Claim excluded by Virus and Bacteria and Pollution Exclusions. The Wisconsin Court of Appeals, Fourth District, affirmed a trial court finding that the plaintiff-policyholders’ claims were barred based on mold (Virus and Bacteria) and pollution exclusions in the insurers’ policies.  Michael and Rhonda Sue Foley hired Harry Simons, Jr. to remodel their house.  The Foleys sued Simons alleging that Simons’... Read More

Insurer ordered to produce specimen forms and a witness to testify on those forms. A federal magistrate judge from the Western District of New York, applying New York law, held that policyholder American Precision Industries, Inc. (“API”) was entitled to deposition testimony and policy forms from an insurer in connection with its effort to prove up lost policies, and therefore... Read More

“Operations Clause” precluded coverage for contamination pre-dating Conrail’s ownership. A Pennsylvania appeals court, applying Pennsylvania law, affirmed the lower court’s ruling that interpreted an “Operations Clause” to require insurance coverage only for environmental contamination that was caused by or grew out of the insured’s operations.  Thus, while the insured paid millions in remediation and other expenses due to contamination at... Read More

Alleged extrinsic evidence outside complaint did not trigger defense duty. A Washington federal court, applying Washington law, granted Cincinnati Insurance Company’s motion for summary judgment, holding that the insurer need not cover its insured, Zaycon Foods, LLC (“Zaycon”), in a lawsuit brought by an ousted, former CEO.  Zaycon conceded that the only potential for coverage of the underlying lawsuit would... Read More

Reservation of rights on punitive damages does not create Peppers conflict. An Illinois appellate court in the first district, applying Illinois law, affirmed the trial court’s ruling and held that an insured was not entitled to reimbursement for the fees of its independent counsel, because no conflict of interest existed regarding the defense of the underlying copyright infringement case that... Read More

Pella entitled to defense reimbursement for property damage when evidence demonstrates the potential for coverage. An Iowa federal court, applying Iowa law, entered summary judgment in favor of window maker regarding during which policy period defense costs coverage was triggered.  The court held that the policy period in which the windows were installed was triggered, because there was potential property... Read More

John Crane fails at trial to prove exhaustion of its primary coverage. Appeal filed. Following a 23 day trial, on December 28, 2017, Judge Moshe Jacobius, of the Cook County Chancery Division, issued a 140 page opinion addressing the issue of whether John Crane Inc. (“Crane”) had exhausted all of its primary coverage and was thus entitled to access its... Read More

Summary judgment for “knowing misrepresentation” regarding late notice claim A Delaware state court judge found Homeland Insurance Co. of New York (“Homeland”) liable for bad faith for its actions in denying a claim by its policyholder CorVel Corp. (“CorVel”) and ordered Homeland to pay damages and penalties in the amount of $13.5M. In the underlying class action arbitration brought in... Read More

“Claims in Process” exclusion applies because contamination first occurred prior to policy inception The Seventh Circuit, applying Indiana law, affirmed the district court’s ruling and held that there was no coverage for property damage arising out of pollutants leaking from underground storage tanks due to a “Claims in Process” exclusion in the relevant policies.  The Seventh Circuit confirmed the trial... Read More

No coverage because exception to IP exclusion not applicable due to inclusion of trademark and copyright claims An Illinois federal district court, applying Illinois law, held that an intellectual property exclusion relieved an insurer of its defense obligations for an underlying suit regarding trademark infringement and unfair competition, because the exclusion clearly excluded coverage for entire suits that allege intellectual... Read More