Applying well-settled Wisconsin law, a federal district court found that an insurer had no duty to indemnify an oral hygiene product manufacturer for tainted products after determining that the losses did not result from an “occurrence” under an excess liability policy. The case, Sage Products LLC v. Federal Insurance Co., arose from a recall of single-use oral hygiene kits that were provided to hospitals and nursing homes. The supplier of the kits contracted with a ... Keep Reading »
No Paying Over Slow Milk? Wisconsin Appellate Court Finds Intentional Act by Cattle Feed Supplier May Be “Occurrence” Under CGL Policy
In Riverback Farms LLC v. Saukville Feed Supplies Inc., a panel of the Wisconsin Court of Appeals found that an intentional act may still constitute an “occurrence” under a commercial general liability policy, reversed the circuit court’s summary judgment finding of no coverage in favor of the insurer, and remanded for further proceedings. The underlying claim arose when a cattle feed supplier substituted an ingredient in its feed that ultimately led to a magnesium ... Keep Reading »
11th Cir. Affirms That Georgia’s Implied Waiver Doctrine Cannot Be Used to Create Coverage
In Century Communities of Georgia LLC v. Selective Way Insurance Co., the Eleventh Circuit Court of Appeals affirmed that the Georgia Supreme Court’s 2012 opinion in Hoover v. Maxum Indemnity Co. does not apply to “coverage defenses” — that is, whether a loss is potentially covered under a policy in the first place. Rather, under Hoover, only certain “policy defenses,” meaning whether a procedural condition of the insurance contract has been fulfilled, may be subject to ... Keep Reading »
Ohio Supreme Court Finds Insured’s Ransomware Payment Not Covered Under Business Owners Policy
In EMOI Services LLC v. Owners Insurance Co., No. 2021-1529 (Ohio Dec. 27, 2022), the Ohio Supreme Court found that there was no coverage for a ransomware attack because there was no direct physical loss as required under the business owners insurance policy, reinstating the trial court’s summary judgment ruling in favor of the insurer. The insured, a computer software company whose software provided certain administrative services for medical offices, was a victim of ... Keep Reading »
Eleventh Circuit Finds Claims-Made Policy’s “Correlating Claims” Provision Substantially Similar to “Related Claims” Provisions
In Datamaxx Applied Technologies Inc. v. Brown & Brown Inc., the Eleventh Circuit Court of Appeals affirmed the district court’s grant of summary judgment to the insurer, finding no merit in the insured’s argument that the analysis for construing a “correlating claims” provision differed substantially from the analysis in construing a “related claims” provision. In doing so, the Eleventh Circuit found that the insurer owed no duty to indemnify the insured for a claim ... Keep Reading »
Louisiana Supreme Court Finds “Assault and Battery Exclusion” Barred Coverage for Kidnapping at Insured’s Motel
In granting summary judgment to the insurer and finding no duty to defend, Louisiana’s highest court reversed a trial court’s ruling on the basis of the “clear and unambiguous” assault and battery exclusion in a commercial general liability policy. Kazan tragically arose from a kidnapping and subsequent homicide of a guest of the insured — a motel operating in Alexandria, Louisiana. As the victim was attempting to retrieve something from her vehicle, another motel ... Keep Reading »
Georgia Federal Court Extinguishes Fire Claim Because of Insured’s Failure to Update Insurer on Home Use
In Mehic v. Allstate Property and Casualty Insurance Co., the U.S. District Court for the Northern District of Georgia determined that an insured did not satisfy a condition precedent to coverage under a homeowners policy — keeping the insurer apprised of the property’s occupancy — thereby finding that the insurer had no duty to provide benefits. Mehic arose after the insured’s home, which she had not inhabited full time in nearly three years, was damaged in a fire. ... Keep Reading »
Virginia Federal Court Orders Suppliers of Contaminated Fruit to Reimburse Subrogated Insurer for Defense of Smoothie Cafes
Sentinel Insurance Co. v. VLM Foods Inc. arose after a hepatitis A outbreak was traced back to contaminated strawberries used and sold by several insured smoothie cafe franchises. The insured tendered all of the outbreak claims to its strawberry suppliers, pursuant to several hold harmless agreements. Although the suppliers paid a bulk of the claims, they refused to pay any of the insured’s attorneys’ fees and costs incurred in defending the outbreak claims, which were ... Keep Reading »
Arizona Supreme Court Finds That Reasonableness of Insurer’s Refusal to Consent to Settlement Under D&O Policy Is in the Eye of the Insurer
In Apollo Education Group Inc. v. National Union Fire Insurance Company of Pittsburgh, the Arizona Supreme Court found that the reasonableness of the insurer’s decision to refuse to consent to settlement under a directors and officers policy is determined from the insurer’s perspective — not that of the insured. Apollo stems from a multimillion-dollar settlement following litigation surrounding an education company’s practice of backdating stock options for corporate ... Keep Reading »
Missouri Federal Court Finds New York Choice-of-Law Provision Does Not Inhibit Insured’s Assertion of Missouri-Specific Public Policy Statute Violation
In Maritz Holdings Inc. v. Certain Underwriters at Lloyd’s London, a federal court in Missouri denied an insurer’s motion to dismiss the insured’s assertion of a vexatious refusal to pay claim based on an obscure Missouri-specific public policy statute, despite the court’s acknowledgment that the subject insurance contracts were governed by their New York choice-of-law provisions. This insurance coverage dispute stemmed from alleged losses following two separate ... Keep Reading »