ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Wednesday, August 1, 2018

Harvey Weinstein's insurance policies

Yet another contract aspect has emerged to the Harvey Weinstein situation, beyond the NDAs with the accusers, the contracts between lawyers and private investigators, and the complicated situation with the National Enquirer. Now insurance policies have stepped into the fray. According to this article, Weinstein's insurance companies are denying coverage based on alleged exclusions of "blatantly egregious and intentionally harmful acts." Weinstein, as his defense has stated, denies the accusations against him and counters that the insurance companies are siding with the accusers in order to get out of paying their obligations. 

According to the insurers, Weinstein is facing eighteen lawsuits and other claims that have been filed in the past year. Naturally, Weinstein's defense is costing a great deal of money. Whether the insurance companies need to pay out under the policies (and which insurance companies need to pay out) probably depends on the exact wording of the policies, which seem to all be slightly different. For instance, one carrier was providing "crisis assistance" in the event of "significant adverse regional or national media coverage." Another was apparently a policy for legal defense that according to Weinstein explicitly included criminal investigations.

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It is quite common for professional liability insurance policies to exclude coverage for personal conduct, intentional or willful conduct. Some will nevertheless cover defense expenses. These exclusions are supported by strong public policy that one cannot insure (avoid personal liability for) intentional misconduct. If colleagues really wanted to bring this point home, they might get language from legal malpractice policy.

Posted by: Judith Maute | Aug 1, 2018 8:38:50 PM

The insurance coverage is fascinating for those in the know about insurance. If Harvey's acts were in furtherance of his company business, then the directors and officers insurance might cover it. But it is very hard to say that having sex with actresses is part of his job description as producer and company officer, and the company denies this was part of the job. Also, having sex with the producer or director cannot possibly be a bona fide occupational qualification to overcome a sexual discrimination claim. That means Harvey's acts were outside the course and scope of his duties. The company's directors and officers insurance carrier then has good reason to deny the claim.

If the job description, or the board's knowledge and acquiescence of such conduct allowed this in furtherance of the company's business, then the directors and officers insurance should cover the defense, until we know if this was an intentional or expected harm, as sexual assault has been determined by all courts.

That leaves Harvey to seek insurance coverage under his personal insurance, specifically his umbrella insurance policies. That works except: (1) sexual assault is by definition an intentional act, and thus not insured. (2) he was discussing the prospective movie the actress or writer was auditioning, and thus this was a business pursuit and excluded in the personal insurance.

The directors and officers insurance, and his personal umbrella insurance, are likely to provide crisis management assistance as an extra coverage. That

Posted by: Harold Weston | Sep 24, 2018 12:51:14 PM