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Zurich must face Telephone Consumer Protection Act suit

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A federal court has refused to grant Zurich Insurance Group Ltd. summary judgment in a Telephone Consumer Protection Act case involving a now-bankrupt retailer and a plaintiff pursuing a $3 million judgment.

In June 2006, Mark William Ellis, president of European Tile & Floors Inc. in Pinellas Park, Florida, paid $422 to send 5,000 faxes randomly, according to Monday’s ruling by the U.S. District Court in Tampa in Zurich American Insurance Co. v. European Tile and Floors Inc.

Robert A. Dalzell Inc., in St. Petersburg, Florida, which received one of the unsolicited faxes, filed suit against European Tile charging violation of the TCPA. Mr. Ellis’ general lability and umbrella liability policies included an exclusion for TCPA lawsuits.

Mr. Ellis said he filed a claim with Schaumburg, Illinois-based Zurich American by phone and was told there was no coverage, although the insurer subsequently claimed it had no record of the call.

Mr. Ellis’ business ceased operations and he later received a complete discharge from all liability in the case in 2013-2014 bankruptcy proceedings, according to the ruling.

The Dalzell lawsuit was given class certification and resulted in a $2.1 million settlement plus an additional $910,00 in prejudgment interest and costs in 2015.

Meanwhile, after certifying the question to the Florida Supreme Court, in 2010, the 11th U.S. Circuit Court of Appeals in Atlanta held that under Florida law, an insurance policy similar to the applicable Zurich policy provides coverage for TCPA infringement under “advertising injuries,” said the District Court ruling.

Mr. Dalzell filed suit against Zurich in an effort to collect the judgment. In 2016, the insurer filed a motion seeking summary judgment seeking dismissal of the suit, claiming European Tile had failed to provide timely notice of the TCPA claim.

With the 11th Circuit and Florida Supreme Court rulings, “Zurich seeks to avoid making any payments under the theory that its insured — European — breached the insurance policy by not filing a written notice of the claim,” said the ruling.

However, it said, “Summary judgment is not appropriate on the issue Zurich isolates in the motion for summary judgment because there is a genuine dispute of material fact regarding when — if ever — European provided notice of the Dalzell suit to Zurich,” said the District Court ruling in denying Zurich’s motion.

Even if, as Zurich contends, Mr. Ellis’ testimony about the claim is self-serving, “it is better to let a jury consider the disputed evidence and make a finding of fact, rather than to simply discredit one party’s side of the story because it is not sufficiently ‘corroborated,’” said the ruling.