Hunton Insurance Recovery Blog

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.”

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.

In an article appearing in Electric Light & Power, Hunton insurance recovery lawyers, Lawrence Bracken, Sergio Oehninger and Alexander Russo discuss the insurability of losses resulting from the recent wildfires in California.  Many affected by the tragedy have tried to shift responsibility to utility and power companies, which also may face subrogation claims from insurers that paid property and business owners for first-party losses.  In addition, liability insurance programs may help defray costs imposed upon those believed to be at fault, including costs resulting from ...

The Wisconsin Supreme Court held last week in Steadfast Ins. Co. v. Greenwich Ins. Co. that two insurers must contribute proportionally to the defense of an additional insured under their comprehensive liability policies.

The Texas Supreme Court has reversed a lower appellate court decision and found that insurers of Anadarko Petroleum Corp. cannot use their own policy wording to avoid coverage for more than $100 million of Anadarko’s defense costs stemming from the 2010 Deepwater Horizon disaster.  Law360 interviewed Hunton’s Sergio F. Oehninger about the substantial impact the decision will have for policyholders in Texas and elsewhere.  Oehninger explained how the decision corrects fundamental errors by the lower court in the construction of insurance policies and how it illustrates the proper way to construe words chosen by the insurer that operate to limit or preclude coverage.  In the Anadarko matter, the London market policy contained a “joint venture” provision that capped joint venture liabilities at $37.5 million.  The insures applied the cap after paying that amount to Anadarko.  The Texas Supreme Court rejected the insurers’ argument and the decision of the court below, finding that the joint venture provision applies only to “liabilities” – that is, amounts Anadarko becomes legally obligated to pay to a third party.  Defense costs, in contrast, are not amounts paid to a third party and, thus, are not “liabilities” within the context of the joint venture provision.  The Court also drew on other policy provisions to support the distinction, including provisions that specifically refer separately to “liabilities” and “defense expenses.”  “The Texas Supreme Court’s reversal of the appellate panel’s ruling serves as a clear pronouncement of both insurance policy construction rules and proper appellate review in Texas,” Oehninger said.  “In this regard, the Supreme Court’s opinion serves to ‘right the ship’ and bring Texas case law back in line with precedent.”

Summary

Reversing a Texas Court of Appeals decision that allowed Anadarko’s Lloyd’s of London excess insurers to escape coverage for more than $100 million in defense costs incurred in connection with claims from the Deepwater Horizon well blowout, the Supreme Court of Texas held that the insurers’ obligations to pay defense costs under an “energy package” liability policy are not capped by a joint venture coverage limit for “liability” insured.  Anadarko Petroleum Corp. et al. v. Houston Casualty Co. et al., No. 16-1013 (Tex. Jan. 25, 2019).

Rosen Millennium Inc. (“Millennium”), the cyber security and IT support subsidiary of Rosen Hotels & Resorts, Inc., has appealed to the Eleventh Circuit contending that a Florida federal court ignored Florida insurance law when it ruled that Travelers Insurance Company has no duty to defend it against a multimillion dollar claim arising out of a cybersecurity breach.

Policyholders facing any type of products liability scored a win in a recent decision from the District Court for the Northern District of Illinois.  The court found that an insurance company must defend its insured against claims arising out of a recall while simultaneously funding the insured’s affirmative claims for recovery.

In Zurich American Insurance Co. v. Don Buchwald & Associates, Inc., 2018 N.Y. Slip. Op. 33325(U) (Sup. Ct. N.Y. County, Dec. 21, 2017), the Supreme Court of New York held that Zurich was obligated to defend a talent and literary agency against claims brought by Hulk Hogan alleging that the agency aided and abetted one of its agents—Tony Burton—in publishing racist and sexual footage of Hulk Hogan online.  The decision also gives ammunition to policyholders seeking to recover their fees incurred while litigating against an insurer’s improper denial of coverage.  The court found that the insureds had “been cast in a defensive posture” due to the insurer’s claims seeking a declaratory judgment, and that this justified a fee-shifting award.

The Second Circuit has ruled a claim alleging an “offer for sale” infringed on a patent constitutes an advertising injury sufficient to trigger a defense under commercial general liability insurance.  In High Point Design LLC v LM Insurance Corporation, the plaintiff High Point brought a declaratory-judgment action against Buyer’s Direct, Inc. after the latter directed High Point to cease-and-desist in the sale of its Fuzzy Babba slippers.  Buyer’s Direct responded with a counterclaim alleging trade dress infringement, claiming that High Point’s offers for sale in retail catalogs infringed on Buyer’s Direct’s own slipper trade dress.  Buyer’s Direct sought discovery of all advertising, marketing and promotional materials related to High Point’s fuzzy footwear to substantiate its claims.

The United States District Court for the Middle District of Florida recently granted summary judgment in favor of developer, KB Homes, ruling that Southern Owners Insurance Co. must defend KB Homes under various Commercial General Liability policies.

The Fifth Circuit in Evanston Insurance Co. v. Mid-Continent Casualty Co. recently held that multiple collisions caused by the same insured driver over a span of 10 minutes constitute a single occurrence subject to a $1 million limit in the insured’s primary policy with Mid-Continent. The holding reversed a lower court’s ruling that Mid-Continent is liable for an additional sum the excess insurer, Evanston, paid to resolve all of the claims arising from the collisions. At issue, a fundamental question about causation and coverage under commercial liability insurance.

In a prior post, we discussed a New York trial-court decision that found an insurance policy issued in 1966, to insure the construction of the World Trade Center, continues to cover modern-day asbestos claims, with each claim constituting an individual occurrence.  Last week, in American Home Assurance Co. v. The Port Authority of N.Y. and N.J., 7628-7628A (1st Dep’t Nov. 15, 2018), an intermediate appellate court affirmed that decision, agreeing that coverage is triggered for claims tied to alleged asbestos exposure at the WTC site in the 1960s and ’70s.

