Prior Knowledge Provision Implicated by Insured’s Pre-Policy Inception Knowledge of Employee Allegations of Workplace Harassment

August 31, 2012

The United States District Court for the Eastern District of Missouri, applying Missouri law, has held that a prior knowledge provision barred coverage for an employee’s suit when the insured received a letter from the employee alleging workplace harassment and a Notice of Charge by the U.S. Equal Employment Opportunity Commission.  City of Maplewood, Missouri v. Northland Cas. Co., 2012 WL 3578695 (E.D. Mo. Aug. 20, 2012).  The court also held in the alternative that coverage was unavailable because the insured did not provide notice of the claim until nearly two years after the claims-made and reported policy period expired. 

The insured, a municipality, sought coverage for a suit by its employee alleging workplace harassment.  The insurer denied coverage for the suit based on the policy’s prior knowledge provision, which carved out coverage for any claim arising from any “facts and circumstances which would cause a reasonable person to believe a claim would be made and which are known to any Insured” before the inception of the policy.  The insurer also contended that the employee’s suit did not trigger coverage under the claims-made and reported policy because it was not tendered during the policy period.

The court held that the prior knowledge provision barred coverage for the employee’s suit.  The court held that the municipality had knowledge before the policy’s inception date of the employee’s allegations in the suit because the employee sent a letter to the municipality asserting workplace harassment and the municipality received a Notice of Charge filed by the employee with the U.S. Equal Employment Opportunity Commission.  The court reasoned that these facts “would cause a reasonable person to believe that a claim would be made.” 

The court also held that no coverage was available for the employee’s suit because the municipality did not provide notice of the employee’s suit until two years after the expiration of the claims-made and reported policy.

The opinion is available here.

Read Time: 2 min
Jump to top of page

Wiley Rein LLP Cookie Preference Center

Your Privacy

When you visit our website, we use cookies on your browser to collect information. The information collected might relate to you, your preferences, or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. For more information about how we use Cookies, please see our Privacy Policy.

Strictly Necessary Cookies

Always Active

Necessary cookies enable core functionality such as security, network management, and accessibility. These cookies may only be disabled by changing your browser settings, but this may affect how the website functions.

Functional Cookies

Always Active

Some functions of the site require remembering user choices, for example your cookie preference, or keyword search highlighting. These do not store any personal information.

Form Submissions

Always Active

When submitting your data, for example on a contact form or event registration, a cookie might be used to monitor the state of your submission across pages.

Performance Cookies

Performance cookies help us improve our website by collecting and reporting information on its usage. We access and process information from these cookies at an aggregate level.

Powered by Firmseek