An insurer was entitled to deny coverage to a marketing firm charged with violating the Telephone Consumer Protection Act because it had properly notified its policyholder about a policy exclusion, says a federal appeals court in upholding a lower court ruling.

In 2011, St. Louis Heart Center Inc. filed a class action against marketing firm Vein Centers for Excellence Inc. for sending unsolicited advertisements via fax to multiple recipients, in alleged violation of the TCPA, according to Wednesday’s ruling by the 8th U.S. Circuit Court of Appeals in St. Louis in American Family Insurance Co. v. Vein Centers for Excellence Inc.; St. Louis Heart Center Inc.

The case was initially granted class certification but was later decertified, according to the ruling.

Vein Centers tendered the lawsuit to Madison, Wisconsin-based American Family for defense and indemnification under two insurance policies: a businessowners policy and a commercial liability umbrella policy. American Family agreed to provide a defense to Vein Centers subject to a full reservation of rights, according to the ruling.

In 2015, American Family filed a complaint in U.S. District Court in St. Louis seeking a declaration it was not obligated to provide coverage.

The District Court awarded American Family summary judgment in the case, which was upheld on appeal by a three-judge panel of the 8th Circuit.

Both policies contained an exclusion for the “Distribution of Material in Violation of Statutes,” according to the ruling. St. Louis argued the exclusion in the businessowners policy never took effect because the insurer failed to properly notify Vein Centers of the provision’s addition when the policy was renewed, according to the ruling.

However, American Family had submitted a deposition from a corporate representative stating the insurer had mailed a coverage summary letter more than 60 days prior to the businessowners policy’s renewal date, and that its standard business practice was to include a “Policyholder Communication,” which is a notification of changes made to an insured’s policy.

“St. Louis has failed to submit any evidence which would indicate Vein Centers did not, in fact, receive” these documents, said the ruling, in affirming the lower court’s ruling.

In February 2018, a federal appeals court upheld a lower court ruling and held a Chubb Ltd. unit was not obligated to pay penalties Dish Network L.L.C. had incurred because of alleged violations of the TCPA because they were not “damages” covered under its insurance policies.