Increasingly, many companies are finding themselves entangled in human trafficking claims under federal and state laws. The federal Trafficking Victims Protection Reauthorization Act (TVPRA) and similar state laws cast a wide net that is intended to snare those involved in or those that "knowingly benefit" from trafficking. Industries such as agriculture, construction, transportation, technology, banking, hospitality, and others are vulnerable to trafficking claims.
In addition to "perpetrator liability" for those directly involved in trafficking, the TVPRA allows victims to pursue civil claims against individuals and entities that benefit from the trafficking. To assert a claim for "beneficiary liability," a plaintiff must allege, and ultimately prove, (1) the defendant knowingly benefitted from (2) participation in a venture (3) that it knew or should have known engaged in trafficking, including forced labor and sex trafficking. Recent examples include:
- Filipino migrant workers alleging forced labor and violations of the TVPRA sued CH2M Hill International, Jacob Engineering Group, and related companies that worked with the Qatari government to construct soccer stadiums and facilities as part of the 2022 FIFA World Cup.
- JP Morgan Chase and Deutsche Bank faced civil lawsuits from victims of Jeffrey Epstein for their alleged role in facilitating and profiting from the trafficking.
- com, Inc. faces multiple TVPRA lawsuits alleging that it assisted, supported, and facilitated sex trafficking by selling its software tools and providing operational support to Backpage.com.
According to the Human Trafficking Legal Center, the number of TVPRA filings has increased from six in 2004 to 280 in 2024. Unsurprisingly, the increase in TVPRA civil claims has led to an increase in disputes over insurance coverage for such claims.
Two recent decisions add to a growing number of courts concluding that TVPRA claims may trigger coverage under Coverage A (bodily injury and property damage) and/or Coverage B (personal and advertising injury) of a commercial general liability (CGL) policy. In both cases, the court rejected the insurers' arguments that (1) policy exclusions precluded coverage and/or (2) public policy barred coverage.
Courts Find That TVPRA Allegations Trigger Coverage
In Peerless Indemnity Insurance Company, et. al. v. Tilma, Inc., No. 24-492 (U.S.D.C. E.D. VA July 22, 2025), the court dismissed the insurers' lawsuit seeking a declaration that the insurers had no duty to defend or indemnify an insured alleged to have violated the TVPRA. The court concluded that the insurers had a duty to defend and indemnify the insured in the underlying trafficking lawsuit "because the Policy unambiguously covers the conduct alleged against [the insured]." Id. at 6. In the underlying lawsuit, the plaintiff alleged she was trafficked, her traffickers used the insured's hotel for their crimes, and that the insured turned a blind eye to the trafficking.
The Peerless court found that Coverage B encompassed the alleged conduct. Like standard CGL policies, the policy at issue in Peerless provided coverage for "personal and advertising injuries," including injuries "arising out of … false arrest, detention, or imprisonment." Id. at 7. The Peerless court explained that the underlying complaint alleged the insured "knew or should have known that [the victim] was being detained" and that employees "overheard [the victim] screaming while her trafficker caught her, dragged her back to her hotel room, and beat her following her attempt to escape her trafficker." Id. The court properly concluded that the complaint's "know or should have known" language sounded in negligence, and the allegations alleged detention as defined under Virginia law. Therefore, the complaint alleged "personal and advertising injury" covered under the policy.
In Liberty Mutual Fire Insurance Company v. Red Roof Inns, Inc., et. al., No. 23-02047 (U.S.D.C. N.D. Georgia August 15, 2025), the court concluded that "Georgia law requires a finding that Plaintiff has a duty to defend the Red Roof Defendants" in the underlying lawsuit under Coverage A of the policy. Liberty Mutual argued the underlying allegations did not trigger coverage because there were no allegations of "bodily injury" caused by an "occurrence." Liberty Mutual predicated its position on the definition of "occurrence" defined in the policy as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." Liberty Mutual pointed to allegations of the insureds' active and intentional participation in the trafficking scheme, arguing that such intentional conduct could not be accidental. The Red Roof Inn defendants, however, argued that whether an event is an accident must be determined from the viewpoint of the insured and whether the insured's conduct was designed to injure the victim. Stated another way, the alleged injury would only not satisfy the "occurrence" definition if the insured subjectively intended or expected to cause specific injury to the plaintiff.
The court agreed with the Red Roof Inn defendants, noting that, while the complaint did include allegations of intentional conduct, the complaint also included allegations that the insureds "should have known" of the trafficking. The court correctly held that such "constructive knowledge language sounds in negligence and implies that the Red Roof Defendants did not have the requisite intent to cause [the victim's] alleged bodily injuries." Id. at 13. The court cited to Georgia law, reasoning that an insurer has a duty to defend if the facts as alleged "even arguably bring the occurrence with the policy's coverage." Id. And, because the insureds "were alleged to be negligent in regard to the TVPRA violations, the Court finds that [Plaintiff's] complaint is arguably covered by the ‘bodily injury from an occurrence' provision of Coverage A."
