Western International Syndication Corp. v. Gulf Insurance

MEMORANDUM **

In December 2002, the Apollo Theater Foundation (“Apollo”) initiated a lawsuit (“Underlying Action”) against Western International Syndication Corporation (“Western”) in the Southern District of New York. Apollo alleged that Western had embarked on a systematic campaign of misconduct, inter alia making misrepresentations concerning Apollo’s television program, “It’s Showtime at the Apollo” or “Showtime at the Apollo” (“Apollo Show”), and using Apollo’s trademarks in connection with a competing program. On March 8, 2004, Western notified Gulf Insurance Company (“Gulf’) 1 of the Underlying Action and requested defense and indemnity pursuant to a commercial lines insurance policy (“the policy”) that Gulf had issued to Western. When Gulf refused to provide a defense, Western filed this declaratory action in state court, and Gulf then removed to federal court.

The District Court held, inter alia, that Gulf had a duty to defend Western against Apollo’s deceptive acts and practices claim under New York law, see N.Y. Gen. Bus. Law § 349 (McKinney 1984), and that, because Gulf failed to show any prejudice, the insurer could not avoid liability based on Western’s late…