Blogs

Insurance Coverage Blog

Commentary on Insurance Coverage Litigation in New York
Posted: April 10, 2018

Indemnity Coverage for Class Action Settlement Not Affected by Covenant Not to Execute Judgment Against Insured’s Assets

On March 8, 2018, Judge Block of the EDNY issued a decision in Illinois Union Ins. Co. v. US Bus Charter & Limo Inc., Case No. 1:16-cv-06602-FB-RLM, holding that indemnification rights under a liability policy survived a class action settlement in which the insured consented to a $50 million judgment against it, subject to a covenant not to execute the...

READ FULL POST

Posted: April 3, 2018

First Department Denies Motion to Stay Order Directing Excess Insurers to Advance Defense Costs

This blog previously covered Justice Sherwood’s decision in Freedom Specialty Ins. Co. v. Platinum Mgt. (NY), LLC, 2017 NY Slip Op 32728(U), which granted a preliminary injunction directing three excess D&O insurers to advance attorneys’ fees and costs for the defense of a securities fraud prosecution and a related SEC enforcement action.  (N.B. I represent one of the insureds and argued the preliminary injunction...

READ FULL POST

Posted: March 26, 2018

Whether School District is Entitled to Indemnity Coverage under CGL Policy for Religious Discrimination Case Depends on Questions of Fact

On March 9, 2018, the Second Department issued a decision in Graphic Arts Mut. Ins. Co. v. Pine Bush Central School Dist., Index No. 6304/2015, holding that a school district’s entitlement to indemnity coverage under a CGL policy for the cost of settling a religious discrimination case depended on questions of fact. Graphic Arts arose from a lawsuit filed by...

READ FULL POST

Posted in CGL Policies
Posted: March 15, 2018

Choice of Law in Insurance Coverage Action Determined by “Principal Location of the Insured Risk”

Determining which state’s law applies is an important issue in any insurance coverage dispute.  Indeed, the outcome may depend on it, as different states have different rules on the interpretation and enforcement of policy provisions, what the claims the insured can bring, and a host of other issues.  Frequently, however, insurance policies do not have choice-of-law provisions.  Thus, the applicable...

READ FULL POST

Posted in Confict of Laws
Posted: March 8, 2018

Standard Policy Forms May Serve as Secondary Evidence of a Lost Policy’s Terms

On February 26, 2018, United States Magistrate Judge H. Kenneth Schroeder of the WDNY issued a decision in American Precision Indus., Inc. v. Federal Ins. Co., Case No. 14-CV-1050-RJA-HKS, holding that an insured could obtain discovery of standard forms used by the insurer as “secondary evidence” of a lost insurance policy’s terms. An insurance policy is a contract, and the...

READ FULL POST

Posted: March 2, 2018

Policy’s Anti-Assignment Provision Only Precludes Assignments Before Loss

A recent decision by Nassau County District Court Judge Scott Fairgrieve (M.V.B. Collision Inc. v. State Farm Ins. Co. (Dist. Ct. Nassau Co. Feb. 20, 2018), 2018 NY Slip Op 28043) provides a helpful survey of the case law on the enforceability of a policy provision prohibiting assignment or transfer of the insured’s rights under the policy.  As Judge Fairgrieve explains, the...

READ FULL POST

Posted: February 27, 2018

Accident that was the “Unintended Consequence of an Intentional Act” is a Covered “Occurrence” under CGL Policy

On February 21, 2018, the Second Circuit issued a decision in Philadelphia Indemnity Ins. Co. v. Central Terminal Restoration Corp., Case No. 17‐1636‐cv, holding that a car accident caused by a driver to whom the insured had served alcohol when he was visibly intoxicated, in violation of New York’s dram shop law, was a covered occurrence under a commercial general...

READ FULL POST

Posted in CGL Policies
Posted: February 15, 2018

Court Recognizes “Narrow Exception” to Duty to Defend Where Extrinsic Evidence, Unrelated to the Merits of the Underlying Claim, Negates any Duty to Indemnify

On January 31, 2018, Judge Spatt of the EDNY issued a decision in Striker Sheet Metal II Corp. v. Harleysville Ins. Co. of N.Y., Case No. 16-cv-5916 (ADS)(AYS), holding that an insurance company was relieved of its duty to defend where “extrinsic evidence” (including an email from the insured in response to questions from the insurer) demonstrated conclusively that the accident...

READ FULL POST

Posted in Duty to Defend
Posted: February 5, 2018

Law Firm Entitled to Business Interruption Coverage Even Though Its Contingency Fees Would Not Have Been Earned Until After the Policy Period

On January 23, 2018, Justice Masley of the New York County Commercial Division issued a decision in Bernstein Liebhard LLP v. Sentinel Ins. Co., Ltd., 2018 NY Slip Op 30169(U), holding that a law firm was entitled to business interruption coverage for the loss of new matters, even though its contingency fees for those matters would not have been received...

READ FULL POST

Posted: January 31, 2018

Insurer Not Entitled to Rely on Facts Outside Complaint to Avoid Duty to Defend

On January 18, 2018, Justice Sherwood of the New York County Commercial Division issued a decision in Zurich Am. Ins. Co. v. Don Buchwald & Assocs., Inc., Index. No. 655533/2016, holding that an insurer could not rely on “extrinsic discovery” to avoid its duty to defend. In Zurich, an insurer sought a declaratory judgment that it had “no duty to...

READ FULL POST

Posted in Duty to Defend