WPCm ZwuEJ&X-Pz :gt-w[THQd>~ ӂ5Jv* :|F@#޽[;AjWRT8j#jN`yH+G bL h%䦱JԮXD tHF,c_TOm#auX8]f Uj(U3'UO'Epvok<C jG֜ۻt \cyG.4`=/Fz)EQ Dah0,!,1O"SEXs Z2BU@t}l0Ӟu3/sxF=taxʭ4 <,avA1t6 8j;MExOb梅;Йn&?͇Ӫ>e.5ړZ~\On&>Ԯbޕ[vd63Q)#ǢajE/i㌟q}#!U N %E 0tK^ w@4 . m0*G 0CNqM 1 0LJ 0 0Dy 0c 0^w  0^ 0^! 0^ 0^u 0^< 0^ 1u! 1{! 1" 1" 1# 1# 1$ 1$ 1,% 1% 1:& 1& 1H' 1' 1V( 1( 1d) 1) 1r* 1* 1+ 1, 1, 1- 1- 1#. 1. 11/ 1/ 1?0 10 1M1 11 1[2 12 0i3 1~4 15%5 1R6o6 17 1&8 18;499; 1< 1= 1= 1(> 1> 6? 0xCC 0De[E\E G C)G CCG AQ]GG 0tH 0I BJ 00J 0DJ 0K D/L BCL D3`L`L`LL 0 YM 0jNO 0!O P 0-|QU NR R 0/A S 0LS 0zA[T 0 AT 0AT 0AU 0_UU"VVVVVVVVV 1 W W W WWW AIXXXXXXX 0XXXX 0 ZZZZ 0+[[[[ 1:\:\\\\\2___bbbbb 0SeSeSeSeSeSeSeSeSeSeSeSeSeSeSeSeSeSe$hf(ffffffff fffffffg" g g g g g g BgBg&bgbg$g$gDg"hhh*6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h6h$`hhh.h4hhhhhhhhhhhhhhh*i,i,i*HiHiHirii0iiiiii*iiij2jNjNj hj0jjjjjjjjjjj 0sj 0 kkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkllllllllllllllllllllllllllllllllllllllllll Cmmm CmHP LaserJet 1100,,,,,,0(9 Z6Times New Roman RegularX(L]r$XOXXXXOXXXOBG, 8D9D:;V<=D>U?BDCU^+:(@backup3|xCUwww.gauntlettlaw.com(O$h6CEIMQUY]aAutoList122222222i)1)a)>c$"Small Circle"0 ((2xf$ ]r!XDrXXXXDrXXXDr  XXDr   `   0  (#$  0  (;3$2#  0  .3  0  (O;$0  2#  a  .3  0` (#(#(b$0  0` (#(#2#   .3  0 ` (#` (#(xir$0  0` (#(#0 ` (#` (#2#(  0  )3  0 (# (#($0  0` (#(#0 ` (#` (#0 (# (#2#(  a  )3  0h(#(#(F$0  0` (#(#0 ` (#` (#0 (# (#0h(#(#2#(   )3  0h(#h(#($0  0` (#(#0 ` (#` (#0 (# (#0h(#(#0h(#h(#2#  0  )3  0(#(#({$0  0` (#(#0 ` (#` (#0 (# (#0h(#(#0h(#h(#0(#(#2#  a  )3  0p(#(#3#37=CIQYag1.a.i.(1)(a)(i)1)a)hFCEIMQUY]aAutoList222222222i)1)a)hVCEIMQUY]aAutoList322222222i)1)a)hfCEIMQUY]aAutoList422222222i)1)a)hvCEIMQUY]aAutoList522222222i)1)a)hCEIMQUY]aAutoList622222222i)1)a)hCEIMQUY]aAutoList722222222i)1)a)hCEIMQUY]aAutoList822222222i)1)a)hCEIMQUY]aAutoList922222222i)1)a)hYEGKOSW[_cAutoList1022222222)1)a)hYEGKOSW[_cAutoList1122222222)1)a)hYEGKOSW[_cAutoList1222222222)1)a)hZEGKOSW[_cAutoList1322222222)1)a)hZEGKOSW[_cAutoList1422222222)1)a)h&ZEGKOSW[_cAutoList1522222222)1)a)h6ZEGKOSW[_cAutoList1622222222)1)a)hZEGKOSW[_cAutoList4222222222)1)a)hZEGKOSW[_cAutoList4322222222)1)a)hZEGKOSW[_cAutoList4422222222)1)a)hZEGKOSW[_cAutoList4522222222)1)a)hZEGKOSW[_cAutoList4622222222)1)a)h[EGKOSW[_cAutoList4722222222)1)a)h[EGKOSW[_cAutoList4822222222)1)a)h&[EGKOSW[_cAutoList4922222222)1)a)hZEGKOSW[_cAutoList5022222222)1)a)hZEGKOSW[_cAutoList5122222222)1)a)hZEGKOSW[_cAutoList5222222222)1)a)h[EGKOSW[_cAutoList5322222222)1)a)h[EGKOSW[_cAutoList5422222222)1)a)h&[EGKOSW[_cAutoList5522222222)1)a)h6[EGKOSW[_cAutoList5622222222)1)a)hF[EGKOSW[_cAutoList5722222222)1)a)hV[EGKOSW[_cAutoList5822222222)1)a)hf[EGKOSW[_cAutoList5922222222)1)a)h[EGKOSW[_cAutoList6022222222)1)a)fNB:HEADING A,03Heading Level A, B, C    BA  .B0 ` F h&[EGKOSW[_cAutoList6122222222)1)a)h6[EGKOSW[_cAutoList6222222222)1)a)I, IILevel 1Level 2Level 3Level 4Level 5hF[EGKOSW[_cAutoList6322222222)1)a)A, BLevel 1Level 2Level 3Level 4Level 5hV[EGKOSW[_cAutoList6422222222)1)a)hf[EGKOSW[_cAutoList6522222222)1)a)hv[EGKOSW[_cAutoList6622222222)1)a)1, 2, 3Level 1Level 2Level 3Level 4Level 5  xf$XDrXXXXDrXXXDrXXDr   `   1    _SeeBroadForm,CL0404(Ed.7-76),reprintedinInternationalRiskManagementInstitute,Inc.,  CommercialLiabilityInsurance,Vol.I,atIV.T.23toIV.T.28(1996). xf$XDrXXXXDrXXXDrXXDr   `   3    _1986Form,CG00011185,atIV.T.41.h[EGKOSW[_cAutoList6722222222)1)a)h[EGKOSW[_cAutoList6822222222)1)a)h[EGKOSW[_cAutoList6922222222)1)a)hV[EGKOSW[_cAutoList7022222222)1)a)hf[EGKOSW[_cAutoList7122222222)1)a)HfNBU:HEADING A,01Heading Level A, B, C    BF  .B0 ` F fZBX:HEADING 1,02Heading Level 1, 2, 3     ` F4  .F0 r l"@Bu:HEADING I,03Heading Level I, II, III   @IX  .@ 0  B 42Emphasis9TABLE A(t3$ ]r!XDrXXXXDrXXXDr   d  \  `&Times New Roman  Z+D*XDrXXXXDrXXXDr  _^O _XXDr00001003"US // [ 02/07/2002!  Ԅ126668.1#XDrX_^O w#(h3+D$ ]r!XDrXXXXDrXXXDr    xf$XDrXXXXDrXXXDrXXDr   `   4    _SeeDavidA.Gauntlett,InsuranceCoverageforIntellectualPropertyAssets,17.04  n.7(AspenLawandBusinessDivisionofAspenPublishers,Inc.,Gaithersburg,NY,1999)(2000Supplement).vxyz{ ddacefhC<< CLevel 1Level 2Level 3Level 4Level 5l"?Bh@:HEADING I,02Heading Level I, II, III   @I  .@0  B (h3+D$ ]r!XDrXXXXDrXXXDr   d(h3+D$ ]r!XDrXXXXDrXXXDr  ($$   1  l"@B85:HEADING I,01Heading Level I, II, III   @IV  .@0  B ii' dxdP Pddddd'dxdLevel 1Level 2Level 3Level 4Level 5l"AB8:HEADING I,01Heading Level I, II, III   @XII  .@ 0  B fNB!:HEADING A,02Heading Level A, B, C    BA  .B0 ` F    fZB:HEADING 1,03Heading Level 1, 2, 3     ` F1  .F0 r a, b, cLevel 1Level 2Level 3Level 4Level 5ffBb:HEADING a,04Heading Level a, b, c     `  ra  .r0  O (hH  Z 6Times New Roman Regular1293-17(V$8   l"?BiD:HEADING I,01Heading Level I, II, III   @V  .@0  B (V$8   (V$8   (V$8   (V$8   (h3+D$ ]r!XDrXXXXDrXXXDr   |+D'XDrXXXXDrXXXDr  _@% TABLEOFCONTENTS   @55((Continued)!!G(# Page www.marshmac.com(EGMSY_ekqAutoList72A.A.A.A.A.A.A.A.  xf$XDrXXXXDrXXXDrXXDr   `   2    _SeeBroadForm,GL0404(Ed.776),atIV.T.23toIV.T.28.eC  << CfNB:HEADING A,02Heading Level A, B, C    BD  .B0 ` F f"?Bh@4HEADING IHeading Level I, II, III   @I  .@0  B dfBYj8HEADING abcHeading Level a, b, c     `  ra  .r0  O (EGMSY_ekqAutoList411.1.1.1.1.1.1.1.  xf$XDrXXXXDrXXXDrXXDr   `   5    _SeeMarkmanv.WestviewInstruments,Inc.,52F.3d967(Fed.Cir.1995),affd,517U.S.370  (1996);InreLockwood,50F.3d966(Fed.Cir.1995),vacated,515U.S.1182(1995)(afterwithdrawalofjury v demand);seealsoSummit:Conn.Indem.Co.v.Markman,1993WL304056(E.D.Pa.1993)(insuredable < topayforthesuitbecausehiscarrierhadpaidfortwoothersuitsinvolvingthesamepatent). ( xf$XDrXXXXDrXXXDrXXDr   `   6    _Thepricepointforcyberpoliciesislow,asofthiswriting(March2001).Underthecurrent  hardeningmarket,however,policypricesaregenerallyontherise.Forexample,theaveragerenewalcostforCGLpoliciesinautumn2000wasup7.8percentfromspring2000.SeeChiefFinancialOfficerRussBanham, < CorrallingRates,SpotlightIns.(Feb.2001)(Magazinepublishedmonthly).Withtheriskofthistrend R affectingcyberpolicies,youshouldgiveseriousconsiderationtopurchasingmultiyearpolicieswhenpossible.  xf$XDrXXXXDrXXXDrXXDr   `   7    _IolabCorp.v.SeaboardSuretyCo.,15F.3d1500,1506(9thCir.1994)(Placedincontext,the  intendedmeaningofthelanguageisclear. Inthecontextofpolicieswrittenprotectagainstclaimsofadvertisinginjury,piracymeansmisappropriationorplagiarismfoundintheelementsoftheadvertisementitself!initstextform,logo,orpictures!ratherthanintheproductbeingadvertised.).fNB!:HEADING A,02Heading Level A, B, C    BA  .B0 ` F www.mediaprof.comwww.insuretrust.comwww.jswum.comwww.fai.com.au/www.aon.comwww.cna.comwww.marshmac.comwww.fai.com.au/www.accessaig.com/www.accessaig.comwww.accessaig.comwww.fsb.org.uk/benefits/legal.aspwww.marshmac.comwww.infringeins.com/www.accessaig.comwww.jswum.comwww.zurichre.com/zrna/www.stpaul.com/wwwstpaul/www.steadfast.com.auwww.chubb.comwww.infringeins.com/www.lrm.comwww.aon.comwww.ventureprograms.comwww.lrm.comwww.infringeins.com/www.allianz.dewww.chubb.comwww.iprm.comwww.swissre.comwww.ventureprograms.com`NB!4HEADING AHeading Level A, B, C    BA  .B0 ` F dZB8HEADING 123Heading Level 1, 2, 3     ` F1  .F0 r (1), (2), (3)Level 1Level 2Level 3Level 4Level 5ddd ]r!XDrXXXXDrXXXDr  _C??CY@-BBCC9@*9 yXXDr 99@!#XDrXy#:XXDr:AmericanBarAssociation  @SectionofIntellectualPropertyLaw:#XDrXa#:yXXDrԈ  @ #XDrXy#h XXDr The17thAnnualIntellectualPropertyLawConference #XDrX h#yXXDrԈ  j  @ #XDrXy#h XXDrInsuranceCoverageLawDistinctionsfor    @V V IntellectualPropertyLitigatorsandCorporate@E E CounselreIPandAntitrustLawsuits#XDrX hu# yXXDrԈ h  @$#XDrXyo#DavidA.Gauntlett  0 `  @zz"` (#` (#Gauntlett&Associates@PP 18400VonKarman,Suite300@\\%Irvine,CA92677@#Phone:9495531010@%Fax:9495532050@uu#4  u O  5  www.gauntlettlaw.com6 O  7 @Ԉ J @;;(JohnMaxin?