A Louisiana federal district court has held that a claims-made-and-reported professional liability policy did not provide coverage for a claim first made and reported years after the policy expired. Sistrunk v. Haddox, 2021 WL 1723545 (W.D. La. Apr. 30, 2021).
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Multiple Lawsuits Arising Out of Employee’s Alleged Sexual Abuse of Multiple Children are “Single Claim” Under Claims-Made Policy
The Illinois Court of Appeals, applying Illinois law, has held that multiple lawsuits filed against a school district arising out of an employee’s alleged sexual abuse of children constitute a “single Claim” first made before the claims-made liability policy incepted. Freeburg Cmty. Consol. Sch. Dist. No. 70 v. Country Mut. Ins. Co., 2021 WL 1337333…
Coverage for Suit Arising from Settlement of Previous Litigation Not Barred by Prior and Pending Proceeding Exclusion
Applying California law, the United States Court of Appeals for the Ninth Circuit has held that a fiduciary liability policy’s Prior and Pending Proceeding Exclusion did not bar coverage for litigation concerning implementation of a settlement agreement resolving a prior lawsuit because the two actions did not “arise out of the same facts or circumstances.”…
Common-Law Claims Associated with Unsolicited Faxes Held to be “Arising Out of” Violation of the TCPA
The United States Court of Appeals for the Seventh Circuit, applying Illinois law, has held that common-law tort claims regarding errant faxes arose out of the Telephone Consumer Protection Act (TCPA) so as to trigger an exclusion in the relevant insurance policy. Mesa Labs., Inc. v. Fed. Ins. Co., 2021 WL 1538230 (7th Cir. Apr.
Ninth Circuit Holds Notice-Prejudice Rule Inapplicable to Claims-Made-And-Reported Policies
Applying Montana law, the Ninth Circuit Court of Appeals has held that a claim made during one claims-made policy period but not noticed until a second policy period was not covered under either policy. Capitol Specialty Ins. Corp. v. Big Sky Diagnostic Imaging, Inc., 2021 WL 1564349 (9th Cir. Apr. 21, 2021). The court…
Wrongful Acts Alleged in Class Action Based on Corporate Policy Are Not “Related Acts”
The United States District Court for the Southern District of New York has held that an insurer has a duty to defend its insured’s subsidiary in a class action lawsuit that alleges wrongful conduct that occurred prior to the parent’s acquisition of the subsidiary, rejecting the insurer’s argument that the policies’ “Related Acts” definition precluded…
Prior Knowledge Provisions Barred Coverage for Malpractice Claim Based on Pre-Policy Sanctions and Default Judgment
The Montana Supreme Court has held that there was no coverage under a lawyers professional liability policy for a client’s malpractice claim because the lawyer knew of and failed to disclose, prior to the insured law firm’s procurement of the policy, the sanctions and default judgment that were the bases of the client’s claim. ALPS…
SEC Investigation of Company Not a “Claim” or “Securities Claim”
Applying New York law, the United States District Court for the Southern District of New York has held that an SEC investigation of the insured company did not constitute a “Securities Claim,” where the term expressly excluded investigations. Hertz Global Holdings, Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh, 2021 WL 1198802 (S.D.N.Y. Mar.…
Alleged Breach of Fiduciary Duty Not a “Securities Claim”
The United States District Court for the District of Delaware, applying Delaware law, has held that lawsuits alleging breaches of fiduciary duty did not constitute “Securities Claims” under a D&O policy. Calamos Asset Mgt., Inc. v. Travelers Cas. & Surety Co. of Am., 2021 WL 663056 (D. Del. Feb. 19, 2021).…
Lawsuit Filed After Expiration of Policy Period for Lawyer’s Negligent Drafting of His Own Trust Agreement Not Covered Under Claims-Made Professional Liability Policy
Applying the law of Mississippi, a federal district court held that coverage was unavailable under a claims-made policy for an underlying lawsuit because the lawsuit, which was filed after the expiration of the policy period, did not allege that the insured had provided legal services “for others” as required by the policy. Blackburn Law Firm…