On August 6, 2019, Hunton Andrews Kurth insurance lawyers Walter J. Andrews and Daniel Hentschel discussed the effect of eroding insurance policies in an article appearing in Florida’s Daily Business Review. The full article is available here. In the article, the authors discuss the potential risks associated with the use of eroding insurance policies
Louisiana Court Holds That Application of Pollution Exclusion Would Lead to Absurd Results
A Louisiana court recently denied an excess insurer’s bid for summary judgment, finding that the insurer’s interpretation of a pollution exclusion would lead to “absurd results.”
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Delaware Court Says Appraisal Action Constitutes a “Securities Claim”; Triggers D&O Coverage
A Delaware court held that an appraisal action, which includes $39 million in attorneys’ fees, prejudgment interest, and costs incurred in defending litigation that arose out of Solera Holdings Inc.’s acquisition by Vista Equity Partners LP, constitutes a covered “securities claim” under Solera’s directors and officers liability insurance policy.
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Waiver of Subrogation Enforced, Denying Insurers Recovery Against Additional Insured in $500 Million Off-Shore Oil Rig Loss
The United States District Court for the Southern District of Texas recently rejected a claim by a group of insurance companies (“Underwriters”) against American Global Maritime Inc. for more than $500 million that the Underwriters paid the named insured under an Off-Shore Construction Risk insurance policy for losses resulting from the an alleged off-shore oil rig failure.
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Claims for Negligence? Duty to Defend Triggered
On June 17, 2019, the First Circuit held that an insurer’s duty to defend was triggered because the underlying complaint set forth claims that required a showing of intent as well as claims that sought recovery for conduct that “fits comfortably within the definition of an ‘accident.’” In Zurich American Ins. Co v. Electricity Maine, LLC, Zurich sought declaratory judgment that, under a D&O policy, it had no duty to defend the insured, Electricity Maine, an electrical utility company being sued in the underlying class action. Zurich argued it had no duty to defend because the underlying complaint failed to allege that Electricity Maine engaged in conduct that qualified as an “occurrence” or that caused “bodily injury” under the terms of the policy. The First Circuit disagreed.
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California Supreme Court Rules That General Liability Insurer Must Defend Employer Against Employee Misconduct Allegations
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.
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Policyholder Data Breach Covered Despite “Essential” Employee Negligence
On May 20, the Eight Circuit held that the State Bank of Bellingham was covered for losses following the criminal third party wire transfer of $485,000 from the bank to a foreign account. The money was stolen by hackers in 2011 after a bank employee inadvertently left one of three security measures disabled and computers running overnight.
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Erin Andrews’ Peeping Tom Verdict May Trigger Hotel Insurance Policies
On Monday, a Tennessee jury awarded $55 million to FOX sportscaster Erin Andrews in her suit against Michael Barrett, her stalker, and the Marriott hotel where they both stayed. In 2008, Mr. Barrett secretly videotaped Ms. Andrews through a peephole as she changed clothes in her hotel room. Hotel staff had revealed that she was staying at the hotel and, upon Mr. Barrett’s request, gave him a room next to hers. Mr. Barrett’s surreptitious video of Ms. Andrews was later made public. Ms. Andrews sued Mr. Barrett, West End Hotel Partners, LLC (the owner/franchisee of the hotel) and Windsor Capital Group, Inc. (the operator of the hotel) for negligence, invasion of privacy, and infliction of emotional distress causing embarrassment. The jury found the hotel’s owner and operator 49% at fault, comprising approximately $27 million of the total verdict.
Continue Reading Erin Andrews’ Peeping Tom Verdict May Trigger Hotel Insurance Policies