Facts

Adir International LLC brought an insurance coverage action against its insurer, Starr Indemnity & Liability Company, alleging that Starr has a duty to defend Adir under a directors-and-officers liability insurance policy in connection with an underlying action that was brought by the California Attorney General against Adir under California's Unfair Competition Law and False Advertising Law. Starr filed a counterclaim against Adir.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendant had a duty to indemnify plaintiff pursuant to their insurance contract.

DEFENDANT'S CONTENTIONS: Defendant Starr alleged that it did not have a duty to defend or indemnify Adir in connection with the underlying action, and that Defendant Starr was entitled to reimbursement from Adir for payments Starr made in connection with Adir's defense in the underlying action.

Result

The court granted Defendant Starr's motion for summary judgment and denied Plaintiff Adir's motion for summary judgment. Specifically, the court held that, under California Insurance Code Section 533.5, Starr does not have a duty to defend or indemnity Adir under its insurance policy in connection with the underlying action, and that Starr was entitled to reimbursement for the amounts it paid for the defense of Adir in the underlying action.