HNRK Coverage Corner

On May 29, 2024, Judge John T. Dorsey of the United States Bankruptcy Court for the District of Delaware issued a decision in Insys Liquidation Trust v. XL Specialty Ins. Co., Adv. Proc. No. 23-50484 (JTD), granting an excess D&O insurer’s motion for summary judgment under the policy’s Prior and Pending Litigation Exclusion.  The wrinkle here is that the “prior litigation” was a qui tam complaint under the False Claims Act that had been filed under seal before the policy period but was never served.  Although the insured did not know—and could not have known—about the lawsuit ...