Wiley Executive Summary

Insights on Insurance

September 23, 2020

The United States District Court for the Northern District of Texas, applying Texas law, has held that an insured’s late notice of a claim bars coverage, rejecting arguments that (i) the initial complaint did not constitute a “claim” because it did not allege a “wrongful act;” (ii) notice to the broker was sufficient; and (iii) the issuance of a renewal policy on different terms triggered the automatic extended reporting period. Vela Wood PC v. Associated …

Wiley Executive Summary

Prior Knowledge Exclusions Apply Where Insured Received Three Letters from Potential Claimants and Issued Two Litigation Holds Before Policy Incepted

By Margaret Thomas

September 22, 2020

In a case in which Wiley represented the insurer, the United States District Court for the Eastern District of Virginia, applying New York law, has held that three prior knowledge exclusions barred coverage under an architects and engineers professional liability policy as a matter of law where, before the policy period incepted, the insured (1) knew that a pressure vessel in a boiler system which it had serviced had exploded, causing property damage and bodily…

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California Court Enforces Federal Forum Selection Provision For 1933 Act Claims

By Joseph Gross

September 16, 2020

A California court ruled that a forum selection provision in a Delaware company’s registration statement requiring that certain securities litigation be brought solely in federal court was enforceable. Wong v. Restoration Robotics, Inc., Case No. 18CIV02609 (Cal. Sup. Ct., San Mateo County, Sept. 1, 2020). The California court’s ruling could signal the beginning of a broader trend, started in Delaware, that would be helpful to securities defendants, and, in turn, to insurance carriers.…

Wiley Executive Summary

EPL Insurer Must Defend Lawsuit Derived in Part from EEOC Claim and Retaliation Lawsuit Filed Prior to Policy Period

By Katelyn Cramp

September 15, 2020

Applying Michigan law, a federal district court has held that an employment practices liability insurer had a duty to defend a lawsuit that derived in part from facts or circumstances that were the subject of an EEOC claim and lawsuit filed prior to the policy period. City of Grosse Pointe v. U.S. Specialty Ins. Co., 2020 WL 3961481 (E.D. Mich. July 13, 2020).…

Wiley Executive Summary

Sanctions Carve-Out Bars Coverage for Show Cause Order Issued to Attorney

By Hume Ross

September 14, 2020

The United States District Court for the District of Colorado, applying Colorado law, has held that a professional liability insurer was not obligated to defend an attorney accused of discovery misconduct. The court ruled that an order requiring the attorney to show cause why he should not be sanctioned did not seek Damages, as defined in the policy, and fell within an exclusion for claims seeking payment of legal fees and costs. Godin & Baity, …

Wiley Executive Summary

Pre-Policy Email Demanding Payment of Overdue Legal Fees is Not a Claim

By Katelyn Cramp

September 10, 2020

Applying California law, a federal district court has held that a request for payment of overdue legal fees does not constitute a claim for purposes of a D&O policy. Domokos v. Scottsdale Ins. Co., Case No. 5:20-cv-00366 (N.D. Cal. July 16, 2020). The court also held that the policy’s prior acts, breach of contract, and creditor claims exclusions did not bar coverage.…

Wiley Executive Summary

Insurer that Breached Duty to Defend Bears Burden on Allocation of Defense Costs

By William Knauss

September 1, 2020

Applying Arizona law, the United States District Court for the District of Arizona held that an insurer that breached its duty to defend bears the burden of demonstrating that an allocation of defense costs between covered and non-covered claims is possible. Tapestry on Cent. Condo. Ass’n. v. Liberty Ins. Underwriters Inc., 2020 WL 4607248 (D. Ariz. Aug. 11. 2020).…

Wiley Executive Summary

Private Funds: SEC Examination and Enforcement Priorities

By David H. Topol

August 25, 2020

The United States Securities and Exchange Commission has increased its focus in recent years on investment advisers who manage private funds. The Division of Enforcement of the SEC reported that in fiscal year 2019, 36% of all civil and stand-alone administrative proceedings were brought against investment advisers and investment companies.…

Wiley Executive Summary

Texas Court Holds “Instrumental Act” in Appraisal Litigation is Execution of Merger

By Ashley-Anne L. Criss

August 24, 2020

A Texas court of appeals found no coverage under two excess directors and officers liability policies for an appraisal action brought by dissenting shareholders to a merger pursuant to Section 262 of the Delaware General Corporation Law. Zale Corp. v. Berkley Ins. Co., 2020 WL 4361942 (Tex. Ct. App. July 30, 2020). The court held that the litigation right created by the appraisal statute turns on the act of executing the merger and not…

Wiley Executive Summary

Fact Issues Preclude Summary Judgment on Prior Knowledge Exclusion

By Nathan Lovett

August 24, 2020

The United States District Court for the District of Connecticut, applying Connecticut law, has denied cross-motions for summary judgment, finding that fact issues remain with regard to whether the insured reasonably could have expected a pre-policy period enforcement notice to give rise to claim. Wallingford Grp., LLC v. Arch Ins. Co., 2020 WL 4464629 (D. Conn. May 11, 2020).…

Wiley Executive Summary

Insights on Insurance

Blog Authors

Texas Court Holds Late Notice Bars Coverage

Prior Knowledge Exclusions Apply Where Insured Received Three Letters from Potential Claimants and Issued Two Litigation Holds Before Policy Incepted

California Court Enforces Federal Forum Selection Provision For 1933 Act Claims

EPL Insurer Must Defend Lawsuit Derived in Part from EEOC Claim and Retaliation Lawsuit Filed Prior to Policy Period

Sanctions Carve-Out Bars Coverage for Show Cause Order Issued to Attorney

Pre-Policy Email Demanding Payment of Overdue Legal Fees is Not a Claim

Insurer that Breached Duty to Defend Bears Burden on Allocation of Defense Costs

Private Funds: SEC Examination and Enforcement Priorities

Texas Court Holds “Instrumental Act” in Appraisal Litigation is Execution of Merger

Fact Issues Preclude Summary Judgment on Prior Knowledge Exclusion

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