In American Family Mutual Insurance Company v. Vein Centers for Excellence, Inc. et al., the Court of Appeals for the Eighth Circuit upheld the Eastern District of Missouri’s ruling granting summary judgment in favor of American Family, finding that the insurer did not have to defend and indemnify its client Vein Centers, which had been accused of violating the Telephone Consumer Protection Act in a class action lawsuit.
In the underlying TCPA class action lawsuit, St. Louis Heart Center, Inc. alleged that Vein Centers violated the TCPA by sending fax advertisements. Vein Centers sought indemnification from its insurance carrier under the Businessowners Policy and Commercial Liability Umbrella Policy. Both policies included a provision that excluded the “Distribution of Material in Violation of Statutes.”
Thus, American Family argued that it did not have to cover Vein Centers for TCPA claims. The Court agreed with the District Court’s decision that American Family was entitled to the presumption that Vein Centers received notice of the policy exclusion because no evidence was offered that would indicate Vein Centers never received notice of the exclusion provisions. Missouri law recognizes the presumption that a letter duly mailed has been received by the addressee, and American Family triggered this presumption by offering deposition testimony that American Family mailed the applicable communications that included the policy exclusion provisions to Vein Centers.
Troutman Sanders has a nationwide defense practice representing many companies with insurance carriers. It is important that insurance policies be reviewed carefully to ensure coverage for consumer statutory violations.