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Friday, March 10, 2017

Ind. Decisions - 7th Circuit decided one Indiana case Thursday

In Telamon Corporation v. Charter Oak Fire Insurance Co (SD Ind., Young), a 13-page opinion, Chief Judge Wood writes:

Underlying this insurance dispute is a regrettably common tale of greed and dishonesty. Telamon, an Indiana telecommunications firm, engaged Juanita Berry to work for it from 2005 to 2011 as its Vice President of Major Accounts. Berry used that position to steal over $5 million from the firm. Upon discovering this loss, Telamon then turned to two insurance policies in an effort to recover its money: a crime insurance policy with Travelers Casualty & Surety (Travelers), and a commercial property policy with Charter Oak Fire Insurance (Charter Oak). At that point, Telamon crashed into a brick wall. Travelers denied coverage because Berry was not, legally speaking, an employee. And Charter Oak refused to pay because, in practice, she was.

Telamon cried foul and filed a lawsuit in which it argued that Berry’s actions were covered under both policies and that the insurers had breached their duty of good faith. At the eleventh hour, it tried to add St. Paul Fire and Marine Insurance (St. Paul) as a defendant. The court rejected the amendment, at which point Telamon filed a new action against St. Paul and Charter Oak. That case promptly found its way back to the same court and was dismissed as an impermissible effort to split the claim. Telamon appealed (case 16-1205). Later the court granted summary judgment in favor of the defendants in the original case. Again, Telamon appealed (case 16-1815). We consolidated the appeals for disposition. Finding no error in either of the district court’s decisions, we affirm. * * *

Berry’s theft was not covered under either the Travelers or the Charter Oak policy. In addition, Telamon has not stated a claim for a breach of the duty of good faith. Finally, it was not entitled to bring a new lawsuit that did no more than add a few additional insurers and policies to its basic case. The judgments of the district court are AFFIRMED.

Posted by Marcia Oddi on March 10, 2017 08:47 AM
Posted to Ind. (7th Cir.) Decisions