+ 4 <DL!X?  IntellectualPropertyCounselorNationalSemiconductorCorporation801EastCampbellRoad,Suite525Richardson,TX75081Phone:9726804523Fax:9726804515>>April1112,2002Washington,D.C.;  +n&$ ;<+<==<<8   8h@         998DrXXdd8p4h@@I  .@0 `   INTRODUCTIONh@B  B ` (#` (# Ќ   ` Intodaysrapidlygrowingcommercialmarketplace,businessrelatedintellectualpropertyclaimshavesignificantlyimpactedthelivesofbusinesspolicyholders.Thisincreasedprevalenceofintellectualpropertyclaimshasraisedthefinancialstakesandtheimportanceofinsurancecoverageforsuchclaims. ` Thisarticlewilldiscussthehistoryof advertisinginjurycoverage,tipsforIPlitigatorsandcorporatecounsel,andnewformsofcoverageavailabletoexpandopportunitiesforprocuringcoveragebenefits.h@     h@^ @II  .@0 `   HISTORYOFTHE ADVERTISINGINJURYPROVISIONh@^  n B $ ` (#` (# Ќ   ` Historically,CGLpoliciescoveredpolicyholdersforliabilitiesarisingoutof bodilyinjuryand propertydamage.However,astheliabilitiesfacingbusinessesgrewandevolved,sodidtheCGLpolicies.*!    *! ` BA  .B0   1976ISOCGLForm*! F \ (# (# Ќ   ` In1976,InsuranceServiceOffice,Inc.( ISO)publishedits BroadFormComprehensiveGeneralLiabilityEndorsement,whichprovidedcoveragefor PersonalInjuryand AdvertisingInjuryliability.G #  1        \  ` Theinsuringclauseofthe1976BroadFormEndorsementincludesthefollowingsections:XXDr8 ` 8 ` ` II.  PersonalInjuryandAdvertisingInjuryLiabilityCoverage x x 8 ` 8 ` `   (A)0h x xTheCompanywillpayonbehalfofthepolicyholderall 4 sumswhichthepolicyholdershallbecomelegallyobligatedtopayasdamagesbecauseofpersonalinjuryoradvertisinginjurytowhichthisinsuranceapplies.... hxhx @pp+***  8 ` 8 ` `   (D)0h x xAdditionalDefinitions.##hxhx 8 ` 8 ` ` 0 x x0hxx AdvertisingInjurymeansanyinjuryarisingoutofanoffensecommittedduringthepolicyperiodoccurringinthecourseofthenamedpolicyholdersadvertisingactivities,ifsuchinjuryarisesoutofsuchlibel,slander, defamation,violationofrightofprivacy,piracy,unfair B(#) competitionorinfringementofcopyrighttitleorslogan. hxhx   ` #XDrX#The1976BroadFormEndorsementexcludedcoverageforadvertisinginjuryarising R outof infringementoftrademark,servicemark,ortradename,otherthantitlesorslogans,inconnectionwithgoods,productsorservicessold,offeredforsaleoradvertised. #  2       * *!    *! ` BB  .B0   1986ISOCGLForm*! F   (# (# Ќ   ` In1986,theISOissuedthe CommercialGeneralLiabilitypolicy(CGL),whichreplacedtheISOs1976 ComprehensiveGeneralLiabilitypolicywithits BroadFormEndorsement.Anewexplanatorymemorandumwasalsoissuedentitled ISOGeneralLiabilityPolicyRevisionHighlightsofCurrentandRevisedContracts(the 1986Highlights).Thisfactsheetwasissuedtoadviseinsuredsandtheirbrokerswhatcouldbeexpectedunderthenewpolicylanguage.The1986Highlightsemphasizedthatdespitesubstitutionoftheoffenseof misappropriationofadvertisingideasorstyleofdoingbusinessfor piracyand unfaircompetitiontherewas nochangeinscopebetweenthe1976ISOand1986ISOpolicies.Thisnewpolicyadoptedthefollowingdefinition:XXDr8 ` 8 ` `  AdvertisingInjurymeansinjuryarisingoutofoneormoreofthe  followingoffenses:  x x 8 ` 8 ` ` (1)0 x xOralorwrittenpublicationofmaterialthatslandersorlibelsa d personororganizationordisparagesapersonsororganizationsgoods,productsorservices; xx 8 ` 8 ` ` (2)0 x xOralorwrittenpublicationofmaterialthatviolatesapersons ,| rightofprivacy; xx 8 ` 8 ` ` (3)0 x xMisappropriationofadvertisingideasorstyleofdoingbusiness; ~ or xx 8 ` 8 ` ` (4)0 x xInfringementofcopyright,titleorslogan.HV #  3        xx  ` #XDrXB#The1986ISOformalsoeliminatedthetrademarkinfringementexclusion. \!" *!    *!  ` BC  .B0   1998ISOCGLForm*! !  F 4#$ (# (# Ќ   ` ISOsnew advertisinginjurycoveragepolicyform,CG00010798,madeanumberofpertinentchangesto advertisinginjurycoverage.  &4"(  ` First,itdeletestheoffensesof:(1) infringementoftitle;and(2) misappropriation ofadvertisingideasorstyleofdoingbusiness._ ` Second,itaddedtwonewoffenses: (1)Infringementuponanotherscopyright,tradedress,orsloganinyouradvertisement;and(2)theuseofanothersadvertisingideainyouradvertisement.Italsodefined advertisementas Anoticethatisbroadcastorpublishedtothegeneralpublicorspecificmarketsegmentsaboutyourgoods,productsorservicesforthepurposeofattractingcustomersorsupporters. ` Asyet,therehasnotbeenanysignificantlitigationregardingcoveragefortrademarkinfringementunderthe1998ISOlanguage.Thefactthatthe1998formexpresslyreferstotradedressinfringementandnottrademarkinfringementmayprecipitatecoveragedisputes.*!    *!t& ` BD  .B0   2001ISOCGLForm*!t&& &F   (# (# Ќ   ` ISOhassignificantlycurtaileditsCGL personalandadvertisinginjurycoverageinthe2001versionofitspolicybeingsubmittednationallyforregulatoryapprovalthisyear.Despitetheabsenceofanyreductioninpremium,itlimitsintellectualpropertycoverage.Towit: Onlyyouradvertisementofcopyright,tradedressorsloganiscovered.SeeLI H GL2001001atp.9.InternationalInternetexposureforcoveredoffensesisextendedtoalloffenses thattakeplacethroughtheInternetorsimilarelectronicmeansofcommunication.LIGL2001001atp.11.NocoverageisprovidedtowebsitedesignersorInternetaccessproviders.LIGL2001001atp.9.h@     h@*@III  .@0 `   COMMONEXCLUSIONSAPPLICABLETOINTELLECTUALPROPERTY   TORTSh@** *B  ` (#` (# Ќ   ` Theexclusionsinthegeneralliabilitypolicyserveanumberofpurposes.Theexclusionsdefinethescopeofliabilitycoverageandaredesignedtocoordinateor dovetailwithothercommonandreadilyavailablecoverages.*!    *!, ` BA  .B0   The FirstPublicationExclusion*!,1- -F D! (# (# Ќ   ` Thisprovisionexcludes oralorwrittenpublicationofmaterialwhosefirstpublicationtookplacebeforethepolicyperiod.Courtshavesplitonwhetherthefirstpublicationexclusionappliestoalladvertisinginjuriesoronlytolibel,slander,andinvasionofprivacy.Thisissuearisesbecausethepredicatequalifyingphraseinthedefinitionofthepolicys advertisinginjuryoffensesfor oralorwrittenpublicationofmaterialonlymodifiestheoffensesreferencedabovebutnotthosefor misappropriationofadvertisingideasorstyleofdoingbusinessor infringementofcopyright,titleorslogan.Thelatteroffensestypicallyencompassarangeofintellectualpropertytorts.Eventhosecourtswhichdonotfindthepolicysplainmeaningexcludescoverageforintellectualpropertytorts,orfindtheexclusionambiguous,agreethattheexclusioncanapplyonlytoaclaimwhosefirst h+&* injuriouspublicationofthesameorsimilarmaterialfirstinceptedbeforethepolicy.Wheretheexclusionisfoundtobeapplicable,priorpoliciesshouldbereviewedtodeterminewhethercoveragearosethereunder.   `  0  CoverageExists: `(#(# L h3L 3    `  33223  0    XXDr WalterL.Maddox,IIIv.St.PaulFireandMarineIns.Co.,No.01-1264,___F. <  Supp.2d___,2001U.S.Dist.LEXIS21892(W.D.Pa.Dec.27,2001) (Thecourt ( x foundthatthelanguageofthefirstpublicationexclusionisambiguousbecauseitisreasonablysusceptibletomorethanoneinterpretation.Thealternativereasonableinterpretation!requiringthepriorpublicationtocausethesameinjuryasthelaterpublication!issuggestedbothbythecontextofthelanguageandthewayothershaveinterpretedit.).#XDrX;4#333݌ Z (#(# Ќ  L hhL 3      `  3M7223  0    XXDr AdolfoHouseDistributingCorp.v.TravelersPropertyandCas.Ins.Co.,165F.   Supp.2d1332,1342(S.D.Fla.2001) (clearimplication...isthatthe   exclusionaryprovisionmerelylimitsthecoverageforadvertisinginjurythatarisesfrom[libel,slanderandinvasionofprivacy]).#XDrX7#3M77݌8(#(# Ќ  L !hh L 3    `  3:223  0    XXDr EverettAssoc.v.TranscontinentalIns.Co.,57F.Supp.2d874,885(N.D.Cal. : 1999) (Courtheldthatwhilesuch priorpublicationexclusionmayaffecttheduty & toindemnify,itdidnotexcusetheinsurerforitsfailuretodefend.).#XDrX:#3:H:݌(#(# Ќ  L "hh!L 3    `  3<223  0    XXDr BayElectricSupply,Inc.v.TravelersLloydsIns.Co.,61F.Supp.2d611,619 R (S.D.Tex1999) (ThecourtfoundthattheFirstPublicationExclusiondidnotapply > becauseTheLanhamAct32(1)specificallyrequiresthatsuitbebroughtbythe registrant.Herethetrademarksatissuewereregisteredin1997,andthepolicywasacquiredin1995.Eventhoughtheinsuredwasawareoftheinfringement,theinjuriouspublicationofadvertisingatissuearoseafterinceptionofthepolicy.).