A Georgia Court of Appeals judge recently ruled that Scapa Dryer Fabrics was entitled to $17.4 million worth of primary coverage from National Union Fire Insurance Company of Pittsburgh, PA for claims of injurious exposure to Scapa’s asbestos-containing dryer felts. Nat’l Union Fire Ins. Co. of Pittsburgh, PA v. Scapa Dryer Fabrics, Inc., No. A18A1173, 2018 WL 5306693, at *1 (Ga. Ct. App. Oct. 26, 2018). Scapa sought coverage under five National Union policies issued from 1983–1987. The 1983, 1984 and 1985 National Union policies had limits of $1 million per occurrence and $1 million in the aggregate. The liability limits for the 1986 and 1987 renewal policies were amended by endorsement to $7.2 million. Scapa sought to recover the full $17.4 million from all five policies. National Union argued that a “Non-Cumulative Limits of Liability Endorsement” in the 1986 and 1987 policies limited Scapa’s recovery to only $7.2 million. Scapa sued National Union and its sister company, New Hampshire Insurance Company (from which Scapa purchased excess liability coverage), in Georgia state court.

Hunton Insurance Coverage attorneys Syed Ahmad and Geoff Fehling contributed to the firm’s Recall Roundup, a monthly publication canvassing consumer product and retail recalls and related litigation.  In the October issue, Ahmad and Fehling discuss two recent decisions with potentially broad implications.  In Lake Country Foods, Inc. v. Houston Casualty Co., No. 18-CV-734 (E.D. Wis. filed May 11, 2018), nutritional supplement manufacturer Lake Country Foods, Inc., (“LCF”) filed an insurance coverage complaint seeking to enforce its rights under a product contamination policy issued by Houston Casualty Company (“HCC”) arising from a salmonella contamination incident.  In the October Recall Roundup, Ahmad and Fehling discuss the potential impact that the insurer’s counterclaims seeking reimbursement of the approximately $1.2 million advance payment it made in response to the alleged salmonella contamination incident might have on the pending insurance recovery dispute.

In a win for policyholders, a California appellate court has held that the loss of use of property resulting from alleged negligence constitutes property damage under a liability insurance policy.

The Massachusetts Supreme Judicial Court recently construed the undefined term “advertising idea” in a case of first impression in the Commonwealth, holding that a footwear company’s insurers must provide a defense against an underlying claim alleging unfair use of a former Olympian’s name to promote a line of running shoes.

Hunton Andrews Kurth insurance practice head, Walter Andrews, recently commented to the Global Data Review regarding the infirmities underlying an Orlando, Florida federal district court’s ruling that an insurer does not have to defend its insured for damage caused by a third-party data breach.

North Dakota’s highest court delivered a blow to Mid-Continent Casualty Company in Borsheim Builders Supply, Inc. v. Manger Insurance Co., ruling that a contract between a policyholder and general contractor fit the insured contract exception of contractual liability.

A District Court Judge for the District of Massachusetts recently ruled that Ace Property and Casualty Insurance Co. breached its duty to defend its insured in a lawsuit brought by Plaistow Project, LLC, after a family owned laundromat leaked chemicals onto Plaistow Project’s property. Plaistow Project, LLC v. ACE Prop. & Cas. Ins. Co., No. 16-CV-11385-IT, 2018 WL 4357480, (D. Mass. Sept. 13, 2018). Plaistow Project sued State Line Laundry Services in state court, and ACE denied coverage under the pollution exclusion in State Line Laundry’s insurance policy. Plaistow Project then settled with State Line Laundry. Under the settlement terms, Plaistow Project was assigned State Line Laundry’s rights against ACE.

In a victory for policyholders, and an honorable mention for Merriam-Webster’s Dictionary, a federal judge in Virginia ruled that the dispersal of concrete dust that damaged inventory stored in an aircraft part distributor’s warehouse was a pollutant, as defined by the policy, but that it also constituted “smoke” as that term was defined in the dictionary, thereby implicating an exception to the policy’s pollution exclusion.  The Court then granted summary judgment for the policyholder, who had suffered a $3.2 million loss.[1]

In a victory for policyholders, a recent decision from the Western District of Texas narrowly construed a common breach-of-contract exclusion and held that the insurer had a duty to defend its insured against an underlying lawsuit over construction defects. The allegations potentially supported a covered claim, as the conduct of the insured’s subcontractor could have been an independent, “but for” cause of the property damage at issue, thereby triggering the insurer’s duty to defend.

The California Department of Insurance recently approved three new insurance carriers to provide coverage for the emerging cannabis industry. Insurance Commissioner Dave Jones announced last week that The North River Insurance Company, United States Fire Insurance Company, and White Pine Insurance Company will all begin offering surety bonds for cannabis businesses by the end of the month.

Attorneys from Hunton Andrews Kurth LLP’s Insurance Coverage practice group contributed to the Firm’s Recall Roundup by weighing in on a recently-filed product contamination insurance coverage dispute, Lake Country Foods, Inc. v. Houston Casualty Co., No. 18-CV-734 (E.D. Wis. filed May 11, 2018), where Lake Country Foods seeks an order permitting it to keep $1.2 million already paid by its insurer and requiring the insurer to provide coverage for the a product contamination claim involving alleged salmonella contamination of powdered whey protein processed in one of ...

The Supreme Court of California has ruled that a general liability insurer must defend an employer against allegations of employee misconduct, reinforcing the breadth of (1) what constitutes an “occurrence” under an employer’s commercial general liability (CGL) policy and (2) the duty to defend regarding claims for negligent hiring, retention and supervision. The opinion in Liberty Surplus Ins. Corp. v. Ledesma & Meyer Constr. Co., Inc. can be found here.

Darshan Karboj described a grisly scene during an October 2016 wedding. She alleges that, during the festivities, a photography drone operated by wedding photographers of Hollycal Production Inc. hit her in the head, causing major injuries, including the loss of an eye. Even though it had some insurance, Hollycal might be on the hook for the bills from this unfortunate incident.

The California Court of Appeal has affirmed that Lloyd’s of London and other insurers cannot escape coverage for $132.5 million in settlements arising from the 2008 Chatsworth train crash, in which 25 individuals were killed and more than 130 injured. In Those Certain Underwriters at Lloyd’s, London v. Connex Railroad LLC, No. B276373, 2018 WL 1871278 (Cal. App. 2d Dist. Apr. 19, 2018), the Second District Court of Appeal affirmed the Los Angeles Superior Court’s ruling, discussed in our November 9, 2015 blog post, that the insurers were obligated to indemnify Connex Railroad for the settlements.

