WFS Financial, Inc. v. Progressive Casualty Insurance

MEMORANDUM **

Appellant WFS Financial (“WFS”), an automobile financing company, appeals the district court’s dismissal of its complaint for breach of contract, breach of duty of good faith, and declaratory judgment seeking indemnity for two claims made under two successive claims-made policies, both issued by appellant Progressive Casualty Insurance Co., Inc. (“Progressive”). We affirm.

WFS’s claims sought indemnity for two separate class action lawsuits alleging that WFS’s practice of permitting independent automobile dealers to mark up interest rates based on subjective criteria was discriminatory to minority applicants. The first claim, involving the Lee class action in federal court, was made during the first claims-made policy period; the second claim, involving the Thompson class action in California state court, was made during the second claims-made policy period.

Both policies include the following limitation of liability:

The district court correctly held that WFS’s second claim involved an “Interrelated Wrongful Act” to the act set forth in the first claim. Therefore, the second claim was subject to the policy limits of the first policy. “Interrelated Wrongful Acts”…