A federal court last month turned away an insurer’s legal arguments seeking to avoid financial institution bond coverage for a bank’s losses resulting from a borrower’s use of forged documents to obtain a $3.6 million loan.  In doing so, the Arizona court rejected Everest National Insurance Company’s narrow construction of the bond’s “Securities” insuring agreement and ruled that the notice-prejudice rule applies to a financial institution bond.

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In an article published in Law360, Hunton & Williams LLP partners Walter Andrews, Malcolm Weiss, and I 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.

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In Centurion Med. Liab. Protective Risk Retention Grp., Inc. v. Gonzalez, No. CV 17-01581 RGK (JCx), 2017 BL 392431 (C.D. Cal. Nov. 1, 2017), Centurion Medical Liability Protective Risk Retention Group sought a declaration that it owed no duty to defend a lawsuit alleging that its insureds—a group of medical practitioners—committed professional negligence during the delivery of a newborn child.  Centurion argued that it had no defense obligation because its insureds did not notify Centurion of the lawsuit within 20 days after it was filed, as required under the policy.


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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.

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On February 11, 2016, New Jersey’s highest court held that National Union Fire Insurance Co. of Pittsburgh, Pennsylvania, (“National Union”) could refuse coverage for Templo Fuente De Vida Corp. and Fuente Properties Inc.’s settlement with policyholder First Independent Financial Group under a “claims-made” directors and officers policy because First Independent did not provide notice “as soon as practicable.”

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