On April 13, 2018, the Superior Court of New Jersey, Appellate Division, affirmed a trial court decision finding that a bill of sale intended to include the transfer of insurance rights and finding that such transfer did not violate an anti-assignment clause. Cooper Industries, LLC, Plaintiff-Respondent, v. Columbia Casualty Company And One Beacon America Insurance Company, Defendants-Appellants, and Employers Insurance Of Wausau, Allstate Insurance Company, Lexington Insurance Company And Westchester Fire Insurance Company, 2018 WL 1770260,(N.J. Super. A.D., 2018).  In May 1986, Cooper Industries merged several entities and transferred assets to a “new” McGraw-Edison Company through a bill of sale.  Eighteen years later, on November 30, 2004, Cooper Industries merged the new McGraw-Edison company into itself.  In 2009, the Environmental Protection Agency determined that Cooper Industries was responsible for generating and disposing of hazardous substances due to McGraw-Edison’s actions taken years earlier.  Cooper Industries sought coverage under the commercial general liability policies McGraw-Edison had in place at the time of the environmental and pollution-related occurrences.

On April 20, 2018, the Eleventh Circuit affirmed an Alabama district court decision finding that an “absolute pollution exclusion” did not bar coverage for environmental property damage and injuries from a sewage leak. Evanston Ins. Co. v. J&J Cable Constr., LLC, No. 17-11188, 2018 WL 1887459, (11th Cir. Apr. 20, 2018).

Two recent decisions addressing allocation of long-tail liabilities demonstrate that resolution of the issue under New York law depends upon the policy language at issue. Judge-made rules on “equity” and “fairness” do not control.  As the New York Court of Appeals held on March 27, 2018, in Keyspan Gas East Corp. v. Munich Reinsurance America, Inc., 2018 WL 1472635 (2018), under New York law, “the method of allocation is covered for most by the particular language of the relevant insurance policy.” Both Keyspan and the April 2, 2018 decision in Hopeman Brothers, Inc. v. Continental Casualty Co., No. 16-cv-00187 (E.D. Va. Apr. 2, 2018), by the United States District Court for the Eastern District of Virginia, illustrate the importance of reviewing insurance policies - both before purchase, to ensure that they contain optimal language for coverage; and after claims arise, to ensure that the policyholder receives the benefit of insurance coverage under “legacy” and all other potentially applicable policies.

In a ruling earlier this month, an Eleventh Circuit Court of Appeals judge ruled in Scott, Blane, and Darren Recovery L.L.C., Anova Foods Inc. v. Auto-Owners Insurance Co., No. 17-12945-E, 2018 WL 1611256 (11th Cir. 2018), that an insurer did not have a duty to defend and indemnify its insured in a false marketing suit. Anova Food Inc. was sued by its competitor, King Tuna, for allegedly falsely asserting in its advertising that it treated tuna meat with a smoking process using filtered wood chips. King Tuna claimed that, in reality, Anova treated its tuna with synthetic carbon monoxide. In finding that King Tuna’s lawsuit did not trigger Auto-Owner’s duty to defend, the court held (1) that the lawsuit did allege a covered “advertising injury”; (2) that coverage was excluded under the policy’s “failure to conform” exclusion; and (3) coverage was barred by Anova’s untimely notice of the lawsuit.

In a ruling earlier this month, an Oklahoma appellate court ruled in JP Energy Marketing LLC v. Commerce and Industry Insurance Co., No. 115285, 2017 WL 7903997 (Okla. Civ. App. March 01, 2018), that additional insured status would be afforded to a project owner despite the absence of a direct contract between the project owner and the subcontractor requiring that the project owner be named as an additional insured, finding that a direct contract was not required where the insurance policies did not use the words “between” or “direct” to describe the level of contractual relationship that would give rise to additional insured status.  The decision underscores the importance of carefully evaluating the language used in “additional insured” provisions, which can vary widely in scope and effect.

A federal court in New Jersey recently held that the construction of an ambiguous policy term is not a matter suitable for judgment on the pleadings, thus denying AIG from avoiding coverage for a $67 million antitrust settlement. Rather, the only way to establish the meaning of an ambiguous term, the court explained, is to ascertain the intent of the parties, which requires “meaningful discovery.”

The Eleventh Circuit, in Mid-Continent Casualty Co. v. Adams Homes of Northwest Florida, Inc., No. 17-12660, 2018 WL 834896, at * 3-4 (11th Cir. Feb. 13, 2018) (per curiam), recently held under Florida law that a homebuilder’s alleged failure to implement a proper drainage system that allowed for neighborhood flooding triggered a general liability insurer’s duty to defend because the allegations involved a potentially covered loss of use of covered property.

A recent ruling by U.S. District Judge Paul Byron of the Middle District of Florida has made clear that the actual words used in an insurance contract matter. The court, in Mt. Hawley Insurance Co. v. Tactic Security Enforcement, Inc., No. 6:16-cv-01425 (M.D. FL. 2018), denied an insurance company’s motion for summary judgment attempting to rely on an exclusion to deny coverage to its policyholder.  The policyholder, Que Rico La Casa Del Mofongo, operated a restaurant establishment in Orlando, Florida, and sought coverage for two negligence lawsuits filed against it for allegedly failing to prevent a shooting and another violent incident on its premises.

An Iowa federal court recently ruled that an insurer must pay its policyholder’s defense costs from the date of installation of the allegedly faulty product, even though the underlying suits failed to allege when damage purportedly occurred. The ruling opens the door under each of the policyholder’s successive liability policies from 2000 to 2008, allowing the policyholder to recover millions of dollars in defense costs.

On January 9, 2018, the Northern District of California held that the Nonprofits Insurance Alliance of California owed defense coverage to a pair of Scientology-based drug and alcohol rehabilitation centers for two lawsuits filed in Georgia and Oklahoma alleging that staff members had provided drugs and alcohol to patients, which resulted in injury and death. In Western World Ins. Co. v. Nonprofits Ins. Alliance of California, No. 14-cv-04466-EJD (N.D. Cal. Jan. 9, 2018), the court confirmed the broad scope of an insurer’s duty to defend under California law and rejected the insurer’s attempt to unreasonably expand the application of a “professional services” exclusion to avoid coverage.

