June 2015

WHAT’S NEW & EXCITING?

As an aspiring screenwriter and novelist, I’malways on the lookout for interesting stories asinspiration. Well, if you’re like me, look no fur-ther than this issue of the CGL Reporter. Asthey say, you can’t make this stuff up. Withoutdoubt, these are some of the most heartbreak-ing and gruesome facts that coverage lawyersare likely to come across. Fitting the scenariosinto covered outcomes is the stuff that real cov-erage lawyers are made of. Can you guesshow the insurance coverage issues played out?

In Travelers Prop. Cas. Co. of Am. v.Moore, 1700, two repossession agents ar-rived at the home of Moore to repossess hispersonal vehicle. As the repossession agentswere attaching the car to the tow boom oftheir truck, Moore appeared on the scenearmed with a shotgun and fired multiple shotsat them. With the car in tow, the agents fledthe scene in their truck. Moore, still armedwith the shotgun, pursued them in a van pro-vided to him by his employer, GTECH Corpo-ration. The agents’ truck and the GTECH vancame into contact during the pursuit, and theshotgun, which Moore was pointing out thevan window at the truck with his finger on thetrigger, fired again. The blast killed one of theagents and wounded the other. Moore fled thescene but returned shortly thereafter, when,brandishing the shotgun, he forced the wound-ed agent to release the car from the tow truck.Moore then fled in the car.

In Sletten & Brettin OrthodonticsLLC v. Continental Cas. Co., 110, Slettenformed a partnership and opened a separateoffice for the partnership. The new location

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was added to Sletten’s CGL policy but did nothave the newly created partnership. Approxi-mately 5 years later, another dentist sued thepartnership alleging that Sletten’s partnerposted defamatory statements about the otherdentist’s practice and office on the Internet.The lawsuit alleged defamation and libel, civilconspiracy, and unfair competition.

In Paulino v. Chartis Claims, Inc.,140, Paulino, an undocumented Mexican na-tional, suffered a spinal cord injury in a work-related accident during his employment withChartis’s insured, C-Tec, Inc., which left himpermanently paraplegic. Chartis paid the costsof Paulino’s medical treatment, rehabilitationservices, and initial stay at the Center for Com-prehensive Services (CCS) for post-acute reha-bilitation and preparation for discharge to apermanent independent living arrangement.After determining that Paulino was capable ofbasic independent living, CCS set an anticipat-ed discharge date of April 30, 2006. Chartis’sclaims manager was unable to locate suitable,affordable housing acceptable to Paulino, andCCS refused to discharge him to a temporaryresidence that was not suitable to his needs.Chartis notified Paulino that it would not payfor his living expenses at CCS after April 30,2006, because his stay was no longer medical-ly necessary. On May 6, 2006, Chartis with-drew payment authorization for those expens-es.

In Gonzalez v. Fire Ins. Exch., 110,Gonzalez filed a civil lawsuit against Rebagliatiand 9 other men, alleging that the 10 defen-dants sexually assaulted her at a party whenshe was 17 years old. Gonzalez alleged thatthe defendants gave her multiple shots of hard

liquor and then assaulted her while she was un-conscious in a room at the house where theparty was taking place. She alleged that themen inside the room actively prevented threeother women from entering the room to helpher and alleged that the men subsequently toldothers untruthfully that she had consented tothe assault. In addition to claims for rape andother intentional sexual misconduct, Gonzalez’scomplaint alleged causes of action for negli-gence, false imprisonment, and slander.

In Dakota Fire Ins. Co. v. J&J McNeilLLC, 310, McNeil owned an excavation andsnow-removal limited liability corporation(LLC), of which he and his wife were the onlymembers. McNeil stored the LLC’s equipmentat his home in large sheds and garages, includ-ing storage of a 93-foot Caterpillar scraper with7.5-foot tires (the “Scraper”). McNeil alsomaintained cars and property at his home that

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were unrelated to the LLC and used only for hispersonal enjoyment, including a 2008 ShelbyGT (“Shelby”). One morning, McNeil movedthe Shelby outside the shed to service theScraper. McNeil did not realize that he had leftthe Shelby in neutral and that it had rolleddown to rest in front of the shed. When hebacked the Scraper out of the shed, he unknow-ingly crushed the Shelby.

