Between the Lines

A Discussion of Case Law and Statutory Law Affecting Commercial Lines of Insurance


Business is Business, Says Maine Supreme Court

Business risk coverage in homeowner's insurance

Above: some of the activities homeowner’s insurance covers.
Not pictured: business pursuits.

No Coverage under Homeowners Policy for Libel in Trade Publication

The publisher of a shipping industry trade publication printed some things about a freight railroad company that the company didn’t like.  The railroad sued the publication and the publisher individually for making false and defamatory statements.  Reversing the trial court, the Maine Supreme Court held that the “business pursuits” exclusion eliminated any duty to defend on the part of the publisher’s homeowner’s insurer.

Why is this blog-worthy, you may ask.  Two questions make the case worth discussing.  First, why did the trial court think there was a duty to defend?  Second, why did the publisher need to resort to his homeowner’s policy for coverage?

The trial court found coverage because the railroad alleged that the publisher had made statements “including but not limited to” specific statements in the publication.  The trial court apparently concluded that this could mean that he made statements outside the publication, and therefore outside of his business role.  The Maine Supreme Court disagreed, observing that the complaint also alleged without qualification that the statements had been made in the trade publication.  Lesson number one: the presence of broad catch-all language in a complaint sometimes may be helpful to coverage, but it won’t always keep the insurer in the case.

But why was homeowner’s coverage even an issue?  Didn’t the publication have a general liability policy with “personal and advertising injury” coverage?  The opinion doesn’t say one way or the other.  But a standard commercial general liability policy would not have helped this insured:  it excludes defamation coverage for insureds who are in the business of publication.  In order to have coverage for this claim the insured would have needed a media liability policy.  Lesson number two: know your risks and get coverage that fits them. 

The case is Hardenbergh v. Patrons Oxford Ins. Co., 2013 ME 68 (2013).

About Harvey: I specialize in Insurance Law and Litigation at Anderson & Kreiger. My most recent post for Between the Lines looked into case law on fraudulent bills of lading.



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About the Author

Harvey Nosowitz

Posted In: Personal and Advertising Injury

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