In Westport Ins. Corp. v. Sycamore Community Unit School District #427, 2021 WL 3674614, BatesCarey attorneys Adam Fleischer and Lindsey Dean obtained a ruling that BatesCarey’s insurer client owed no duty to defend or indemnify in connection with an underlying sexual abuse claim. In granting judgment on the pleadings to BatesCarey’s client, the United States District Court for the Northern District of Illinois enforced the notice condition in BatesCarey’s client’s policies.

In 2003, the School District allegedly became aware of inappropriate sexual contact between an athletic trainer and a student. Even though the School District’s liability insurance policies required the School District to provide notice to BatesCarey’s client of an occurrence that may result in a claim, the alleged sexual contact was not reported to the insurer at the time of the incident. In 2019, the student sued the School District and its alleged former employee. The School District then provided notice to BatesCarey’s client. BatesCarey’s client denied coverage and filed a declaratory judgment action.

The U.S. District Court for the Northern District of Illinois held that a reasonable school district should have known that sexual contact between a student and a staff member may result in a claim. Accordingly, there was no coverage available for the School District because the School District’s 16-year delay in providing notice violated BatesCarey’s client’s policies’ notice condition. The court also concluded that the allegations against the alleged former employee fell squarely into an exclusion for criminal and dishonest acts. Accordingly, the court granted BatesCarey’s client’s motions for judgment on the pleadings, and denied the motions filed by the School District and its alleged former employee.