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Directors & Officers Coverage - Related Claims
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Court Applies Factual Nexus Test to Exclude Coverage for
Related Claims
Nomura Holding Am. v. Fed. Ins. Co.,
2014 U.S. Dist. LEXIS 127574 (S.D.N.Y. Sept. 11, 2014)
The Southern District of New York finds no coverage for RMBS
claims under "related acts" provision in D&O policy, but
strictly construes a separate endorsement
designed to preclude coverage for a known RMBS consolidated lawsuit and
related claims.
This action involves claims for coverage for five lawsuits initiated
between 2011 and 2012 against the insured arising out of various of residential
mortgage-backed securities ("RMBS"). Previously, in 2008,
the insured had separately been named as a different consolidated action which also arose from
RMBS. ( "2008 RMBS
Consolidated Action").
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Discovery - Reserve Information
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Southern District Permits Discovery Reflecting Reserve
Information But Defers Ruling on Admissibility
Nat'l Union Fire Ins. Co. v. H&R
Block, Inc., 2014 U.S. Dist. LEXIS 123966 (S.D.N.Y. Sept. 4, 2014)
An insurer initiated this action
seeking declaration that it has no obligation to indemnify its insured in
connection with either the settlement of or the defense costs incurred in
connection with an underlying action. The insurer had disclaimed
coverage for the underlying action on the basis that the alleged damages
did not constitute personal injury and advertising injury and further, that
the insured's failure to cooperate barred coverage. In this action,
the insured filed a counterclaim, arguing that it did not violate the
policy's cooperation provision and that any failure to provide information
was based on the insurer's refusal to sign the protective order that was
entered in the underlying action and common interest agreement. The
underlying action was settled prior to the commencement of this action.
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Duty to Defend
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Appellate Division Finds No Duty to Defend Non-Covered
Contract Claims
Selective Ins. Co. v. , Inc., 2014
N.J. Super. . LEXIS 2315
(App. . . 2014)
The New Jersey Superior Court,
Appellate Division, ruled that the liability insurer for a general
contractor was not obligated to defend (reimburse defense costs) the
general contractor for breach of warranty and other contract claims
asserted against it in a suit arising from damage caused by a
malfunctioning fire suppression system. The decision also confirmed
that certificates of insurance are not proof of a party's status as an
additional insured.
The general contractor agreed to build
a nursing home facility and subcontracted the installation of a fire
suppression system. Improper installation by the subcontractor
resulted in the fire suppression system activating and causing water
damage. The owner of the nursing home, and later its property
insurer, filed suit against the general contractor and the subcontractor,
alleging breach of contract, breach of implied and express warranties and
negligence.
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Lawsuit Limitation
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Lose Coverage by Violating Policy's
Lawsuit Limitation Provision
Rihanna Corp. v. Certain Underwriters at Lloyd's of
London, 2014 N.J. Super. . LEXIS 2216 (App. . Sept. 11, 2014)
A group of insureds coverage in
connection with a fire at their restaurant because they failed to comply
with their policy's lawsuit limitation and their delay in filing suit was
not excused by equitable considerations.
Plaintiff insureds, the owners of a
restaurant, suffered a fire loss on October 3, 2008 and sought coverage
under their insurance policy. The insurer issued a reservation of rights
letter on January 7, 2009 and, on October 29, 2009, disclaimed coverage
because of "concealment, misrepresentation or fraud," as
suspicion existed regarding whether the restaurant's owner purposefully set
the fire. The insurer also pointed to the failure to
"submit to examinations under oath" in connection with an
adjuster's investigation of the fire.
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