Fungi Clause Sinks Coverage For Hyatt Worker's Mold Suit

Law360 (March 24, 2020, 3:50 PM EDT) -- An Illinois federal judge on Tuesday ruled that Penn-Star Insurance Co. doesn’t need to defend the owner of a Hyatt Corp. office against an employee's suit alleging that mold in the building made her ill, saying the owner's policy specifically excludes suits that allege the presence of fungi or bacteria contributed to injuries.

U.S. District Judge Nancy J. Rosenstengel said that Zeller Properties Inc.'s liability policies with Penn-Star are "unambiguous" in stating that mere allegations of fungi or bacteria in the employee's suit are enough to trigger the exclusionary clause in the policy — regardless of whether the presence of either...

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