April 24, 2019 Feature

Insurance and the TCPA: Are Claims Against Telemarketers Covered?

By Thomas K. Bick

In 1991, Congress enacted the Telephone Consumer Protection Act (TCPA)1 to regulate the explosive growth of the telemarketing industry. In doing so, Congress was responding to growing outrage from consumers subject to a torrent of telemarketing calls on their residential telephones and from businesses subject to unsolicited telefaxed advertisements, sometimes dozens per day. Many of the telephone solicitations, which soon began appearing on cell phones as well as residential lines, were made by automatic telephone dialing systems with prerecorded messages, commonly known as “robocalls.”

The TCPA prohibits the “use [of] any telephone facsimile machine, computer, or other device to send, to a telephone facsimile machine, an unsolicited advertisement.”2 Separate sections of the TCPA prohibit certain categories of unsolicited telephone calls, including calls to cell phones using an automatic telephone dialing system or an artificial or prerecorded voice,3 prerecorded telemarketing calls to residential lines,4 and prerecorded or live calls to recipients registered on the National Do Not Call Registry.5

Defendants in TCPA cases are typically entities that sent, or arranged to have sent, a large number of advertising faxes or telemarketing calls to nonconsenting recipients. The TCPA creates a private cause of action that authorizes any person to bring suit for a violation of the Act and receive $500 in damages per violation.6 If a court finds that the defendant willfully or knowingly violated the Act, it may increase the award to $1,500 per violation.7

A common method of private enforcement of the TCPA is for a recipient of an unlawful communication to bring a class action against the entity or entities responsible for the communication. Class action plaintiffs have had varying degrees of success in arguing that such cases are suitable for class certification.8 Many of the cases certified as class actions have resulted in multimillion-dollar settlements.

Defendants subject to TCPA claims who have sought insurance coverage for their losses have met with mixed results. This article is based on a survey of reported TCPA insurance coverage cases. It explores the extent to which courts have found that common liability policies—primarily commercial general liability (CGL) policies—provide coverage for claims arising from telemarketing practices that allegedly violate the TCPA.

Plaintiffs who bring TCPA coverage cases are often the same parties who filed suit against people who violated the Act. Through assignments of the insureds’ coverage rights or other legal mechanisms, they have pursued coverage directly from the insureds’ carriers. Because, with very few exceptions, the assignee in such cases stands in the shoes of the assignor-insured, this article does not distinguish between the two. That is, reference to the “insured” refers to the person seeking insurance coverage regardless of whether that entity is the insured or an assignee of the insured’s coverage rights.

Methods Used by Telemarketers

From faxes to robocalls. Following enactment of the TCPA in 1991, there was an initial wave of lawsuits by recipients of unsolicited fax advertisements against the senders of those faxes. As telemarketers’ use of fax solicitations decreased and their use of telephone and text message solicitations increased, there was a corresponding increase in TCPA suits by recipients of unsolicited telephone calls and text messages. The insurance coverage cases followed a similar pattern: Insureds initially sought coverage for claims arising from TCPA-violating faxes; more recently, insureds have sought coverage for TCPA-violating telephone calls and texts.

Text messages under the TCPA. Although the TCPA does not specifically mention text messages, the Federal Communications Commission (FCC) has interpreted the word call in the Act to include text communications in addition to telemarketing calls. The U.S. Court of Appeals for the Ninth Circuit found the FCC’s interpretation to be a lawful exercise of the commission’s rulemaking authority: “[W]e find that the FCC’s interpretation of the TCPA is reasonable, and therefore afford it deference to hold that a text message is a ‘call’ within the TCPA.”9 Thus, for insurance coverage purposes, there should not be any substantive difference between TCPA-violating texts messages and telephone calls.

Coverage for Advertising Injury

For decades, standard CGL policies have covered losses resulting from third-party claims for bodily injury and property damage, except where such coverage is expressly precluded by a policy exclusion. Today, many CGL policies also cover claims for “personal and advertising injury.” In some CGL policies, the bodily injury/property damage part is referred to as Coverage A and the personal injury/advertising injury part as Coverage B.

The focus of much of the litigation over coverage for TCPA claims has been on the meaning of advertising injury in Coverage B. Advertising injury is typically defined to include “oral or written publication, in any manner, of material that violates a person’s right of privacy.”10 In the context of TCPA claims, this definition raises two frequently litigated questions: (1) Does the transmission of an unsolicited fax, telemarketing call, or text message violate the recipient’s right to privacy? and (2) Does the transmission of such a fax, call, or text to a single recipient constitute a “publication”? Courts have adopted conflicting positions on both issues.

