I wrote an article for Risk Management discussing the Federal Aviation Administration’s long-awaited regulations for commercial drones weighing 55 pounds or less and the insurance coverage available to address drone risks. Insurance is widely available, but careful attention should be paid to differences in policy language. Also, expect insurers to incorporate features of the
In what it described as a case of first impression, the Northern District of California ruled that a professional liability policy that excluded the insured’s “assumption of liability obligations in a contract or agreement” did not extend to breach of warranty or false advertising claims arising out of a genetic data testing company’s marketing and sale of a personal genome service. See Ironshore Specialty Ins. Co. v. 23andMe, Inc. (July 22, 2016) N.D. Cal. No. 14-cv-03286-BLF. What is noteworthy about this case is not so much the decision, but the fact that the insurer challenged coverage on this ground. While this issue apparently has never been decided in the context of a professional liability policy, both case law and custom and practice recognize that the same phrase used in a general liability policy applies only to liabilities “assumed,” i.e. created by, a contractual indemnity agreement.
Continue Reading “Assuming” the Obvious: Exclusion for “Assumption of Liability in a Contract” Does Not Apply to Breach of Professional Services
Erica Villanueva and Tyler Gerking will be presenting to the Association of Corporate Counsel (ACC) on September 14 (in San Francisco) and 15 (in Palo Alto) about private company D&O liability insurance, also known as management liability insurance. Below is a description of the program, which will touch on hot issues that many companies are
The crash of a vehicle operating in semi-autonomous or fully autonomous mode presents a headline-grabbing opportunity to question the technology and the pace at which it is being introduced. Every accident resulting in injury or death is a tragedy. In the case of new technology that offers the possibility of dramatically reducing the total number of injuries and deaths, it will be important to look at any individual crash in the context of the overall promise of the technology. For example, it will be important to know how many miles of autonomous driving took place before the first crash occurred and compare that to ordinary cars, where the national average is one fatality every 94 million miles, and the worldwide average is a fatality every 60 million miles.
For our purposes, a crash also presents a scenario for how liability and insurance issues may play out as these cars and trucks start appearing on the road in greater numbers. We’ll walk through what won’t change, and the few things that might.
Continue Reading Autonomous Vehicles: A Case Study of Liability and Insurance
Under a ruling this week from the California Insurance Commissioner, your company may be insured under an unenforceable workers’ compensation program. You may also be entitled to a refund of premiums paid to California Insurance Company (CIC) and Applied Underwriters (Applied), two Berkshire Hathaway subsidiaries.
Our April 19, 2016 post discussed a decision from the California Department of Insurance finding that the EquityComp workers’ compensation program sold to Shasta Linen Supply by CIC and Applied is void as an unfiled collateral agreement. CIC appealed the administrative law judge’s decision finding the program void. Shasta appealed the denial of its claim for reimbursement of all sums in excess of actual claims paid. On June 20, 2016, the California Insurance Commissioner affirmed the ALJ’s decisions.
Continue Reading UPDATE: Is Your Workers’ Compensation Program Unlawful?
Employers continue to face a wave of lawsuits alleging violations of various “wage and hour” statutes (overtime pay, meal and rest breaks, etc.). Employment liability insurers have uniformly denied coverage for these claims and have tightened applicable exclusions. Some insurers now offer wage and hour coverage, but these policies and endorsements usually provide only very restricted defense cost coverage. A new source of coverage now exists, courtesy not of insurers but of revisions to the California Labor Code.
New Labor Code §558.1, effective January 1, 2016, appears to create individual liability for violation of California’s wage and hour statutes.
Continue Reading New Law May Create Coverage for Wage and Hour Claims
Law firms are important gatekeepers between cybercriminals and clients’ sensitive data. The release of the Panama Papers and several other recent high-profile breaches have brought to light vulnerabilities in law firm cyber security.
I recently participated in a podcast with journalist Ben Hammersley and eSentire’s VP and industry security strategist Mark Sangster. Our discussion focused
When a venture capital or private equity firm invests in a portfolio company (PC) and places a general partner on the PC’s board, they typically require that the PC agree to defend and indemnify the board member in any litigation arising out of their board service, and to purchase directors’ and officers’ liability insurance. However, the D&O insurance requirements are typically quite vague, and some firms may be surprised to learn of key gaps in the PC’s coverage. These gaps are usually discovered when the VC/PE firm needs the coverage most – i.e., after a lawsuit has been filed, naming their board member as a defendant. Here are two examples I’ve come across in representing venture capital and private equity firms:
Continue Reading Do You Know What’s In Your Portfolio Company’s D&O Insurance?
In a recent case out of the Fourth Appellate District of the California Court of Appeal, Clarendon America Ins. Co. v. Starnet Ins. Co., the Court held that an insurer’s duty to defend applies to the mandatory pre-litigation procedures required in California construction defect cases, holding that the term “suit”, as used in a
On July 21, U.S. District Court Judge Claudia Wilken handed insureds a significant victory in a coverage case for Seagate, a computer hard drive manufacturer. Download 2010-07-21 Order re defts MTC and plffs MSJ (2) Farella represents Seagate in that action. Judge Wilken granted Seagate partial summary judgment on its claim that the Insurance Company