#XDrX=#3<<݌Z(#(# Ќ   `  0  CoverageDoesNotExist:  \(#(# L #Yhh"L 3    `  3r@2Y23  0    XXDr TradesoftTechnologies,Inc.v.FranklinMut.Ins.Co.,329N.J.Super.137 8  (N.J.Super.App.Div.2000): 3r@@݌ $!(#(# Ќ  8 ` 0 ` ` 0 0h  Thefirstpublicationexclusionmustbereadtoapplytotheentiredefinitionof advertisinginjury,[whichincludes] misappropriationofadvertisingideasorstyleofdoingbusiness[and] infringementofcopyright,titleorslogan.#XDrX@#$ &h h  L $Yhh#L 3    `  3C2Y23  0    XXDr EssexIns.Co.v.RedtailProds.,Inc.,No.3:97CV2120D,1998U.S.Dist. d&!( LEXIS18507(N.D.Tex.Nov.13,1998)(unpublishedorder) (Thecourtrelied P'") onthefirstpublicationexclusiontobarcoverage,statingthattheSept.27,1996letter,whichwasreceivedbyRedtail18dayspriortotheEssexpolicybeingissued,showedallegedtrademarkviolationsoccurringbeforethepolicyperiod.Thesameinjuriouspublicationofadvertisingwasatissuebothbeforeandafterthepolicy.).#XDrXHD#3CD݌2+&.(#(# Ќ   +H'/ *!    *!F ` BB  .B0   The KnowledgeofFalsityExclusion*!F9G GF  (# (# Ќ   ` Thisprovisionexcludesfromcoverageallegationsassertingconductcommittedwithactualmalice!knowledgeofthestatementsfalsity.Insomecases,insuredshavearguedthatthisexclusiondoesnotapplywherethecomplaintdoesnotspecificallyallegeknowledgebutinsteadallegesarecklessdisregardofthetruth.IPcasesinherentlydonotinvolve knowledgeoffalsitysothatthisexclusionshouldhavenoapplicationtobarcoverageforsuchclaims. `  0  CoverageExists:  L (#(# L %Yhh$L 3    `  3J2Y23  0    XXDr ArnetteOpticIllusions,Inc.v.ITTHartfordGroup,Inc.,43F.Supp.2d1088, (  1092(C.D.Cal.1998) (FirstPublicationExclusiondoesnotapplybecause   languageisambiguousastowhetheritappliestoalladvertisinginjuriesoronlytolibel,slanderandinvasionofprivacy,whichoffensesareprecededbythe oralorwrittenpublicationofmaterialpolicylanguage.).#XDrXrK#3J,K݌j (#(# Ќ  L &Zhh%L 3    `  3M2Z23  0    XXDr AdolfoHouseDistributingCorp.v.TravelersPropertyandCas.Ins.Co.,165F.  Supp.2d1332,1342(S.D.Fla.2001) (Theexclusiononlyappliestolibel,slander  andinvasionofprivacy.Eveniftheexclusionwerebroadlyinterpretedtoapplytotradedressortrademarkinfringementclaims,thiswouldnotrenderitapplicablehereasanabsolutecoveragebar.Despitethefactthatsomeoftheunderlyingsuitsallegationsareintentionalinnature,thesuitalsoassertednon-intentionalgroundsforrelief.Insuchcircumstances,wherethecomplaintsallegationsleaveopenthepossibilitythatAdolfoHousemightbeliableforunintentionalactsoftradedressinfringement,itmaybesaidthatthecomplaintcontainsallegationswhich fairlyandpotentiallybringthecasewithinthepolicycoverage,thusrequiringtheinsurertodefendtheentireclaim.).#XDrX~N#3M8N݌(#(# Ќ  L 'Zhh&L 3    `  3R2Z23  0    XXDr Interface,Inc.v.TheStandardFireInsuranceCo.,etal.,No. d 1:99-CV-1485-MHS,2000U.S.Dist.LEXIS14019,at*13(N.D.Ga.Aug.15,2000) (Knowledgeoffalsity,asalaymanwouldreadit,hasnothingtodowith f copyrightinfringement.Norisitanelementofaclaimforcopyrightinfringement....WhetherInterfaceknowinglymanufacturedinfringingcarpetsorpublicationsdisplayingthosecarpetsdoesnotmakethecarpetsorpublications false.Thisexclusionappearsmorerelevanttocoverageforclaimsoflibelorslander.)#XDrXS#3R9S݌2"#(#(# Ќ   `  0    CoverageDoesNotExist: #4%(#(# L (&Zhh'L 3    `  3W2&Z23  0    XXDr AmericanGuarantee&LiabilityIns.Co.v.Shel-RayUnderwriters,Inc.,844F. %!' Supp.325,331(S.D.Tex.1993) (Here,sincetheunderlyingcomplaintallegesthat &!( Shel-RayandBunkerHillknowinglycommittedfraudulentacts,thecourtheldtheknowledgeoffalsityexclusionbarscoverage.3W\W݌ (#(# Ќ  8 ` 0 ` ` 0 0h  TheexclusioncontainslanguagethatunambiguouslystatesthatAGLICwouldnotinsureforinjuryifdonebyoratthedirectionoftheinsuredwithknowledgeofitsfalsity.SeeDaca,Inc.v. T+&. CommonwealthLandTitleIns.Co.,822S.W.2d360,363-64 ,j'/ (Tex.App.!Houston[1stDist.]1992,writdenied)(nodutytodefendwhereunderlyingsuitisbasedonfraud);cf.Decorative v CenterofHoustonv.EmployersCas.Co.,833S.W.2d257,260 < (Tex.App.!CorpusChristi1992,writdenied)( Publicpolicyprohibitspermittinganinsuredtobenefitfromhisownwrongdoinginthat oneshouldnotbeabletoinsureagainstonesownintentionalmisconduct.).#XDrXW#T h h  L )6Zhh(L 3    `  3,]26Z23  0    XXDr MaxiAids,Inc.v.GeneralAccidentIns.Co.,N.Y.SupremeCourt,Mineola,  V IndexNo.193/97(N.Y.SupremeCt.MineolaAug.27,2001) (Thisprovision  B  excludescoverageforaninfringementwheretheconductatissuewasboth knowingandintentional.SeeA.J.Sheepskin&LeatherCo.,Inc.v.ColoniaIns.    Co.,273A.D.2d107(1stDept.2000).Here,notonlywastheconductinthe H  underlyingactionexpresslyfoundbythejurytobewilful,butthecomplaintthereinallegedwilfulconductbyplaintiffs....AsforCountI,IIAallegedthat despitenoticebyittoplaintiffsthattheyhadinfringedJLAscopyrights,plaintiffsneverthelesscontinuedtoinfringesaidcopyrights.Thisallegationistheequivalentof intentionalconduct.Id.atpp.12).#XDrX]#3,]o]݌&v (#(# Ќ  h@     h@a@IV  .@0 `   RULESOFPOLICYCONSTRUCTIONh@aa aB (` (#` (# Ќ  *!    *!b ` BA  .B0   ThereAreThree(3)LevelsofDistinctionsDependingontheKindof  Offense:*!b,c cF  (# (# Ќ  0 ` (1)0 ` (#` (#Commonlaworstatutorytorts(libel/infringementofcopyright)(actual t elementsoftortreadintothecomplaintwheretheoryofreliefisassertedbydescriptivefactsarenotalleged;  (# (# 0 ` (2)0 ` (#` (#Genericlabelsforincludedrangeoftorts(Invasionofprivacy;oralorwritten $t publicationofmaterialwhichdisparagesthegoodsorservicesofanother)(Alltortswhichfallwithintheambitofsuchclaims)(Againtheelementsofanyincludedtortmustbereadintothecomplaintwherefactelementsofoneoftheincludedtortsareasserted);and  (# (# 0 ` (3)0 ` (#` (#Layandgenericoffenses(Misappropriationofadvertisingideasorstyleof !" doingbusiness)(PlainEnglishequivalentsmustbedeterminedforthepolicylanguagetogaugethescopeofconductthatwillfallwithinitsambit;andwhereappropriatelinguisticanalysisperformedtovalidatetherangeofcontextuallyreasonabledefinitions.Thosedefinitionsmustthenbeappliedtotheassertedclaimsandwherepossibletheelementsofthetortspledexpoundedsoastodeterminewhethersuchclaimstriggeradefense).  (# (# *!    *!i ` BB  .B0   ANumberofRulesofPolicyConstructionImpactAnalysisof Offense  )\$* BasedCoverage*!ii iF )H%+ (# (#    *4&, 0 ` Thedutytodefendexistsifthereisanypotentialthattheclaimiswithincoverage; thedutymaybebasedonthefactsofthecomplaintorextrinsicfactsfromothersources. ` (#` (#  ` (1)0 Coverageclausesofinsurancepoliciesaregenerallyinterpretedbroadlyin ` ordertoprotecttheobjectively reasonableexpectationsoftheinsured.Thedutytodefendistriggeredifthereisanypotentialforliabilityunderthepolicy.Itdoesnotmatterwhethercoveredornoncoveredacts predominatedintheunderlyingaction.  (# (#  ` (2)0 Thepolicytermsmustbeinterpreted inordinaryandpopularsenseand  8  usedunlessthepartiesusetheminatechnicalsenseoraspecialmeaningisgiventothembyusage.  (# (# 0 ` (3)0 ` (#` (#Wecannotreadintothepolicywhat[theinsurer]hasomitted.Todoso   wouldviolatethefundamentalprinciplethatininterpretingcontracts,includinginsurancecontracts,courtsarenottoinsertwhathasbeenomitted.  (# (# 0 ` (4)0 ` (#` (#Theword offensecannotbereadtolimitcoverageonlytoaparticular H  causeofactionor claim.Theword offensesimplydoesnothavethismeaningeitherincommonusageorlegalusage.  (# (# 0 ` (5)0 ` (#` (#Unlikeliabilitycoverageforpropertydamageorbodilyinjury,personal H injurycoverageisnotbasedonanaccidentoccurrence.Ratheritistriggeredbyoneoftheoffenseslistedinthepolicy...personalinjury[advertisinginjury]coverageappliestoinjurywhicharisesoutofthecommissionofcertainenumeratedactsoroffenses.  (# (#  ` (6)0 Coveragethusistriggeredbytheoffense,nottheinjuryordamagewhicha  plaintiffsuffers...Totheextentthelistedoffensesinthepolicyareframedingenericterms,theyshouldbeconstruedbroadlytoencompassallspecifictortswhichreasonablycouldfallwithinthegeneralcategory.  (# (#  ` (7)0 Thedutytodefendisdeterminedfromthefactsofthecomplaint(andall #l! legaltheoriesthosefactscouldsupport),andnotjustthelegaltheoryorcause $X" ofactionactuallypledbytheplaintiff.  (# (# 0 ` 0 ` (#` (#(a)0 (# (#Forexample,theplaintiffneedonlypleadthedefendantpublished &"% specifiedtypesofdefamatorystatements;theplaintiffneednotspecificallyallegethestatementswerefalse...theunderlyingcomplaintallegedpublicationtothirdpersonsandthecontentofthestatementswereallegedlydisparaging.Theseallegationssufficedtogiverisetoapotentiallycoveredclaim.h+&*(#(# Ї0 ` 0 ` (#` (#(b)0 (# (#[Thecomplainants]statementsthat[theinsured]wasontheedgeof  businessruinandthat[theinsured]couldnotbetrustedtodeliverordersclearlydisparagedhisservices. (#(#  ` (8)0 Ifthemeaningcannotbedeterminedbytheinsuredsobjectivelyreasonable ` expectationsofcoverage,thepolicylanguageisambiguousandmustbeconstruedagainsttheinsurerandinfavorofcoverage.  (# (#  ` (9)0 Ifthemeaningcannotbedeterminedbytheinsuredsobjectivelyreasonable  ` expectationsofcoverage,thepolicylanguageisambiguousandmustbeconstruedagainsttheinsurerandinfavorofcoverage.  (# (#  ` (10)0 Ambiguitymayalsoresultfromcontradictoryornecessarilyinconsistent   languageindifferentportionsofthepolicy.  (# (# n8     n89{@V  .@0 `   THETHREEPARTTESTFORESTABLISHINGADVERTISINGINJURY   COVERAGEn89{v{ I{B p` (#` (# Ќ  !    !| ` BA  .B0   An AdvertisingActivitybytheNamedInsured!|| |F H (# (# Ќ  @! PolicyholderConstruction   p L 6hh)L 3    `  3~2623  0    XXDr Hameidv.NationalFireIns.ofHartford,114Cal.Rptr.2d843,848,2001WL H 1654962(Cal.App.2001): 3~~݌4(#(# Ќ  8 ` 0 ` ` 0 [W]herethebusinessisonewithasmallcustomerbaseandthatbase,orasignificantpartofit,isthetargetaudience,thereachisextensiveenoughtoconstituteadvertisinginjury.Toholdotherwisewouldeffectivelyprecludesmallbusinessmenfromeverinvokingtheirrightstocoverageforadvertisinginjuryliability....    8 ` 0 ` ` 0 PlaintiffanditsemployeessolicitedcustomersbyadvertisinginthePennysaver,sendingmailers,andtelephoningHowardandBillingtonsclientsfromBellezza.Viewedinthecontextofastart-up,communitybeautysalon,theseactivities fit[]neatlyintothecommonlyunderstoodmeaningofadvertising...,i.e., theactofcallingpublicattentiontoonesproductthroughwidespreadpromotionalactivities.[Citations.](El-ComHardware,Inc.v.FiremansFundIns.Co.(2001)92Cal.App. $ % 4th205,217[catalogdistributedbymanufacturerheldtobeadvertising].)#XDrX*#H&!'   L FhhL 3    `  32F23  0    XXDr ElComHardware,Inc.v.FiremansFundIns.Co.,92Cal.App.4th205,218 'J#) 19(2001): 30݌(6$*(#(# Ќ  8 ` 0 ` ` 0 0h  Amanufacturersdisplayandpresentationofitsproductstoasignificantnumberofitsclientbase,particularlyatasiteotherthanthemanufacturersfactoryorshowroom,wouldbe +N'. commonlyunderstoodtofallwithinthedefinitionofadvertising,towit,callingpublicattentiontothemeritsofonesproductsoastoencouragepurchaseoftheproduct.#XDrXv#<h h  L VhhL 3    `  32V23  0    XXDr USF&Gv.StarTechnologies,Inc.,935F.Supp.1110,11141115(D.Or.1996): 3݌>(#(# Ќ  8 ` 0 ` ` 0 0h  Themajorityofcourts...havebroadlyconstrued advertisingactivitytoencompassavarietyofbusinesssolicitations...(personaloneononeandgroupsolicitation;...(threeletterstooneclient);...(singlelettersenttoclientbase)#XDrX6# B h h    @# InsurerConstruction     L fhhL 3    `  32f23  0    XXDr EKCOGroupv.TravelersIndemnityCo.,273F.3d409,413,414(1stCir. |  (N.H.)2001): 3\݌h (#(# Ќ  8 ` 0 ` ` 0 0h  [Advertisingisusuallydefinedas][t]heactorpracticeofcallingpublicattentiontoonesproduct[,service,need,etc.,]esp.bypaidannouncementinnewspapers,overradioortelevision,onbillboards,etc.#XDrX#Jh h  L vhhL 3    `  3+2v23  0    XXDr Solers,Inc.v.HartfordCasualtyIns.Co.,146F.Supp.2d785,79293(E.D.Va. L 2001): 3+n݌8(#(# Ќ  8 ` 0 ` ` 0 0h  Thesubmissionofproposalsonaone-on-onebasisdoesnotrisetothelevelofadvertisingactivity[andwouldnotinclude]anefforttosellthroughacompetitivebiddingprocess,aproductthatisspecificallytailoredtoasinglecustomertomeettheneedsofaspecificproject.[Suchproposals,whilebeingpromotionalincharacter,]aremoreappropriatelycharacterizedas solicitationsratherthanadvertisements.Advertisingandsolicitationaremutuallyexclusive...becauseadvertisingmustbeofapublicnature.#XDrX# h h  _*!    *!D ` BB  .B0   Allegations_ԀThatFitintoOneoftheNamed AdvertisingInjury Z " Offenses*!D~ TF F!# (# (# Ќ  0 ` 0 ` (#` (#(Theoffensemusthavebeencommittedinthe coverageterritoryduringthepolicyperiod.)  (# (# @' 1976ISOCGL  %2!( @RR" 1.UnfairCompetition  ' #* @! PolicyholderConstruction  )$, XXDr ` 0 0 (# (#theprotectionofabusinessfrommisappropriationofitscommercialadvantage j+&. earnedthroughskill,organization,labor,andmoney.0,'/(#(# Ї `  0  Itcoversclaimsbyacompetitorthattheinsuredmonopolizedthemanufactureand  saleofcertainproductsinviolationoftheShermanActandintentionallyinterferedwiththecompetitorscontractsmaybecoveredasclaimsforcompetitiveinjury. (#(#  `  0  Itincludesdisparagementofacompetitorsgoodsorbusinessmethods,threatsof  groundlesssuitsandfalseadvertising.#XDrXD#(#(#   @# InsurerConstruction  @  XXDr ` 0 0 (# (#thetortofpassingoffonesgoodsandservicesasthoseofanother. h (#(#  `  0  ItdoesnotcoverviolationsofCaliforniaBusiness&ProfessionsCode17200et    seq.prohibiting unfaircompetitionasonly disparagementofillgottengainswhicharenotdamagesarerecoverableforthesestatutoryviolations. (#(#  `  0  Itdoesnotcoverclaimsbyconsumersforunfairbusinesspracticesbutonlyfor   claimsofcompetitiveinjury. (#(#  `  0  Itdoesnotcoverdeceptivebusinesspracticesbyofficersanddirectorswhich ^ causedlossestoinvestorsallegedlyviolativeoftheUnfairBusinessPracticesAct.#XDrX#$(#(#   @( 2.Piracy   @! PolicyholderConstruction  ^  `  0  XXDrthe unauthorizedreproductionoforuseofa...patentedinventionor unlawful 6 reproductionofdistributionofpropertyprotectedbypatentandtrademarklaws.#XDrX~#"r(#(# XXDr `  0  Piracyisalaytermwhichmaybeinterpretedtoincludesuchoffensesas  publicationoftradesecrets,interferencewithprospectiveeconomicadvantage,ortrademarkinfringement.#XDrX#:(#(# @# InsurerConstruction  <  XXDr `  0  acommonlawtortofmisappropriationofuncopyrightedliteraryartisticornews  " materials. (#(#  `  0  misappropriationorplagiarismintheelementsoftheadvertisementitself,e.g.,in #f% itstextorpictures.#XDrX;##,&(#(# @ 3.Infringementof...Title  % ( @! PolicyholderConstruction  f'"* XXDr `  0  Ownershiporpropertyinterestsuchasapropertyinterestinatradesecreted >)$, advertisingapproachorinthesubjectmattercoveredbypatentclaims. (#(#  `  0  Infringementofaliteraryorartisticwork,+&/(#(#  V,'0  `  0  Businessnameortitle.#XDrX#(#(#   @# InsurerConstruction  b XXDr `  0  concernsunauthorizeduseofthebodyortitleofaprotectedliteraryorartisticwork : oradvertisingslogan(recasesreferencedconstruenonstandardpoliciesthatincludeapolicyexclusionforinfringementoftrademarksortradenames otherthantitlesorslogans).#XDrX# (#(# @'' 4.Infringementof...Slogan  >   @! PolicyholderConstruction  f  XXDr `  0  Asloganisabrief,attentiongettingphraseusedinadvertisingorpromotion.#XDrX<#> (#(# @# InsurerConstruction    XXDr `  0  Asusedintheexceptiontoatrademarkexclusionfor infringementof... x trademarkedorservicemarkedtitlesorsloganssoitmeanswordsorphrasesusedtopromoteparticularproductsorproductlinesbutnothouseorproductnames.