Thank You For Submiting Feedback!
Superior Court of Delaware, New Castle
July 14, 2021, Submitted; August 18, 2021, Decided
C.A. No. N20C-04-268 MMJ CCLD
FACTUAL AND PROCEDURAL CONTEXT
In this insurance coverage case, Plaintiff Guaranteed Rate, Inc. ("GRI") seeks coverage for approximately $18 million in connection with a federal government investigation ("Government Investigation"). The U.S. Attorney's Office for the Northern District of New York and the U.S. Department of Justice initiated an investigation of alleged violations of the False Claims Act.1 GRI received a Civil Investigative Demand ("CID") on June 27, 2019.
GRI was in the business of underwriting and issuing federally-insured mortgage loans. GRI purchased a Private Company Management Liability Policy from Defendant ACE American Insurance [*2] Company ("ACE"). On July 8, 2019, GRI gave notice of the CID to ACE. By letter dated January 13, 2020, ACE denied that the CID constituted a "Claim" under the Policy, and declined to advance defense costs.
GRI has filed a Motion for Partial Judgment on the Pleadings on three issues:
(1) whether the CID was a Claim first made during the Policy period;
(2) whether exclusions in the Policy, including the Professional Services Exclusion negate ACE's obligations to advance GRI's defense costs; and
(3) whether, by refusing to acknowledge the CID as a Claim and refusing to advance GRI's defense costs, ACE breached the Policy.
Defendant ACE2 filed a Cross Motion for Judgment on the Pleadings. ACE contends:
(1) that the Professional Services Exclusion bars coverage under the D&O part;
(2) that GRI has not pleaded a claim for loss under the EPL part; and
(3) that GRI's bad faith claim also should be dismissed.
STANDARD OF REVIEW
Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.
2021 Del. Super. LEXIS 552 *; 2021 WL 3662269
GUARANTEED RATE, INC., Plaintiff, v. ACE AMERICAN INSURANCE COMPANY, XL SPECIALITY INSURANCE COMPANY, AXIS INSURANCE COMPANY, and ENDURANCE AMERICAN INSURANCE COMPANY, Defendants.
Notice: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL.
Subsequent History: Rehearing denied by Guaranteed Rate, Inc. v. Ace Am. Ins. Co., 2021 Del. Super. LEXIS 630, 2021 WL 4726608 (Del. Super. Ct., Oct. 11, 2021)
Certificate of appealability denied Guaranteed Rate, Inc. v. Ace Am. Ins. Co., 2021 Del. Super. LEXIS 659, 2021 WL 5370794 (Del. Super. Ct., Nov. 16, 2021)
Appeal denied by Ace Am. Ins. Co. v. Guaranteed Rate, Inc., 2021 Del. LEXIS 373 (Del., Nov. 19, 2021)
Disposition: On Plaintiff's Motion for Partial Judgment on the Pleadings. On Insurers' Cross Motion for Judgment on the Pleadings.
coverage, professional services, Insured, Pleadings, defense costs, false claim, wrongful act, borrowers, allegations, mortgage, insurance company, advancement, proceedings, violations
Civil Procedure, Judgments, Pretrial Judgments, Judgment on Pleadings, Evidence, Burdens of Proof, Allocation, Insurance Law, Commercial General Liability Insurance, Exclusions, Burdens of Proof, Claim, Contract & Practice Issues, Policy Interpretation, Exclusions, Ordinary & Usual Meanings, Entire Contract, Ambiguous Terms, Coverage Favored, Excess Insurance, Obligations, Indemnification Obligations, Inferences & Presumptions, Inferences, Procedure, Evidence & Trial