Insurance Coverage

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7^th Circuit Court of Appeals

Case Name: American Alternative Insurance Corporation v. Metro Paramedic Services, Inc.

Case No.: 15-2310

Officials: WOOD, Chief Judge, and BAUER and WILLIAMS, Circuit Judges

Focus: Insurance Coverage

Insurance provider owed duty to defend insured based on plain language of the policy.

“AAIC breathlessly predicts that if Metro qualifies as a named insured, then anyone could be a named insured to an AAIC policy so long as a third party alleged that that person was in a joint venture with Antioch. There are two answers to this alarm. The first is that this concern is overblown: it is un‐ clear why a third‐party plaintiff would allege that another party is in a joint venture with Antioch unless (as Federal Rule of Civil Procedure 11(b) and its state counterparts require) that plaintiff had a reasonable basis for doing so. This case is not a close one. Metro is a named insured under AAIC’s pol‐ icy with Antioch. Metro is thereby covered by the policy, and AAIC is bound to defend it. As a result, we need not consider its backup argument for coverage: that it is an “additional blanket insured.” Second, if AAIC seriously fears this result, it can always re‐draft its policies to specify each additional insured (a practice we believe is common)”

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.