arises as to what information a court may consider in determining whether two or more claims are “related” within the meaning of a given policy. The Eleventh Circuit recently analyzed this issue in Health First, Inc. v. Capitol Specialty Insurance ... Keep Reading »
New Opinions From Second and Sixth Circuit Courts Rock Phishing Loss Coverage Landscape
On July 6, the Second Circuit Court of Appeals set off some fireworks in the insurance coverage litigation field when it found coverage for a “social engineering”/phishing scheme loss, bucking the trend among its sister courts. The appellate court affirmed a Southern District of New York decision that had been a relative outlier, finding coverage under a crime/fidelity policy for a scheme where fraudsters used spoof emails to trick company employees into changing wiring ... Keep Reading »
Drawing a Line in the Sand: The Second Circuit Tries to Define Where D&O Coverage Ends and E&O Coverage Begins
Policyholders often obtain both errors and omissions (E&O) and directors and officers (D&O) liability insurance policies because they provide complementary coverage. E&O policies provide coverage for claims for wrongful acts arising from the provision of "professional services," and while D&O policies also provide coverage for claims for wrongful acts, they often exclude coverage for such claims arising from the provision of professional services. Despite ... Keep Reading »
CGL Policies and Data Breaches: No Publication, No Coverage
As cyber hacking and phishing schemes become more common, one issue that is often raised is whether, and to what extent, damages resulting from these incidents fall within the coverage afforded under a standard commercial general liability policy. The United States District Court for the Middle District of Florida recently addressed this issue Innovak Int'l, Inc. v. Hanover Ins. Co., No. 8:16-CV-2453-MSS-JSS, (M.D. Fla. Nov. 17, 2017), and held that a data breach was not ... Keep Reading »
The Privilege Maintains Its Power: Texas Supreme Court Blocks Discovery of Insurer Attorney’s Billing Information
When (if ever) are an insurer’s attorney’s fees and billing information discoverable in a coverage dispute? Though the question is straightforward, the answer can vary from case to case and jurisdiction to jurisdiction. The Texas Supreme Court recently weighed in on the issue and found that an insurer’s attorney-billing information is not discoverable merely because the insurer challenges the insured’s request for attorney’s fees in coverage litigation. See In re Nat'l ... Keep Reading »