U.S. District Court Judge Patrick J. Schiltz (D. Minn.) recently denied an insurer’s motion to dismiss an insurance coverage claim (for “personal and advertising injury”) by a Minnesota cell phone financial services company (Cachet) and a Minnesota broadband internet service company.
If you have any interest in trying to follow how insurance coverage disputes are resolved, I strongly recommend that you read Judge Schiltz’s order as it navigates the thicket as well and as carefully as anyone could.
And, if you have a quirky sense of humor and an affection for absurdity (as I do), you might also enjoy the decision on that score.
“Alice in Wonderland”.
Sometimes insurance policies seem to reek of illogic.
An insurance policy provides coverage for X, but includes an exclusion that excludes coverage for X, but provides an exception to the exclusion of X, affording coverage for X, and another policy, called an “umbrella policy” provides coverage for X if the underlying policy provides coverage for X, but only to the extent that the underlying policy provides coverage for X.
And X, by the way, is defined in the policy as “X” (which does not mean X).
You think I am lying or at least exaggerating. The “endorsement” to the “business-liability policy” at issue in the case provides:
This insurance [which on its face provides coverage for “personal and advertising injury”] does not apply to “personal and advertising injury” and none of the references to “personal and advertising injury” in the policy apply. This exclusion does not apply to “personal and advertising injury” arising out of the following offenses: a. False arrest, detention or imprisonment; b. Malicious prosecution; or c. The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that the person occupies [none of which would most people think of as “personal injury” or “advertising injury”]. . . .
And, to me, the punch line of Judge Schiltz’s decision on the insurer’s motion to dismiss is that he found the insurer’s analysis of the issue “nonsensical,” the insureds’ analysis “weird,” and concludes both are “reasonable but flawed.”
In other words, a major U.S. insurance company sells an insurance product to sophisticated U.S. companies and neither buyer nor seller can provide a coherent or persuasive explanation of what one sold and the other bought.