'Advertising' vs. 'Solicitation': The Impact on Available Advertising Injury Coverage

While insureds often seek liability coverage for damages arising from bodily injury or property damage, an increasing number of insureds are seeking coverage for “advertising injury” in an age of growing technology and intellectual property disputes. Coverage for “advertising injury,” generally found in Part B of a commercial liability policy, insures against injuries that occur in the “course of advertising [the insured's] goods, products or services.” “Advertising injury” is defined to include injury arising from a specific, finite category of offenses, including:

1. Oral or written publication of material that slanders or libels a person or organization or disparages a person's or organization's goods, products, or services;
2. Oral or written publication of material that violates a person's right of privacy;
3. Misappropriation of advertising ideas or style of doing business; or
4. Infringement of copyright, title, or slogan.

Lawsuits implicating advertising injury often involve claims of defamation, patent, trademark and copyright infringement, and violation of privacy torts. Under the threshold requirements to coverage, the insured's alleged conduct, in addition to falling within an enumerated offense, must have occurred within the course of “advertising.” Recent decisions confirm that whether an insured is “advertising” depends strongly on the nature of the insured's communication, and the identity of the insured's targeted audience.