#XDrXX#T(#(# @' 1986ISOCGL     1.MisappropriationofAdvertisingIdeas   &@! PolicyholderConstruction  f XXDr ` 0 0 (# (#Thetakingormisuseoftheideaofclaimingarevolutionarynewdesignasan h enticementtocustomers. (#(#  ` 0 0 (# (#Thetakingormisuseofanideaaboutidentifyingoneselftocustomers(i.e.,it j includesanallegedmisappropriationthatinvolvestradesecretsrelatingtoacompetitorsmarketingandsalestechniques,includingcustomerlists). (#(#  ` 0 ` 0 ` (#` (#0 (# (#Thewrongfultakingofthemannerbywhichanotheradvertisesitsgoodsor !" services,whichincludesmisuseofanotherstrademark,tradenameorservicemark(i.e.,whenreadinlightofthefactthattrademarkinfringementcouldreasonablybeconsideredtobepartofeitheranadvertisingideaorastyleofdoingbusiness,itwouldappearobjectivelyreasonablethat advertisinginjurycoveragewouldnowextendtotheinfringementofatrademark.).#XDrXΫ#`% '(#(# @# InsurerConstruction  'b") XXDr `  0  Misappropriationofadvertisingideasislimitedtocommonlawmisappropriation.(:$+(#(#  `  0  Thewrongfultakingofthoughtsabouthowtomakethepublicawareofsomething.#XDrX#v*%-(#(#   <+&.    @9 9  2.MisappropriationofStyleofDoingBusiness   @! PolicyholderConstruction   XXDr ` 0 0 (# (#Thetakingormisuseoftheoutwardappearanceorsignatureofabusiness, ` includingitstradedress. (#(#  ` 0 0 (# (#Thewrongfultakingofthemannerinwhichaparticularcommercialactivityis   conducted. (#(#  ` 0 0 (# (#Thetakingormisuseofaplanforinteractingwithconsumersandgettingtheir  T  business.#XDrX#  (#(# @# InsurerConstruction  |  XXDr `  0  Misappropriationofstyleofdoingbusinessislimitedtocommonlaw T  misappropriation. (#(#  `  0  Thewrongfultakingofthemannerinwhichacommercialenterpriseoperates.(#(#  ` 0 0 (# (#Thetakingormisuseofacompanyscomprehensivemannerofoperatingits 2 business.#XDrX#H(#(# _*!    *! ` BC  .B0   An_ԀInjuryThatArisesoutofanOffenseCommittedintheCourseof   AdvertisingActivityreAdvertisingRequiresaCausalNexusBetweenanAdvertisingInjuryOffenseandtheInsuredsAdvertising*!0 F  (# (# Ќ   `  !0  Anumberofcourtshavedescribedtheappropriatenexustobethat Z betweenadvertisingactivityand advertisinginjury.Thisisclearlyamisreadingofthepolicylanguage.Itdoesnotrequiresuchanexus. (#(#  `  !0  Rather,thenexusthatitpositsascorrectlyfoundbyJudgePatelin  Z theFoxfireaction,isbetweenoffenseandadvertisingactivity.F (#(#  `  !0  Courtfindingstothecontraryimproperlycollapsetheseparate !" requirementthattheoffenseoccurinthecourseofadvertisingandfurtherrequirethattheinjuryariseoutofanoffense. (#(# @# InsurerConstruction  ~% & 0 ` 0 ` (#` (#0 (# (#XXDr TheFrog,Switch&Mfg.Co.v.TravelersIns.Co.,193F.3d742,751n.9(3d V'"( Cir.1999): B(#)(#(# 8 ` 0 ` ` 0 0h  Thisinsuranceappliesto:... Advertisinginjury causedbyan )"%+ offensecommittedinthecourseofadvertising yourgoods, *%,  productsorservices;...[Thecourtnotedthat]somecourts f+&- conflatetherequirementof advertisinginjurywiththerequirementthattheinjuryoccurinthecourseofadvertising. h h    `    Itwentontofindnocausationinthatcase.#XDrX# R  `  0  XXDr Fluoroware,Inc.v.ChubbGroupofIns.Cos.,545N.W.2d678,682(Minn.  1996) (Advertisingamisappropriatedproductismerely coincidentalandthe   advertisingdoesnotmateriallycontributetotheinjury.).#XDrX#j (#(#  `  0  XXDr SimplyFreshFruit,Inc.v.ContinentalIns.Co.,94F.3d1219(9thCir.(Cal.)  l  1996) (Nodutytodefendtradesecretclaim.Thecourtheldthatappellants  X  producednoevidencethattheircompetitorsuffereddamagesduetotheiradvertisinginordertoprovetheelementsofanysuchclaim,andthusthecausationrequirementwasnotmet.Thecourtalsofoundthatappellantsadvertisingdidnotcausetheinjuriesallegedintheinfringementclaim.).#XDrX#$t (#(#   @! PolicyholderConstruction  &  0 ` 0 ` (#` (#0 (# (#   XXDr CATInternetSystems,Inc.v.ProvidenceWashingtonIns.Co.,153F.Supp.2d  755(E.D.PA2001): (#(# 8 ` 0 ` ` 0 0h  Intheinstantaction,theinjurywascompleteinacoveredoffense,trademarkinfringement,whileinFrog,Switch,the @ injurywascompleteinanoncoveredoffense.#XDrX#h h  0 ` 0 ` (#` (#0 (# (#   XXDr ElComHardware,Inc.v.FiremansFundIns.,92Cal.App.4th205(2001)  h (Courtfoundtherewascausationwhereamanufacturersdisplayandpresentationofitsproductstoasignificantnumberofitsclientbase,particularlyatasiteotherthanthemanufacturersfactoryorshowroom,calledpublicattentiontothemeritsoftheproductsoastoencouragepurchaseoftheproduct.).#XDrX#(#(# h@     h@ @VI  .@0 `   SURVEYOFINTELLECTUALPROPERTYINSURANCECOVERAGE X CASELAWh@ G B D ` (#` (# Ќ  *!    *!z ` BA  .B0   Copyright*!z F !l" (# (# Ќ   `  Section106: h FiveBasesforInfringement "D$  `  -  Reproduction $ &  `  -  Adoptionofaderivativework &!(  `  -  Publicdistribution |(#*  `  -  Publicperformance T*%,  `  -  Publicdisplay ,,|'. Ї   `  0  CoverageExists: (#(# L *ZhhL 3    `  3H2Z23  0    _XXDr C CRyland_ԀGroup,Inc.v.TravelersIndemnityCo.ofIllinois,No.A00CA233JRN,  2000U.S._Dist_.LEXIS21412,*1617(W.D._Tex_.Austin_Div_.Oct.25,2000)(dutytodefendfound),motiontovacateorderdenied,2001U.S._Dist_.LEXIS > 14850(W.D._Tex_.Austin_Div_.Feb.16,2001) #XDrX#XXDrXԀ( *Xx X*[_T]he_ԀCourtmustdetermine  T whetherthereisaconnectionbetweenthecopyrightclaimsintheUnderlyingLawsuitand_Ryland_'sadvertisingactivity.[The]Complaint...allegedthat_Ryland_infringed_KFA_'scopyrightedarchitecturalplans(1)byconstructingandsellinghousesbasedonthecopyrightedworks,R  _andRemenCC>>  _Ԁ(2)byusingnonpictorialdepictions  p  ofthecopyrightedworksinpromotionalandadvertisingmaterials..._KFA_'sComplaintexpresslyallegedthat_Ryland_'suseof"nonpictorialrepresentationsoftheCopyrightedWorksinpromotionalandadvertisingmaterialsasdescribed% u %uiabovehasinfringedandisinfringing_KFA_'scopyrights"andthat"_Ryland_'suseofnonpictorialdepictionsofsuchderivativeworksinpromotionalandadvertisingmaterialsasdescribedabovehasinfringedandisinfringing_KFA_'sCopyright."Thus,_KFA_Ԁspecificallyallegedthat_Ryland_'sadvertisementsandpromotionalmaterialsindependentfromtheseparateclaimsthat_Ryland_Ԁbuilthomesbasedon_KFA_'scopyrightedplansinfringed_KFA_'scopyrights...Thus,theadvertisementsandpromotionalmaterialsinfringed_KFA_'scopyrightanddidnotmerely"expose"theinfringement.Accordingly,theCourtfindsthatthereisacausalconnectionbetweentheadvertisingactivityand_KFA_'sclaimforcopyright_infringement.)#Xk##XDrXL#_3H݌.~(#(# Ќ  L +Zhh*L 3    `  32Z23  0    XXDr Interface,Inc.v.TheStandardFireInsuranceCompany,etal., 0 No.1:99-CV-1485MHS,2000U.S.Dist.LEXIS14019,at*10(N.D.Ga.Aug.15,2000) (CopyrightInfringementclaimswherenatureofliabilityunder15USC  106necessarilyinvolvedadvertisingasaformofdisplayordisseminationsatisfiedthecausalnexustestbetweenadvertisingactivityandtheenumerated advertisinginjuryoffenseof copyrightinfringement.Thecourtstated:#XDrX#3݌8(#(# Ќ  XXDr8 ` 0 ` ` 0 0h  Inthiscase,theadvertisingitselfinfringedonthecopyrights  allegedlyownedbyCAFbecausetheadsboreimagesofthepatterns....Forthatveryreason,CAFsoughtproductionofInterfacespromotionalmaterials.AstheCourtofAppealsfortheNinthCircuitexplained, theinjuryemanateswithintheadvertisementitselfandrequiresnofurtherconduct.Cahillv. x!$ LibertyMut.Ins.Co.,80F.3d336,339n.3(9thCir.1996).The >"% causalconnectionbetweentheadvertisingactivityandtheadvertisinginjurycouldnotbemoreclear.).#XDrX##'h h   `  0  CoverageDoesNotExist: |% )(#(# L ,Zhh+L 3    `  3k2Z23  0    XXDr GREIns.Group/TowerIns.Co.,Inc.v.CompleteMusic,Inc.,271F.3d711(8th X'"+ Cir.(Neb.)2001) (Atissuewasaquestforindemnificationoflossesincurredin D(#, defendingandsettlingacopyrightinfringementcase.TheEighthCircuitaffirmedthedistrictcourtsdecisionthattherewasnodutytoindemnify.Itreasoned:3k݌ (#(# Ќ  8 ` 0 ` ` 0 0h  TherewasnoevidencethatCompleteMusicadvertisedtheHallanddiscsbynameorthatitsadvertisingencouraged, &,v'1 instructed,orexplainedhowitsfranchiseescouldengageincopyrightinfringement.ItssaleanddistributionoftheHallanddiscstoitsfranchiseesmayhaveledtotheinfringement,buttheinfringementdidnotoccur inthecourseofitsadvertising.See R Sentry.Itwastheplayingofthecopyrightedsongsthat  infringed,andthiscouldhaveoccurredindependentofCompleteMusicsadvertising.).