In Selective Ins. Co. of the Southeast v. William P. White Racing Stables, Inc. (http://caselaw.findlaw.com/us-11th-circuit/1882819.html), the Eleventh Circuit recently ruled that a liability insurer is not required to defend its insured against a claim for spoliation of evidence.  In the underlying case a jockey, James Rivera, was paralyzed in a racing accident when the horse he was riding suddenly collapsed.  Mr. Rivera sued the race track, Mr. Rivera’s employer, and the horse’s veterinarians, claiming that the horse was not fit to be raced due to the negligence of most of the defendants.  His claims against his employer, White Racing Stables, did not assert negligence but alleged that by failing to preserve the horse’s remains, White Racing had violated Florida’s workers compensation law by failing to investigate and pursue Mr. Rivera’s claims against the other defendants.  He also asserted a claim for spoliation.

Hunton & Williams insurance partner, Syed Ahmad, was quoted twice in Law360 concerning significant insurance cases to watch in 2018.  On January 1, 2018, Ahmad noted that Pitzer College v. Indian Harbor Insurance Co., pending in the California Supreme Court, “can be significant for coverage disputes in California because the California rule could override the law of the state that would apply otherwise, even if the parties agreed to another state’s law governing,"  On January 9, 2018,  Ahmad was again asked by Law360 to comment on key D&O cases that will likely be decided in 2018.  Ahmad noted that in Patriarch Partners LLC v. Axis Insurance Co., pending in the Second Circuit Court of Appeals, Patriarch's appeal presents an unusual situation in which a policyholder is arguing that various developments in an ongoing SEC investigation don't constitute a claim under a D&O policy, in order to avoid the application of an exclusion.  In other circumstances, it may be favorable for a policyholder to assert that a preliminary step in an SEC probe is a claim, so as to maximize coverage.   According to Ahmad, the district court didn't fully address how, in the context of the specific policy language at issue, a non-public order by the SEC could qualify as a claim.   "As Patriarch argues, 'until an agency makes a demand upon the target under legal compulsion, there may be no way for a policyholder to even know that it is being investigated, that an order authorizing investigation has been issued against it or what the order of investigation says,'" Ahmad said, quoting from Patriarch's appellate brief.

In an article published in Law360, Hunton & Williams LLP partners Walter Andrews, Malcolm Weiss, and Paul Moura discuss two recent decisions in Tree Top Inc. v. Starr Indem. & Liab. Co., No. 1:15-CV-03155-SMJ, 2017 WL 5664718 (E.D. Wash. Nov. 21, 2017).  There, the Eastern District of Washington rejected an insurer's attempt to escape insurance coverage for a Proposition 65 lawsuit filed against juice-maker Tree Top Inc.

This week, SEC Chairman Jay Clayton issued a statement on Initial Coin Offerings (ICO) addressing the legality, fairness, and risks associated with those offerings. Although the agency’s bulletin was one of many recent public statements by federal agencies on ICOs and cryptocurrencies generally, this new warning highlights additional issues and concerns with the ICO phenomenon that are particularly relevant to insurance coverage.

Earlier this month, the California Supreme Court agreed to review Montrose Chemical Corporation’s appeal from a September appellate court ruling that rejected Montrose’s preferred “vertical exhaustion” method of exhausting excess-layer policies in favor of a policy-by-policy review to determine which policies are triggered. The California high court’s grant of Montrose’s petition for review is potentially significant in clarifying the appropriate excess policy exhaustion trigger under California law, not to mention in addressing a significant insurer defense in Montrose’s longstanding coverage dispute over environmental insurance coverage, which has been winding its way through California courts for more than 25 years.

A New York trial court held last week in American Home Assurance Co. v. The Port Authority of N.Y. and N.J., Index No. 651096/2012 (Sup. Ct. N.Y. Nov. 29, 2017) (Bransten, J.) that an insurance policy issued in 1966, to insure the construction of the World Trade Center, continues to provide insurance coverage over modern-day asbestos claims, with each claim constituting an individual occurrence.

The Fifth Circuit recently upheld the dismissal on summary judgment of a policyholder’s claim under a commercial crime insurance policy, affirming the trial court’s narrow interpretation of the terms “owned” and “loss,” concluding that the policyholder did not “own” the funds at issue or suffer a “loss” when it loaned those funds to the fraudsters. In so holding, the court ignored state court precedent concerning construction of those same terms.

In Cooper Industries, Ltd. v. National Union Fire Insurance Co. of Pittsburgh, Pa., No. 16-20539 (5th Cir. Nov. 20, 2017), Cooper invested its pension-plan assets into what proved to be a multimillion-dollar Ponzi scheme. Over the course of many years, Cooper invested more than $175 million into various equity and bond investments managed by fraudsters who used the investment funds in furtherance of the Ponzi scheme. After discovering the fraud, Cooper recouped a large portion of its investment and sought coverage from its commercial crime insurer for the unrecovered $35 million. The policy limited coverage to “loss” of property that Cooper “owned.” Neither term was defined in the policy.

In a recent insurer’s failure-to-settle case, Hughes v. First Acceptance Ins. Co. of Ga., the Georgia Court of Appeals reaffirmed that there is no hard-set rule conducive to summary judgment; rather, the court ruled that a jury should determine whether the insurer’s actions had been “reasonably prudent.”  Plaintiff Robert Jackson allegedly caused a five-vehicle collision that resulted in his death and the serious injuries of others, including Julie An and her minor child, Jina Hong.  An and Hong, through their counsel, communicated with Jackson’s insurance company, First Acceptance, stating that they were “interested” in settling their claims within Jackson’s policy limit of $25,000.  Counsel also requested that the insurer send him policy information within 30 days.  An later claimed that this communication represented an offer of settlement, when, 41 days later, they sent First Acceptance a letter withdrawing their “offer” and stating their intent to file suit due to the insurer’s failure to respond.  An and Hong then filed suit and were ultimately awarded $5,334,220 in damages.  First Acceptance paid $25,000 towards the award, leaving Jackson’s estate exposed to over five million dollars in damages.

