Court Rules that Liability Insurance Does Not Cover Claims for Civil Liability Under the Antiterrorism Act 18 U.S.C. 2333(a)

Several insurers sought a declaration that they were not obligated to indemnify the defendant when it resolved underlying claims alleging liability for support of Columbian terrorists. The underlying litigation was a consolidated civil action seeking to recover damages for the death of U.S. citizens in Columbia. The plaintiffs were missionary organizations and the relatives and representatives of six Americans kidnapped and killed in the 1990s by Columbian terrorists. They allege that the defendant provided financial support by funneling money to a terrorist organization. The defendant claimed it was a victim of extortion by the terrorist. The underlying case proceeding on motions for summary judgment, which were granted in part and denied in part. Thereafter, the defendant settled all of the claims in February of 2018. 

When the defendant sought indemnity for the settlements, the insurers brought a declaratory judgment action. The trial court held that, “where there is no evidence of an insured’s direct intent to cause harm and the insured denies the intent to cause any harm, the doctrine of inferred intent allows a court to infer an insured’s intent to injure, thus barring coverage for accidents as a matter of law on summary judgment where the insured’s act necessarily results in the resulting harm.” The Court of Appeals found that the trial court applied the wrong standard but reached the correct result. Citing the Ohio Supreme Court’s decision in Allstate Ins. Co. v. Campbell, 128 Ohio St.3d 186, 2010-Ohio-6312, 942 N.E.2d 1090, holding that “in cases in which the insured’s intentional act and the harm caused are intrinsically tied so that the act has necessarily resulted in the harm” intent can be inferred. The court also rejected the defendant’s affirmative defense of extortion. 

This case is significant for its application of the definition of “occurrence” in CGL policies and the standard to apply when analyzing inferred intent. 

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