Unsolicited communications and violation of right to privacy. By far, the most frequently litigated issue in TCPA coverage disputes is whether an unsolicited fax, telephone call, or text message violates the recipient’s “right to privacy” as that phrase appears in the advertising injury part (Coverage B) of the insured’s CGL policy. To date, a substantial majority of courts that have addressed this question have answered it in the affirmative.11

In arguing to the contrary, insurers frequently claim that the right to privacy covered by their CGL policies is separate and distinct from the right to privacy protected by the TCPA. They argue that the privacy covered by their policies is the right to maintain the secrecy of the insured’s confidential information (secrecy privacy). In contrast, argue insurers, the right to privacy protected by the TCPA is the right to seclusion, that is, the right to be left alone (seclusion privacy). A minority of courts, including the Fourth and Seventh Circuit Courts of Appeal, have accepted this secrecy-versus-seclusion distinction as a basis for denying coverage for TCPA claims.12

From the policyholder’s perspective, then, the key to convincing a court that a TCPA violation causes advertising injury is to show that the right to privacy protected by the typical CGL policy and the right to privacy protected by the TCPA are one and the same. That is, policyholders must successfully argue that the insurance industry, in drafting the advertising injury coverage part, did not intend to distinguish between the two categories of privacy. Many courts have adopted this position.13

The Florida Supreme Court addressed this issue in Penzer v. Transportation Insurance Co.14 The court concluded that the right to privacy protected by the TCPA was the “privacy right to seclusion,” which could be violated regardless of the content of the communication.15 Based on a detailed analysis of the policy language, the court concluded that the meaning of right to privacy in the policy could be gleaned “from federal or Florida law, rather than defined in the dictionary.” The court held that “the source of the right of privacy is the TCPA, which provides the privacy right to seclusion.”16

The Illinois Supreme Court reached the same conclusion in Valley Forge Insurance Co. v. Swiderski Electronics, Inc.17 Relying heavily on Black’s Law Dictionary, the court found that the right to privacy “connotes both an interest in seclusion and an interest in the secrecy of personal information.” Accordingly, the court concluded that the phrase material that violates a person’s right of privacy can be understood to mean “material that violates a person’s seclusion.”18 The Illinois high court distinguished––or explained why it disagreed with––the leading Fourth and Seventh Circuit TCPA decisions and decisions of lower courts in those circuits. The court emphasized that its opinion was consistent with

the majority of the federal courts of appeals that have considered the applicability of “advertising injury” coverage to TCPA fax-ad claims, including the Fifth, Eighth, Tenth and Eleventh Circuits.19

The court added, “[O]ur decision is consistent with that reached by the majority of courts that have examined policy language identical to the language at issue here.”20

In Motorists Mutual Insurance Co. v. Dandy-Jim, Inc., the insurer took another tack, arguing that a single fax advertisement was far too minimal of an intrusion into the recipient’s right to privacy to constitute an advertising injury. The court disagreed, stating that

the TCPA presumes that all advertising, so long as it is unsolicited, is an offensive intrusion into the recipient’s solitude. Accordingly, even a single unsolicited advertising fax is sufficient to establish a violation of an individual’s right to privacy.21

Most reported TCPA coverage decisions address coverage for unsolicited faxes. Far fewer address unsolicited telemarketing calls or text messages. Logically, there is no reason that faxes, telephone calls, and texts should be treated differently for insurance coverage purposes. As one court noted,

regarding both unsolicited telephone calls and fax solicitations: (1) the substance of what is prohibited is the same—unwanted solicitations; and (2) the nature of the right being disregarded is the same—the receiver’s right to be left alone.22

Accordingly, insureds seeking coverage for claims arising from unsolicited telemarketing calls and texts can find support in cases where unsolicited faxes were found to have invaded the recipient’s right to privacy. Citing a number of those fax decisions, the court in Schuetz v. State Farm Fire & Casualty Co.23 held that prerecorded telemarketing calls invaded the recipient’s right to privacy to an even greater extent than did unsolicited faxes. The court reasoned as follows:

As the plain and ordinary meaning of “privacy” includes both the right to secrecy and the right to seclusion, and as the receipt of an unsolicited telephone call, by its very nature, is much more intrusive than a facsimile, the court finds that Charvat’s allegations that Schuetz caused unsolicited telephone calls to be made to Charvat’s residence constitute allegations of a violation of his right to “freedom from unauthorized intrusion.”24

Notably, the Schuetz court found that unsolicited telemarketing calls violated the recipient’s right to privacy even though the underlying complaint did not specifically allege such a violation:

Thus the court finds that the Charvat complaint implicitly alleges a violation of Charvat’s privacy interest in seclusion, even though it does not explicitly set forth a claim of “invasion of privacy.”25

