Insurer Scores a Slam Dunk in TCPA Suit Before the Ninth Circuit

A recent decision by the Ninth Circuit is sure to catch the eye of insurers for its favorable reasoning rejecting coverage as well as a potential warning sign that policyholders are seeking coverage for Telephone Consumer Protection Act (TCPA) suits beyond CGL policies. In Los Angeles Lakers, Inc. v. Federal Insurance Company, No. 15-55777, 2017 WL 3613340 (9th Cir. Aug. 23, 2017), the Ninth Circuit determined there was no coverage for violations of the TCPA under a D&O policy. In short, by analyzing the …

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A Bad Faith Cautionary Tale: Ninth Circuit Affirms $8.7 Million Award for Bad Faith Coverage Denial

In Millennium Laboratories, Inc. v. Darwin Select Insurance Co., No. 15-55227, 2017 U.S. App. LEXIS 1533 (9th Cir. Jan. 27, 2017), the Ninth Circuit held that Darwin Select Insurance Company breached its duty to defend its insured, Millennium Laboratories, Inc., against two third-party lawsuits (Ameritox and Calloway). The court further held that Darwin’s failure to defend Millennium was in bad faith.

As background, Millennium filed a complaint seeking coverage regarding two underlying lawsuits alleging Millennium told its customers that its competitors’ businesses …

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Ninth Circuit Confirms the FDIC Cannot Avoid the Insured-Versus-Insured Exclusion

In recent years, courts frequently have held that a D&O policy’s “insured-versus-insured” exclusion bars coverage for claims by the FDIC, as receiver of a failed bank, against the bank’s former directors and officers because the FDIC stands in the shoes of the insured bank. Therefore, the FDIC has tried to circumvent this exclusion by arguing that a policy’s shareholder derivative suit exception to the insured-versus-insured exclusion brought the FDIC’s claim back within coverage. A recent decision by the Ninth Circuit Court of Appeals rejected this …

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EPA Inquiries Under CERCLA Trigger the Duty to Defend . . . To The End

The Ninth Circuit Court of Appeals ruled that the unique liability regime of CERCLA qualifies a request for information under the statutory scheme as a “suit” within the meaning of general liability insurance policies, thereby triggering an insurer’s duty to defend its insured. The court also held that this duty to defend continues until the EPA issues its final Record of Decision.

The insured cement company ran two of its cement plants on an Oregon Superfund Site. In 2008, the EPA sent a letter to …

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A Sporting Retailer’s Bid for Coverage Gets Punted by the Ninth Circuit

The Ninth Circuit recently handed down a decision holding that insurers did not have a duty to defend their policyholder, a sporting goods retailer, in several ZIP code class action lawsuits.  The class action lawsuit all arose out of alleged violations of the Song-Beverly Act, a California statute which prohibits retailers from collecting customer ZIP code information as a purported requirement of credit card transactions. The court held that policy exclusions negated coverage.

In Big 5 Sporting Goods Corp. v. Zurich American Insurance Co., …

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