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video-game-retro-1398289137-300x150In the last few years, the video game industry has been hit with lawsuits accusing certain games of fostering addictive behaviors, especially among younger players. These lawsuits often cite features like loot boxes, microtransactions, and reward systems, which are designed to enhance player engagement, as in-game mechanisms that push players toward compulsive play and psychological harm. Plaintiffs claim that game developers either knew or should have known about these potential risks and failed to mitigate them.

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A recent decision by a California appellate court in Practice Fusion, Inc. v. Freedom Specialty Insurance Company, denying the policyholder more than $118 million in Directors & Officers liability coverage based on an expansive professional services exclusion, is a sobering reminder that this nettlesome exclusion—when over-broadly applied, as was the case here—may render your D&O coverage worthless. The mere fact that Practice Fusion’s insurers asserted this exclusion in the circumstances of this claim should remind brokers and risk managers of the importance of eliminating, or at least narrowing, professional services exclusions where there is any potential argument that the insured is engaged in providing any form of “professional services.” Although it is of course appropriate to fill any gaps created by the exclusion with commensurate Errors & Omissions coverage, E&O policies do not provide the same scope of coverage, or even limits, that are available under D&O policies.

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GettyImages-1302089727-300x200In recent months, the United States-Mexico border has seen an unprecedented surge of migrants. With this wave, various state and local authorities across the nation have expressed a strain on their public resources and housing capacities. To relieve overwhelmed border towns, Texas Governor Abbott initiated a migrant relocation plan to bus migrants to certain “sanctuary cities” like New York, Washington, D.C., Chicago, Philadelphia, Denver and Los Angeles.

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In recent years, corporate directors and executives have faced challenges from conservative groups opposed to corporate diversity, equity and inclusion initiatives, with some efforts taking the form of shareholder litigation.

The U.S. Supreme Court’s recent decision overturning the use of affirmative action in university admissions provides new ammunition for these claims and is likely to embolden potential claimants.

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GenAI-insurance-1483272785-300x169Generative AI is transforming our economy in previously unimagined ways, with Goldman Sachs estimating a $7 trillion (7%) increase in global GDP by virtue of this ecosystem. Insurance is but one sector that will be impacted, with new products, services and opportunities for efficiencies being the most obvious benefits. For insight into the insurance implications of this technology, we asked AI oracle du jour ChatGPT-4 the top three ways it believes generative AI will impact policyholders.

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GettyImages-173203881-gavel-300x200Last month, we discussed a decision by the Northern District of Illinois finding an amount labeled “restitution” in a settlement between a pharmaceutical company and the DOJ was insurable loss under a D&O policy. Shortly after that post, the New York Court of Appeals reached a similar conclusion, continuing the trend of looking beyond the labels used for the payments in the underlying settlement agreement. In rejecting the insurers’ argument, the court evaluated the purpose of the payments and the nature of how they were derived to find the payments at issue were insurable under a Professional Liability policy, despite being called “disgorgement.”

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potholes policiesAs summer comes to a close, road repair crews across the country are identifying the street repairs and potholes that must be filled before the cold weather approaches. Now is also a good time for policyholders to identify some of the “potholes” that may accompany their claims-made insurance policies and get them filled before it is too late.

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Feeling wired about risks arising from the Telephone Consumer Protection Act? Maybe you should. The TCPA subjects businesses that use text messaging, auto-dialing, and bulk faxing for advertising and marketing to potential class action litigation. Financial institutions, various supermarket chains, and recently Caribou Coffee have all been targeted in TCPA class actions. But policyholders who get static over such claims are not without recourse: several lines of liability insurance may answer the call.

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