Federal Can't Shake Suit Over Client's $2M Tab

Law360, New York (October 22, 2010, 2:48 PM EDT) -- Federal Insurance Co. has failed to put an end to a putative class action alleging it is obligated to cover a $2 million judgment entered against a bankrupt debt collection agency it insured.

Judge A. Richard Caputo of the U.S. District Court for the Middle District of Pennsylvania concluded Thursday that the plaintiff has standing to sue Federal for American Corrective Counseling Services Inc.’s unpaid $2 million judgment and that the underlying litigation is not excluded from coverage under Federal’s policy, as the insurer had claimed...
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