Harvard, Zurich Insurance At Odds Over $15M in Insurance for Admissions Program Defense

Harvard University has already exhausted $25 million in insurance protection defending its affirmative motion admissions program and is in courtroom making an attempt to power one other of its insurers to cowl as much as $15 million extra.

While the $25 million prices thus far have been coated underneath an AIG major legal responsibility coverage, the college desires its $15 million extra insurance coverage issued by Zurich Insurance to cowl prices above that quantity. But Zurich maintains Harvard missed the deadline for notifying it of its declare.

The college has been defending its admissions coverage towards a lawsuit introduced by Students for Fair Admissions filed in 2014 and a Department of Justice investigation launched in 2017. Both the first and extra insurance policies coated claims made through the yr ended November 2015 offered Harvard notified the insurers by January 2016.

Harvard stated its protection prices encompass authorized charges and bills, prices related to digital discovery distributors, skilled witness charges and courtroom prices. These prices have exceeded the AIG coverage limits and retention/deductible. The college stated it has incurred and can proceed to accrue protection prices for these issues as a result of the SFFA motion is now the topic of a writ of certiorari in the U.S. Supreme Court and the DOJ Investigation continues to be pending.

According to courtroom filings, AIG has handled the SFFA motion and the DOJ investigation as a single declare and coated the protection prices incurred topic to a single retention/deductible.

Zurich has declined protection, claiming that Harvard didn’t give it well timed written discover of the SFFA declare. Notice to the first insurer doesn’t fulfill its discover requirement, the insurer insists.

However, Harvard argues that, whereas it didn’t formally notify Zurich of the SFFA motion till May 2017, it believes that Zurich had “actual or constructive knowledge” of the SFFA motion in late 2014 or early 2015, and in any occasion no later than January 30, 2016. Harvard contends that Zurich had discover by advantage of widespread media protection of the SFFA motion together with by CNN and Fox News, in addition to The New York Times, The Wall Street Journal, The Boston Globe, Bloomberg, USA Today, The Associated Press and The Washington Post.

Harvard additional claims Zurich was given discover by way of the attendance by Zurich personnel assigned to its account at conferences the place the SFFA motion was mentioned.

Harvard argues that the Zurich coverage follows the AIG coverage, which requires written discover “as soon as practicable,” and that it formally notified Zurich properly earlier than its prices exceeded the AIG coverage. “Formal notice of the SFFA Action was given to Zurich as soon as practicable, given the attachment point of the Zurich Policy and the state of the SFFA Action and its defense at or about the time that formal notice was provided,” Harvard states.

Harvard claims that when it offered formal discover to Zurich, the AIG coverage restrict quantity was “far from being exhausted” and its protection prices “were not even close to the attachment point” of the Zurich coverage. Also, the college notes, AIG as the first insurance firm was actively collaborating in the protection of the underlying declare.

Harvard seeks damages from Zurich for breach of contract and a declaration that Zurich should reimburse Harvard for all cheap protection prices incurred and which will probably be incurred in extra of the AIG coverage and retention/deductible.

The dispute over the surplus protection is earlier than federal courtroom in Massachusetts.

Harvard can be asking the courtroom to compel Zurich to grant it entry to personnel, emails and paperwork associated to the SFFA motion and its insurance account, together with underwriting and setting of insurance charges.

The SFFA has contended that Harvard College administers its scholar admissions plan by utilizing race in a approach that violates Title VI and unfairly discriminates towards Asian American candidates. Harvard stated the SFFA Action required it to have interaction in in depth pre-trial discovery and movement observe. The trial was carried out over a three-week interval. Judgment was entered in favor of Harvard on all counts, and SFFA appealed the judgment to the U.S. Court of Appeals for the First Circuit, which on November 12, 2020, dominated in favor of Harvard and upheld the district courtroom’s choice.