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Insurers' Rights to Recoup Defense Costs
Commercial General Liability (“CGL”) policies typically provide two distinct benefits to policyholders: defense against potentially covered claims, and indemnity against covered claims. Because the duty to defend is broader than the duty to indemnify, it is as important, if not more important, than the duty to indemnify. See, e.g., Buss v. Los Angeles Superior Court, 65 Cal.Rptr.2d 366, 373, 939 P.2d 766, 773 (1997). Insurers often accept their defense obligations, however, subject to reservation of their rights to assert non-coverage. Now, with increasing frequency, insurers also are demanding reimbursement if it turns out that the liability claim was not covered.
When an insurer is presented with a claim, it may (if appropriate) deny coverage, and advise the policyholder of the basis for its non-coverage position. If a claim is indisputably covered, the insurer must accept its coverage obligations. If it is unclear to the insurer whether a claim is covered, the insurer may (and in some states must) either: 1) defend the suit; 2) defend the suit under a reservation of rights; or 3) seek a timely declaratory judgment of no coverage. See, e.g., Employers Ins. of Wausau v. Ehlco Liquidating Trust, 708 N.E.2d 1122, 1134-35 (Ill. 1999); Shell Oil Co. v. AC&S, Inc., 649 N.E.2d 946, 949 (Ill. App. Ct. 1995). If the insurer fails to take one of these three steps and is later found to have had a duty to defend, the insurer then may be estopped from raising any policy defenses to coverage. Employers Ins. of Wausau v. Ehlco Liquidating Trust at 1122, 1135; Korte Construction Co. v. American States Ins., 750 N.E. 2d 764, 769 (Ill. App. Ct.), appeal denied, 763 N.E. 2d 319 (Ill. 2001); Shell Oil v. AC&S, Inc., 649 N.E.2d 946, 949-50 (Ill. App. Ct. 1995).
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
How AI Has Affected PR
When we consider how the use of AI affects legal PR and communications, we have to look at it as an industrywide global phenomenon. A recent online conference provided an overview of the latest AI trends in public relations, and specifically, the impact of AI on communications. Here are some of the key points and takeaways from several of the speakers, who provided current best practices, tips, concerns and case studies.