Wisconsin Appellate Court: A Single Policy is Triggered and its TCPA Exclusion Applies, Per the Allegations of the Class-Action Complaint

A Wisconsin appellate court recently addressed the applicability of a Telephone Consumer Protection Act (TCPA) exclusion to claims of conversion and which policies are triggered in a TCPA class action. First, the court held the TCPA exclusion barred coverage and that the insurer had no duty to defend. The court noted the overlap between the TCPA and conversion allegations in the complaint, with the only additional fact alleged to support the conversion claim being that the faxes “effectively stole” employee time and caused loss of paper and toner. The court found that the TCPA exclusion “is directed at [the insured’s] actions, not the effect of its actions” and all of the actions alleged to have taken in violation of the TCPA were the same allegations in support of the conversion claim. Second, the court held that earlier policies without a TCPA exclusion were not triggered. The court rejected the argument that the putative class potentially implicated earlier policies. The court determined that even if the class was certified, the only injury alleged in the complaint occurred during a specific single policy period. The insurer was not required to “speculate beyond the written words of the complaint in order to imagine a claim that a plaintiff might be making or to determine all the potential issues that could be sought when the insurer is evaluating its duty to defend.” The class representative’s potential representation of an expansive class of claimants is insufficient to trigger the duty to defend for a policy “untethered to a factual allegation in the complaint.” The Wisconsin court of appeals’ decision in State Farm Fire & Cas. Co. v. Easy PC Solutions, LLC (App. No. 2014AP2657, Dec. 9, 2015), affirming the trial court’s ruling can be found here.