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BT Policyholder Protection Blog
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10 Sep 2015 NEW JUSTICE DEPARTMENT MEMO HIGHLIGHTS NEED FOR REVIEW OF SIDE “A” D&O COVERAGE

Heightened Liability Concerns for Individuals   On Sept. 9, 2015, the U.S. Department of Justice (DOJ) issued a memo to all U.S. attorneys and other enforcement bureaus (such as the FBI) providing guidance on the pursuit of individuals responsible for corporate wrongdoing. In essence, the memo says that the government is no longer going after only corporations; it will now also be focusing on those individuals within corporations responsible for corporate wrongdoing. The memo provides specific guidance for taking on these individuals. For example, it states that in order to qualify for cooperation credit, corporations must now provide all relevant facts relating to the individuals responsible for the misconduct and it states that absent extraordinary circumstances or approved departmental policy, the DOJ will not release…

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21 Apr 2015 UPDATE: Georgia Supreme Court Sides with Insurer in Settlement Rights Fight

I previously reported that the United States Court of Appeals for the Eleventh Circuit had certified questions to the Supreme Court of Georgia regarding the rights of an insurer to refuse to consent to a settlement and, thereby, absolve itself of any payment obligation for any settlement entered into by the policyholder. See Piedmont Office Realty Trust v. XL Specialty Ins. Co., No. 14-11987 (11th Cir. Oct. 21, 2014). On April 20, 2015, the Supreme Court of Georgia sided with the insurer. See Piedmont Office Realty Trust v. XL Specialty Ins. Co., No. S15Q0418 (Ga. Apr. 20, 2015). The opinion creates a Hobson’s choice for policyholders wishing to settle underlying lawsuits, even in cases where those insurers expressly agreed in their policies that they would…

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18 Mar 2015 Barnes & Thornburg Represents Simon Property Group in $200 Million Summary Judgment Victory

A Barnes & Thornburg team led by Andrew Detherage and Charles Edwards represented Simon Property Group in obtaining summary judgment awarding Simon $200 million in insurance coverage from 16 insurance carriers for flood damage to the Opry Mills mall in Nashville, Tennessee. The court rejected the insurers’ argument that a $50 million sublimit applied. Read the full announcement here. Charles EdwardsCharles P. Edwards is co-chair of the firm’s Policyholder Insurance Recovery and Counseling Practice Group, which exclusively represents policyholders in insurance claims and litigation. Mr. Edwards has worked with a wide variety of policyholders and their insurance claims regarding D&O insurance matters, complex commercial disputes, contract disputes, lost property, errors and omissions, and professional liability matters.More Posts – Website

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18 Feb 2015 RECENT CASE LAW ILLUSTRATES IMPORTANCE OF WORDING FOR “FINAL ADJUDICATION” REQUIREMENT IN D&O EXCLUSIONS

Directors and officers and management and professional liability policies generally contain so-called “conduct exclusions,” which exclude coverage for deliberate fraud, willful violation of a statute, the gaining of a profit to which the insured was not entitled and similar conduct. Most policies today, however, require a “final adjudication” for these exclusions to apply. Disputes frequently arise between insureds and insurance companies about what constitutes a final adjudication and what that adjudication must contain to exclude coverage.   Several courts have held that a settlement does not constitute a final adjudication within the meaning of these exclusions. For example, in U.S. Bank N.A. v. Indian Harbor Ins. Co. (D. Minn. Dec. 16, 2014), a federal court in Minnesota applying Delaware law held that coverage was not…

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04 Nov 2014 Know Your Rights: Policyholders’ Defense and Settlement Rights

In Piedmont Office Realty Trust v. XL Specialty Ins. Co., No. 14-11987 (11th Cir. Oct. 21, 2014), the United States Court of Appeals for the Eleventh Circuit certified questions to the Supreme Court of Georgia regarding the extent to which an insurance company was bound by a settlement to which it refused to consent. This case represents one of an increasing number of disputes between policyholders and their insurance companies over the defense and settlement of underlying lawsuits. Having lost the battle to narrow the scope of their defense and settlement obligations in many states, insurance companies appear to have opened a new front:  attempting to reduce the cost of their defense and settlement obligations.  This may take the form of refusing to consent to…

