Insurance Coverage and Bad Faith

On June 17, 2022, Houston Harbaugh obtained judgment on the pleadings for The Charter Oak Fire Insurance Company when the U.S. District Court for the Middle District of Pennsylvania held that the related prior acts clause in the public-entity employment-related practices liability coverage (“EPL”) precluded coverage. Attorneys Alan S. Miller and Jake Oresick represented Charter Oak.

In Slaughter v. The Charter Oak Fire Ins. Co. (4:21-cv-1284), the City of Williamsport switched insurance carriers, from State National to Charter Oak, at the beginning of 2019. In 2021, the City was sued by Steven Helm, a lieutenant in its police department, who alleged that the City denied him promotions in retaliation for his prior lawsuits against the City filed in 2017 and 2018 seeking relief for violations of his First Amendment rights of association. Both Charter Oak and State National denied coverage for Helm’s 2021 suit, and the City filed a declaratory judgment action.

Houston Harbaugh moved for judgment on the pleadings, arguing that there was no coverage under the Charter Oak policy for suits involving “related employment practice offenses” first brought prior to the coverage period. Houston Harbaugh argued that the 2021 suit alleged employment loss involving “related employment practices” was deemed to have been first brought against the City in the 2017 lawsuit and thus before the inception of the Charter Oak Policy. Chief Judge Matthew W. Brann agreed that “Helm’s 2017 and 2018 suits qualify as ‘related’ to his 2021 claims,” and granted Houston Harbaugh’s motion for judgment on the pleadings. The court also entered judgment on the pleading for State National, but on other grounds.