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Insurance Coverage at Issue After Verdict in Depp-Heard Defamation Case

On Behalf of | Aug 25, 2022 | Insurance Recovery |

By now, you may think that you know all there is to know about the Johnny Depp-Amber Heard defamation lawsuit. The case, which resulted in a verdict for Johnny Depp against ex-wife Amber Heard, is still ongoing after the actress appealed the decision against her.

But guess what? We are going to bet that you didn’t realize that there is an ongoing dispute regarding insurance coverage in this case. The policy highlights provisions in California law that may allow the insurers to avoid paying the verdict against Ms. Heard.

Ms. Heard had an insurance policy with New York Marine And General Insurance Company. This policy required the company to indemnify Ms. Heard for a portion of any judgment that went against her in the defamation case, or other types of litigation covered under the policy.

When the suit was filed against Ms. Heard by Mr. Depp, Ms. Heard reached out to the insurers for coverage under the policy. The insurance company hired counsel to represent her in the case; however, the insurers contend that actions by Ms. Heard, and her representatives caused the lawyers to remove themselves from the case.

“Willfulness” Of Conduct and Impact on Policy

New York Marine contends that it is not responsible to cover the verdict or defense costs because Ms. Heard’s conduct was found to be willful. This is an important distinction, because California Insurance Code Section 533 states that insurers can remove themselves from being forced to cover an insured’s losses if the conduct was “purposeful and intentional.”.

Here, the jury instructions and verdict in the defamation case called special attention to Ms. Heard’s actions – that is, it required the issue of willfulness to be addressed in the verdict. This may make it difficult for Ms. Heard to claim that the code section does not apply to her actions.

This may take some time to resolve. With appeals still pending in the defamation case, the potential exists that more defense costs could continue to add up. It will be interesting to see how the insurance coverage and policies in this case are applied to the defense costs and final verdict responsibilities, if any, that Ms. Heard incurs.

Duty To Inform of Potential Conflict?

One other wrinkle in this case. Because of the California rule, the insurers may have had an obligation to inform Ms. Heard that there may be issues regarding their obligations to cover her defense. This may have required the insurers to provide independent counsel in the case. This issue is a point of emphasis in a second case related to insurance matters in the defamation suit, between insurance companies regarding the costs of defending Ms. Heard.

If you have questions about litigation connected with an insurance policy, we invite you to reach out to us today to learn more about what we can do to help. We have extensive experience with many different aspects of commercial general liability insurance policies and can explain what we believe to be the issues in your case.