Hunton Insurance Recovery Blog

On March 22, 2019, a federal judge in Michigan found in Alticor Global Holdings, Inc. v. America Int’l Specialty Lines Ins. Co., that claims of copyright infringement by several major record labels are potentially covered under liability policies issued by AIG.  Alticor involved a claim for coverage stemming from suits by a group of entertainment companies against Amway, “accusing it of infringing hundreds of copyrighted sound recordings.”  Amway sought coverage from its umbrella insurer, AIG.  AIG claimed that the personal injury and advertising injury coverage did not apply because “coverage extends only to advertisements of a Named Insured,” i.e., Amway, and the underlying suit related to advertisements of Amway independent business owners.

Hunton Andrews Kurth LLP partner Lorie Masters, partnering with insurance broker Marsh and others, analyzed the often complex issues raised by the insurance coverage actions posed by actions alleging violations of antitrust laws.  “Optimizing Antitrust Coverage in Private Company D&O Policies,” published by Marsh in Insights.  Investigations invoking antitrust laws raise the prospect of both civil and criminal liabilities. While most of these investigations are settled or resolved without findings of liability, the defense costs can be staggering.  Policyholders ...

In a March 6, 2019 article appearing in Law360, Hunton insurance team partner, Syed Ahmad, commented on the Wisconsin Supreme Court’s recent reinforcement of a general liability insurer’s broad duty to defend in West Bend Mut. Ins. Co. v. Ixthus Med. Supply, Inc.  In the article, Ahmad noted that “the ruling puts some real teeth into the broad duty to defend standard."  A deeper analysis of the decision is discussed in our March 8, 2019 blog post, in which we analyze the court’s reasoning behind its refusal to allow the insurer to escape its duty to defend by relying on the knowing ...

The Georgia Supreme Court ruled this week that First Acceptance Insurance Co. need not pay a $5.3 million excess judgment against its insured, Ronald Jackson.  First Acceptance Ins. Co. of Georgia, Inc. v. Hughes, No. S18G0517, 2019 WL 1103831 (Ga. Mar. 11, 2019), even though Jackson’s insurer could have settled the claim for Jackson’s $50,000 policy limits.

In a March 13, 2019 article appearing in Law360, Hunton Insurance team head, Walter Andrews, explains the adverse impact of a Georgia Supreme Court ruling that attempts to clarify the rules governing settlement of insured liability claims under Georgia law.  As Walter explains, however, the decision stands to hinder settlements and potentially subject innocent insureds to staggering liability beyond that covered by their insurance.  In First Acceptance Ins. Co. of Georgia, Inc. v. Hughes, the Georgia Supreme Court ruled that policyholders must make a “valid offer” – that is, one that contains definite time limits and other terms - before an insurance company is required to settle.  As Walter told Law360, the court took “an overly narrow approach” that is “disturbing and is likely to act as a deterrent to settlements in the future.” He goes on to explain that insurance companies will actually have less incentive to settle, “which means that fewer cases will settle and cases will linger longer in court, which is not in the interests of either the injured parties or the insured defendants.”

Insurance partner Michael Levine is teaming up with Hunton’s Michael Perry and Adam Solomon and Jones Day’s Lisa Ropple to discuss cybersecurity litigation and insurance coverage presentation for the Massachusetts Bar Association. The presentation, sponsored by the MBA’s Complex Commercial Litigation Section, will take place on Wednesday, March 20^th at 4:30 pm at the MBA’s office in Boston. Topics will include:

• General litigation claims arising from cybersecurity incidents and defenses available to companies facing these claims.
• Safeguards to prevent ...

Hunton insurance associate Andrea DeField will be speaking on a plenary panel titled “Transferring the Risk: A Professional's Checklist for Procurement of the Cyber Liability Policy” at the University of South Carolina School of Law’s 2019 Cybersecurity Legal Institute. The event will take place on April 4^th in Columbia, South Carolina. Additional information about this event can be found here.

In an Expert Analysis recently published in Law360, Hunton insurance recovery attorneys Sergio Oehninger and Latosha Ellis discuss the many ways that event cancellation insurance can help mitigate loss caused by government shutdowns and other disruptive events.  A copy of the Expert Analysis can be found here.

In an article appearing in CyberInsecurity News, Hunton insurance recovery partner, Michael Levine, comments on Zurich American Insurance Company’s attempt to invoke a so-called “war exclusion” as a basis for not paying business income losses suffered by snack food giant Mondelez International.  As Levine expains, so-called “war exclusions” have rarely been invoked and only then, in times of clear military or state-sponsored activity.  The Mondelez case will therefore focus on whether a computer attack was indeed an act of war and, importantly, whether and how Zurich ...

The Wisconsin Supreme Court held last week in West Bend Mut. Ins. Co. v. Ixthus Med. Supply, Inc., that West Bend Mutual Insurance Co. (“West Bend”) could not escape its duty to defend by relying on the knowing violation and criminal acts exclusions in a commercial general liability policy issued to Ixthus Medical Supply, Inc. (“Ixthus”).  The court required the insurer to defend notwithstanding underlying allegations that Ixthus acted wrongfully and knowingly in defrauding Abbott Laboratories (“Abbott”).

In January we wrote about Rosen Millennium Inc.’s (“Millennium”) appeal to the Eleventh Circuit, whereby Millennium took the position that a Florida federal court ignored well established Florida insurance law when it ruled that St. Paul Fire & Marine Insurance Co. had no duty to defend it against a multimillion dollar claim arising out of a 2016 cybersecurity breach.