In Dunn, et al. v. Columbia National Insurance Company, No. 2:17-cv-0246 (N.D. Ga.), an insurance company refused to defend an insured in a personal injury claim contending that the insured failed to cooperate in the defense. The underlying claim stemmed from an automobile accident, where an employee of Lawson Air Conditioning and Plumbing, Inc. (“Lawson”), Ronald Patterson, struck members of the Dunn family with a pickup truck owned by Lawson as the family was walking out of a Walmart store. The Dunn family members suffered bodily injury as a proximate result of the accident. Patterson admitted fault.
The Privacy and Cybersecurity Practice posted a recent blog on a Webinar on the SAFETY Act, Security and Insurance which can be found here.
A federal court in Illinois ruled recently, in Cincinnati Insurance Company v. H.D. Smith Wholesale Drug Company, that Cincinnati Insurance Company was required to indemnify H.D. Smith for a $3.5 million settlement it reached with the State of West Virginia. The settlement resolved an action in which West Virginia alleged that H.D. Smith contributed to the state’s opioid addiction epidemic through its negligent distribution of opioid prescription drugs.
In a recent Global Data Review article, Hunton Andrews Kurth insurance practice head Walter Andrews commented on the FBI’s guidelines on ransomware payments and the insurance industry’s aggressive marketing of ransomware policies, noting that policyholders now have a resource that can help cover the cost of such an attack. The full Global Data Review article can be found here.
Insurance companies frequently raise the so-called “dishonesty” exclusion that is typically found in most professional liability and directors and officers insurance policies. Last week, the U.S. Court of Appeals for the Sixth Circuit took a substantial step toward curtailing that practice. In a coverage dispute with eight-figure implications, the appellate court found in favor of the policyholder and ruled that publishing false statements does not equate to dishonesty and thus is not sufficient to support application of a dishonesty exclusion.
Recap of HAK Insurance Recovery Group presentations in August and September 2019 focusing on key risk management techniques and strategies for maximizing recoveries under corporate insurance policies and enforcing indemnity rights under technology, sales, services, outsourcing, and other commercial contracts:
- John Eichman and Sergio F. Oehninger presented a seminar on Electronic Crime – Insurance Coverage for Cyber Attacks and Computer Fraud, Independent Community Bankers of America Webinar Series, September 24, 2019.
- Sergio F. Oehninger presented seminars on: (i) Navigating the Tri-Partite Relationship and An Insurer’s Duty to Defend and Settle Under Liability Policies, HNBA Annual Conference, September 27, 2019; (ii) Risk Transfer, Indemnity, and Insurance Provisions in Commercial Contracts, DC Bar, September 11, 2019; and (iii) Data Privacy, Social Media Compliance & Cyber Insurance, Financial Poise Webinar, August 8, 2019.
- Andrea DeField presented on Your Risks and Other People’s Insurance: Maximizing Recovery Through Indemnity Agreements, Insurance Requirements, and Additional Insured Status, Florida RIMS Educational Conference, August 2, 2019.
- Michael S. Levine presented a seminar on Insurance for IP Claims, University of New Hampshire Franklin Pierce Law Center’s Alumni CLE Program, Concord, New Hampshire, September 14, 2019.
Upcoming HAK Insurance Recovery Group presentations for October 2019 include:
- Walter J. Andrews will be presenting on Ransomware, ACCC Dialogue, October 8, 2019. (Please note this event is restricted to ACCC Fellows)
- Michael S. Levine will be presenting on Depreciation of Labor in Property Insurance Claims: Guidance from Recent Cases, Strafford webinar, October 30, 2019.
The Seventh Circuit held last week that a manufacturer’s insurer must cover its insured, a designer and builder of anaerobic digesters, under its errors and omissions policy for claims alleging breach of contract, despite an exclusion in the policy for claims arising out of the breach of an express or oral contract. The decision in Crum & Forster Specialty Insurance Company v. DVO, Inc., No. 18-2571 (7th Cir. Sept. 23, 2019), illustrates the practical application of policy construction to avoid what would otherwise amount to an illusory promise of coverage. Continue Reading Seventh Circuit Says Contract Exclusion Renders E&O Coverage Illusory
Congratulations to Hunton Andrews Kurth LLP insurance recovery lawyer, Geoffrey Fehling, on his confirmation by the DC Bar Foundation’s Board of Directors to the organization’s Young Lawyers Network Leadership Council.
A Florida district court recently held that an insurer wrongfully refused to defend a Miami-based strip club in a lawsuit filed by 17 models claiming that the club used their images to promote its business without their authorization. The insurer was required to defend the club for allegations of defamation under the policy’s personal and advertising coverage even though 16 of the 17 plaintiffs’ claims alleged conduct outside the covered policy period and no plaintiffs brought a cause of action for “defamation.” The decision highlights the broad duty to defend, in Florida and elsewhere, that policyholders should emphasize when pursuing coverage.
On September 18, 2019, a Texas federal court vacated its prior ruling and entered summary judgment for the insured, finding that after a hacker impersonating the customer convinced the insured to wire $1 million out of the customer’s account, the insurer had a duty to defend its insured against claims by its customer because the potential for coverage existed. See Quality Sausage Company, LLC, et al. v. Twin City Fire Insurance Co., Civil Action No. 4:17-CV-111 (S.D.TX) (Dkt. No. 110). The prior order was based on disputed extrinsic evidence, which the court considered in deciding the duty to defend, even though Texas’ narrow exception to the “eight corners” rule is limited to only undisputed extrinsic evidence.