Last week, Golden Bear Insurance Company became the first admitted insurer approved by the California Department of Insurance to provide insurance coverage for marijuana companies. Golden Bear will now begin offering first- and third-party insurance coverage specifically targeting marijuana companies in the state.

In a recent Client Alert, Hunton & Williams insurance attorneys Lorelie Masters, Michael Levine, and Geoffrey Fehling discuss the importance of reviewing historical liability insurance policies and the potential benefit these policies can have on minimizing exposure to environmental hazards. In Cooper Industries, LLC v. Employers Insurance of Wausau, et al., No. L-9284-11 (N.J. Super. Ct. Law Div. Oct. 16, 2017), a New Jersey trial court held that an electrical products manufacturer was entitled to coverage rights under commercial general liability policies issued to a predecessor company for environmental remediation costs stemming from a U.S. Environmental Protection Agency cleanup of a 17-mile stretch of the Passaic River in New Jersey.

Earlier this week, Canada’s transport minister announced that a drone had collided with a commercial aircraft, the first confirmed collision of its kind in North America. Thankfully, the aircraft sustained only minor damage and was able to land safely. But this recent incident, which many commentators believed was inevitable given the proliferation of consumer and commercial drones, highlights the potential risks associated with drone operations.

In an article appearing in Law360, Hunton & Williams insurance partner, Michael Levine, weighs in on Office Depot’s pending Ninth Circuit appeal of a district court ruling that Office Depot is not entitled to coverage for a California False Claims Act case alleging that the office supply chain overbilled public agency customers.  The decision is premised on a finding that California Insurance Code Section 533 — which precludes coverage for a policyholder's willful acts — applies to the entire underlying CFCA action, including allegations of reckless and negligent conduct.  ...

A Missouri appellate panel recently upheld a lower court's ruling in favor of the insured that an "all-sums" allocation would apply to determining exhaustion of the insured's liability insurance coverage and, in so holding, rejected the pro-rata, proportional allocation sought by the insurers. The appellate panel further held that coverage could be exhausted vertically.

Three significant insurance disputes are pending before the New York Court of Appeals, and Hunton partner Syed Ahmad discusses the importance of those cases in Law 360’s article titled 3 Insurance Cases To Watch At NY’s High Court.

Hunton & Williams Insurance Recovery partner, Michael Levine, was quoted in an August 29, 2017 article appearing in Business Insurance, regarding the rapid increase in lawsuits, and insurance issues, surrounding concussions in high school and college sports.  Among other things, the article discusses a coverage lawsuit filed by Great American Assurance Company against Conference USA in federal court in Dallas, Texas.  In the lawsuit, the insurer alleges that its policy did not afford coverage for football concussion injuries because the policy included a “limited event ...

In a prior blog post, we discussed Kanye West's touring company's, Very Good Touring, Inc. ("Very Good"), lawsuit against its insurer, Lloyd's of London ("Lloyd's"), for withholding almost $10 million in coverage after the cancellation of shows on West's "Life of Pablo" Tour. On Tuesday, August 29, 2017, Lloyd's responded by counterclaiming against Very Good and West, alleging that the loss was due to their failure to abide by policy conditions.

From disaster preparedness and workplace safety to autonomous deliveries and performance arts, companies worldwide increasingly rely on drones as a natural extension of their business. Recent Federal Aviation Administration forecasts predict that nearly 4 million drones—over 420,000 of which will be used for commercial operations—will be operating in the U.S. by the year 2021.

Earlier this month, the Washington Supreme Court reaffirmed coverage for injuries for carbon monoxide, holding that an insurer acted in bad faith when it improperly relied on an absolute pollution exclusion to deny coverage for a lawsuit involving alleged release of carbon monoxide gas inside a home.

A federal judge has ordered an insurer to show cause why he should refrain from dismissing the insurer's case against an NCAA football conference over the availability of insurance for concussion-related lawsuits. Back in May, Great American Assurance Company filed a complaint against Conference USA, seeking a declaration that it need not defend or indemnify the conference against a lawsuit brought by a former football player. In the underlying lawsuit, the former player alleged that he suffered neurodegenerative disorders and diseases, including chronic traumatic encephalopathy ("CTE"), Alzheimer's disease, memory loss, mood swings, headaches, and anxiety stemming from repeated concussive brain impacts he sustained while playing for the University of Louisville. In the coverage action, Great American argues that a Limited Event Coverage endorsement added to Conference USA's policies did not include football as a covered event and therefore the policies do not provide coverage for "bodily injury" arising from football.

Liability insurance policies generally have an exclusion barring coverage for claims brought by the insured’s own employees. Many times, especially in the hospitality industry, a liability insurance policy provides coverage for various different companies. A common question is whether claims brought by an employee of one insured against another insured are covered under such a policy.

This past Monday, August 14, a federal magistrate judge explained to an insurer that “you can’t always get what you want” when he denied the carrier’s motion to dismiss claims arising from a July 4, 2015 Rolling Stones concert, concluding that the facts in the complaint allege a properly pled claim.

A Colorado district court held last week that a general liability insurer must defend a product disparagement claim despite a broadly-worded intellectual property exclusion in the policy. The court reached its ruling even though the alleged disparagement involved representations about patent infringement. In so holding, the court rejected the insurer’s attempt to deny coverage where the “crux of the dispute” fell within the policy’s personal injury coverage part and the insurer had failed to show that the underlying allegations “unequivocally” fell within the ambiguously worded exclusion.

A Georgia district court recently denied an insurer's attempt to recoup defense costs, holding that even where the court previously determined that coverage was barred under the policy's pollution exclusion, the insurer could not "rewrite the record" or clarify its "defective" reservation of rights letters to show that it fairly informed the policyholder of its coverage position, which is a prerequisite to recoupment of defense costs.

