Insurer sued by Yahoo hits back

Tech giant is suing company for failing to defend it in five class-action suits

Insurer sued by Yahoo hits back

Insurance News

By Ryan Smith

An insurer is fighting back against a lawsuit filed by Yahoo.

The lawsuit alleges that National Union Fire Insurance Co. failed to defend Yahoo in five class-action suits over unsolicited text messages. National Union claims that California law only requires it to defend suits that allege disclosure of personal information; nuisance texts, it maintains, are not its problem.

“The underlying lawsuits do not allege that Yahoo disclosed any such information about the underlying plaintiffs to others,” National Union said in a motion to dismiss the case. “Instead, Yahoo is alleged to have sent unsolicited text messages to the underlying plaintiffs.”

The five proposed class-action lawsuits at issue were brought against the tech giant in 2013 and 2014 in Illinois, Pennsylvania and California. Each suit accused Yahoo of violating the Telephone Consumer Protection Act by spamming people’s phones with nuisance texts. Most of the suits have been dismissed.

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Yahoo wanted National Union to defend the suits under a commercial general liability policy. The policy, Yahoo claimed, covers litigation alleging “personal injury” that arises from publication of material that violates the right to privacy. National Union refused to defend and Yahoo filed the suit against it in January.

National Union claims that under California law, “personal injury” arising from a violation of privacy occurs only when “someone’s private, personal information is disclosed to a third person.”

“It is the content of the communication that implicates the privacy offense; allegations that the insured disturbed another by sending material to that person do not involve the offense,” National Union said in its court filing. “…We will have no duty to defend the insured against any ‘suit’ seeking damages for ‘personal injury’ to which this insurance does not apply.”
 

 

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