A federal district court in Illinois reached the same conclusion in Travelers Property Casualty Co. of America v. Dish Network. Noting that under Illinois law the right to privacy “also includes the right to be left alone,” the court concluded that unsolicited telemarketing calls clearly violated that right.26

And in National Union Fire Insurance Co. of Pittsburgh, Pa. v. Papa John’s International, Inc., the court stated thus:

After reviewing the case law from other jurisdictions, the Court concludes that a Kentucky court would likely follow the rationale of Owners Ins. Co. [v. European Auto Works, Inc., 695 F.3d 814 (8th Cir. 2012)] and the majority of other circuits by holding that the plain and ordinary meaning of the personal and advertising injury provision is sufficiently broad to include violations of a person’s right to seclusion.27

Insureds often refer to the legislative history of the TCPA to support the argument that unwanted telephone calls invade the recipient’s right to privacy. In Universal Underwriters Insurance Co. v. Lou Fusz Automotive Network, Inc.,28 the U.S. Court of Appeals for the Eighth Circuit observed that the legislative history was replete with statements that a primary purpose of the Act is to protect consumers from unwanted telemarketing calls that invade their right to privacy. The court concluded that “it is clear that Congress viewed violations of the Act as ‘private nuisances’ and as ‘invasions of privacy’ under ordinary, lay meanings of these phrases.”29

Unsolicited communications that constitute publications. As noted above, for there to be an advertising injury under most standard CGL policies, there must be an oral or written “publication” of the allegedly unlawful communication.

A majority of courts have held that sending an unsolicited fax falls within the commonly accepted definition of publication, despite the fact that the faxed communication is not shared with third parties.30 For example, in Park University Enterprises Inc. v. American Casualty Co. of Reading, Pa., the U.S. Court of Appeals for the Tenth Circuit stated that “it is entirely reasonable to define publication as making something generally known.”31 Accordingly, the court found that an unsolicited fax was a publication even if seen by only the sender and recipient.

The highest court of Massachusetts reached the same conclusion, though suggesting that its holding was based in part on the enormous number of faxes distributed by the sender in that case: “In this case, the mass transmission of 60,000 facsimile advertisements constitutes an announcement or communication of the material to the public.”32

A minority of courts have held that the word publication, as used in the advertising injury coverage part, does not include the sending of faxes, regardless of the number of recipients. A leading case on this issue is the Seventh Circuit’s Auto-Owners Insurance Co. v. Websolv Computing, Inc. opinion.33 There, the court of appeals distinguished between seclusion privacy and secrecy privacy in support of its no-publication ruling. The court reasoned that the right to privacy protected by the advertising injury provision in standard CGL policies is the right to keep information secret. Consequently, for there to be a publication, a communication must be shared with a third party.34 Emphasizing that the message in a typical advertising fax is not shared with any third party, the court denied coverage, concluding that sending a fax does not result in a publication.

In a small percentage of CGL policies, the word publication does not appear in the definition of advertising injury. Instead, the policies define such injuries as “making known to any person or organization covered material that violates a person’s right of privacy.”35 Most courts interpreting the phrase making known in this context have concluded that there was no publication (and therefore no coverage) where the communication in question was not revealed to third parties.36

There have been relatively few reported decisions addressing whether sending unsolicited telephone calls or texts constitutes a publication within the meaning of the advertising injury coverage part of standard CGL policies. One such case is the Schuetz opinion discussed previously. In Schuetz, the court agreed with the insured that sending a robocall to a nonconsenting recipient constituted “publication,” reasoning that the word “is not limited to a term of art used in defamation and other torts that require the communication of objectionable material to a third party.”37

As in the right-to-privacy cases referenced above, key to the insured prevailing on the publication issue is countering the insurer’s argument that advertising injury does not include a violation of the recipient’s right to seclusion privacy. The district court so held in Western Rim Investment Advisors, Inc. v. Gulf Insurance Co.38 As in Schuetz, the court concluded that unlike the use of publication in a defamation case, in a dispute alleging violation of one’s right to privacy—specifically one’s right to seclusion privacy—publication to a third party is irrelevant.

Unlike in Schuetz, the TCPA violations in Western Rim and Valley Forge involved unsolicited faxes. Nevertheless, the reasoning in those cases should apply equally to unsolicited telephone calls and text messages. That is, one’s right to seclusion can be violated simply by the receipt of a communication, regardless of its content. Accordingly, it should be of no consequence whether or not that content is revealed to a third party.