Hunton & Williams insurance partner Syed Ahmad commented in a July 19, 2017, Law360 article concerning the Second Circuit Court of Appeals’ recent decision in Olin Corp. v. OneBeacon America Insurance. In the decision, which is the subject of a July 26, 2017, Hunton blog post, the Second Circuit agreed with Olin that its payments toward remediating contamination at five manufacturing sites implicated a series of excess policies issued by Lamorak Insurance Co., formerly OneBeacon.

The ruling adopted the principles articulated by New York’s highest court, the Court of Appeals ...

Last week, the Second Circuit remanded environmental coverage litigation between Olin Corporation and OneBeacon based on its conclusions that (1) all sums allocation applied and (2) a prior insurance provision allowed OneBeacon the opportunity to show that prior excess insurers had made payments for the same claims, thereby reducing OneBeacon’s liability for Olin’s remediation costs at five manufacturing sites.

The district court had calculated OneBeacon’s liability on a pro rata allocation. Based on the New York Court of Appeals’ intervening decision in Viking Pump (previously covered here, the Second Circuit found that an all sums allocation should apply. The decision thus allows Olin to obtain full indemnification under OneBeacon’s policy for amounts spent to remediate the manufacturing sites, up to the limits of that policy. Because the district court had applied a pro rata allocation based on pre-Viking Pump case law, the Second Circuit remanded for the district court to recalculate damages.

In 2015 and 2016, we discussed certain provisions of the then drafts of the Restatement of the Law, Liability insurance, including the Duty to Cooperate, here, and Duty to Defend, here and here. In late May 2017, the American Law Institute met to approve the Proposed Final Draft—the culmination of over seven years of work on this project. Not surprisingly, many of the issues discussed in the Restatement have been hotly contested by insurers. While in many instances, the reporters simply opted for the majority rule, in a few instances, the Restatement may seek to move the law on key ...

In the linked Client Alert, my colleague, Geoff Fehling, discusses the recent federal appellate decision in Camacho v. Nationwide Mutual Insurance Co., No. 16-14225, 2017 WL 2889470 (11th Cir. July 7, 2017), where the Eleventh Circuit affirmed a Georgia district court’s refusal to disturb a jury award for the policyholder arising from the insurer’s failure to accept a time-limited settlement demand, holding that the lower court’s order was “thorough and well-reasoned.”

In the linked Client Alert, my colleagues, Lorie Masters and Brittany Davidson, discuss the recent New Jersey appellate court decision in Haskell Prop., LLC v. Am. Ins. Co., No. A-1452-14T2 (N.J. Super. Ct. App. Div. June 29, 2017), where the court again confirmed that, in “occurrence” policies, an insured can assign its policies after a loss even if the policy has an anti-assignment provision.

Commercial general liability policies typically provide coverage to insureds for losses resulting from property damage caused by an “occurrence,” usually defined in the policy as “an accident, including continuous or repeated exposure to substantially the same harmful conditions.” In the context of food recalls, however, the exact cause of the food damage, whether contamination, spoilage or something else, may be unknown. This creates uncertainty, and in turn, a coverage dispute, over whether the cause of damage was indeed accidental, and thus a covered ...

Last week, my partner, Syed Ahmad, commented on some of the biggest insurance rulings of the year in a Law360 feature article that can be found here.  Among those decisions is USAA Texas Lloyd’s Co. v. Menchaca, where the Texas Supreme Court ruled that that policyholders may recover for bad faith in the absence of coverage under their policy.  Ahmad also discussed the Connecticut appeals court decision in R.T. Vanderbilt Co., Inc. v. Hartford Acc. And Indem. Co., and its ruling that insurers may not force policyholders to act as an insurer during policy periods in which insurance was not ...

Ride and homesharing technologies like Uber and Airbnb are now ubiquitous. Slice, an on-demand insurance provider, seeks to fill the gap between the demands of these on-the-go services and traditional insurance contracts, which may not cover home rental or car sharing. Slice users can pick and choose the dates for which they receive coverage. So, for example, a homeowner that rents her home to Airbnb renters for two nights can obtain coverage solely for those two nights.

The interplay between primary and excess insurance is often litigated, especially in the context of settlements. On April 26, 2017, the First Circuit in Salvati v. Am. Ins. Co., 16-1403, 2017 WL 1488238, at *1 (1st Cir. Apr. 26, 2017) considered whether the settlement agreement entered into between plaintiff and the insureds/primary insurer was sufficient to trigger excess insurance coverage under the insured’s policy with American Insurance Company.

"Before the Court is, once again, the classic case of the insurer requesting relief from the consequences of the inartfully drafted, yet plain, terms of its insurance policy." So begins the Eleventh Circuit's recent opinion in Liberty Surplus Ins. Corp. v. Norfolk Southern Railway Co., No. 16-14767, 2017 WL 1228550 (11th Cir. April 4, 2017), where the court held that the unambiguous language of Liberty's "Completed Work" exclusion did not bar coverage for injuries sustained by a motorist injured at a railroad crossing who later sued Norfolk Southern.

Hunton & Williams insurance partner Syed Ahmad was recently quoted in Law360 regarding a recent trend in judicial decisions favoring policyholders. Ahmad addresses an apparent trend by courts to refuse to allow technical violations to void coverage under complex insurance policies. A link to the Law360 article containing Ahmad’s comments can be found at 5 Insurance Rulings You May Have Missed In The 1st Quarter.

Cyber and crime insurance policies have been heavily recommended to address the growing prevalence and types of cyber risks.  Walter Andrews and Jennifer White recently authored an article appearing in Risk Management discussing how the purchase of cyber and crime insurance policies alone is not enough to successfully manage these risks. These policies must be carefully evaluated and tailored to the particulars of each organization. The full article is available here. In the article, Andrews and White identify four key questions that every organization must ask when purchasing ...

As posted earlier today on the Hunton Retail Law Resource blog, Hunton insurance lawyer Michael S. Levine, along with Hunton colleagues Randy S. Parks and Keith Voorheis, discuss five tips to consider when thinking about what cybersecurity insurance requirements you need in your technology transactions.

On February 22^nd, Hunton insurance team partner Syed Ahmad and Mary Borja of Wiley Rein LLP will be speaking at the DC Bar’s CLE program “What Every Litigator Should Know About Insurance and How It May Impact Your Case Strategy.” The two hour class will discuss what steps an insured should take to protect claims, the role of insurance in defending and settling claims, and how to preserve attorney-client privileges. To learn more about the event, please visit: http://bit.ly/2k8SCQT.