#XDrX#T h h  L -Zhh,L 3   0 ` 0 ` (#` (#32Z23  0 (# (#  XXDr ConstructionManagementSystems,Inc.v.AssuranceCompanyofAmerica,23  V P.3d142(Ida.2001) (TheIdahoSupremeCourtdeniedcoverageforclaimsof  B  copyrightinfringementinconnectionwithallegeduseofarchitecturalplansanddrawingscopyrightedbytheplaintiff.Therehavebeenaplethoraofcasesanalyzingcoverageforarchitecturalcopyrightinfringementclaims.Mosthavegonefavorablyfortheinsured.Thisdidnot.).#XDrX#3@݌^ (#(# Ќ    *!    *! ` BB  .B0   Patent*!? F   (# (# Ќ  *SdTddd Xdd Xdd X(#(#,` dd ,dd +     1. Patent L TypesofPatentClaims! Process   ! Utility     ! Design(289 \  exposureforsale)   p BasesforInfringementLiability!0 $ Direct271(a)-Use;Sale;Manufacture;Offer $  forSale $"$" ! $ Contributory271 # ! $ Inducing271(b) p% _0 $ Inducinguseofaprocessthroughuseofproduct H' madewhichreadsonaprocessunder271(g)#4($"$" #+    + `  F1  .F0    DirectPatentInfringementBased OfferforSale35U.S.C. (x) 271(b)+/ r  d*(#(# Ќ   `  0  CoverageExists: !<,(#(# L .Zhh-L 3    ` 0 372Z23  0 (# (#  XXDr EverettAssociates,Inc.v.TranscontinentalInsuranceCo.,57F.Supp.2d874 #. (N.D.Cal.1999),partial_summ_.judgmentgranted,_summ_.judgmentdenied,141 $ / F.Supp.2d989,994(N.D.Cal.2001),reportedinfullat159F.Supp.2d1196 z% 0 (N.D.Cal.2001) (Whereaninsuredchargedwithpatentinfringementbasedonits @&!1  offerforsaleofgoodsalsoadvertisesitsproductsforsale,thissatisfiesthecausalnexustestbecausetheadvertisementitselfisabasisforliabilityanddamages.Butnoindemnityariseswhereresultingdamageawarddoesnotfallwithintheoffensesof misappropriationofadvertisingideasorstyleofdoingbusinessbecausepursuanttoMaxconn,Inc.v.TruckIns.Exchange,74Cal.App. "*r%6 4th1267,1276(1999)(discussingcoveragefor infringementof...title).37z݌ (#(# Ќ   +&8 8 ` 0 ` ` 0 Theadvertisinginjuryoffenses...consistofcommonanddistinctcategoriesofactionableconduct.Aclaimforpatentinfringementisalsoadistinctlegalclaimgovernedbyavastbodyofstatutoryandcaselaw.Yet,thereisnomentionofpatentinfringementanywhereinthisCGLpolicy.Id.at*27-28.).#XDrX#    `  0  CoverageDoesNotExist: z (#(# L 5[hh.L 3    ` 0 32[23  0 (# (#  XXDr GreenMachineCorp.v.ZurichAm.Ins.Group,No.99-3048,2001U.S.Dist. V  LEXIS13378(E.D.Pa.Aug.24,2001)(unpublishedorder) (Insuredwassued B   forinfringementoffivepatentsandinducementastotwoofthepatents.Theinsurerdeniedcoverageonthebasisthattheclaimdidnotconstituteadvertisinginjury.ThecourtreliedonFrog,SwitchandWinklevossConsultantsInc.v.   FederalIns.Co.,991F.Supp.1024(N.D.Ill.1998),whenitheld,3݌^ (#(# Ќ  8 ` 0 ` ` 0 Patentinfringementthatismadethesubjectofadvertisingisnotinandofitselfanadvertisingidea[ora styleofdoingbusiness]anddeniedcoverage.Id.at*12(quotingFrog,Switch).).#XDrX!#v    +    + `  F2  .F0    InducementofPatentInfringement35U.S.C.271(b)+' r (x(#(# Ќ   `  0  CoverageExists: P(#(# L 0[hh5L 3    ` 0 32[23  0 (# (#  XXDr UnionIns.Co.v.Land&Sky,Inc.,247Neb.696,529N.W.2d773(Neb.1995)  , (Thecourtfoundthatthe advertisinginjuryprovisionsofthepolicycoveringtheoffenseof piracydidnotdefinethislayterm.Inaccordwithdictionarydefinitions,itisdefinedas unlawfulreproductionordistributionofpropertyprotectedbypatentandtrademarklawsor theunauthorizedappropriationoruseofa...patentedwork.Thus, piracycouldbeinterpretedtoincludeadvertisingbasedpatentinfringementclaims.3I݌ (#(# Ќ  ݀0 ` 0 ` (#` (#0 (# (#Land&Skysadvertisementswhichexplainedhowitsflexibleliquidstoragecontainerscouldbeusedaswaterbedmattresses,distributedtowholesalersaswellasretailersviapamphlets,satisfiedthecausalnexusbetweenadvertisingactivityandthe advertisinginjuryoffenseof piracytotriggeradefense.#XDrX#XXDr)#XDrX# "(#(#  `  0  CoverageDoesNotExist: 6"$(#(# L 1&[hh0L 3    `  32&[23  0    XXDr TriClover,Inc.v.DSOSanitarySupplyCo.,Inc.,No.97C1990,2000U.S. $b& Dist.LEXIS9981(E.D.Wis.Mar.31,2000)(unpublishedorder) (Nothingin $N ' thiscasesuggeststhat_TCI_sallegationsofpatentinfringementhaveanythingtodowith_TCI_smarketingstrategiesoradvertisingconcepts.)#XDrXz#34݌&!)(#(#    T'"* L 2Zhh1L 3       `  3 2Z23  0    XXDr TradesoftTechnologies.Inc.v.FranklinMut.Ins.Co.,329N.J.Super.137,151  (N.J.Super.2000) (Wecontinuetoadheretothatviewandconclude,therefore,  thatan offertosellpatentinfringementisnotencompassedbytheadvertisinginjurycoverageofthispolicy).#XDrX #3 a ݌,|(#(# Ќ  L 3Zhh2L 3    `  3 2Z23  0    XXDrUSF&Gv.StarTechnologies,Inc.,935_F. _ԀSupp.1110(D.Or.1996) (Thecourt . foundthatinducementtoinfringemayoccurduringthecourseofStarTechnologiesadvertisingactivities.Id.at1116.Theterm piracywas   ambiguousandwhenconstruedinfavoroftheinsuredcouldencompassinducementtoinfringeapatent.Id.at1114.Thecourtfoundnodutytodefend  l  arose,however,becausetherewasnosuchcausalconnectionbetweenStarTechnologiesadvertisingandtheadvertisingoffenseof piracy.ThegravamenofclaimantWaltersactionwaspremisedonStarTechnologiesmanufactureandsaleofthereconstructionprocessorspriortotheissuanceofthepatent.3  ݌ (#(# Ќ  8 ` 0 ` ` 0 0h  Notably,WaltersComplaintdoesnotallegeinjurybasedonStarTechnologiesadvertisingorattemptstosellthereconstructionprocessors....TheNinthCircuithasrepeatedlyfoundtherequisitecausalconnectionlackingintheabsenceofanallegationinthecomplaintimplicatingadvertisingactivity.Id. ( at1116.).#XDrXR #h h  _+    + `  F3  .F0    Design_ԀPatentBasedonExposureforSale35U.S.C.289+ r P(#(# Ќ   `  0  CoverageExists: (x(#(# _L 6[hh3L 3    ` 0 32[23  0 (# (#  XXDr EKCOGroup,Inc.v.TravelersIndemnityCo.ofIllinois,No.99-236-JD,2000 T U.S.Dist.LEXIS17702(D.N.H.Nov.29,2000),rev.273F.3d409(1stCir. @ 2001) (Thecourtfoundthedesignpatentclaimallegedwassufficientlysimilarto  thetradedressinfringementclaimtopermitareasonableinsuredtoexpectcoverage.ThisfollowsbecauseInfringementofadesignpatentrequiresthatthedesignshavethesamegeneralvisualappearance,suchthatitislikelytodeceivethepurchaserintoconfusingthedesignoftheaccusedarticlewiththepatenteddesign.Likewise,tradedressincludesthedesignandappearanceofaproducttogetherwiththeelementsmakinguptheoverallimagethatservestoidentifytheproductpresentedtotheconsumer.Id.at*33.3a݌$!t#(#(# Ќ   `  Thecausalnexuswasmetbecause:8 ` 0 ` ` 0 Theappearanceoftheteakettleswasaformofadvertisingusedtocallpublicattentiontothekettlesforpurposesofsellingthem.EKCOinfringedChantalsdesignpatentwhentheinfringingkettleswereofferedforsaleandsold.Therefore,thepatentinfringementclaimedinthecomplaintwascaused,inpart,byEKCOofferingforsaleitsteakettlesthatwereadvertisedbyappearancetobeChantalteakettles.Id.at*36.).#XDrX#(j#,    `  0  CoverageDoesNotExist: )%.(#(#   * &/ L 7&[hh6L 3    `  32&[23  0    XXDr EKCOGroupv.TravelersIndemnityCo.,273F.3d409,411and415(1stCir.   2001) (ChantalsaidthatEKCOhaddeliberatelycopiedthewellknowndesign,  features,andpackagingofChantalsteakettle,thattheEKCOversionwasalowqualityreplica,andthattheproductionandsaleoftheEKCOteakettlehaddamagedChantal....NothingintheChantalcomplaintsuggeststhatitwasconcernedwithEKCOsdesignofitsbrochuresorannualreportsorthatthegraphicsortypographywereinventedbyorborrowedfromChantal.ThemisappropriationoffenseschargedbyChantalinitscomplaintwerethephysicalreproductionandsaleofalookaliketeapotbyEKCO.Thatphysicalreproductionandsalewerenotdone inthecourseofmakingbrochuresorannualreports.Thelatterisadvertising,tobesurebutnotwheretheoffenseschargedbyChantaloccurred.#XDrX)#)3݌\  (#(# Ќ  L 86[hh7L 3    `  3 26[23  0    XXDr FantasiaAccessories,Ltd.v.N.Assur.Co.ofAm.,No.01Civ663(AGS),2001 4  U.S.Dist.LEXIS18865,at*17-18(S.D.N.Y.Nov. 20.2001) (Thecourts  p  coverageanalysisfocusedonhowtheintellectualpropertyrightssueduponcameintobeing,not,asrequiredbyapplicablecoveragelaw,whatfactallegationswouldcreateliability.Thecourtreasoned:3  ݌ (#(# Ќ  8 ` 0 ` ` 0 0h  Givingthetermsofparagraphctheirlikelymeaningtoalayperson, misappropriationreferstowrongfullytakingsomething; advertisingideasarethoughtsabouthowtomakethepublicawareofsomething;anda styleofdoingbusinessisthemannerinwhichacommercialenterpriseoperates.Id.at j *33. h h   `  0  ConcedingthatthedamagesmightestablishacausalnexustoFantasiasadvertisingactivities,thecourtdeclinedtoadopttherationaleofBenBergerand 2 PennyPrevillebecauseH(#(# 8 ` 0 ` ` 0 0h  Thosedecisionsequatethedesignofacompanysproductorproducts(i.e.thephysicalappearanceofthegoods)withthecompanys styleofdoingbusiness.Thiswouldincludehowacompanymarketsitsgoods,andalsowouldincludetrademarksortradedress;buttheordinarymeaningofthewordswouldnotincludetheactualphysicalgoodsthemselves.Id.at*8.).