To summarize, a sizable majority of courts have held that unsolicited communications are publications that invade the recipients’ right to privacy under the advertising injury coverage part of the standard CGL policy. Accordingly, an insured alleged to have sent such a communication in violation of the TCPA is likely to have coverage under the personal injury/advertising injury coverage part of its CGL policy unless the policy expressly excludes TCPA violations.

Policy Exclusions

Policies may contain any of a variety of exclusions that have the potential to protect insurers from TCPA claims.

The statutory violation exclusion. Over the past decade, many insurers, in response to the wave of TCPA lawsuits against telemarketers, have added exclusions to their CGL policies that expressly preclude coverage for violations of that statute. Initially, insurers added these exclusions to the bodily injury/property damage coverage part (Coverage A) of standard CGL policies. More recently, insurers have added them to the personal injury/advertising injury coverage part (Coverage B) as well.39

A typical TCPA exclusion bars coverage for loss

arising directly or indirectly out of any action or omission that violates or is alleged to violate . . . the Telephone Consumer Protection Act (TCPA), including any amendment or addition to such laws. . . .40

Courts have uniformly held that such exclusions preclude coverage for TCPA claims.41

Some CGL policies contain statutory violation exclusions that do not mention the TCPA. Typical is an exclusion that precludes coverage for any loss

arising out of or resulting from . . . any act that violates any statute, ordinance or regulations of any federal, state or local government . . . that includes, addresses or applies to the sending, transmitting or communicating of any material or information, by any means whatsoever.42

Most courts that have addressed these exclusions have held that they preclude coverage for TCPA claims even though they do not refer specifically to the Act.43

Intentional acts exclusion. Insurers frequently argue that sending unsolicited communications to consumers in violation of the TCPA is an intentional act and/or causes intentional harm, for which there can be no coverage. While this argument has been generally successful with respect to coverage for property damage, it has been rejected by most courts with respect to advertising injury.

Courts have held that faxes cause property damage within the meaning of the bodily injury/property damage coverage part of the standard CGL policy. However, many courts also have accepted the insurer’s argument that such damage must have been anticipated by the sender and therefore cannot have been an “accident” within the policy’s definition of a covered occurrence.44

Insureds pursuing coverage in TCPA fax cases have argued that receipt of an unsolicited fax causes property damage as defined in the bodily injury/property damage coverage part of the typical CGL policy. They contend that faxes cause property damage by wasting the recipient’s paper and toner, by increasing wear and tear on the recipient’s fax machines, and by causing the temporary loss of use of those machines. Although most courts have agreed with insureds that receipt of unsolicited faxes causes property damage,45 a significant majority of courts also have concluded that such damage clearly was expected or intended by the sender—and, consequently, does not give rise to a covered occurrence.46

A few courts have ruled to the contrary, concluding that unsolicited fax advertisements can cause property damage to the recipient that was not intended by the sender. A leading proinsured case on this issue is the Missouri Supreme Court’s opinion in Columbia Casualty Co. v. HIAR Holding, L.L.C. Ruling in favor of the insured, the court observed that “[n]othing in the record supports the contention that HIAR sent faxes intending to injure the recipients or violate the TCPA.”47 Similarly, in Park University Enterprises, Inc. v. American Casualty Co. of Reading, Pa.,48 the Tenth Circuit held that there was no intent by the sender of a fax to injure the recipient because the sender believed that the recipient welcomed the communication. Consequently, because any property damage caused by the fax was unintentional, it was a covered loss under the policy.

There is sparse authority for the proposition that telemarketing calls cause the recipient property damage to the same extent as do faxes. One such case is Dish Network, discussed above, where the court concluded that

[t]ying up a consumer’s telephone line arguably falls within the Travelers Policy’s Property Damage Definition that includes the loss of the use of tangible property that is not physically injured.49

Although Dish Network is in the distinct minority of cases to address this issue, insureds seeking coverage for TCPA claims arising from unsolicited telephone calls or text messages should not overlook the property damage argument, especially if they can show that the recipient welcomed the subject communication.

Unlike coverage for property damage, coverage for intentionally caused advertising injury generally is not expressly excluded under CGL policies.50 However, many policies do exclude coverage for advertising injury that arises out of “knowing violations of rights of another.”51 Insurers have argued that this “knowing violation” exclusion precludes coverage because the act of sending a fax or making a robocall is always purposeful and therefore knowingly violates the rights of the recipient.

Courts, for the most part, have rejected this argument. For example, in Sawyer v. West Bend Mutual Insurance Co.,52 the court held that because the underlying complaint allowed for the possibility that the advertising injury was negligently (rather than intentionally) caused by the sender of the fax, the insured had a duty to defend the underlying TCPA suit.

