Employee's Illegitimate Acts Insured
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Duty to Defend and Indemnify Inviolate\\n\\nFour insurers (collectively, the appellants) appealed the district \\ncourt\'s order finding they are required to provide insurance coverage \\nfor an incident at Hampton Inn-Albany, a hotel owned by Albany Downtown \\nHotel Partners, LCC (Albany), and managed by Banyan Tree Management, LCC\\n (Banyan). The four insurance companies-Citizens Insurance Company of \\nAmerica and Massachusetts Bay Insurance Company (collectively, Hanover),\\n Westfield Insurance Company (Westfield), and Starr Indemnity \\n&Liability Company (Starr)-issued commercial general liability \\ninsurance to Banyan and Albany.\\n\\nIn Citizens Insurance Company Of America, Massachusetts Bay Insurance \\nCompany, Westfield Insurance Company, Intervenor v. Banyan Tree \\nManagement, LLC, Albany Downtown Hotel Partners, LLC, Jane Doe, Starr \\nIndemnity &Liability Company, No. 22-13581, United States Court of \\nAppeals, Eleventh Circuit (September 28, 2023) the Eleventh Circuit \\naffirmed.\\n\\nFACTS\\n\\nIn 2015, an employee of Hampton Inn-Albany secretly recorded a hotel \\nguest while she was showering in the hotel bathroom. Years later, the \\nvideo was circulated, and the guest sued Banyan and Albany for \\nnegligence, premises liability, and vicarious liability, alleging she \\nsuffered emotional and subsequent physical injury (Underlying \\nComplaint). Banyan and Albany subsequently sought coverage from their \\ninsurance providers, who disputed their duty to cover this injury, \\nprimarily arguing that the Underlying Complaint did not include \\nallegations of "personal and advertising injury" arising out of Albany\'s\\n "legitimate business," and that their policy exclusions precluded \\ncoverage.\\n\\nDISCUSSION\\n\\nGeorgia law makes clear that ambiguities are to be resolved in favor of \\nthe insured noting that if the policy exclusions are ambiguous, the \\npurported reservation of rights must be construed strictly against the \\ninsurer and liberally in favor of the insured.\\n\\nThe appellants failed to even make a showing of ambiguity, let alone \\ndefinitively establish that the Underlying Complaint falls outside their\\n policies or that an exclusion precludes coverage. The Eleventh Circuit \\nfound unpersuasive the arguments that the hotel guest\'s right to privacy\\n was not violated, and that the recording did not arise out of Banyan \\nand Albany\'s business.\\n\\nWhile filming a showering guest is clearly not a "legitimate" hotel \\npractice, when a hotel employee-who would not have had access to the \\nroom but for his authority-places the camera in the bathroom and \\ncirculates the video, the injury was undoubtedly imputed to the hotel.\\n\\nAccordingly, the Eleventh Circuit affirmed the district court\'s \\ndecision.\\n\\nZALMA OPINION\\n\\nHotel employees should not have the access to film a guest while she \\nshowered and then distribute the video to the world as she, believing \\nshe was taking a private shower, was clearly an illegitimate hotel \\npractice performed by an employee who was given access by the hotel to \\ninclude a camera where the victim showered. No exclusion applied and \\ncoverage was clearly applicable.\\n\\n(c) 2023 Barry Zalma & ClaimSchool, Inc.\\n\\nPlease tell your friends and colleagues about this blog and the videos \\nand let them subscribe to the blog and the videos.\\n\\nSubscribe to Excellence in Claims Handling at locals.com at \\nhttps://zalmaoninsurance.locals.com/subscribe or at substack at \\nhttps://barryzalma.substack.com/publish/post/107007808\\n\\n\\nGo to Newsbreak.com\\xa0 https://www.newsbreak.com/@c/1653419?s=01\\n\\n\\nFollow me on LinkedIn: \\nwww.linkedin.com/comm/mynetwork/discovery-see-all?usecase=PEOPLE_FOLLOWS&followMember=barry-zalma-esq-cfe-a6b5257\\n
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