#XDrX3!#b #h h  *!    *!( ` BC  .B0   Trademark*!(K( !(F "d% (# (# Ќ   ` 0 McCarthyonTrademarksandUnfairCompetition (3ded.) #<' (Release#2,4/94),pp.25-39,25.05(1)(a):  (# (# XXDr8 ` 0 ` ` 0 TheLanhamActimposesliabilityforinfringementofaregisteredmark &"* uponanypersonwhousesaninfringingmarkininterstatecommerceinconnectionwiththesaleoradvertisingofgoodsorservices.Thisbroaddefinitionincludesanymanufacturer,supplier,dealer,printer,publisher,orbroadcasterwhoinfacthasusedtheinfringingmarkinconnectionwith thesale,offeringforsale,distributionoradvertisingofanygoodsorserviceswhensuchuseislikelytocauseconfusion.#XDrX)#X+&0    ,n'1  `  0  CoverageExists: (#(# L 9F[hh8L 3    `  3W-2F[23  0    XXDr AdolfoHouseDistributingCorp.v.TravelersPropertyandCas.Ins.Co.,165F.  Supp.2d1332(S.D.Fla.2001) (rejectingAdvanceWatchholding,andconcluding x that misappropriationinthepolicyencompassesclaimsoftrademarkandtradedressinfringement).#XDrX-#3W--݌ X(#(# Ќ  L :V[hh9L 3    `  3/2V[23  0    XXDr El-ComHardware,Inc.v.FiremansFundIns.Co.,92Cal.App.4th205,111   Cal.Rptr.2d670,679(Cal.Ct.App.2001) (Tocausecustomerconfusion,   appellantswouldhavehadtocallattentiontotheappearanceoftheirownhandles,andanobviousmethodfordoingsowastodepictthehandlesintheircatalog.Thecatalog,therefore,potentiallyestablishesthat,asusedinthePennFabricationcomplaint,theallegationsof passingoff, palmingoff,and offeringtoselltheinfringinghandleconnoteadvertisingthedisputedhandles....RespondenthadbeforeitsufficientfactstoshowthatappellantstradedressinfringementwascausedbytheadvertisingoftheirhandlesusingtheinfringingtradedressofthePennFabricationhandles.)#XDrX0#3/90݌* (#(# Ќ  L ;f[hh:L 3    `  342f[23  0    XXDr BayElectricSupply,Inc.v.TravelersLloydsIns.Co.,61F.Supp.2d611,619  (S.D.Tex1999)( BayandFAEhaveestablishedthenexuswhichentitlesthemto x adefenseundertheadvertisinginjurysectionofthepolicy.ACBspecificallyalleged importation,marketing,and/orsaleofcircuitbreakersbearingtheinfringingreproductionsoftheConfigurationMarksand/orwhichbearorarepackagedwithinfringingreproductionsofthetrademarkSTAB-LOK...constitutestheuseoffalsedesignationsoforigin...whichislikelytoconfuseordeceivethepublicasthesource,sponsorshipand/orapprovalofDefendantscircuitbreakers.Inessence,BayandFAEwereaccusedoftradingonthegoodwillofACBbymarketingandsellingknock-offcircuitbreakers,therebyinjuringACB.Thecausalnexus,baseduponallegationsinACBsComplaint,isthereforemet.#XDrX5#)344݌8(#(# Ќ  L <[hh;L 3    `  392[23  0    XXDr PoofToyProducts,Inc.v.UnitedStatesFidelity&Guar.Co.,891F.Supp.1228 ` (E.D.Mich.1995) (Theallegationsoftrademarkandtradedressinfringementare L   advertisinginjuriescausedbyanoffensecommittedinthecourseofadvertising[plaintiffPoofToys]goods,productsorservices,andcovered.).#XDrX:#399݌ "(#(# Ќ   `  0  CoverageDoesNotExist: >"$(#(# L >&[hh<L 3!    `  3<2&[23  0    XXDr EKCOGroupv.TravelersIndemnityCo.,273F.3d409,411and415(1stCir. $j& 2001) (ChantalsaidthatEKCOhaddeliberatelycopiedthewellknowndesign, %V ' features,andpackagingofChantalsteakettle,thattheEKCOversionwasalowqualityreplica,andthattheproductionandsaleoftheEKCOteakettlehaddamagedChantal....NothingintheChantalcomplaintsuggeststhatitwasconcernedwithEKCOsdesignofitsbrochuresorannualreportsorthatthegraphicsortypographywereinventedbyorborrowedfromChantal.ThemisappropriationoffenseschargedbyChantalinitscomplaintwerethephysicalreproductionandsaleofalookaliketeapotbyEKCO.Thatphysicalreproduction andsalewerenotdone inthecourseofmakingbrochuresorannualreports.The :+&/ latterisadvertising,tobesurebutnotwheretheoffenseschargedbyChantaloccurred.#XDrXT=#XXDr)#XDrXYA#3<=݌v(#(#   L ?6[hh>L 3"   0 ` 0 ` (#` (#36B26[23  0 (# (#  XXDr CATInternetSys.,Inc.v.ProvidenceWashingtonIns.Co.,153F.Supp.2d755 (x (E.D.Pa.2001) (trademarkinfringementclaim)(Theinsureds,ownersofdomain d nameof magazine.comweresuedbytheownerofthedomainname magazines.comfortrademarkandtradenameinfringement,unfaircompetitionandviolationoftheTennesseeConsumerProtectionAct.ThecourtreliedonFrog j  Switchsstatementthat36BB݌0 (#(# Ќ  8 ` 0 ` ` 0 0h  thisstandardadvertisinginjurypolicyprovisioncoverstrademarkinfringement,becauseatrademark isawayofmarkinggoodssothattheywillbeidentifiedwithaparticularsource. h h   `  0  Id.at760.Ultimately,the courtdistinguishedthedisputefromthatatissuein   FrogSwitch. d (#(# 8 ` 0 ` ` 0 0h  Unlike[Frog,Switch],theTennesseecomplaintdoesallege that > whattheinsuredtookwasitselfanideaaboutidentifyingoneselftocustomers,andthat magazines.com servedasanindicationoforigin.... h h   `    Id.at762.Thecourtheldthattheinsurerhadthedutytodefend.Id.at763.).#XDrXB#  L AF[hh?L 3#   0 ` 0 ` (#` (#0 (# (# 3yI2F[23  0(#(#  XXDr AmericanNatlFireIns.Co.v.MethodsResearchCorp.,No.99C7484,2000 ~ U.S.Dist.LEXIS17748,at*11(N.D.Ill.Dec.5,2000)(unpublishedorder)  j (UnderNewJerseylaw,iftortnotenumerated,notcovered.Ifthepartieshadintendedsuchcoverage,theywouldhavecraftedthepolicytoexpresslyincorporatesuchcoverage.Theinjurytheplaintiffcomplainedofintheunderlyingactionwasnotanadvertisinginjuryandwascommittedlongbeforeanyadvertisingactivityandlongbeforethepolicywasinforce.Thecourtfounditwasthemanufacturingofthecopieditem,nottheadvertisingthatcausedtheallegedinjurytotheplaintiffintheunderlyingcase.Therewasnonexusbetweentheadvertisingandtheinjury.).#XDrX2J#3yII݌"(#(# Ќ  L CV[hhAL 3$    `  3N2V[23  0    XXDr AdvanceWatchCo.v.KemperNatlIns.Co.,99F.3d795(6thCir.(Mich.) L!$ 1996) (heldwhereaninsurancepolicyidentifiesspecificlanguagebasedtorts, 8"% unmentionedproductbasedviolationscannotbethoughtreasonablytobewithinthesamecategory).#XDrXN#3N\N݌#'(#(# Ќ  *!    *![P ` BD  .B0   TradeSecret*![PP kPF z% ) (# (# Ќ   `  !0  AcquisitionR'"+(#(#  `  !0  Disclosureoruse*)z$-(#(#  `    UniformTradeSecretsAct `    3426 +>'0 Ї `    3426.3 `    Damages;royalties `    Definitions... `    3426.1  8 ` (b) Misappropriationmeans:$ t` `  8 `  (1)0` ` Acquisitionofatradesecretofanotherbyapersonwho  L  knowsorhasreasontoknowthatthetradesecretwasacquiredbyimpropermeans;or    8 `  (2)0` ` Disclosureoruseofatradesecretofanotherwithoutexpress   orimpliedconsent...     `  0  CoverageExists: p(#(# L Df[hhCL 3%    `  3HV2f[23  0    XXDr Hameidv.NationalFireIns.ofHartford,114Cal.Rptr.2d843,2001WL L 1654962(Cal.App.2001) (Thecourtfoundthattherewasacausalconnection 8 betweentheinsuredsadvertisingandinjury.ItnotedthatKWPsallegedinjuriesaroseoutofplaintiffsadvertisingactivitybecauseitlostclientsasaresultofBillingtonandHowardssolicitationsofitsclients.).#XDrXV#3HVV݌(#(# Ќ  L Ev[hhDL 3&    `  3YY2v[23  0    XXDr SentexSys.,Inc.v.HartfordAccident&Indem.Co.,882F.Supp.930(C.D. @ Cal.1995),affd,93F.3d578(9thCir.(Cal.)1996) (heldthat misappropriation ,| ofadvertisingideasorstyleofdoingbusinessencompassesthecommonlawtortofunfaircompetitionallegedwheremarketingandsalestradesecretstaken).#XDrXY#3YYY݌ (#(# Ќ   `  0  CoverageDoesNotExist: n(#(# L I[hhEL 3'    `  3\2[23  0    XXDr IDXSystemsCorp.v.EpicSystemsCorp.,165F.Supp.2d812(W.D.Wis. J  2001) (Findingthatthephrase misappropriationofadvertisingideasorstyleof 6!  