Statutory penalty/punitive damages exclusion. Insurers have argued that a monetary award under the TCPA is essentially an award of punitive damages, pointing to policy exclusions—or public policy justifications—in denying coverage for such awards. Although some courts have accepted this argument, most have not.

For example, the policy in Alea London Ltd. v. American Home Services, Inc.53 excluded coverage for “damages attributable to punitive or exemplary damages.”54 The U.S. Court of Appeals for the Eleventh Circuit rejected the insurer’s argument that this exclusion precluded coverage for an award of treble damages under the TCPA. The insurer argued that because treble damages can only be imposed on people who intentionally violate the Act, they are essentially punitive in nature. Disagreeing, the appeals court observed that “there is no rigid rule on characterizing treble damage statutes as either compensatory or punitive”55 and concluded that “TCPA’s treble damages provision falls more on the compensatory than punitive side.”56

Similarly, in Standard Mutual Insurance Co. v. Lay, the court reasoned that the “manifest purpose of the TCPA is remedial not penal” in rejecting the insurer’s argument that the availability of treble damages made the TCPA a punitive statute.57

In First Mercury Insurance Co. v. Nationwide Security Services, Inc.,58 the court adopted a middle position, concluding that an award of $500 per TCPA violation was remedial rather than punitive; but it characterized awards above $500 per violation as punitive—and therefore barred from coverage as a matter of Illinois public policy.

Invasion of privacy exclusion under D&O policies. Although most coverage disputes arising from TCPA claims have involved CGL policies, insureds have occasionally sought coverage for such claims under their directors and officers liability (D&O) policies. Because most D&O policies exclude coverage for claims arising out of an “invasion of privacy,” insureds in those cases generally have not been successful.

For example, in Los Angeles Lakers, Inc. v. Federal Insurance Co.,59 the insured sought coverage under a D&O policy that excluded claims “based upon, arising from, or in consequence of . . . invasion of privacy.”60 Emphasizing that California courts consistently give a broad interpretation to the phrase arising out of and concluding that a TCPA claim essentially is an invasion of privacy claim, the Ninth Circuit upheld the trial court’s denial of coverage.

Conclusion

Insurers and insureds involved in disputes over coverage for TCPA claims should be aware of the following lessons gleaned from a survey of reported cases:

  • Most of the reported cases addressing insurance coverage for TCPA claims have involved unsolicited faxes. A majority of courts in those cases have found coverage for such claims under the personal injury/advertising injury coverage part (Coverage B) of CGL policies. There are fewer reported cases addressing advertising injury coverage for claims arising from unsolicited telemarketing calls, and fewer still that address coverage for unsolicited text messages. However, insureds responsible for those calls or texts should be covered under the advertising injury part of their CGL policies to the same extent as insureds who sent unsolicited faxes.
  • Especially where their CGL policies do not provide coverage for advertising injury, insureds have looked for coverage under the bodily injury/property damage coverage part. Most courts have denied coverage for such claims, concluding that the property damage was expected or intended by the insured. A small number have found coverage, especially where the insured has a credible argument that the communication was welcomed by the recipient.
  • In a few reported cases, insureds have sought coverage under D&O policies. Because most such policies contain “invasion of privacy” exclusions, insureds have rarely been successful in pursuing such coverage.
  • The majority of courts have held that a communication (whether made by fax, telephone call, or text message) that allegedly violates the TCPA is a “publication” of that communication within the meaning of the advertising injury coverage part, even if the communication was not revealed to a third party.
  • The arguments for and against coverage discussed in this article should apply regardless of whether the underlying TCPA claim against the insured was brought by an individual plaintiff or as a putative class action.
  • The Fourth and Seventh Circuits, and some district courts in those circuits, have not been as receptive as other courts to insureds seeking coverage for TCPA claims. The Fifth, Eighth, Tenth, and Eleventh Circuits have generally been the most receptive to insureds’ coverage arguments.
  • Insurers frequently argue that the TCPA is a penal statute; and, consequently, a TCPA claim is, in effect, a request for punitive damages. Insurers make this argument because many CGL policies exclude coverage for punitive damages or because such damages are not insurable (in some states) on public policy grounds. Most courts have not been receptive to this argument. Even where the TCPA plaintiff seeks treble damages for the defendant’s knowing violation of the TCPA, most courts have held that such damages are remedial, not punitive, and therefore are fully insurable. 

Notes

1. Telephone Consumer Protection Act of 1991, Pub. L. No. 102-243, § 2(5) (codified at 47 U.S.C. § 227 (1991)).

2. 47 U.S.C. § 227(b)(1)(C).

3. Id. § 227(b)(1)(A).

4. Id. § 227(b)(1)(B).

5. Id. § 227(c); 47 C.F.R. § 64.1200(c)(2) (2003).

6. 47 U.S.C. § 227(b)(2)(G)(3)(B).

