A company which reached a $28 million settlement in a Telephone Consumer Protection Act lawsuit has filed a suit of its own, alleging that its insurance companies are not paying up to cover the costs of the settlement.
Monitronics reached the settlement last year after it was accused of contacting individuals who had placed their phone numbers on the Do Not Call registry as well as contacting individuals by using an automated telephone dialing system to try and sell home security systems. The plaintiffs in the case were due to receive $38 each while the plaintiff’s attorneys are splitting $10 million.
In a lawsuit that was filed earlier this month, Monitronics is alleging that three insurance companies — Everest Indemnity Insurance Co., Navigators Specialty Insurance Co., and AXIS Surplus Insurance Co. — for refusing to indemnify Monitronics and cover the settlement.
Monitronics is alleging all three carriers have breached their contracts with the company, and it is seeking declaratory relief.
Two of the three carriers are arguing that they do not have to pay out the claim in the event that either Monitronics knowingly violated the rights of another or if the company made false, misleading, deceptive, fraudulent or misrepresenting statements.
How courts are interpreting the TCPA continues to be like a football bouncing on the ground — you never really know which way it’s going to bounce. And if companies that reach settlements are not going to be protected by the insurance policies they have in place for specifically this kind of development, then plaintiff’s attorneys are going to have a field day filing more lawsuits because companies are going to lack an important source of protection against these kinds of incidents.
