The Ninth Circuit Court of Appeals has asked the California Supreme Court to weigh on whether insurers have a duty to defend violations of TCPA under a commercial liability policy that covers “personal injury,” which as defined includes violation of a person’s privacy rights.
The issue arose in Yahoo! Inc. v. Nat'l Union Fire Ins. Co. of Pittsburgh, No. 17-16452, 2019 WL 209713 (9th Cir. Jan. 16, 2019). Yahoo! sued its insurance company, National Union Fire Insurance Co. of Pittsburgh, for breach of contract when the insurance company refused to tender defense of underlying TCPA actions in which Yahoo! was a defendant. Yahoo! claims that under the commercial general liability insurance, the insurer had a duty to defend the company under the policy that covers “personal injury” which, among other things, is defined as an injury arising out of “[o]ral or written publication, in any manner, of material that violates a person’s right of privacy.”
In the order certifying the question to the California Supreme Court, the Ninth Circuit noted that courts across the country have come out different ways on the issue. Courts in Missouri, Florida and Massachusetts have found coverage under similar policies, whereas Courts of Appeal applying Iowa and Virginia law have found no coverage.
The Ninth Circuit further noted that the two California Court of Appeal decisions to address the issue are in conflict. Whereas in ACA Sys., Inc. v. St. Paul Fire & Marine Ins., 53 Cal. Rptr. 3d 786, 5798 (Ct . App. 2007) the Court seem to suggest that such a provision as the one at issue would provide coverage, the State Farm Gen. Ins. V. JT ‘s Frames, Inc., 104 Cal. Rptr. 3d 573, 588 (Ct. App. 2010) opinion held that such a provision does not provide coverage. Thus, the Ninth Circuit seeks clarity from the California Supreme Court.
Only time will tell how the California Supreme Court will resolve this issue. Although, whatever it decides will likely have broad implications across the insurance industry for liability coverage of TCPA claims.