7. Id. § 227(b)(2)(G)(3)(C).

8. Compare Mohamed v. Am. Motor Co., LLC, 320 F.R.D. 301 (S.D. Fla. 2017) (class certification granted), with Balschmiter v. TD Auto Fin. LLC, 303 F.R.D. 508 (E.D. Wis. 2014) (class certification denied).

9. Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 954 (9th Cir. 2009); accord Gager v. Dell Fin. Servs., LLC, 77 F.3d 265, 269 n.2 (3d Cir. 2013).

10. Park Univ. Enters. Inc. v. Am. Cas. Co. of Reading, Pa., 314 F. Supp. 2d 1094, 1106 (D. Kan. 2004) (emphasis added).

11. E.g., Owners Ins. Co. v. European Auto Works, Inc., 695 F.3d 814, 819 (8th Cir. 2012); Park Univ. Enters. Inc. v. Am. Cas. Co. of Reading, Pa., 442 F.3d 1239, 1250 (10th Cir. 2006); Hooters of Augusta, Inc. v. Am. Global Ins. Co., 157 F. App’x 201, 206–07 (11th Cir. 2005); Universal Underwriters Ins. Co. v. Lou Fusz Auto. Network, Inc., 401 F.3d 876, 881 (8th Cir. 2005); W. Rim Inv. Advisors, Inc. v. Gulf Ins. Co., 96 F. App’x 960 (5th Cir. 2004); Travelers Pro. Cas. Co. of Am. v. Dish Network, LLC, 2014 WL 1217668 (C.D. Ill. Mar. 24, 2014); Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Papa John’s Int’l, Inc., 29 F. Supp. 3d 961 (W.D. Ky. 2014); Am. Home Ins. Co., v. McLeod USA, Inc., 475 F. Supp. 2d 766 (N.D. Ill. 2007); Nutmeg Ins. Co. v. Emp’rs Ins. Co. of Wausau, 2006 WL 453235 (N.D. Tex. Feb. 24, 2006); Registry Dallas Assocs., L.P. v. Wausau Bus. Ins. Co., 2004 WL 614836 (N.D. Tex. Feb. 26, 2004); Prime TV, LLC. v. Travelers Ins. Co., 223 F. Supp. 2d 744 (M.D.N.C. 2002); Penzer v. Transp. Ins. Co., 29 So. 3d 1000, 1006–07 (Fla. 2010); Valley Forge Ins. Co. v. Swiderski Elecs., Inc., 860 N.E.2d 307 (Ill. 2006); Terra Nova Ins. Co. v. Fray-Witzer, 869 N.E.2d 565 (Mass. 2007); Columbia Cas. Co. v. HIAR Holdings, L.L.C., 411 S.W.3d 258 (Mo. 2013); Motorists Mut. Ins. Co. v. Dandy-Jim, Inc., 912 N.E.2d 659 (Ohio Ct. App. 2009); TIG Ins. Co. v. Dallas Basketball, Ltd., 129 S.W.3d 232 (Tex. Ct. App. 2004), abrogated on other grounds by Lamar Homes, Inc. v. Mid-Cont’l Cas. Co., 242 S.W.3d 1 (Tex. 2007); Sawyer v. W. Bend Mut. Ins. Co., 821 N.W.2d 250 (Wis. Ct. App. 2012).

12. E.g., Auto-Owners Ins. Co. v. Websolv Computing, Inc., 580 F.3d 543, 550–51 (7th Cir. 2009); Res. Bankshares Corp. v. St. Paul Mercury Ins. Co., 407 F.3d 631 (4th Cir. 2005); Am. States Ins. Co. v. Capital Assocs. of Jackson Cty., Inc., 392 F.3d 939, 941 (7th Cir. 2004); Yahoo! Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., 255 F. Supp. 3d 970 (N.D. Cal. 2017); Melrose Hotel Co. v. St. Paul Fire & Marine Ins. Co., 432 F. Supp. 2d 488 (E.D. Pa. 2006); State Farm Gen. Ins. Co. v. JT’s Frames, Inc., 181 Cal. App. 4th 429 (2010); Auto-Owners Ins. Co. v. Tax Connection Worldwide, LLC, 831 N.W.2d 454 (Mich. 2013); Telecomm. Network Design v. Brethren Mut. Ins. Co., 5 A.3d 331, 337 (Pa. Super. Ct. 2010).

