Robo-calls on the firing line
The underlying lawsuit in this case arose from a previously settled class action suit in the state of Washington. In that litigation the plaintiffs alleged that they were the recipients of phone calls with a prerecorded message soliciting them to use Stellar Concepts and Design, Inc., for their business needs. The plaintiffs alleged that the calls were in violation of the Washington Consumer Protection Act, and the basis of the plaintiffs’ damages was found to be loss of use of their telephones because of being inundated with Stellar’s robotic telephone solicitations. The Washington litigation resulted in a settlement and judgment in favor of the plaintiffs.
At all relevant times, Stellar was insured under a general liability policy and an umbrella policy issued by Old Dominion Insurance Company. The general liability policy provided that Old Dominion “will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ ” that is caused by an “occurrence.”
Under the policy, “ ‘[o]ccurrence’ means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” “Accident” was not defined.
After the judgment in the Washington litigation, Old Dominion filed the underlying action, seeking a declaratory judgment that it had no duty to indemnify or defend Stellar for the claims in the Washington litigation. The parties both moved for summary judgment. The court determined that coverage existed under the policy and entered judgment in favor of the plaintiffs in their suit against Stellar. Old Dominion appealed.
On appeal, Old Dominion argued that there was no “occurrence” to trigger coverage under the policy. Alternatively, it contended that, if there had been an occurrence, the “expected or intended injury” exclusion applied because the calls were placed intentionally, not accidentally, and Stellar knew the calls would necessarily result in loss of use of the phone lines.
The plaintiffs argued that the calls qualified as an “occurrence” because the undisputed evidence showed that Stellar lacked specific intent to cause harm to a third party. They further argued that the trial court correctly found that the expected or intended injury exclusion did not apply because, although the calls were intentionally placed, the damages were not intentionally caused.
The court noted that there was no evidence to suggest that Stellar intended to cause an injury by making the robo-calls, so the trial court did not err in determining that the calls constituted an “occurrence” under the policy. The court further stated that the expected or intended injury exclusion did not apply and that the policy language supported a conclusion that coverage was provided where the insured did not expect or intend to cause harm. The judgment of the trial court was affirmed.
Old Dominion Insurance Company vs. Stellar Concepts & Design, Inc.- District Court of Appeal of Florida, Fourth District-April 13, 2016-41 Fla. Weekly D916.