Date and Time:
Wednesday, February 22, 2017 from 6 pm to 8:15 pm

Location:
D.C. Bar Conference ...

On February 3, 2017, members of Hunton & Williams’ insurance group, led by Insurance Practice Head Walter Andrews, and firm associate Anna Lazarus, achieved a significant victory in the Eleventh Circuit U.S. Court of Appeals, in Hillsborough County v. Star Insurance Co.  The 11^th Circuit’s published opinion, available here, addressed an issue of first impression under Florida law involving the impact of Florida’s statutory limitations on liability and an excess liability policy’s self-insured retention.  The decision provides substantial guidance under Florida law ...

Maryland’s highest court recently held that a policyholder’s failure to provide notice of a lawsuit for two and a half years was no basis for a denial of coverage. The court in Nat’t Union Fire Ins. Co. of Pittsburgh, PA v. Fund for Animals, Inc. held instead that, because National Union could not prove it suffered “actual prejudice” as a result of the late notice, Fund For Animals, Inc. (“FFA”) was entitled to receive the coverage it contracted for under its non-for-profit liability insurance policy (the “Policy”).

Hunton and Williams LLP has published its 2016 Retail Industry Year in Review.  The Review discusses the key legal and regulatory developments that affected the retail industry last year.  In the Review, Hunton insurance coverage attorneys Syed Ahmad, Mike Levine and Jenn White discuss the lessons learned from insurance coverage cases that promise to have a lasting impact on retail cyber security and product contamination insurance.  As they explain, “Last year’s decisions are critical reminders that having the right insurance is key, and even unintentional missteps can ...

The Eleventh Circuit recently held in G.M. Sign, Inc. v. St. Paul Fire and Marine Ins. Co., that, by denying coverage for a lawsuit filed against its insured, St. Paul waived the policy's notice requirements, thus obviating the need for the policyholder to provide notice of a second similar lawsuit arising out of the same acts and asserting the same claims. The policyholder, MFG.com, was sued in a class action filed in November 2008 by GM Sign, Inc., which alleged that MFG.com had sent numerous unsolicited faxes in violation of the Telephone Consumer Protection Act (TCPA), among other things. After St. Paul denied coverage, MFG.com and GM Sign stipulated to the dismissal of the first lawsuit without prejudice in July 2009. The next day, GM Sign filed a new class action complaint against MFG.com alleging the same claims on behalf of the same class of plaintiffs as the first suit. MFG.com did not tender the second suit to St. Paul. As part of the $22.5 million settlement of the second suit, GM Sign took an assignment of MFG.com's right to payment from St. Paul and filed suit to recover insurance proceeds and for bad faith. St. Paul responded, contending that MFG.com breached the policy's notice provision by failing to provide notice of the second lawsuit.

A California appellate court held on Tuesday in Navigators Specialty Ins. Co. v. Moorefield Constr., Inc., 2016 WL 7439032, __ Cal.Rptr.3d __ (Dec. 27, 2016), that a general liability insurer must cover amounts paid as attorneys’ fees in an underlying settlement even where no duty to indemnify was owed under the policies. The coverage was required under the policies’ Supplementary Payments provision – an often overlooked and underutilized section of the CGL policy that can be of significant value to policyholders.

On December 20, 2016, a New York federal district court granted a petition to compel arbitration, filed by Zurich Insurance Co.’s (“Zurich”), as a subrogee of Adidas Group (“Adidas”), against Crowley Latin America Services LLC (“Crowley”), a transportation and logistics company. The underlying dispute involves losses from a fire-damaged shipment of Adidas clothing.  The Court allowed Zurich to compel arbitration based on its service contract with Adidas.

Many communities are breathing a sigh of relief as winter weather kills off a good portion of the Zika-carrying mosquito population – at least in some parts of the US, and at least until next spring.  But dwindling mosquito populations have not diminished business concerns about Zika-related losses.  Since the health effects of Zika may not be apparent until months after birth, businesses in mosquito-popular locales should assess their option to cover the losses caused by Zika, or the mere threat of Zika.  Read my colleagues Walter Andrews, Michael Levine, Andrea DeField’s ...

On November 9, 2016, my colleagues Syed Ahmad, Shawn Regan and Shannon Shaw, published an article in Corporate Counsel discussing a recent decision from New York’s highest court that may impact the exchange of information between policyholders and their insurers. The article addresses the impact of Ambac Assurance v. Countrywide Home Loans, in which the New York Court of Appeals held that an attorney-client communication disclosed to a third party during the period between the signing and closing of a merger will remain privileged only if the communication relates to a common ...

On August 15, we wrote a blog post (which can be accessed here) about how the Eleventh Circuit certified to the Florida Supreme Court the issue of whether Florida’s pre-suit process in contractor cases, under Chapter 558 of the Florida Statutes, constitutes a “suit” under CGL policy language, which would trigger the insurer’s duty to defend. On October 25, various construction trade organizations and a nonprofit policyholder advocacy group, United Policyholders, urged the Florida Supreme Court to rule in favor of Altman Contractor Inc.’s (“Altman”) interpretation that a construction defect notice issued under Chapter 558 constitutes a “suit” under CGL policies because such a reading would promote insureds and insurers to resolve disputes with the underlying plaintiff out of court and because CGL policies should be construed broadly to provide coverage for pre-litigation proceedings.

As reported in the Privacy & Information Security Law blog, on October 25, 2016, the Federal Trade Commission released a guide for businesses on how to handle and respond to data breaches (the “Guide”). The 16-page guide details steps businesses should take once they become aware of a potential breach. The guide also underscores the need for cyber-specific insurance to help offset potentially significant response costs.

On September 22, 2016, the Oregon Supreme Court rejected an insurer’s attempt to separately relitigate issues of liability previously decided in an underlying lawsuit.  The decision in Fountaincourt Homeowners’ Ass’n v. Fountain Dev., LLC, 360 Or. 341 (2016), reaffirms the settled liability paradigm that “an insurer cannot, in a subsequent proceeding, retry its insured’s liability, or alter the nature of the damages awarded in that proceeding.”  Id.

