Wednesday, February 27, 2013, 5:57 PM

Insurance Company Files DJ Action to Avoid Coverage for Defendant in Lawsuits Brought by George Clooney and Julia Roberts

In a prior post, we reported on an October 2012 right-of-privacy (right to publicity) lawsuit filed in the Northern District of Georgia by celebrities George Clooney and Julia Roberts against Kennesaw-based Digital Projection, Inc. (“DPI”), a seller of projectors and related items.  With service of the summons having been waived and an extension of time to answer the complaint having recently been granted, nothing of substance has yet occurred in that case since the filing of that complaint.  However, DPI now finds itself a defendant in a new, related case.

On February 21, 2013, DPI’s insurer, OneBeacon America Insurance Company (“OneBeacon”) filed a declaratory judgment action, seeking to avoid liability coverage for DPI not only in relation to the Georgia lawsuit mentioned above, but also in relation to a lawsuit brought in a California state court against DPI, also by Mr. Clooney and Ms. Roberts, but months earlier, in April 2012.

OneBeacon’s complaint identifies three policies it issued to DPI, each including commercial general liability coverage (“GCL Coverage”) applying to, among other things, “personal and advertising injury” committed within the “coverage territory” during the policy period.  However, also identified in the complaint are exclusion provisions, such as an exclusion for infringement of intellectual property rights occurring in a manner other than through advertisements.

In three separate declaratory relief counts, OneBeacon asserts that on the basis of the cited exclusions, it has no duty to: (1) defend DPI in either the Georgia lawsuit or the California lawsuit; (2) indemnify DPI against those actions; or (3) provide DPI with independent counsel.  To those, OneBeacon adds fourth and fifth counts for, respectively: (4) a quasi-contractual claim for reimbursement, based on the allegation that OneBeacon has thus far paid attorneys’ fees and costs to DPI for both lawsuits, but under a reservation of rights to seek reimbursement; and (5) unjust enrichment, under the theory that OneBeacon’s payments to DPI unjustly enriched DPI, which should be remedied by reimbursement.

The case is OneBeacon America Insurance Company v. Digital Projection, Inc., No. 1:13-cv-0559-JEC, filed 02/21/13 in the U.S. District Court for the Northern District of Georgia, Atlanta Division, assigned to Chief Judge Julie E. Carnes.

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