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August 29, 2014 Occurrence

Seventh Circuit Enforces Products-Completed Operations Hazard Exclusion in Faulty Workmanship Coverage Dispute

The Seventh Circuit, applying Illinois law, held that a Products-Completed Operations Hazard exclusion in a commercial general liability policy precluded coverage for a construction defect suit. The coverage dispute arose out of the alleged faulty workmanship by the developer-insured in connection with a condominium conversion project, which allegedly caused damage to the condominium owners’ personal property.

Following the construction of the condominiums, the condominium owners discovered water damage. The board of the condominiums ultimately sued the developer, alleging faulty workmanship with respect to the construction …

July 17, 2014 Emerging Issues

Primary Insurer Cannot Use Equitable Indemnification To Rewrite Unambiguous Terms Of Its Policy

The plaintiff, Arch Insurance Company (Arch), brought a declaratory judgment action against Illinois Union Insurance Company and Harleysville Worcester Insurance Company the defendants, seeking indemnification for payments made to settle a personal injury claim brought by Enio Rodrigues, an employee of the defendants’ insured, Erie Painting & Maintenance, Inc., against Arch’s insured, the New York State Thruway Authority (Authority).

The court found, and Arch conceded, that Arch could not seek contribution from other insurers for its payment to the Authority because the terms of the …

July 10, 2014 Policy Conditions, Considerations, Construction, and Formation

‘Super Sized’ Ruling: IL Federal Court Upholds Application of ‘Super’ Intellectual Property Exclusion Under Coverage B

In Hartford Casualty Insurance Company v. Dental USA, Inc., No. 13-C-7637, 2014 U.S. Dist. LEXIS 85529 (N.D. Il. June 24, 2014), the United States District Court for the Northern District of Illinois recently upheld as enforceable and not against public policy a “super” intellectual property exclusion.

The coverage dispute arose out of the following circumstances. Since 2008, Dental USA, Inc. had been insured by Hartford Insurance Company, which issued general liability policies for Dental’s business as a supplier of dental instruments. Dental commenced two lawsuits …

May 19, 2014 Emerging Issues

If It Walks Like a Duck and Talks Like a Duck … IL Appellate Court Applies Violation of Statutes Exclusion To Preclude Coverage for Non-TCPA Counts in Blast Fax Suit

On May 2, 2014, the Illinois Appellate Court, Second District enforced the Violation of Statutes Exclusion to preclude coverage entirely for a $4.9 million settlement arising out a blast fax suit. The case, G.M. Sign, Inc. v. State Farm Fire & Casualty Company, 2014 IL App (2d) 130593, is the first published appellate decision interpreting this standard ISO exclusion to conversion and consumer fraud causes of action.

In G.M. Sign, the underlying lawsuit contained causes of action for violations of the Telephone Consumer …

March 13, 2014 Policy Conditions, Considerations, Construction, and Formation

Court Finds Coverage Under Professional Liability Policies For Settlement In Breast Cancer Vaccine Case

In this declaratory judgment action, the plaintiff, Rosalind Franklin University of Medicine and Science (Rosalind), seeks coverage from its insurers, Lexington Insurance Company (Lexington) and Landmark American Insurance Company (Landmark), after both insurers denied coverage for a settlement Rosalind paid in an underlying lawsuit brought by former patients who sought compensation for Rosalind’s decision to discontinue an experimental breast cancer vaccine program. Lexington filed a cross-claim against Landmark, contending that Landmark’s policy should provide coverage for the underlying suit and settlement.

Lexington and Landmark argued …

October 24, 2013 Uncategorized

Cases for the October 2013 Edition of CaseWatch

The below cases correspond with the October edition of CaseWatch: Insurance and the analysis of each case. Click here for access to the newsletter. Cases are provided courtesy of LexisNexis.

Affinity Health Plan

Am. Econ. Ins. Co. v. Zurich Am. Ins. Co.

Biochemics, Inc. v. Axis Reinsurance Co.

Brannan Paving GP, LLC v. Pavement Markings, Inc.

Carolina Cas. Ins. Co. v. Nanodetex Corp.

Detroit Med. Ctr. v. Progressive Michigan Insurance Company

Doe Run Resources Corporation v. Lexington Insurance Company

Dupree v. Scottsdale Ins. Co.…

October 21, 2013 Policy Conditions, Considerations, Construction, and Formation

“Personal and Advertising Injury” Coverage Insures Property Damage, Not Just Physical Harm

An Illinois appellate court recently held that insurance coverage for wrongful eviction claims, typically part of “personal and advertising injury” provided by Coverage B in CGL policies, includes coverage for property damage as a result of the eviction, not just physical harm to a person.

The insured property owners leased commercial space to a tenant who worked as an architect, painter, and sculptor. The tenant used the space as a rent storage and work space. During the lease term, the owners sold the space and, …

August 15, 2013 Emerging Issues

Dear John: Attorney Not Required to Disclose Letter From Dissatisfied Client in Application for Malpractice Policy

Illinois State Bar Association Mut. Ins. Co. v. Gold
(Ill. Ct. App. Aug. 7, 2013)
An Illinois appellate court recently held that a letter from a dissatisfied client to his attorney did not amount to a potential claim requiring disclosure on the attorney’s application for malpractice coverage.

In 2004, the defendant attorney received a letter from his client expressing dissatisfaction with the attorney’s handling of his case. In the letter, the client outlined different options for moving forward, including that he “go to war” against …

July 24, 2013 Emerging Issues

Insurer Owes Coverage After Longshoreman Drops Lathe

Amera-Seiki Corp. v. The Cincinnati Ins. Co., United States Court of Appeals for the Eighth Circuit, July 23, 2013
The Eighth Circuit Court of Appeals found that The Cincinnati Insurance Company owed coverage to its insured for equipment that was destroyed at port terminal based on ambiguous policy language. The Cincinnati Insurance Company insured a machine tool supplier, Amera-Seiki Corp., under a commercial property policy. During the policy period, Amera-Seiki purchased a vertical lathe from Taiwan for delivery to a customer in Illinois. The …