In Yousuf v. Physicians Liab. Ins. Co.,530, Dr. Yousuf and Dr. Cohlmia, board-ertified surgeons in Tulsa, Oklahoma, had privi-leges to practice cardiothoracic surgery at theHillcrest Medical Center. In November 2004,Dr. Yousuf sued Dr. Cohlmia. In his suit againstCohlmia, Yousuf alleged that Cohlmia had writ-ten a defamatory letter to the board of directorsof Hillcrest and that Cohlmia had circulated thecontents of the letter to the local news media inan effort to damage Yousuf’s professional repu-tation. According to the Tulsa World dailynewspaper, Cohlmia’s letter related to thedeaths of two of Yousuf’s patients followingsurgeries performed by Yousuf. In his suit, You-suf asserted claims for defamation, tortious in-terference with business relations, intentionalinfliction of emotional distress, and outrage,negligence, and breach of contract. The jury re-turned a general verdict against Cohlmia for $5million. Although the jury found that Cohlmiaacted with intent and malice, the jury did notaward any punitive damages.

In Reese v. George, 605, George, anAmerican citizen of Syrian descent, was thechairman and CEO of the George Group, anumbrella corporation active in the food service,real estate development, and construction man-agement industries. He had interests in compa-nies that operated bars, restaurants, and night-clubs in Ohio. In the years after September 11,2001, George came to believe that his bar andrestaurant businesses were being unlawfully tar-geted by Ohio liquor enforcement officials basedon his Arabic ethnicity. He also believed that

Reese, a member of the Ohio Department ofPublic Safety’s investigative unit (ODPS),played a part in the overzealous law enforce-ment. Reese also worked security for variousprivate employers, including the Velvet Dognightclub in Cleveland. Reese alleged that,while he was working security at the VelvetDog, George walked by with his wife, recog-nized him, and became enraged. He allegedthat George made threatening statements toReese. Reese further claimed that George hadentered into a civil conspiracy with a criminalinvestigator, a TV reporter, and Reese’s for-mer girlfriend in an effort to discredit Reeseand avoid prosecution. Reese alleged that theinvestigator investigated Reese at George’s be-hest and reported false allegations that Reesetook steroids to the Cleveland Police Depart-ment, which initiated an internal affairs investi-gation that resulted in a 5-day suspension. Healso alleged that the investigator, at George’sdirection, informed the reporter that Reesehad falsified his police department application,was mentally unstable, and failed to make childsupport payments. The reporter allegedly pub-lished these allegations and raised questionsabout Reese’s fitness to serve as a ClevelandPolice officer.

In Peerless Indem. Ins. Co. v. Moshe& Stimson LLP, 1400, Moshe’s relationshipwith her brother, Stimson, began to rapidly de-cline in 2011 when she announced she was re-signing from Moshe & Stimson, the law firm inwhich she and her brother were partners. Aftershe announced her plans to leave the firm,Stimson refused to dissolve the partnership,seized control of the firm’s assets, refused toturn over client files and personal property be-longing to Moshe, and refused to pay Mosheher regular income. In addition, Stimson beganmaking accusations about Moshe’s personalintegrity and professional competence. Onemonth later, Moshe sued Stimson for defama-tion and sought a formal dissolution of the law

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firm, an accounting, injunctive relief, and mon-etary damages.

Hope you enjoy these stories. Look for thebestseller!

