Insurers Waived Right To Control Defense

In an Opinion, dated June 24, 2022, in National Hockey League v. TIG Ins. Co., 2022 N.Y. Slip Op. 22213, Justice Melissa Crane determined that insurers had waived the right to control the defense in proceedings brought by former NHL players that they sustained concussion-related injuries during their careers. The Court explained:

Here, defendants’ [sic] waived their right to control NHL's defense in the underlying action by failing to disclaim coverage timely and by making partial payments towards NHL's independent defense under reservation of rights over the course of several years. Defendants agreed to make partial payments towards NHL's defense costs under reservation of rights and acquiesced to NHL's selection of independent counsel. In any event, NHL was entitled to independent counsel by virtue of defendants’ reservations of rights (Federated Dept. Stores, Inc., 28 A.D.3d at 37 n.1, 807 N.Y.S.2d 62). Thus, defendants’ disclaimer arguments are precluded at this juncture.

The attorneys at Schlam Stone & Dolan frequently litigate insurance coverage claims. Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning such issues.