Earlier today, FC&S Legal published an article by Hunton & Williams insurance lawyers Mike Levine and Matt McLellan, discussing the Seventh Circuit’s recent decision in Cincinnati Ins. Co. v. H.D. Smith, LLC , in which the court held that a general liability insurer must defend a West Virginia pharmaceutical distributor in litigation brought by the State of West Virginia alleging it had contributed to an epidemic of prescription drug abuse.  The decision is significant for policyholders in West Virginia and elsewhere because it illustrates that the general liability ...

In Cypress Point Condo. Ass'n, Inc. v. Adria Towers, L.L.C., 076348, 2016 WL 4131662, at *8 (N.J. Aug. 4, 2016), a condominium association sued its general contractor for rainwater damage to the condominium complex, after the project was completed, which was allegedly the result of defective work performed by subcontractors. The condominium association also sued the developer's CGL insurers, seeking a declaration that claims against the developer were covered by the policies. The trial court granted summary judgment to the insurers, finding that there was no "property damage" or "occurrence," as defined and required by the policies, to trigger coverage. The condominium association appealed, and the Appellate Division reversed, concluding that "consequential damages caused by the subcontractors' defective work constitute[d] 'property damage' and an 'occurrence' under the polic[ies]."

On August 2^nd, the Eleventh Circuit Court of Appeals certified to the Florida Supreme Court the issue of whether the notice and repair process of Chapter 558, Florida Statutes constitutes a "suit" under widely used CGL policy language, thus triggering the insurer's duty to defend. Altman Contractors, Inc. v. Crum & Forster Speciality Ins. Co., No. 15-12816 (11th Cir. Aug. 2, 2016).

Insurance-giant American International Group (AIG) announced that it will be the first insurer to offer standalone primary coverage for property damage, bodily injury, business interruption, and product liability that result from cyberattacks and other cyber-related risks. According to AIG, “Cyber is a peril [that] can no longer be considered a risk covered by traditional network security insurance product[s].” The new AIG product, known as CyberEdge Plus, is intended to offer broader and clearer coverage for harms that had previously raised issues with insurers over ...

In June, Syed S. Ahmad and Jennifer E. White published an article in Risk Management Magazine about how commercial general liability (CGL) policies may help with trademark infringement litigation, despite common exclusions. A recent federal court opinion out of California conforms with the precedent we described in that article, holding that the insurer, Great Lakes Reinsurance (UK) PLC ("Great Lakes"), is required to defend In and Out Fashion, Inc. ("IOF") in a trademark suit filed by Forever 21, Inc. ("Forever 21"). The fashion giant alleged that IOF essentially sold Forever 21 products as its own by obscuring or removing Forever 21's marks. IOF requested that its CGL insurer, Great Lakes, defend it in the underlying suit. The relevant CGL policies covered damages because of "personal and advertising injury," defined to include "infring[ing] upon another's copyright, trade dress or slogan in your 'advertisement'." The policies excluded damages arising from trademark infringement and, according to the insurer, did not cover copyright, trade dress or slogan infringement in non-"advertisement" mediums. Great Lakes refused to defend IOF, and sued for declaratory relief regarding its obligations under the policies.

A federal appeals court ruled on Wednesday that the absence of a duty to defend does not foreclose the potential for indemnity coverage under primary and umbrella liability policies. The decision in Hartford Casualty Insurance Co. et al. v. DP Engineering LLC, stems from a March 31, 2013, incident where an industrial crane collapsed at a nuclear generating facility near Russellville, Arkansas, causing significant damage and injuries, including one death.

Last week’s torrential rains have caused widespread flooding in West Virginia and surrounding areas. It is important that policyholders in these and other areas remain mindful of the substantial benefits that may be available to them for resulting economic and physical losses under ordinary business insurance policies. Policyholders also should be mindful of the interplay between coverage for flood under business insurance policies and assistance that may be available from state and federal agencies (e.g., FEMA). Finally, policyholders should stand ready to enforce their ...

On Tuesday, Syed Ahmad and Jennifer White published an article in Risk Management magazine about how commercial general liability (CGL) policies may help policyholders looking to recover attorney’s fees or fund settlements in trademark infringement litigation. Historically, like the Johnny Lee song “Lookin’ for Love,” CGL policies were the wrong place to look for coverage, and insurers raised often successful defenses to covering such trademark infringement cases under CGL policies. Or, policyholders would avoid CGL insurance altogether in favor of intellectual ...

In a June 1, 2016 decision, the Second Circuit Court of Appeals in National Fire Insurance Co. of Hartford et al. v. E. Mishan & Sons Inc. required CNA Financial Corporation to defend E. Mishan & Sons, Inc.("Emson") – best known for its "As Seen on TV" products –in two class actions alleging a conspiracy to trap customers into recurring credit card charges and that Emson sold private consumer information that it obtained through its product sales.

Hunton & Williams' insurance practice head, Walter Andrews, was quoted in a Law360 article yesterday regarding the confusion that is likely to result from a federal bankruptcy judge's decision in Rapid-American Corp. v. Travelers Casualty and Surety Co., where the court concluded that a majority of excess insurers owe no coverage to Rapid-American Corp. for underlying asbestos claims until the company exhausts the limits of its underlying primary and excess coverage through actual payment, not just accrued liability. According the Andrews, "the public policy clearly ...

Andrea DeField’s update, and her original post discuss portions of the proposed Restatement of the Law on Liability Insurance and how they may alter the consequences for breaching the duty to defend. The proposed Restatement contains many other provisions that may prove relevant to future coverage disputes, particularly ones governed by state law that is less developed than in states like New York, California, and Florida.

In an article recently published in Bloomberg/BNA Privacy and Security Law Report, Hunton lawyers Syed Ahmad, Sergio Oehninger and Patrick McDermott discuss a recent decision finding insurance coverage for a cyber-related incident.  In the article, the authors dissect whether information made available on the internet is “published” if there is no evidence that anyone ever accessed the information.  As the authors and the court conclude, coverage is indeed available under the general liability policy at issue, demonstrating that general liability insurance can provide ...