13. E.g., European Auto Works, 695 F.3d 814; Hooters of Augusta, 157 F. App’x 201 (unpublished); W. Rim Inv. Advisors, 96 F. App’x 960 (unpublished); Dish Network, 2014 WL 1217668; Nutmeg Ins. Co., 2006 WL 453235; Penzer, 29 So. 3d 1000; Valley Forge Ins. Co., 860 N.E.2d 307; HIAR Holdings, 411 S.W.3d 258; Dallas Basketball, 129 S.W.3d 232; Sawyer, 821 N.W.2d 250.

14. 29 So. 3d at 1000.

15. Id. at 1006.

16. Id.

17. 860 N.E.2d at 316–17.

18. Id.

19. Id. at 319.

20. Id.

21. 912 N.E.2d 659, 665 (Ohio Ct. App. 2009) (emphasis in original).

22. Sawyer v. W. Bend Mut. Ins. Co., 821 N.W.2d 250, 259 (Wis. Ct. App. 2012).

23. 890 N.E.2d 374 (Ohio Ct. Com. Pl. 2007).

24. Id. at 392.

25. Id. at 385.

26. 2014 WL 1217668 (C.D. Ill. Mar. 24, 2014).

27. 29 F. Supp. 3d 961, 968 (W.D. Ky. 2014).

28. 401 F.3d 876, 881 (8th Cir. 2005).

29. Id.

30. E.g., Owners Ins. Co. v. European Auto Works, Inc., 695 F.3d 814, 820 (8th Cir. 2012); Park Univ. Enters. Inc. v. Am. Cas. Co. of Reading, Pa., 442 F.3d 1239, 1239 (10th Cir. 2006); Hooters of Augusta, Inc. v. Am. Global Ins. Co., 157 F. App’x 201, 207–08 (11th Cir. 2005); Registry Dallas Assocs., L.P. v. Wausau Bus. Ins. Co., 2004 WL 614836, at **4–6 (N.D. Tex. Feb. 26, 2004); W. Rim Inv. Advisors, Inc. v. Gulf Ins. Co., 269 F. Supp. 2d 836, 836 (N.D. Tex. 2003); Penzer v. Transp. Ins. Co., 29 So. 3d 1000, 1005 (Fla. 2010); Valley Forge Ins. Co. v. Swiderski Elecs., Inc., 834 N.E.2d 562, 573–74 (Ill. App. Ct. 2005) (dictum); TIG Ins. Co. v. Dallas Basketball, Ltd., 129 S.W.3d 232, 238 (Tex. Ct. App. 2004).

31. 442 F.3d at 1250.

32. Terra Nova Ins. Co. v. Fray-Witzer, 869 N.E.2d 505, 572 (Mass. 2007).

33. 580 F.3d 543 (7th Cir. 2009), reh’g & reh’g en banc denied (Oct. 1, 2009).

34. Id. at 550.

35. St. Paul Fire & Marine Ins. Co. v. Brother Int’l Corp., 319 F. App’x 121, 123 (3d Cir. 2009) (emphasis added).

36. E.g., Cynosure, Inc. v. St. Paul Fire & Marine Ins. Co., 645 F.3d 1, 2 (1st Cir. 2011); Brother Int’l, 319 F. App’x at 125–26; Res. Bankshares Corp. v. St. Paul Mercury Ins. Co., 407 F.3d 631, 641–42 (4th Cir. 2005); ACS Sys., Inc. v. St. Paul Fire & Marine Ins. Co., 147 Cal. App. 4th 137 (2007); Fray-Witzer, 869 N.E.2d at 574.

37. 890 N.E.2d 374, 391 (Ohio Ct. Com. Pl. 2007).

38. 269 F. Supp. 2d 836, 836 (N.D. Tex. 2003).

39. E.g., Emcasco Ins. Co. v. C.E. Design, Ltd., 784 F.3d 1371, 1383–84 (10th Cir. 2015).

40. W. Heritage Ins. Co. v. Love, 24 F. Supp. 3d 866, 872 (W.D. Mo. 2014).

41. E.g., C.E. Design, 784 F.3d at 1375; Integral Res., Inc. v. Hartford Fire Ins. Co., 2014 WL 2761170 (C.D. Cal. June 13, 2014); Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Papa John’s Int’l, Inc., 29 F. Supp. 3d 961, 971 (W.D. Ky. 2014); GM Sign, Inc. v. Auto-Owners Ins. Co., 2012 WL 4840592 (Mich. Ct. App. Oct. 11, 2012).

