In Helguera v. Mid-Century Insurance Co., California’s Fourth District Court of Appeal held that an intentional acts exclusion in the liability coverage part of a homeowners insurance policy issued by Mid-Century Insurance Co. barred coverage for an underlying wrongful death lawsuit. The court rejected the insured’s argument that the exclusion rendered coverage illusory. The underlying wrongful death lawsuit involved a shooting at a party at the insured’s house. ... Keep Reading »
Intentional Acts
Federal Court Finds No Coverage for Mouthwash Tainted From Auto Cleanser Equipment
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 »
Fifth Circuit Holds No Liability Coverage for Negligence Claim Premised on Allegations of Intentional Conduct
In Gold Coast Commodities, Inc. v. Crum & Forster Specialty Insurance Co., issued May 22, 2023, the U.S. Court of Appeals for the Fifth Circuit held that a pollution liability policy did not provide coverage for a negligence claim premised on allegations of intentional conduct. In Gold Coast, the insured, Gold Coast Commodities sought defense and indemnity coverage for an underlying lawsuit filed against it by the city of Brandon, Mississippi. In that lawsuit, the ... Keep Reading »
Massachusetts High Court Rejects Insurance Company’s Application of “Physical Abuse” Exclusion to a Personal Injury Claim Involving One-Time Unintentional Contact
Insurance companies typically incorporate intentional harm exclusions into their homeowners’ insurance policies, which allow them to deny coverage where the insured intentionally causes bodily injury or property damage. Policies also often include an exclusion for physical abuse and molestation. However, as the Massachusetts Supreme Judicial Court held in Dorchester Mutual Insurance Co. v. Timothy Krussell et al., No. SJC-12856 (Mass. Aug. 13, 2020), an attempt by an ... Keep Reading »
Iowa Supreme Court Finds Fatality Allegedly Caused by Gross Negligence Was a Potential “Accident” Under CGL Policy
Coverage under most commercial general liability (CGL) policies applies only to liability arising from an “accident.” As such, injury or damage that an insured “expected or intended” to occur is not covered. But whether an insured subjectively intended to cause injury may be difficult to determine, even when the conduct itself was clearly intentional. In a recent decision by the Supreme Court of Iowa, the court examined a related, if not potentially more difficult, ... Keep Reading »
A Case of Mass Listeria: Insurer’s Duty to Defend in New Jersey Contaminated Pizza Crusts Suit
Last week, in Conte’s Pasta Co. v. Republic Franklin Insurance Co., a New Jersey federal court ruled that Republic Franklin Insurance Co. was obligated to indemnify Conte’s Pasta for the costs incurred defending against a suit brought by one of its customers, Nature’s One, for damages related to listeria contamination in its gluten-free pizza crusts. Underlying Litigation In early 2017, Nature’s One contracted with Conte’s Pasta to manufacture gluten-free pizza ... Keep Reading »
Years of Embezzlement Precluded From Coverage Under E&O Policy’s Commingling Exclusion
A federal district court in North Dakota recently granted an insurer’s motion to dismiss in Campbell Property Management LLC v. Lloyd’s Syndicate 3624, finding that both prongs of a “commingling exclusion” to coverage applied. The court granted the insurer’s motion to dismiss the breach of contract and bad faith claims asserted by Campbell Property Management, finding that there was no coverage for the subject acts, and thus there could be no bad faith. Lloyd’s issued ... 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 »
The Insurer’s Howler, or How Travelers Proved Its Insured’s Case
What happens when an insurer presents evidence at trial that supports the insured's case? Answer: The evidence can be used to sustain the jury verdict for the insured-plaintiff. That is the lesson learned by Travelers in the Connecticut Supreme Court, despite: (1) Travelers' moving for directed verdict after the plaintiff's case-in-chief; (2) the trial court's reserving its ruling until after the defense's case; and (3) Travelers' renewing its motion for directed ... Keep Reading »
Homeowners Insurance Has Unintended Consequence, Insurer Must Defend Teen in Cyberbullying Suit
In State Farm Fire and Casualty Co. v. Motta, et al., No 18-cv-3956 (E.D. Pa. Dec. 11, 2018), the Eastern District of Pennsylvania Court held that State Farm Fire and Casualty Co. had a duty to defend a teenage boy against a lawsuit accusing him of cyberbullying one of his classmates that led her to commit suicide, under the boy’s mothers’ homeowners insurance policy. Julia Morath died by suicide within a couple of days of Zach Trimbur attacking her, via text message ... Keep Reading »