Gauntlett on Intellectual Property/Antritrust Insurance : Insurance Policyholder Advocate & Attorney David Gauntlett : Gauntlett Law Firm : Insurance Recovery, Policy Interpretation : Irvine, Orange County, California

In the Fourth Amended Complaint by Williams, DCSB who owned portions of Brown’s Sump Site, a former garbage dump that received municipal incinerator ash and municipal solid waste from the City of Jacksonville between the late 1940's and the 1960's was sued. The dump site had been the location for construction of the Mary Macleod Bethune Elementary School in 1957 as well as founding residential housing. The carrier denied a defense duty based on the pollution exclusion.

The court found the exclusion at issue barring pollution coverage for bodily injury and property damage discharge, dispersal and release unambiguous.

The court found that the exclusion addressed fraud claims including both passive and active polluters. It determined that the issue as to whether DCSB’s conduct was negligent dependant on its response of the recognition of environmental pollution.

The application of the pollution exclusion to insured non-polluter was hardly novel, nor did it matter that the exclusion was applied to a party that did not “discharge” pollution as the “arise out of” language was sufficient to reach same. Nor was the :sudden and accidental exception” implicated. There was no specific facts evidencing a grounds for estoppel in this case.

The personal injury coverage was also rejected because actions for inverse condemnation, nuisance and trespass are not equivalent to wrongful entry or eviction within the meaning of this section.

“Wrongful entry” or “eviction,” require some sort of impingement of the possessory rights of the residents neighboring the Site. City of Delray Beach, 85 F.3d at 1534.

Id. at *10.

As a matter of law, that no environmental contamination was covered.

“Without Atkins' valid authority or informed consent, IMT and Thane have invaded and continue to invade Atkins' privacy by appropriating Atkins' name and likeness by using Atkins' name and image on the EFL package and Atkins' name and image in at least one infomercial which was aired on television. Atkins' image on the EFL package and in the infomercial is readily identifiable in that any person viewing these images with the naked eye can reasonably determine that the person depicted in these images is Atkins because Atkins' face is clearly visible and distinguishable, the image depicting Atkins on the EFL package is situated next to Atkins name on the package and the image depicting Atkins in the EFL infomercial is shown with a verbal statement of Atkins' name.”

Id. at *3.

A duty to defend these fact assertions was owed by Hartford.

All causes of action were covered because the defendant refused to defend citing, Buss v. Superior Court, 16 Cal. 4th 35, 48-50 (1997).

The fair market value of the goods, i.e., the EFL units, or $492,793.62, that Thane agreed to relinquish in consideration for the settlement of all claims against it in the underlying lawsuit is recoverable as damages arising from Defendants’ breach. Earth Elements, Inc. v. Nat'l Am. Ins. Co. of Calif., 41 Cal.App.4th 110, 116-17, 48 Cal.Rptr.2d 399 (1995); McMahan's of Santa Monica v. City of Santa Monica, 146 Cal.App.3d 700-701 (1983), disapproved on other grounds, Bunch v. Coachella Valley Water Dist., 15 Cal.4th 432, 63 Cal.Rptr.2d 89, 935 P.2d 796 (1997).

Id. at *6.

The court also found 10% prejudgment interest was recoverable on the fair market value of the goods relinquished as well as on defense fees from the date incurred.