In VAM Check Cashing Corp. v. Federal Insurance Co., 699 F.3d 727 (2d Cir. 2012) (No. 11-2644), the Second Circuit confirmed that ambiguities are resolved in favor of the policyholder where both the policyholder and the insurer have presented reasonable interpretations of the policy language at issue.  An employee of the policyholder, VAM, was subject to a criminal scheme in which the employee was tricked into providing a large sum of money to an individual the employee believed to be a tax collector authorized to collect funds.  Upon later discovery of the criminal nature of the acts, VAM made a claim under its crime insurance policy issued by Federal, and Federal denied coverage on the basis that the acts at issue did not fall within the policy’s definition of “robbery.”  The policy defined “robbery,” in relevant part, as:  “the unlawful taking of insured property from . . . an Employee . . . by . . . overt felonious act committed in the presence and cognizance of such person.”  The parties disagreed as to the proper interpretation of this definition.  Under Federal’s interpretation no robbery occurred because the employee did not realize that the acts at issue were criminal at that time.  By contrast, VAM interpreted the definition to require only that the act itself be overt and observable by the Employee at the time, while the criminal character of the act could remain covert until later discovered.  According to VAM, a robbery did occur because the act of the money being taken was overt and observed by the employee, even though its criminal nature remained hidden until subsequently discovered.  The Second Circuit noted that each party’s respective interpretation was reasonable, therefore rendering the policy language ambiguous.  The Court then applied the maxim of contra proferentem, commonly applied by New York courts, and held in favor of coverage for a VAM.  “[T]he insured will recover for ‘robbery’ whenever property is taken from an employee by means of an observable act that amounts to a felony, provided that the act occurs in the presence of the employee and the employee is aware of the act’s occurrence.  But the employee need not be aware that the act itself is felonious.”