Supreme Court Of Missouri Holds CGL Policy Covers Statutory Damages Claim For Violations of Telephone Consumer Protection Act (TCPA)–Columbia Casualty Company v. Hiar Holding, LLC, 411 S.W.3d 258 (Mo.banc 2013)


In Columbia Casualty, the Supreme Court of Missouri held that statutory damages for violations of the TCPA were firmly within the “property damage” and “advertising injury” coverage provided by a CGL policy. The Court rejected an argument that TCPA statutory damages are considered fines or penalties precluded from coverage under a CGL policy, abrogating Olsen v. Siddiqi, 371 S.W.3d 93 (Mo.App. E.D. 2012).

The insurer, Columbia Casualty Company, refused to defend its insured, Hiar Holding, LLC, in a class action brought against Hiar for alleged violations of the TCPA. The class plaintiffs alleged hotel pro- prietor Hiar used a marketing services company to send approximately 12,500 unsolicited advertising facsimiles, approximately 10,000 of which were received. The class plaintiffs sought injunctive relief and statutory damages under the TCPA of $500 per occurrence. Columbia refused to defend, on the basis that the claims were outside the policy coverage provisions or otherwise excluded from coverage. Columbia rejected a settlement offer to Hiar for an amount within its coverage limits ($1,000,000 per occurrence, or $2,000,000 aggregate). Hiar defended at its own expense before agreeing to a class-wide settlement of $5,000,000 (with liability limited to insurance assets).

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Topics:  Advertising Injury, Commercial General Liability Policies, Property Damage, Statutory Damages, TCPA

Published In: Insurance Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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