(Court opinion corrected 9/28/17.) Flow sued Plaintiff alleging patent infringement and false marketing. Plaintiff had an insurance policy with Defendant which provided that Defendant would defend it in any suit arising out of a publication that “disparages a person’s or organization’s goods, products or services.” Plaintiff argued that since the Flow lawsuit included a claim for false marketing, Defendant had a duty to defend it. When Defendant refused, Plaintiff sued alleging that Defendant breached their contract and violated section 155 of the Insurance Code. Court properly granted summary judgment for Defendant. Flow’s false marketing claim was based on Plaintiff’s allegedly falsely assertion that it had a patent pending on a product when it did not, and “patent pending” is a neutral designation that does not qualify as a disparaging statement. Thus, Defendant did not owe Plaintiff a duty to defend in the underlying action, did not breach its insurance contract, and did not violate section 155 of the Insurance Code. (CONNORS and HARRIS, concurring.)
Illinois Appellate Court
Civil Court
Insurance