Courts Find That Policy Exclusions Do Not Preclude Coverage
Having concluded the allegations triggered coverage, both courts turned to the policy exclusions the insurers argued precluded coverage. Both courts properly found the exclusions inapplicable by focusing on the allegations and conduct of the insured as opposed to those of the traffickers.
In the Peerless matter, the insurer argued that an exclusion precluding coverage for "personal and advertising injuries caused by or at the direction of the insured with the knowledge that the act would violate the rights of another and would inflict personal and advertising injury" applied. The court disagreed because the underlying complaint did not allege the insured itself sexually trafficked the victim or directed her traffickers to commit their intentional tort. Instead, the complaint alleged the insured's lack of action or lack of knowledge of the trafficking made it liable and such allegations do not "equate to ‘causing or directing' actions with the knowledge that those actions would violate the rights of" the victim. Similarly, an exclusion for injuries "arising out of a criminal act committed by or at the direction of the insured" was inapplicable because there were no allegations that the insured committed or directed the criminal conduct.
Likewise, the Liberty Mutual court rejected the argument that the Expected or Intended Injury Exclusion, which bars coverage for bodily injury "expected or intended from the standpoint of the insured," applied. In analyzing the exclusion, the court noted it must narrowly and strictly construe the provision against the insurer under Georgia law. Given the "know or should have known" allegations, the court found that at least some of the allegations did not allege the insureds acted with the intent or expectation of causing bodily injury and, thus, the exclusion did not unambiguously preclude coverage.
Courts Find That Public Policy Does Not Prohibit Coverage for TVPRA Claims
Many states prohibit insurance coverage for criminal acts or intentionally inflicted injuries on public policy grounds. Insurers have sought to extend these public policy prohibitions to human trafficking claims. At least one federal district court did just that, concluding that Pennsylvania's public policy bars coverage for those involved in allegedly enabling or profiting from human trafficking. In Samsung Fire & Marine Ins., Co., (U.S. Branch) v. UFVS Mgmt. Co., LLC, No. CV 18-04365 (E.D. Pa. Mar. 20, 2023), the court relied on Pennsylvania's anti-trafficking law, which criminalizes (1) harboring or maintaining a person with reckless disregard to the fact that they will be subject to sex trafficking and (2) knowingly benefitting from such trafficking as evidence of Pennsylvania's overriding public policy against sex trafficking. According to the court, the allegations against the insureds exposed them to independent criminal liability.
On appeal, the Third Circuit Court of Appeals recognized that deciding the issue would require weighing Pennsylvania's strong presumption of insurance coverage against Pennsylvania's public policy against sex trafficking and, because the court could not predict how the Pennsylvania Supreme Court would rule, it certified the issue to the Supreme Court. Samsung Fire & Marine Ins. Co. (U.S. Branch) v. RI Settlement Tr., No. 23-1988 (3d Cir. Aug. 12, 2024). The Pennsylvania Supreme Court granted certification, and the case remains pending.
Beneficiary liability under the TVPRA, however, is not limited to criminal conduct and, for defendants that purportedly knowingly benefit from trafficking, plaintiffs often allege conduct that falls short of criminal as demonstrated in the Peerless matter. After ruling that the criminal act exclusion did not apply, the Peerless court addressed the insurers' argument that Virginia public policy prohibits coverage for criminal acts prohibited by the TVPRA. In rejecting this argument, the court explained that Virginia courts prohibit coverage only in cases where the insured acts with specific intent to cause harm. The court further explained that beneficiary liability under the TVPRA does not require specific intent on the part of a beneficiary and there were no such allegations in the underlying complaint.
Liberty Mutual raised the issue of intent in arguing that public policy precludes coverage for the Red Roof Inn defendants, pointing to Georgia law that states it is against public policy to insure against injuries intentionally inflicted. According to Liberty Mutual, because the Red Roof Inn defendants participated in the sex trafficking venture where injuries are often intentionally inflicted, it goes against public policy to provide coverage. The Liberty Mutual court rejected this argument, explaining that "Georgia's public policy exclusion focuses on whether the injuries were intentionally inflicted, not simply whether the conduct was intentional," and there were no allegations that the insureds (as opposed to the traffickers) intended to injure the victims. Additionally, the Liberty Mutual court recognized that the TVPRA does not have a scienter requirement, nor does it require a showing of injurious intent.
The Peerless and Liberty Mutual decisions add to the growing body of case law concluding that TVPRA claims trigger coverage under CGL policies under Coverages A and B, of course depending on the specific allegations and policy language. The decisions also reinforce well-established principles of insurance law, including (1) insurers have a broad duty to defend; (2) exclusionary language must be narrowly and strictly construed against the insurer; and (3) intentional act exclusions focus on the subjective intent of the insured, not the intentional acts of others. Importantly, both courts also recognized that TVPRA beneficiary liability does not require specific intent on the part of the alleged beneficiary, making reliance on public policy difficult where there are allegations the alleged beneficiary acted negligently i.e., "knew or should have known" of the trafficking.
In sum, companies are increasingly targets of beneficiary liability claims under the TVPRA and should understand and evaluate the potential risk such lawsuits pose, including what insurance coverage may be available.
