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Nathan Anderson

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Nathan's practice centers on business-related contract disputes. He represents policyholders in insurance litigation matters and other business entities involved in disputes related to interpretation of complex contracts. He also defends products liability disputes.

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In Verizon Communications Inc. v. National Union Fire Insurance Co. of Pittsburgh, Pa.[1] the Delaware Superior Court ruled that Verizon was entitled to a defense under its D&O policy for fraudulent transfer claims. Although the decision relies on unique facts and specific policy language, it provides guidance on how to exploit minor but critical differences in policy language to expand the company’s coverage beyond claims involving securities fraud.

The opinion also rejected the insurers’ efforts to limit coverage under a separate policy, based on their contention that the subsidiary out of which the liabilities arose was not a subsidiary when the policy was purchased. And finally, it handed policyholders a practical and valuable gift of universal application, holding that an insurer who wrongfully refuses to defend a claim cannot contest the reasonableness of the fees incurred by the policyholder to defend the case.

Whether or not it is successfully challenged on appeal, the Verizon decision is an important reminder not to make assumptions as to what is or isn’t covered under any type of insurance policy. Coverage depends on the particular language of the policy under review and the particular facts for which claims are sought.
Continue Reading In Verizon Decision Careful Review of Insurance Policies Expands Coverage

Though much of the conversation regarding insurance coverage for COVID-19-related losses has focused on the potential for business interruption-type coverage (see prior discussion here), insureds should not overlook the potential that COVID risks trigger other types of coverage. For example, as previously discussed here, some insureds may seek coverage under D&O policies should they face securities and derivative-type claims.

In addition to the forms of coverage we’ve previously blogged about, businesses who have continued operations during the pandemic as well as those considering whether, when, and how to reopen their businesses in the coming weeks and months should consider whether they will be able to access coverage under their GL policies for some COVID-related claims. For example, companies that continue or restart operations in some form during the pandemic may anticipate claims from individuals who allegedly contracted the virus while interacting with that company’s employees or independent contractors. While those claims will likely face significant causation issues (will plaintiffs be able to substantiate transmission from a particular source though some combination of location tracking data and genetic testing of the virus?), these kinds of claims can be costly to defend and may create significant risks for certain businesses.
Continue Reading COVID-19 Exposure and GL Coverage: Issues for Personal Injury Claims

In Pitzer College v. Indian Harbor Insurance Company, the California Supreme Court resolved two previously open questions in insurance law: (1) it concluded that the notice-prejudice rule[1] is a fundamental public policy of California, and (2) it concluded that the notice-prejudice rule applies to consent provisions, but only in first-party policies.

This decision provides three primary lessons to insureds. First, when a first-party insurer cites a strict notice provision as a complete bar to coverage, a California policyholder should respond by citing the notice-prejudice rule, even if the policy selects the law of a state that does not follow the notice-prejudice rule. Second, the insured should do the same if a first-party insurer cites a consent provision as a basis to limit coverage for otherwise-covered expenses. In both cases, the notice-prejudice rule may override the choice of law provision and preserve coverage unless the insurer was actually and substantially prejudiced by the delayed notice/consent. Third, in the case of third-party policies, the insured should continue to promptly notify the insurer in the event of a claim and should seek consent before incurring otherwise-covered expenses. The insured should not rely on the notice-prejudice rule to potentially save coverage where it delays notice or fails to seek consent for expenses under a third-party policy.
Continue Reading California Supreme Court Ruling Clarifies That the Notice-Prejudice Rule Is a Fundamental Public Policy That May Override Choice of Law Provisions

In an unpublished decision, the Ninth Circuit affirmed the Central District of California’s interpretation of the related acts provision in a professional liability policy, holding that related acts reported in a prior policy period were not excluded from coverage in a subsequent period because that policy defined “Policy Period” to mean only the current policy period, not any policy period. Attorneys Insurance Mutual Risk Retention Group, Inc. v. Liberty Surplus Ins. Co., No. 17-55597 (9th Cir., Feb. 15, 2019). As a result, the related acts clause, which incorporated this term, could not be read to aggregate claims first made under prior policy periods with those made in the current period. The case reinforces the importance of reviewing the particular language of an insurance policy rather than relying on case law interpreting similar language. Small differences in policy language can lead to significant changes in the available coverage.
Continue Reading Claims-Made Policy Note: Policy’s Use of Defined Terms May Expand or Limit Coverage Under Related Acts Provision

Blog-Image---Are-You-CoveredA recent case in the Northern District of California offers two cautionary tales to policyholders. First, when buying insurance, companies should understand their risks and ensure that the policies they’re buying match those risks as closely as possible. Second, when a claim arises, policyholders must carefully consider all the allegations, not just the formal causes of action, in the complaint to determine whether they might trigger an insurer’s defense obligation.
Continue Reading CGL Coverage for False Advertising and Intellectual Property Claims: Sometimes It’s There, but You Need to Know Where to Look for it

Blog-Image---attorney-clientAttorney invoices may be protected in their entirety by the attorney-client privilege during ongoing litigation. After litigation has concluded, however, those same invoices may be discoverable. So concludes the California Supreme Court in a fascinating ending to a case we have been following since last June of last year, County of Los Angeles Board of Supervisors v. Superior Court (opinion). In a 4-3 decision that mirrored the split we observed in oral argument, the Court reversed the decision of the Court of Appeal.
Continue Reading California Supreme Court Concludes Attorney Invoices Privileged During Ongoing Litigation

Blog-Image---attorney-clientOn October 6, the California Supreme Court heard oral argument in Los Angeles Board of Supervisors v. Superior Court, a case that we have blogged about twice in the past because of its possible impact on policyholders (see posts Submitting Your Defense Bills to Insurers Could Mean Waiving Privilege and California Supreme Court Will Review Appellate Decision Holding That Attorney Bills Are Privileged). On appeal, the Court will decide whether to affirm the California Court of Appeal’s decision that legal invoices sent to the County of Los Angeles by outside counsel are within the scope of attorney-client privilege and thus exempt from disclosure under the California Public Records Act. As this issue could have a major impact on policyholders’ ability to share defense bills with insurers, we attended the oral argument.
Continue Reading California Supreme Court Leans in Favor of Treating Defense Bills as Privileged Communications