Wausau Business Ins. Co. v. Fisher Printing Co., No. 07 C 3732, 2008 WL 2704874. (N.D. Ill. Jul. 8, 2008) (Kennelly, J.).
Judge Kennelly granted in part defendant’s motion for summary judgment of insurance coverage and denied plaintiff’s cross motion. Defendant-insured was charged with copyright and trademark infringement for allegedly using a third party’s trademarks in various advertisements the insured printed. Insured sought defense and indemnity from plaintiff-insurer based upon the advertising injury clause in the parties’ insurance policy. Insurer contended that a prior publication exclusion denied coverage insured’s case because the accused infringement began before the policy’s effective date and was allegedly knowing and intentional. But because the complaint alleged that some of insured’s infringement commenced after the policy’s effective date, the exclusion did not preclude coverage. All that is required to trigger coverage is that one allegation falls within the policy.
Insurer also argued that a knowing violation exclusion denied coverage because the complaint alleged willful and intentional copyright and trademark infringement. But because copyright infringement could be proven without regard to insured’s intent, the exclusion did not apply.
Finally, the Court denied summary judgment as to insured’s bad faith litigation claim. The Court held that there was at least a question of fact as to whether insurer had a plausible defense to the coverage.

Continue Reading Infringement Allegations Trigger Insurance Policy

Capitol Indemnity Corp. v. Elston Self Serv. Wholesale Grocs., Inc., No. 04 C 6536, 2008 WL 696919 (N.D. Ill. Mar. 13, 2008) (Pallmeyer, J.).
Judge Pallmeyer held that the advertising injury claim in plaintiff Capitol Indemnity’s (“CI”) insurance policy required that it defend defendants the “Elston Grocery” defendants in the underlying trademark infringement, unfair competition and Illinois Deceptive Trade Practices Act (“IDTPA”) claims. In the underlying litigation, Lorillard Tobacco accused Elston Grocery of selling counterfeit Newport cigarettes using Newport cigarette advertisements.
The advertising injury clause covered infringement of “copyright, title, or slogan” and “[m]isappropriation of advertising ideas.” The Court held that “title” does not mean just the title of a work, but also encompasses, among other things, trademarks and names. CI, therefore, had a duty to defend Elston Grocery against Lorillard’s trademark infringement claims. A duty to defend was also created by the trademark infringement claims because they accused Elston Grocery of misappropriating Lorillard’s advertising ideas – its trademarks and advertisements.
CI argued that there was an exclusion for allegedly intentional acts. But the Court held the exclusion did not apply, even though Lorillard pled intent, because intent was not required for trademark infringement.
Additionally, it did not matter that the policy covered only compensatory damages. Lorillard sought punitive damages, but they would only be awarded if compensatory damages were awarded. So, the punitive damages exclusion did not alter CI’s duty to defend.
Finally, the Court declined to rule on indemnity because Lorillard’s claims had not been finally resolved. An indemnity ruling regarding an ongoing case was inappropriate because it would be an advisory opinion.

Continue Reading Advertising Injury Insurance Policy Covers Trademark Claims

Discover Financial Servs. LLC v. National Union Fire Insur. Co. of Pittsburgh, PA, No. 06 C 4359, 2007 WL 2893624 (N.D. Ill. Sep. 26, 2007) (Pallmeyer, J.).

Judge Pallmeyer granted summary judgment that defendant National Union Fire Insurance Co. (“National Union”) did not have a duty to defend plaintiff Discover Financial Services (“Discover”) pursuant

Global Computing, Inc. v. Hartford Cas. Ins. Co., No. 05 C 6753, 2007 WL 844618 (N.D. Ill. Mar. 14, 2007) (Hibbler, J.).

Judge Hibbler granted defendant-insurer summary judgment that it had no duty to indemnify or defend plaintiff-insured.  Microsoft brought suit against plaintiff alleging that plaintiff distrbuted counterfeit Microsoft software and used Microsoft logos

Allied Ins. Co. v. Bach, No. 05 C 5945, 2007 WL 627635 (N.D. Ill. Feb. 27, 2007) (Leinenweber, J.).

Judge Leinenweber granted declaratory judgment defendants/counter-plaintiffs (collectively "defendants") summary judgment DJ plaintiff/counter-defendant’s ("plaintiff") duty to defend defendants against Lanham Act and related state law claims.  Defendants were sued by third party Acushnet which accused defendants of