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09 Nov 2015 Scott Godes Quoted in Business Insurance “Cyber Security Bill Passes Senate Muster”

Scott Godes, partner and co-chair of the firm’s Data Security and Privacy Practice Group, was recently quoted in a Business Insurance article, “Cyber security bill passes Senate muster.”   In a 74-21 vote in October, the U.S. Senate approved The Cybersecurity Information Sharing Act of 2013. It protects businesses against liability if they share information with governmental agencies.   The good thing about the Senate bill is “it allows for comparing notes and provides liability protection for companies” that share risk information and “fosters a sense of working together among companies,” said Scott.   Read the full article here. Scott GodesScott N. Godes is a veteran trial lawyer with experience in insurance coverage matters and technology issues. He is a partner in Barnes & Thornburg…

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03 Nov 2015 Scott Godes Quoted in Law360 Article, “How to Navigate the Cloudy Skies of Drone Insurance”

Scott Godes, partner and co-chair of the firm’s Data Security and Privacy Practice Group, was recently quoted in a Law360 article, “How to Navigate the Cloudy Skies of Drone Insurance.”   The commercial drone industry has opened up a world of business opportunities – as well as often misunderstood risks and questions about insurance coverage. Scott discusses insurance coverage for the potential liabilities drone operators face. In response to a question about an exclusion in CGL policies, “One argument as to why the aircraft exclusion shouldn’t apply is that it was written in the context of commercial aircraft. It almost certainly is not within the reasonable expectations of an insured that an exclusion for cars, boats, and airplanes would eliminate coverage for drones. I would…

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28 Oct 2015 You Snooze; You Lose: When The Carrier’s “Investigation” (Read: Delay) Breaches The Duty To Defend

Earlier this month, a California federal court issued a stern warning to liability carriers: failing to provide an immediate defense forfeits your right to control the policyholder’s defense, including any right to select counsel, and, once forfeited, the right to control irrevocably vests with the policyholder. The carrier cannot regain control, even if it reimburses pre-acceptance defense fees. Travelers Indem. Co. v. Centex Homes, Case No. 11-CV-03638-SC (N.D. Cal. Oct. 7, 2015).   Carriers and policyholders have long been engulfed in the battle as to when a carrier’s delay (usually couched in terms of an “investigation”) leads to forfeiture of the right to control; and, when it does, whether the carrier may re-gain control by paying pre-acceptance defense fees. Policyholders are all too familiar with…

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27 Oct 2015 Scott Godes quoted in Law360 Article, “Privacy ‘Bill of Rights’ to Boost Demand for Breach Coverage”

Scott Godes, partner and co-chair of the firm’s Data Security and Privacy Practice Group, was recently quoted in a Law360 article, “Privacy ‘Bill of Rights’ to Boost Demand for Breach Coverage.”   The article highlights the recently introduced privacy bill of rights and changes to the regulatory environment that could change the cyberinsurance marketplace for  policyholders.   Scott is noted saying, “Cyberinsurance remains the Wild West of insurance. But with the changing regulatory environment, we’re starting to see changing prices and the market opening up and tightening up.”   Read the full article here. Scott GodesScott N. Godes is a veteran trial lawyer with experience in insurance coverage matters and technology issues. He is a partner in Barnes & Thornburg LLP’s Washington, D.C., office and…

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08 Oct 2015 Regulation S-P Violation: Are You Prepared For A Cyber-Security Breach?

