The United States District Court for the Southern District of New York has found that an SEC investigation and subpoena were a “Claim” under a directors’ and officers’ liability insurance policy such that they triggered an exclusion from coverage for pending and prior claims.  Patriarch Partners, LLC v. Axis Insurance Co., No. 16-CV-2277 (VEC) (S.D.N.Y. Sept. 22, 2017).  Axis had issued an excess directors’ and officers’ liability insurance policy to Patriarch incorporating the “Claim” definition from an underlying policy.  The Axis policy also included an exclusion for pending and prior claims as of the inception date of the policy, August 11, 2011.  The SEC began investigating Patriarch in 2009, first through an informal inquiry, then in May 2011 as an informal investigation, then on July 1, 2011 through a document subpoena of a former Patriarch executive.  The SEC issued that document subpoena pursuant to an SEC formal order dated June 3, 2011 authorizing an investigation of Patriarch.  The Court determined that the July 1, 2011 document subpoena to a former Patriarch executive and the June 3, 2011 SEC formal order of investigation of Patriarch both constituted a “Claim” for purposes of triggering the Axis policy’s pending and prior claim exclusion.  The Court reasoned that the subpoena met the Claim definition of a demand for non-monetary relief and that compliance with the subpoena was not optional.  The Court also reasoned that the Axis policy’s definition of Claim as a demand for non-monetary relief did not also require an allegation of a wrongful act.  On the other hand, the Axis policy’s alternative definition of Claim as an investigation did require an allegation of a wrongful act.  The Court then found that the SEC’s formal order of investigation also met that Claim definition and alleged a wrongful act.