Adir International, LLC v. Starr Indemnity and Liability Co., No. 19-56320 (9th Cir. 2021)
Annotate this Case
The Ninth Circuit affirmed the district court's grant of summary judgment to Starr in an action brought by Adir, seeking insurance defense coverage. The panel held that California Insurance Code section 533.5(b) — which nullifies an insurance company’s duty to defend — does not facially violate a party's due process right to retain counsel. The panel explained that, in civil cases, courts have recognized a denial of due process only if the government actively thwarts a party from obtaining a lawyer or prevents it from communicating with counsel. In this case, Adir has made no such allegation.
The panel also rejected Adir's statutory argument that section 533.5 applies to actions involving only monetary relief. Rather, under the plain text of the statute, it applies to actions that seek injunctive relief along with monetary relief. Because it turns out that there is no duty to defend nor to indemnify, the panel affirmed the district court's determination that Starr is entitled to reimbursement under the explicit language of the insurance policy.
Court Description: California Insurance Law. The panel affirmed the district court’s summary judgment in favor of Starr Indemnity and Liability Company in a diversity insurance-coverage action. California’s Attorney General sued Adir International, LLC for violating state consumer protection laws. After initially agreeing to provide coverage, Adir’s insurer, Starr Indemnity, said it would no longer pay for Adir’s defense pursuant to California Insurance Code § 533.5(b), which forbids insurer coverage in certain consumer protection cases brought by the state. The panel held Cal. Ins. Code § 533.5(b) did not facially violate the due process right of insurance holders to fund and retain the counsel of their choice in the civil context. The panel also rejected Adir’s statutory argument that section 533.5 applied to actions involving only monetary relief. The panel further held that under the plain text of the statute, it * The Honorable Matthew F. Kennelly, sitting by designation from the Northern District of Illinois. ADIR INT’L V. STARR INDEMNITY & LIABILITY 3 applied to actions that seek injunctive relief along with monetary relief. Because Starr Indemnity had no duty to defend nor to indemnify, the panel affirmed the district court’s determination that Starr Indemnity was entitled to reimbursement of defense costs under the explicit language of the insurance policy.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.