In a summary order by the Second Circuit Court of Appeals, the Court affirmed the lower court’s summary judgment that found that a professional liability insurer was not required to defend and indemnify its insured for certain ongoing arbitration proceedings in which the insured was a defendant. The Second Circuit agreed with the lower court that as of the inception date of the policy, the insured “had knowledge or a reasonable basis upon which to anticipate that a wrongful act or interrelated wrongful act could result in a claim” under the underlying policies. The district court’s opinion reveals that the definition of Claim in the policies expressly covered demands made in either litigation or arbitration. Quanta Specialty Lines Ins. Co. v. Investors Capital Corp., No. 10-0219 (2d Cir. Nov. 16, 2010).
This post written by Michael Wolgin.