Federal Insurance Co. v. Great American Insurance Co.

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Federal filed suit seeking a declaratory judgment determining the parties obligations and any priority coverage in an underlying wrongful death suit. The Eighth Circuit held that repeatedly shooting, and encouraging others to shoot, a handgun "in the general direction" of a small lake in a residential area of Kansas City, Missouri, which results in a young child's death, qualified as "gross negligence." In this case, the employee of the insured was convicted of reckless killing and his criminal conduct was determined through state court criminal proceedings. The court held that, because the conduct constituted gross negligence under the relevant indemnity clause, defendant Great American was not liable for the loss, and the district court erred in relying on the clause to require Great American to indemnify Federal and Zurich. The court vacated and remanded for further proceedings. View "Federal Insurance Co. v. Great American Insurance Co." on Justia Law