In Frankenmuth Mutual Insurance Co. v. Brown’s Clearing Inc., the Eleventh Circuit Court of Appeals affirmed an Alabama district court’s ruling that the insured was not required to give notice of an underlying lawsuit until the insured had actual knowledge of the suit. Brown’s Clearing, a tree clearing company, hired a subcontractor to clear trees along I-75 in Bartow, Georgia. In July 2018, Courtney Ford allegedly sustained injuries when a tree limb pierced the ... Keep Reading »
Duty to Defend
No CGL Coverage for Opioid Distributor Sued for Economic Damages but Not Bodily Injury Damage
In Westfield National Insurance Co. v. Quest Pharmaceuticals, the Sixth Circuit held that two insurers owed no coverage obligations to Quest Pharmaceuticals in connection with 77 lawsuits filed against it alleging misconduct that contributed to a nationwide epidemic of opioid abuse. 57 F.4th 558 (6th Cir. 2023). Quest Pharmaceuticals, a Kentucky-based distributor of generic drugs, faced an onslaught of lawsuits from cities, counties, a county health department, ... Keep Reading »
New York Federal Judge Finds No Duty to Defend Based on War Exclusion’s Insurrection Clause
In Hartford Fire Ins. Co. v. The Western Union Co. et al., No. 22-CV-0557 (JMF) (S.D.N.Y. Sept. 22, 2022), a federal judge in New York granted Hartford Fire Insurance Company’s motion for judgment on the pleadings and motion to dismiss Western Union’s counterclaims, ruling that the war exclusion and financial services exclusion in its commercial general liability insurance policy both independently operated to bar coverage for the underlying lawsuit. Underlying ... Keep Reading »
Eleventh Circuit Holds Buzz Words in Arbitration Demand Insufficient to Trigger Duty to Defend
On November 8, 2022, the Eleventh Circuit Court of Appeals agreed with the U.S. District Court for the Middle District of Florida that Mount Vernon Fire Insurance Co. did not have a duty to defend Global Travel International Inc. in an arbitration between Global Travel and Qualpay Inc. despite Global Travel’s best efforts to bring the claim within coverage. Global Travel and Qualpay entered into a merchant card processing agreement pursuant to which Global Travel ... Keep Reading »
Investment Advisory Firm’s Unlawful Copying and Distribution of Industry Publication to Firm Employees Not Covered by Professional Liability Policy
A California court recently held that an investment advisory firm’s losses stemming from its alleged copying and distribution of Oil Daily, an energy industry publication, to the firm’s advisers were not covered by investment advisory professional liability policies the firm had procured. Energy Intelligence Group Inc. is the publisher of “newsletters and other publications for the highly-specialized global energy industry,” including Oil Daily. Energy Intelligence ... Keep Reading »
Federal Court Finds Selling Products in New Jersey Is Insufficient to Establish Personal Jurisdiction in Case Regarding Insurance Coverage for Underlying New Jersey Action
A U.S. district judge ruled in a coverage dispute that an allegation that a company sold products in New Jersey is insufficient to establish personal jurisdiction in a related insurance coverage action. In Ohio Security Insurance Co. v. Premium Food Group Inc., the court ruled that the fact that the insureds sought coverage for an underlying suit filed in New Jersey was not sufficient to exercise specific personal jurisdiction over two New York corporations. Underlying ... Keep Reading »
Eleventh Circuit Holds Tort Claimants Lack Standing to Challenge Judgment That Insurer Has No Duty to Defend
On March 29, 2022, the Eleventh Circuit Court of Appeals held that a tort claimant lacks standing to challenge a court's judgment finding that the carrier had no duty to defend the insured. A.B. was 10 years old when she was sexually abused by her parent and her parent's spouse. The spouse was ultimately indicted, pleaded guilty to two counts of human trafficking, and was sentenced to 30 years in prison per count. In her suit against the convicted human trafficker ... 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 »
Illinois Supreme Court Finds That Alleged Sharing of Fingerprint Data Violates the Right of Privacy, a “Personal Injury” Triggering Duty to Defend
The Illinois Supreme Court recently affirmed that West Bend Mutual Insurance Co. has a duty to defend an insured under a business insurance policy against allegations that they violated the Illinois Biometric Information Privacy Act (BIPA), finding that an exclusion that bars coverage for certain statutory actions did not apply. The court ruled that a tanning salon’s sharing of its clients’ biometric identifiers and biometric information (fingerprints) with a third-party ... Keep Reading »
Florida Supreme Court Permits Insurer to Maintain Subrogated Malpractice Claim Against Counsel Retained to Represent Its Insured
Long-standing Florida law recognized only two limited exceptions to the general rule prohibiting a third party from pursuing a legal malpractice claim against an attorney who was not in privity with the third party - a will drafting situation and a private placement memoranda situation. In Arch Insurance Co. v. Kubicki Draper, LLP, the Florida Supreme Court created a third exception, now allowing an insurer with a duty to defend to stand in the shoes of its insured and ... Keep Reading »
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