Arch Specialty Insurance Company v. University of Southern California

I. BACKGROUND

This insurance coverage action concerns two policies for excess healthcare professional liability coverage Arch issued to USC for the policy periods of July 1, 2016 to July 1, 2017 and July 1, 2017 to July 1, 2018. (Dkt. 1, Complaint ¶ 9.) Each policy provides USC with $10 million of coverage, in excess of $100 million in underlying coverage per claim, provided by several different insurance carriers. (Id. ¶ 10.) The policies include an Abuse or Molestation Exclusion, which bars coverage to any “claim” or “loss” that alleges “[i]njury or damages that in any way, in whole or in part, arises out of, relates to or results from ‘abuse or molestation.’” (Id. ¶ 1, 9, Ex. A & B.) Arch alleges that in May 2018, USC learned that the Los Angeles Times planned to run a story accusing USC of allowing one of its physicians, Dr. George Tyndall, to continue practicing as a gynecologist in the Student Health Center, despite multiple accusations of repeated misconduct toward young patients “over many years.” (Id. ¶ 1.) Arch alleges that once USC’s insurance broker, Chivaroli, “recogniz[ed] that lawsuits were sure to be filed in the wake of this story,” Chivaroli “suddenly…