doingbusinesshadbeeninterpretedunderWisconsinlawtohaveaplainmeaning,thecourtdefinedanadvertisingideaasanideaforcallingpublicattentiontoaproductorbusiness,especiallybyproclaimingdesirablequalitiessoastoincreasesalesorpatronage.Similarly,astyleofdoingbusinessreferstoacompanyscomprehensivemannerofoperatingitsbusiness.Thecourtfoundtherewerenoclaimsfallingwithinthisoffense.).#XDrX&]#3\\݌%.!&(#(# Ќ  L J[hhIL 3(    `  3`2[23  0    XXDr McDonaldsCorporationv.AmericanMotoristsIns.Co.,748N.E.2d771(Ill. '"( App.2001) (Neitherthecomplaintnorthepretrialorderoftheunderlyingsuit |(#) allegedanoffensewhichfellwithinthepolicy.Thecloudontitletheorywasadamagestheory,outsidethecoverageofthepolicy.Eveniftheallegationsofmisappropriationoftradesecretswerealistedoffense,theinsuredwasunabletoshowthatthemisappropriationoftradesecretswascausedbyitspromotionalactivities.).#XDrXa#3``݌^,'.(#(# Ќ  L K[hhJL 3)    `  3d2[23  0    XXDr ZurichIns.Co.v.AmcorSunclipseN.Am.,241F.3d605(7thCir.2001)  (applyingCalifornialaw) (Thecourtaffirmedthetrialcourtsfindingthatthere  wasnocoverageunderthepolicyforcustomersolicitationwithinthemeaningofthe advertisinginjuryoffenseof infringementoftitleunderCalifornialaw,basedonitsviewthatindividualsolicitationsarenotadvertising,relyinguponPeerlessLightingCorp.v.AmericanMotoristsIns.Co.,82Cal.App.4th995,98   Cal.Rptr.2d753(1stDist.2000).).#XDrXd#3dJd݌j (#(# Ќ  L LV[hhKL 3*    `  3g2V[23  0    XXDr TheFrog,Switch&Mfg.Co.v.TravelersIns.Co.,193F.3d742(3dCir.(Pa.)  l  1999) (Plaintiffclaimedthatformeremployeehadmisappropriatedtradesecrets  X  andconfidentialbusinessinformation,includingdrawingsandprintsrelatedtoadipperbucketproductline,unfaircompetitionandpassingoff.Claimsdidnotallegethattheinsuredmisappropriatedanideaaboutidentifyingoneselftocustomers.Courtdeniedcoverage.CitedAppliedBoltingTechnologyProds.,Inc. $t  v.UnitedStatesFidelity&GuaranteeCo.,942F.Supp.1029,1034(E.D.Pa. :  1996)(distinguishingbetweentakinganadvertisingideaandadvertisingfalsely)).#XDrXNh#3gh݌ (#(# Ќ  L Mf[hhLL 3+    `  3l2f[23  0    XXDr WinklevossConsultants,Inc.v.FederalIns.Co.,991F.Supp.1024,1038(N.D. b Ill.1998) (holdingthatthebroadestreadingofmisappropriatingadvertisingideas N isthattheinsuredwrongfullytookanideaaboutthesolicitationofbusinessandfindingnocoverage).#XDrXl#3lEl݌.(#(# Ќ  *!    *!Qn ` BE  .B0   OtherAdvertisingInjury/PersonalInjuryCoverageCases*!Qnn anF  (# (# Ќ   `  1.0  XXDr LockwoodIntl,B.V.,etal.v.VolmBagCo.,273F.3d741(7thCir.(Wis.)2001)  h (Thecourtfoiledtheinsurersexitstrategyofpaying$1.5MtoplaintiffsforfilinganAmendedComplaintthatwoulddeletecoveredclaims.Thecourtsummarized, Wehavedifficultyimaginingamoreconspicuousbetrayaloftheinsurersfiduciarydutytoitsinsuredthanforitslawyerstoplotwiththeinsuredsadversaryarepleadingthatwillenabletheadversarytomaximizehisrecoveryofuninsureddamagesfromtheinsuredwhilestrippingtheinsuredofitsrighttoadefense....Id.at744.Thecourtfoundthatcontinuingcoveragearoseeventhoughthe H  plaintiffssoughttoeliminatefactallegationsthatwouldtriggeradefense.Thecourtsaid, [S]everalofthetheoriesofliabilityassertedinitsoriginalcomplaint(theonesmostlikelytoinvolvedisparagementorsolicitation),suchastortiousinterferenceandunfaircompetition,andthuslikelytobecoveredbythepolicythatNorthRiverhadissuedtoVolm(id.at746)survivedasbasesofliabilityunder "&% theamendedpleading.Thus,thecourtfoundthattheallegationsthatVolm [disparaged]Lockwoodanditsproducts(evenspreadingfalserumorsaboutLockwoodsfinancialsolidity),bysolicitingpurchasesofLockwoodproductsandthensubstitutingknock-offsofthemmanufacturedbyManter,andbywarningcustomersthatLockwoodmachinesinfringedaVolmpatent(acquiredbyfraud,thecomplaintalleged)!hadinducedcustomersforweighingandbaggingmachinestoswitchtheirordersfromLockwoodsmachinestoManters(id.at743) @(#, triggeredcoverage.).#XDrXo#)V$-(#(#  `  2.0  XXDr Flodinev.StateFarmIns.Co.,No.99C7466,2001U.S.Dist.LEXIS2204,at *&/ *3233(N.D.Ill.Mar.1,2001)(unpublishedorder) (Holdingthatclaimsunder +&0 IllinoisConsumerFraudandDeceptiveBusinessPracticesActwerecoveredbecausetheoccurrencewasallegedlycommittedinthecourseofadvertising.Thecourtstated, TheunderlyingcomplaintallegesthatHo-ChunkandNAAwereharmedwhenFlodinesgoodswereadvertisedandmarketedinawaythatfalselysuggestedthatthegoodswereIndian-made.ThisfalsesuggestionoccurredinthecourseofPenneyspublicpromotionofFlodinesproducts,whichisallegedtohaveincludedadvertisinganddisplayinthePenneyscatalogue.EvenifthecourtdisregardstheadvertisingofFlodinesgoodsconductedbyPenney,itcouldstillfindcoveragearisingfromFlodinesadvertisingactivity:attachingtagstogoodsthatpresumablywouldbedistributedtostoresanddisplayednationwide.ThecourtneednotapplythebroadestpossibledefinitionofadvertisingtofindthatFlodinesallegedoffensesoccurredinthecourseofadvertisingherproducts,becausethetagsfunctionedasmini-adsthatweretiedtotheproducts,clearlypromotionalinnatureyetdistinctfromtheproductsthemselves.).#XDrX`w# (#(# h@     h@}@VII  .@0 `   TIPSFORCOVERAGESAVVYIPCOUNSELh@}E} }B p ` (#` (# Ќ  *!    *!L~ ` BA  .B0   DefenseCounselShouldNotEliminateCoveragebySeekingtoDismiss H  PotentiallyCoveredClaims*!L~~ \~F 4 (# (# Ќ   ` 0 XXDr WinklevossConsultants,Inc.v.FederalInsuranceCo.,11F.Supp.2d995,998-999  \ (N.D.Ill.E.D.1998) (TheCourtfoundWinklevossmadefalsestatementstosteercustomers " awayfromLynchvalsproduct.Winklevosspromotionalmaterialsfalselyadvertisedcapabilitiesofitssoftware,drewadversecomparisonstoLynchvalssoftware,andmadefalsecomparativestatementsaboutthespeedofitssoftware.Suchclaimssatisfiedthelaymansdefinitionof disparagement.ThecourtalsofounddismissalofunderlyingactionsCountforcommonlawproductdisparagementdidnotridthecomplaintofallallegationswhichmayfitwithinthecoveredoffenseof disparagement.However,itfoundthatfactualallegationsintheamendedpleadingdidnotrelatebacktothefirstpleadingsoastoprovideadefenseunderit.).#XDrX#V (# (# *!    *! ` BB  .B0   FailuretoTenderMayBeLegalMalpractice*!( F  (# (# Ќ   `  1.0  XXDr[YES]: JordacheEnterprises,Inc.,v.Brobeck,Phleger&Harrison,etal.,18 ! Cal.4th739,764,76Cal.Rptr.2d749,774(Cal.1998) (Implicitfindingthatit | " ismalpracticetonottender.WhilethecourtinDarby&Darbyruledthatalawyersdutytoadviseclientofavailablecoveragewasnotverybroad,herethecourtruledthatJordachehadsustainedactualinjurymorethanayearbeforesuitwasfiled,inunpaiddefensecostsinthirdpartysuit.JordachesinjurieswerenotspeculativeorcontingentuntilthetrialcourtruledtheinsurershadadutytodefendJordacheandJordachesettleditscoverageclaims.).#XDrXj#$%t ((#(#  `  2.0  XXDr[NO]: Darby&Darby,PCv.VSIInternational,Inc.,268A.D.2d270,272,701 &&"* N.Y.S.2d50,51(N.Y.App.Div.2000) (Thecourtconcludedthatalawyersduty '#+ toadvisehisclientastoallavailablecausesofactionoravenuesofdefensedoesnottranslateintoabroaddutytoinquireintoalloftheclientsinsurancecoverage.Furthermore,sincethedefendantsthemselvesprocuredthegeneralliabilityinsurancepolicy,theywerechargeablewiththeknowledgeofwhetherthatinsurancecoveredthependinglitigation.Resultmaydifferwherepotential +&0 coveragefortrademarkinfringementclaimwaswidelyknowntotheIPpractitioner.).#XDrX#v(#(# *!    *!Ӌ ` BC  .B0   LitigantsCanEliminateorCreateCoverageforthePartySued*!Ӌ  F (x (# (# Ќ   ` 0 XXDr SeverinMontres,Ltd.v.YidahWatchCo.,etal.,USDC,C.D.Cal.,No.97-6985KMW  P (MANx) (Lyon&Lyoninitiallyfiledacomplaintforcopyrightinfringement,federalunfair   competition,includingtradedress,etc.,whichtriggereddefenserightsforthepartiessued.Followingcostlylitigation,Guccigaveitscounselpermissiontoamenditscomplainttolimitthereliefsoughttoprecludeanylikelihoodthatthedefendantwouldobtaincoverage.Itachievedthisgoalbyfailingtoseekanyreliefotherthananinjunctionandmodifyingtheprayertoonlystate, Thatplaintiffshavesuchotherandfurtherreliefasthecourtmaydeemjustandequitable(exceptmonetarydamages,whichareforeverwaived).Followingtheamendment,theinsurerwhichhadbeenprovidingadefensetoYidahWatchCo.promptlywithdrewitsdefense.).#XDrXT#J  (#