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An American International Group Inc. unit has prevailed in coverage litigation against The Humane Society of the United States, with a federal appeals court holding that a related state court ruling does not impact its decision to uphold the district court in the case.
The Washington, D.C.-based Humane Society of the United States obtained “Not-for-Profit Risk Protector” insurance policies, which included directors and officers liability coverage, from National Union Fire Insurance Co. of Pittsburgh, Pa., a unit of New York-based AIG, according to the complaint in The Humane Society of the United States v. National Union Fire Insurance Co. of Pittsburgh, Pa.
In 2000 and 2003, The Fund for Animals, a separate corporate entity that would later become associated with The Humane Society, along with other co-plaintiffs brought lawsuits against Palmetto, Florida-based Feld Entertainment Inc., whose units had included the now-defunct Ringling Bros. and Barnum & Bailey Circus, alleging violation of the Endangered Species Act, based on its alleged treatment of elephants, according to the complaint.
In 2009, following a non-jury trial, a court ruled in favor of Feld Entertainment in the case.
In 2010, Feld Entertainment added The Humane Society and two of its employees as additional defendants in the case.
In May 2014, the Feld litigation was settled under a confidential agreement, according to the complaint. National Union denied coverage for the Humane Society, stating other insurance policies covered the insureds and that certain policy provisions precluded coverage.
The Humane Society filed suit in U.S. District Court in Greenbelt, Maryland, seeking coverage in the case.
The district court ruled in National Union’s favor, which was upheld in Friday’s ruling by a unanimous three-judge appeals court panel by the 4th U.S. Circuit Court of Appeals in Richmond, Virginia.
The Humane Society points to a Maryland Circuit Court judgment, issued during the appeal process, says the appeals court ruling. “The Maryland judgment held that (National Union) improperly denied coverage under the same insurance policy to an affiliate for (The Humane Society, the Fund for Animals,” and this action “concerned the same underlying settlement funds that The Humane Society) seeks to recover here,” said the ruling.
The Humane Society contends that the Maryland ruling “no longer bars (The Humane Society) from recovering” against National Union’s case because it occurred later.
The panel said it disagreed with The Humane Society “about the preclusive effect of that judgment.” In adjudicating this action, the Maryland court “explicitly refrained from reaching the issue of (National Union’s) liability” to (The Humane Society) and therefore the issue in the two actions do not align,” said the appeals court panel, in affirming the lower court’s ruling.
Attorneys in the case could not immediately be reached for comment.
The U.S. Occupational Safety and Health Administration said in 2015 that Feld Entertainment had agreed to settle charges stemming from a 2014 incident in which nine Ringling Bros. employees were injured.
A federal appeals court has upheld a lower court ruling that an American International Group Inc. unit is not liable under its property coverage for financial losses stemming from its policyholder’s defective material.