On Sept. 22, 2015, the Securities and Exchange Commission (SEC) announced the first violation by a registered investment advisor of the so-called Safeguards Rule (Regulation S-P) pertaining to the protection of personally identifiable information from cyber-attack. This is the first instance of the SEC enforcing Regulation S-P against an investment advisor.   The Regulation, broadly speaking, requires broker-dealers, investment advisers and other financial firms to protect confidential customer information from unauthorized release to unaffiliated third parties. Included in Regulation S-P is the “Safeguard Rule” (Rule 30(a)), which requires financial institutions to, among other things, adopt written policies and procedures reasonably designed to protect customer information against cyber-attacks.  This raises the question:  Are you prepared for a cyber-attack (and the attendant liability)?   In its findings,…

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02 Oct 2015 Scott Godes Quoted in Law360 Article, “A Cyberattack Survival Guide for Policyholders”

Scott Godes, partner and co-chair of the firm’s Data Security and Privacy Practice Group, was recently quoted in Law360’s article, “A Cyberattack Survival Guide for Policyholders.” The article examines cybersecurity concerns companies face after massive data breaches and highlights issues such as card issuer liability, customer liability, and D&O litigation.   Scott is quoted multiple times within the article.  He notes that there is not a magic solution to preventing data breaches and cyberattacks, noting that many “large enterprises that were hit with data breaches” had been “certified as compliant with payment card security rules by a third party.” Scott then gives advice for buying and evaluating cyberinsurance policies and insurance towers for those risks.   Read the full article here. Scott GodesScott N. Godes…

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17 Sep 2015 My Company Doesn’t Have Cyberinsurance: Where Do I Start?

Cyber risks and cyberinsurance are hot topics in almost every industry. However, many companies do not have cyberinsurance yet and often don’t know where to start or how to evaluate their cyber risks and need for coverage, let alone how to identify carriers and forms offering cyberinsurance. Business Insider recently reported that cyberinsurance will become a $7.5 billion dollar industry in the next five years. Here are five tips for getting started if your company does not have cyberinsurance:   Evaluate your needs   Every company has cyber risk. However, the potential impact of a cyber incident varies widely depending on your industry, type of customer, amount of and type of data you store electronically and your security systems. Talking to similar companies about whether…

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15 Sep 2015 Property Damage Coverage Covers More Than Property Damage

Carriers employ many time-tested strategies to eliminate, or at least limit, their liability for covered claims. Policyholders must know their rights, and understand that the law is often on their side, if they want to enforce the policy as written and obtain the benefits for which they paid premiums and to which they are entitled.   One coverage-avoidance tactic we have seen carriers employ time and again is to try to limit their obligations for claims that allege both property damage, and other types of consequential damage such as lost profits or loss of reputation flowing from the alleged property damage. Carriers will try to avoid paying for the consequential losses – which can be a significant part of the value of the claim –…

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11 Sep 2015 LANDMARK CALIFORNIA SUPREME COURT DECISION EXPANDS CIRCUMSTANCES UNDER WHICH POLICYHOLDERS MAY ASSIGN POLICY RIGHTS UNDER THIRD PARTY LIABILITY POLICIES WITHOUT INSURER CONSENT

Third party liability insurance policies often contain “consent to assignment” clauses which purport to bar insureds from assigning policies without insurer consent. In the case of Henkel Corp. v. Hartford Accident & Indemnity Co., 29 Cal.4th 934 (2003), the California Supreme Court determined, under the specific facts of that case, that such clauses barred the insured from assigning policy rights without the insurer’s consent until there exists a “chose in action” against the insured, which occurs when the claims against the insured have “been reduced to a sum of money due or to become due under the policy.”   In Fluor Corporation v. Superior Court of Orange County, the California Supreme Court granted review to consider whether Section 520 of the California Insurance Code—an 1872…

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10 Sep 2015 Barnes & Thornburg Represents Simon Property Group in $204 Million Trial Victory

A Barnes & Thornburg team led by partners Andrew Detherage and Charles Edwards representing Simon Property Group, a global leader in retail real estate ownership, management and development, won a $204 million jury verdict after a six-week trial in Nashville, Tenn. The trial related to flood losses that occurred in May 2010 at the Opry Mills mall in Nashville. The verdict included both covered losses and consequential damages in excess of the coverage limits. The jury also awarded additional consequential damages in an amount to be determined by the trial judge.   The trial involved 17 insurers who refused to pay for losses above the first $50 million layer of coverage. The verdict follows a favorable summary judgment ruling in March 2015 in which the…

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