RSUI Indemnity Co. v. Murdock, et al.Annotate this Case
An excess insurer under a directors’ and officers’ liability insurance policy sought a declaration from the superior court that coverage under the policy was not available to fund the settlement of two lawsuits: a breach of fiduciary duty action in the Court of Chancery, and a federal securities action in the United States District Court for the District of Delaware. In a series of decisions, the superior court rejected the insurer’s claims and entered judgment in favor of the insureds. Aggrieved, the insurer contended the superior court committed several errors: whether the insurance policy, which insured a Delaware corporation and its directors and officers but which was negotiated and issued in California, should have been interpreted under Delaware law; whether the policy, to the extent that it appeared to cover losses occasioned by one of the insureds’ fraud, was unenforceable as contrary to the public policy of Delaware; whether a policy provision that excluded coverage for fraudulent actions defeats coverage; and whether the superior court properly applied the policy’s allocation provision. Finding no reversible error, the Delaware Supreme Court affirmed the superior court.