Insurance Claim –Exclusion

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WI Court of Appeals – District II

Case Name: West Bend Mutual Insurance Company v. Ixthus Medial Supply, Inc., et al.

Case No.: 2017AP909

Officials: Reilly, P.J., Gundrum and Hagedorn, JJ.

Focus: Insurance Claim –Exclusion

West Bend Mutual Insurance Company insured Ixthus Medical Supply, Inc. and Karl Kunstman, Ixthus’ principal (collectively, Ixthus) under a commercial general liability (CGL) policy and a commercial umbrella policy. The sole question on appeal is whether the policies’ “knowing violation” exclusion applies and relieves West Bend of its duty to defend Ixthus in connection with a trademark/trade dress infringement case Abbott Laboratories and two of its affiliates (collectively, Abbott) filed against Ixthus in federal court in New York. Concluding that the exclusion applied because the New York complaint includes allegations of willful misconduct, the circuit court granted summary judgment in favor of West Bend and declared that West Bend had no duty to defend or indemnify Ixthus. We disagree and conclude Abbott’s complaint alleges facts sufficient to trigger the duty to defend. We therefore reverse the judgment and remand for further proceedings.

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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.