Other Miscellaneous (but Less Dramatic) Cases

• Acceptance Indem. Ins. Co. v. Southwest Ark. Electric Coop. Corp., 235

• Acuity v. Chartis Specialty Ins. Co., 220

• Allen v. Continental W. Ins. Co., 110

• Alterra Excess & Surplus Ins. Co. v. Snyder, 1400

• Amish Connection, Inc. v. State Farm Fire & Cas. Co., 950

• Anderson v. Aul, 190

• Arceneaux v. Amstar Corp., 135

• BancInsure, Inc. v. Highland Bank, 1900

• Bank of Brewton v. Travelers Cos., Inc., 1900

• BB Syndication Servs., Inc. v. First Am. Title Ins. Co., 1950

• Blasing v. Zurich Am. Ins. Co., 615

• Brecek & Young Advisors v. Lloyd’s of London Synd. 2003, 1000

• Cincinnati Ins. Cos. v. Motorists Mut. Ins. Co., 120

• Cincinnati Specialty Underwriters Ins. Co. v. Larschied, 225

• Craft v. Philadelphia Indem. Ins. Co., 190

• Diamond State Ins. Co. v. Rippy, 225

• E.J. Zeller, Inc. v. Auto Owners Ins. Co., 950

• First Health Settlement Class v. Chartis Specialty Ins. Co., 170

• George v. Great Lakes Reins. (UK) PLC, 225

• Greenwell v. Auto-Owners Ins. Co., 180

• Hastings Mut. Ins. Co. v. Village Cmtys. Real Estate, Inc., 120

• Hawk v. Stocklin, 225

• Hegel v. First Liberty Ins. Corp., 950

• Illinois State Bar Ass’n Mut. Ins. Co. v. Law Office of Tuzzolino & Terpinas, 545

• Indian Harbor Ins. Co. v. City of Waukegan, 1800

• In re Deepwater Horizon, 615

• J.P. Morgan Secs., Inc. v. Vigilant Ins. Co., 1000

• Margulis v. BCS Ins. Co., 1000

• Mid-Continent Cas. Company v. Kipp Flores Architects LLC, 1400

• Motorists Mut. Ins. Co. v. King, 1600

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• Occidental Fire & Cas. Co. v. Soczynski, 1700

• Old Second Nat’l Bank v. Indiana Ins. Co., 950

• Preisler v. General Cas. Ins. Co., 220

• State Farm Fire & Cas. Co. v. Dantzler, 220

• St. Paul Fire & Marine Ins. Co. v. Llorente, 1000

• Syfco v. Encompass Indem. Co., 950

• Tri-National, Inc. v. Yelder, 1700

• 282 Cnty. Rd. LLC v. AAA Southern New England, 1950

• United Fire & Cas. Ins. Co. v. Thompson, 605

• West Bend Mut. Ins. Co. v. Athens Constr. Co., Inc., 620

• Will Repair, Inc. v. Grange Ins. Co., 950

• Wright v. Larschied, 225

~Jill B. BerkeleyCGL Reporter Executive Editor

Written by ABA Members of the ICLC

This supplement was written by the following members of the Insurance Coverage LitigationCommittee (ICLC) of the Tort Trial and Insurance Practice Section (TIPS) of the American BarAssociation, under the direction of Jill Berkeley, author and executive editor or CGL Report-er since 1986. TIPS uses royalties from subscriptions sales to seed a scholarship fund to in-crease diversity among participants in TIPS programs. Learn more.

Jill B. BerkeleyHelen K. MichaelBrian R. AdeShannon M. AwsumbMark M. BellAnna BennettBenjamin A. BlumeEric CaughLaurie DugonithsW. Gray Dunlap Jr.

Laura A. FogganRippi GillAlan K. GoldsteinEric HermansonMarci Goldstein KokalasEsther Slater McDonaldTerrence R. McInnisJ. David MooreErik W. Nielsen

Nicholas N. NierengartenHarvey NosowitzRhett PetcherKatie C. PfeiferCarl A. SalisburyNicholas C. Snow Kara ThorvaldsenGordon WaltonJohn E. Zulkey

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