42. E.g., Papa John’s, 29 F. Supp. 3d at 969.

43. Id. at 969–71; Interline Brands, Inc. v. Chartis Specialty Ins. Co., 749 F.3d 962 (11th Cir. 2014).

44. W. Rim Inv. Advisors, Inc. v. Gulf Ins. Co., 269 F. Supp. 2d 836, 844–45 (N.D. Tex. 2003); G.M. Sign, Inc. v. Pennswood Partners, Inc., 40 N.E.3d 169, 179 (Ill. App. Ct. 2015); First Mercury Ins. Co. v. Nationwide Sec. Servs., Inc., 54 N.E.3d 323 (Ill. App. Ct. 2016); Allstate Ins. Co. v. Kaigler & Assocs., Inc., 2017 WL 3841318 (Tenn. Ct. App. Aug. 31, 2017).

45. E.g., Park Univ. Enters., Inc. v. Am. Cas. Co. of Reading, Pa., 442 F.3d 1239, 1244 (10th Cir. 2006) (noting that the insurer agreed that “sending an unsolicited fax can result in ‘loss of use of tangible property’”); Destination Ventures Ltd. v. FCC, 46 F.3d 54, 57 (9th Cir. 1995) (finding that “unsolicited fax advertisements shift significant advertising costs to consumers” based on cost of paper and use of victims’ fax machines).

46. E.g., Auto-Owners Ins. Co. v. Websolv Computing, Inc., 580 F.3d 543, 551–52 (7th Cir. 2009); Am. States Ins. Co. v. Capital Assocs. of Jackson Cty., Inc., 392 F.3d 939, 943 (7th Cir. 2004); Melrose Hotel Co. v. St. Paul Fire & Marine Ins. Co., 432 F. Supp. 2d 488, 510 (E.D. Pa. 2006); W. Rim Inv. Advisors, 269 F. Supp. 2d at 844–45; State Farm Gen. Ins. Co. v. JT’s Frames, Inc., 181 Cal. App. 4th 429 (Cal. Ct. App. 2010); Nationwide Sec. Servs., 54 N.E.3d 323.

47. 411 S.W.3d 258, 269 (Mo. 2013).

48. 442 F.3d at 1245–46.

49. Travelers Prop. Cas. Co. of Am. v. Dish Network, LLC, 2014 WL 1217668, at *12 (C.D. Ill. Mar. 24, 2014).

50. E.g., Capital Assocs. of Jackson Cty., 392 F.3d at 943; Park Univ. Enters. v. Am. Cas. of Reading, Pa., 314 F. Supp. 2d 1094, 1110 (D. Kan. 2004).

51. Sawyer v. W. Bend Mut. Ins. Co., 821 N.W.2d 250, 254 (Wis. Ct. App. 2012).

52. Id. at 259.

53. 638 F.3d 768 (11th Cir. 2011).

54. Id. at 776.

55. Id. But see Ace Am. Ins. Co. v. Dish Network, LLC, 883 F.3d 881, 892 (10th Cir. 2018) (“[T]he provision awarding statutory damages for violating the TCPA is a penalty under Colorado laws and uninsurable as a matter of Colorado public policy.”).

56. Alea London, 638 F.3d at 779; accord Terra Nova Ins. Co. v. Fray-Witzer, 869 N.E.2d 565, 575 (Mass. 2007) (finding that the TCPA is a remedial statute intended to address misdeeds suffered by individuals, not a punitive statute intended to punish the defendant); Penzer v. Transp. Ins. Co., 545 F.3d 1303, 1311 (11th Cir. 2008); Universal Underwriters Ins. Co. v. Lou Fusz Auto. Network, Inc., 401 F.3d 876, 881 (8th Cir. 2005); Hooters of Augusta, Inc. v. Am. Global Ins. Co., 272 F. Supp. 2d 1365 (S.D. Ga. 2003), aff’d, 157 F. App’x 201 (11th Cir. 2005); W. Rim Inv. Advisors, Inc. v. Gulf Ins. Co., 269 F. Supp. 2d 836, 849 (N.D. Tex. 2003); Motorists Mut. Ins. Co. v. Dandy-Jim, Inc., 912 N.E.2d 659, 668 (Ohio Ct. App. 2009). Contra Kruse v. McKenna, 178 P.3d 1198, 1201 (Colo. 2008) (en banc).

57. 989 N.E.2d 591, 599 (Ill. 2013); accord Lou Fusz Auto. Network, 401 F.3d at 881; Melrose Hotel Co. v. St. Paul Fire Marine Ins. Co., 432 F. Supp. 2d 488, 509, n.10 (E.D. Pa. 2006).

58. 54 N.E.3d 323 (Ill. App. Ct. 2016).

59. 869 F.3d 795 (9th Cir. 2017).

60. Id. at 810.

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By Thomas K. Bick

Thomas K. Bick is the chair of the Insurance Coverage Specialty Team at Butzel Long PC in Washington, D.C. He may be reached at bick@butzel.com.