About plushq

The Professional Liability Underwriting Society (PLUS) was founded in 1986 by industry professionals who recognized the need for a forum for individuals involved in the field of professional liability. The Society is a non-profit organization with membership open to persons interested in the promotion and development of the professional liability industry. Membership consists of over 6,500 individuals, representing over 1,000 companies active in the many fields of professional liability. PLUS currently receives the support of more than 200 companies through corporate membership. PLUS is recognized as the primary source of professional liability educational programs and seminars, assistance to its members to help serve clients, and information regarding professional liability. The Society is continually seeking new means to fulfill its mission statement and better serve its members.

Intellectual Property Insurance Webinar Q&A Follow Up

We had so many great questions come in during our Intellectual Property Insurance webinar earlier this month and the speakers were gracious enough to spend some time putting together answers to some of those questions we were unable to address live.

1. Briefly discuss IP exclusions on the Cyber form.

IP related losses are generally excluded from Cyber coverage.

However, some carriers are willing to cover losses relating to contractual indemnity obligations in the event that an Insured loses a third party’s trade secret information due to a cyber incident.

2. Can you talk specifically about policies designed to cover only trademarks? Many small companies have logos and firm names similar to larger unrelated companies and want protection from litigation.

A good defensive IP policy is designed to be flexible and is customized for each buyer so that it covers only what the Insured wants to protect.  For example, a company that wants to protect certain brand-related IP assets can schedule only those assets and thus customize the defensive IP policy to apply exactly to what they are trying to protect.

3. Insured is selling a water bottle on their website that they co-designed and imported from Chinese Manufacturer. Being accused of patent infringement for water bottle design. 

What type of policy do they need to protect them against claims such as this? 

They may be able to protect against catastrophic loss in the ongoing suit by purchasing a specific contingency policy. A defensive policy will provide protection against future infringement claims.

4. Is there still a typical “vetting” fee upfront before firm quote can be received?

There are carriers available that can usually provide an initial quote without charging a fee, However, when special protections are requested, such as defense against claims of trade secret misappropriation, an initial underwriting fee may be required.

5. Do you need a lawyers confirmation there is no infringement before insuring?

No, IP underwriters typically rely on in-house analysis and bring in outside counsel on an as-needed basis.

6. What about indemnity to a customer for infringement claims he may face from use of a product?

A defensive IP policy protects an alleged infringer against such claims.  The entity that is concerned that they will be alleged to infringe can obtain a defensive IP policy to protect itself or can request a contractual indemnification from their suppliers.

A component of a good defensive IP insurance policy is a contractual indemnification backstop, which can protect such a supplier from losses related to such contractual indemnity obligations.

In conclusion, there are two ways to solve for this problem, both of which allow for risk transfer through a defensive IP policy.

7. How often do the carriers get involved in the valuation of the IP? How/how often?

Underwriters of defensive IP insurance are concerned with the potential losses that will be covered by such a policy, including defense costs, damages from infringement claims related to products or services, and contractual indemnification obligations.  While damages from infringement claims related to products or services require an understanding of the value relating to such products or services, defensive IP underwriters do not value IP assets.

Residual value insurance is a different type of IP insurance that was not the subject of this webinar.  Residual Value underwriters will conduct an exercise to value IP assets as part of their underwriting process.

Did you miss the live webinar? PLUS members can access the on-demand recording here.

Thank you again to our speakers!

Dan Auslander headshot

 

Dan Auslander
Director of Marketing & Development at Ambridge Partners

 

 

 

Sean Doyle headshot

 

Sean Doyle
Intellectual Property Counsel at Ambridge Partners

 

 

 

Douglas Kine headshot

 

Douglas Kline
Partner, Chair IP Litigation at Goodwin

 

 

 

Jason Sandler headshot

 

Jason Sandler
Vice President at Marsh FINPRO

Midwest Chapter Hosts Future PLUS Social at Whirlyball

Last Thursday, February 28, was the Midwest Chapter’s Future PLUS social at Whirlyball. Over 60 young insurance professionals in the Chicago area enjoyed food, drinks and “Whirlyball,” a combination of dodge-cars and whiffle-ball.

Thank you to all the attendees for making this event a success! Help the Midwest Chapter host events like this one and more by becoming a sponsor in 2019. For more information, visit the PLUS website here.

Thank You Sponsors (as of 3/8/19):

PLATINUM

AmWins Brokerage of the Midwest

CNA

ECC Insurance Brokers, Inc.

Great American Insurance Group

RT Specialty – Chicago

Traub Lieberman Straus & Shrewsberry, LLP

 

GOLD

Argo Pro

Founders Professional

Kaufman Dolowich & Voluck, LLP

Markel Corporation

Philadelphia Insurance Companies

Socius Insurance Services, Inc.

USLI

 

SILVER

Aronberg Goldgehn

Beazley Group

Berkley Select

Burns & Wilcox

General Reinsurance Corporation

Maxum Specialty Insurance Group

Pretzel & Stouffer, Chartered

Interview on the SEC Whistleblower Program: Rising Claims in 2019?

In this audio post, Justin Kudler interviews Thomas Sporkin about the SEC Whistleblower Program and potential rising claims resulting from this area. Tom is a partner at Buckley LLP in Washington, DC.  Before joining Buckley, Tom held several positions at the SEC, including serving as Chief of the Office of Market Intelligence, where he oversaw the formation of the Whistleblower Program.

As Justin introduces in the interview, the SEC’s Whistleblower Program hopes to find people who know of possible securities law violations, and is authorized to reward those people with monetary awards.  The program recently published its annual report to Congress for Fiscal Year 2018, and it contains some interesting information. For example, the SEC has awarded over $326 million to 59 whistleblowers since the beginning of the program approximately 7 years ago, and it awarded more than $168 million to 13 individuals in Fiscal Year 2018.  With these types of numbers, it is fair to speculate that claims in this area could be rising.

Listen to the interview in full below, and read the full SEC Whistleblower Report to Congress here. Thank you to both Justin and Tom for their time and expertise.

justin.headshotJustin Kudler is Assistant Vice President, Claims at AXA XL in Hartford, where he handles professional liability claims under directors and officers, errors and omissions, and other insurance policies issued to financial institutions and publicly traded companies.  Before joining AXA XL in 2006, Justin defended individuals in Securities and Exchange Commission investigations, as well as litigated complex insurance matters and securities and consumer class actions, at a major Boston law firm.  He also has represented plaintiffs in federal securities class actions.  Justin recently co-authored an article for the Third Quarter 2018 edition of the PLUS Journal on federal judicial vacancies, and he regularly speaks at industry conferences and writes articles on insurance, claims, securities, and class action issues.

Sporkin_Thomas_bioTom Sporkin is a partner at Buckley LLP where he represents individuals and entities in matters before the Securities and Exchange Commission.  Prior to joining Buckley Firm, Tom spent 20 years with the Division of Enforcement of the SEC, where he was one of the leaders who oversaw its Dodd-Frank whistleblower rule-writing and subsequent launch of its Office of the Whistleblower. Tom was also Chief of the Office of Market Intelligence, where he had primary responsibility for vetting all whistleblower tips and other intelligence received by the SEC, and oversaw a multidisciplinary staff of more than 50 senior enforcement attorneys, accountants, market-surveillance specialists, and analysts tasked with investigating potential violations of the federal securities laws. Today, Tom specializes in representing executives who report matters to the SEC pursuant to the whistleblower rules, and helps companies deal with sensitive whistleblower issues.