Selman Breitman Obtains a Published 8th Circuit Decision Affirming Summary Judgment of No Duty of CGL Insurer to Indemnify a Class Action for TCPA "Blast Fax" Allegations Based on the Policy's $1,000 Per-Claim Deductible

August 3, 2015

The 8th Circuit Court of Appeals issued a published Opinion affirming a Missouri federal court's grant of summary judgment to Selman Breitman's CGL insurer client.

The underlying claimant sued the insured asphalt and paving company in a class action, alleging the insured sent tens of thousands of "blast fax" ads in violation of the TCPA, 47 USC §227. The claimant sought $500 in statutory damages per fax.  Selman Breitman's client agreed to defend, then brought a Declaratory Relief Action seeking a determination it owed no duty to indemnify as a matter of law. It moved for summary judgment, arguing the millions of dollars sought fell under the policy's $1,000 per-claim deductible. The claimant opposed the motion, arguing the insurer "waived" the deductible through a purported delay in asserting it, and that the term "claim" in the deductible provision was ambiguous and could refer to the insurance claim, entire class suit or to each claimant.

The district court granted the insurer's summary judgment motion, finding the term "claim" as used in the per-claim deductible was not ambiguous and referred to each fax sent in violation of the TCPA. The 8th Circuit affirmed, rejecting the claimant's assertion that the insurer "waived" the per-claim deductible through alleged delay in asserting it. The Court held that under Missouri law, a deductible is akin to a policy limit that sets boundaries on coverage and cannot be "waived" through the insurer's conduct. The Court further reasoned that even if the term "claim" could be construed to refer to all the faxes a given claimant received during one policy year as the claimant argued (rather than to each fax as the district court found), the claimant presented no evidence any of the claimants received more than one fax. Since the claimant failed to sustain its burden of showing any per-claim damages in excess of $1,000, the district court correctly found the insurer owed no duty to indemnify as a matter of law. 

The Selman Breitman lawyers on this case were Alan Yuter and Rachel Hobbs.

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