Bill Cosby Hugh Hefner - H 2015
CorbisBill Cosby may get his insurance company to pick up the cost of defending a defamation claim brought by Janice Dickinson.
The comedian was sued in two states by AIG Property Casualty Company, which argued that when it agreed to cover Cosby for “personal injury,” defined in a homeowner policy as including “defamation, libel, or slander,” that this didn’t mean a denial of allegations of sexual abuse. The insurer pointed to an exclusion for “personal injury arising out of any actual, alleged, or threatened… sexual molestation, misconduct, or harassment.”
Cosby sought to dismiss the lawsuits and contended that the insurer was reading the policy wrong and that its actions threatened his defense against his primary accusers.
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On Friday, California Federal Judge Beverly O’Connell granted Cosby’s motion to dismiss and concluded that AIG had a duty to defend.
Although insurance can be a wonky issue, it wouldn’t be too much of a surprise if this aspect of the Cosby scandal ends up being the most referenced in terms of future legal disputes (and not only ones concerning Cosby). That’s especially true if plaintiffs start using defamation claims targeting denials of misconduct as an end-run around untimely claims barred by the statue of limitations. Over in Massachusetts, since Cosby lost a bid to dismiss a libel claim last month, more than a half dozen other women have filed defamation lawsuits against him.
In her opinion today, O’Connell looks at the “arising out of” exclusion noted above and declares the meaning is ambiguous.
“The Court finds that both Plaintiff’s broad interpretation and Defendant’s narrow interpretation of ‘arising out of’ are reasonable,” she writes. “The sexual misconduct exclusion could reasonably be read to require that Dickinson’s claims merely relate to sexual misconduct, or that Dickinson’s claims be proximately caused by the sexual misconduct.”
Since ambiguous terms are interpreted in favor of finding coverage, Cosby prevails.
O’Connell also gives a second independent reason for finding in Cosby’s favor. She looks at the Dickerson complaint and concludes that there are allegations independent of sexual misconduct.
“For example, allegations that Defendant ‘intentionally drugged’ Dickinson ‘even though he knew that she had been in a rehab center for addiction a few months before’ could reasonably be interpreted as independent of sexual misconduct, and therefore, within the Policies’ coverage,” she writes. “Similarly, the Dickinson Complaint alleges that Defendant’s statements contain numerous false implications about Dickinson, including the implication that ‘Dickinson has falsely copied the claims made publicly by other women against Defendant’ and ‘the implication that Ms. Dickinson’s rape disclosure is false and that therefore she is a liar.'”
Since courts impose coverage in a “mixed” action, Cosby scores here too.
AIG is still doing battle with Cosby in Massachusetts, where the dispute has even greater stakes, with more women involved and a demand by the insurer that the defamation cases be paused to figure out the meaning of its policy.
