HNRK Coverage Corner

On September 26, 2019, Judge Abrams of the SDNY issued a decision in Jovani Fashion, Ltd. v. Fed. Ins. Co., Case No. 17-CV-4518, holding that a complaint alleging that a fashion designer's garment infringed the plaintiff’s copyrighted lace textile design did not trigger “advertising injury” coverage under the designer’s general and excess liability policies.

The insured (Jovani Fashion) argued that “the Subject Design” constituted an “advertisement” under the “the advertising model in the fabric making industry or other industries that use sample ...

On September 13, 2019, Justice Borrok of the New York County Commercial Division issued a decision in Colony Ins. Co. v. International Contr. Servs., LLC, 2019 NY Slip Op 32717(U), holding that issues of fact precluded summary judgment on a liability insurer’s disclaimer based on the insured’s failure to cooperate with the defense.

In the underlying personal injury litigation at issue in this case, the defendant ICS had its answer stricken based on its failure to cooperate in discovery (including failing to present a witness for a court-ordered deposition and to provide an ...

On August 27, 2019, Judge Pauley of the SDNY issued a decision in Gemini Ins. Co. v. Titan Construction Servs., Case No. 17-cv-8963, dismissing a declaratory judgment claim as premature because the lability insurer’s duty to indemnify would depend on facts to be developed in the underlying lawsuit against the insured.  The court explained:

It has long been well-established that a liability insurer may bring an action for a declaratory judgment against the parties in an underlying lawsuit involving its insured without waiting for the underlying action to proceed to judgment ...

On August 26, 2019, Judge Caproni of the SDNY issued a decision in Spandex House, Inc. v. Hartford Fire Ins. Co., Case No. 18-CV-8367 (VEC), enforcing an IP exclusion in a CGL policy that circumvented the “entire action” rule by precluding both defense and indemnity coverage for an otherwise-covered “advertising injury” claim if that claim was joined with any IP claim unconnected to advertising. As Judge Caproni explains, under a duty to defend policy, “if a lawsuit contains a mix of allegations covered by an insurance policy and other allegations falling outside the ...

On May 29, 2019, Justice Crane of the New York County Supreme Court issued a decision in Continental Cas. Co. v KB Ins. Co., Ltd., 2019 NY Slip Op 31513(U), holding that an exclusion for “Knowing Acts” did not excuse a CGL carrier’s duty to defend Lanham Act claims against the insured. In the underlying litigation, the insured, Value Wholesale, Inc. (Value), was sued by the patent holder for FreeStyle blood glucose test strips for allegedly selling imported test strips not authorized for sale in the United States and selling them in FreeStyle product boxes. The action asserted ...