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25 Jul 2014 Recent Changes in Insurance Status Affects Companies Seeking Additional Insured Status

  For those companies that are seeking additional insured status, keep in mind that there have been major changes in how that insurance status is written. The Insurance Services Office, the drafter of many “standard form” insurance policies and endorsements, has been paring back coverage for additional insureds for many years.  It rolled out major overhauls to its standard form additional insured endorsements recently.  Insurance companies, too, have been tightening their own company forms, to the extent that they don’t use the ISO forms.   This area of insurance has evolved substantially over the years.  As one commentator has noted: “Twenty years ago, additional insured endorsements came in two flavors:  The short form and the long form.  Today there are more flavors than found in Baskin-Robbins…

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16 Jul 2014 Insurance and indemnity issues arising out of AIA form agreements and contracts.

  On July 14, 2014, Charlie Edwards gave a presentation on indemnity and insurance issues for architects to the Indianapolis Chapter of the American Institute of Architects (AIA).  The presentation covered indemnity and insurance issues arising out of the standard AIA form agreements. It also covered insurance issues related to construction projects, such as additional insured status and forms, insurance implications of “flow-down” provisions in construction contracts and waivers of subrogation.   If you missed the presentation and would like to obtain copies of the materials, or have any questions on these topics, email Charlie Edwards.   Charles EdwardsCharles P. Edwards is co-chair of the firm’s Policyholder Insurance Recovery and Counseling Practice Group, which exclusively represents policyholders in insurance claims and litigation. Mr. Edwards has worked with a…

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26 Jun 2014 Insurance Coverage and Risk Mitigation for the In-House Practitioner

  On June 25, 2014, Charlie Edwards and Kara Cleary, from Barnes & Thornburg’s Policyholder Insurance Recovery Group, gave a presentation to in-house counsel and other corporate representatives regarding insurance coverage and risk management.     The CLE, called “Insurance Coverage and Risk Mitigation for the In-House Practitioner,”  addressed insurance issues and other risk transfer provisions that often get little attention in business transactions.  The topics addressed included the transferability of insurance rights in buy/sell transactions, tips for drafting contractual insurance requirements, as well as hot topics in Directors and Officers liability and recommendations to reduce risk to your company.     For those who missed the presentation, you can request the materials by emailing Charlie Edwards or Kara Cleary.        Charles EdwardsCharles P. Edwards is co-chair of…

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14 May 2014 ALL IS NOT LOST FOR CLAIMS MADE OUTSIDE POLICY PERIOD

Most businesses are aware that their claims-made insurance policies – like directors and officers policies, management liability policies and professional liability policies – generally provide coverage for claims made during the policy period (or, if purchased, an extended period of reporting).  It would be unwise, however, to simply assume that any claim made outside a policy period is untimely and not covered.  That is because claims-made policies also often contain “related claim” provisions, which deem a claim to have been made during a prior policy period if it is sufficiently related to another, prior claim.   A recent case illustrates the potential breadth of these related claim provisions.  A mortgage company had a professional liability policy with a policy period of May 10, 2007, to…

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28 Apr 2014 Indiana Supreme Court Opinion Highlights Importance of Knowing Your Coverage Before You Need It

  In Groce v. American Family Mutual Insurance Co., No. 48S02-1307-CT-472 (Apr. 3, 2014), the Indiana Supreme Court has again held that the rule of caveat emptor, or let the buyer beware, applies to the purchase of insurance coverage.  The Court held that where an agent’s failure to obtain the coverage sought by the policyholder is “ascertainable from the policy itself,” the two-year statute of limitations on the policyholder’s claim against the agent for failure to obtain coverage begins to run when the policyholder receives a copy of the policy.   This rule presents three challenges for policyholders:  (1) many policyholders renew the same coverage year after year, such that the initial failure to obtain coverage could have happened years before the loss for which…

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