Zurich American Ins. Co. v. Ocwen Financial Corp.

990 F.3d 1073 (7th Cir. 2021)

Words & Phrases

Duty To Defend: Exclusions

Trial Judge

Charles Kocoras

Appellate Judge

Wood

Holding

Coverage for complaint alleging dozens of improper robocalls was barred by exclusions "arising out of the Telephone Consumer Protection Act and certain other statutes."

Fact Summary

Zurich American Insurance sold a policy to Ocwen Financial, a debt-collection company. After a disgruntled consumer sued Ocwen, it tendered the dispute to Zurich, but Zurich asserted that policy exclusions relieved it of any duty to defend. Zurich then asked a federal court to decide whether this was indeed the case. The district court issued a judgment declaring that Zurich had no duty to defend Ocwen in the underlying litigation, and Ocwen has appealed. We agree with the district court’s reading of the policy and therefore affirm.

To the extent that Counts I through III alleged conduct that violated the TCPA, it found that the policy ex-clusion’s “catch-all” clause swept in the FDCPA as an “other statute” that regulates the communication of information. Because the FDCPA prohibits calls made with the “intent to annoy, abuse or harass,” the court concluded that even if some of Ocwen’s calls to Beecroft did not violate the TCPA, they still violated the FDCPA because they were made after Beecroft had asked Ocwen to stop calling. Calling someone after being asked to stop, the court thought, indicated an intent to abuse, harass, or at the very least annoy. The court also held that the common-law claims in Counts IV and V (defamation and invasion of privacy) were excluded because they were based on conduct “arising out of” the same operative facts as the conduct that was alleged to have violated the enumerated statutes.

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