Insurance Hot Potato in Ferguson, Missouri

     CLAYTON, Mo. (CN) — An insurance company sued Ferguson, Mo., saying it has no obligation to defend the city from a class action accusing it of jailing people who don’t have the money to pay traffic tickets and other minor fines.
     The St. Louis Area Insurance Trust (SLAIT) also sued 11 class-action plaintiffs, seeking declaratory relief in St. Louis County Circuit Court. The 11 filed a federal class action against Ferguson in February 2015.
     Keilee Fant et al. claim Ferguson’s jailing them for minor offenses and poverty violated their right to due process. They said Ferguson jailed them without appointing appropriate counsel, subjected them to deplorable conditions in jail and violated other constitutional protections.
     Ferguson filed a claim seeking defense and indemnity. The insurance trust rejected it, and sued on June 29.
     “Based upon the foregoing policy language and allegations made in the Class Action, coverage under the Insurance Policy is not triggered because the constitutional claims asserted in the First Amended Petition do not identify damages because of ‘bodily injury’, ‘personal injury’ or ‘acts, errors or omissions’ for purposes of the Insuring Agreement set forth in Paragraph A of Section II of the insurance policy,” the complaint states. “More specifically, those allegations do not involve ‘bodily injury’, ‘personal injury’ or ‘acts, errors or omissions caused by an ‘occurrence’ as those terms are defined in section I of the insurance policy.”
     The insurer says even if Ferguson can argue that the class claims can be construed as bodily injury, personal injury or acts, errors or omissions, they are barred by other policy exclusions.
     “These provisions specifically exclude coverage for damages ‘expected or intended from the standpoint of any insured’, ’caused by any dishonest, fraudulent, criminal or malicious act or omission of any insured’ and state that plaintiff has no obligation ‘to investigate, defend or pay any damages, judgments loss, costs or expenses that may be awarded in a class action against any insured because of bodily injury, … personal injury, … errors or omissions injury,'” the complaint states. (Ellipses in complaint.)
     SLAIT seeks declaratory judgment and an injunction stating that “Ferguson and the class action claimants shall be barred forever and enjoined from asserting any action against plaintiff SLAIT on account of the claims and/or damages alleged by the class action claimants in their class action.”
     It is represented by Martin Buckley with Buckley & Buckley in St. Louis.
     The class action was filed after of the Michael Brown shooting in August 2014. Brown, an unarmed black man, was killed by then-Ferguson police Officer Darren Wilson, who is white. The shooting sparked months of often violent protests and brought racism and excessive police force by police into the national conversation.
     The Department of Justice declined to bring charges against Wilson, but released a scathing report against March 2015, accusing Ferguson police of targeting black citizens and using its municipal court as a revenue generator.
     Ferguson avoided litigation by approving a settlement with the Justice Department in March, requiring massive overhauls in its police department and municipal court system.

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