“Advertising Injury” Policy Provision
A class action was filed against an insured for sending unsolicited advertisements by facsimile to class members, alleging a violation of the Telephone Consumer Protection Act (TCPA), 47 U.S.C. §227 (2006). The insured entered into a settlement agreement without the insurer’s consent, which was to be satisfied solely from the general commercial liability insurance policy. The insurer sought a declaratory judgment that they had no duty to defend or to indemnify. The main issue on appeal was whether the trial court used the correct interpretation of the “advertising injury” provision.
Because the class action complaint alleged that the unsolicited advertisements violated the members’ right to privacy, the complaint fell within the “advertising injury” provision. They reasoned that the makeup of the underlying plaintiffs made no difference because they had never made a distinction in prior decisions and ones would have been specifically made if it was intended. Furthermore, the Valley Forge court specifically rejected the privacy distinctions between secrecy and seclusion for insurance policies and their affect on individuals versus corporations. The court also noted the TCPA gives either a “person or entity” the right of action in case of a violation further evidencing that an individual/corporation distinction should not be made.
Landmark American Ins. Co. v. NIP Group, Inc., 962 N.E.2d 562, (Ill.App. 1 Dist., 2011), Nos. 1-10-1155, 1-10-1158
