Selective Insurance Co. of the Southeast v. RLI Insurance Co.
706 F. App'x 260
6th Cir.2017Background
- In 1998 Barberton police arrested and later convicted Clarence Elkins for murder based largely on a six‑year‑old witness identification; DNA and alibi evidence were available but not decisive at trial. Elkins was convicted in 1999 and sentenced to life; he was exonerated in 2005 after DNA linked another suspect, Earl Mann, to the crime.
- A key undisclosed document (the “Mann memorandum”), prepared January 5, 1999, indicated Mann’s proximity and statements; police failed to provide it to Elkins’s defense (alleged Brady violation).
- The City switched excess insurers on June 29, 1998: RLI’s excess policy expired that day and Selective’s excess policy began.
- Elkins sued the City and officers (§ 1983 due‑process and Ohio malicious prosecution). After discovery revealed the Mann memorandum, the case proceeded; in November 2010 three insurers (two primaries and Selective as excess) settled for $5.25 million, with Selective paying $3.25 million and receiving assignment of the City’s claims against RLI.
- Selective sued RLI for the $3.25 million, arguing RLI’s excess policy was triggered when charges were filed in June 1998. RLI argued its occurrence‑based policy covered only acts committed during its policy period and that the tortious conduct (withholding the Mann memo) occurred in January 1999, after RLI’s policy expired.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether RLI's occurrence‑based excess policy was triggered during RLI's policy period | Selective: coverage triggered when criminal charges were filed (June 1998); majority rule treats injury as occurring at filing | RLI: policy covers only injury "caused by" acts committed during the policy period; the tort (Brady withholding) occurred Jan 1999 after expiration | Court reversed district court: RLI not liable because the tortious act that caused the covered injury occurred after RLI's policy expired |
| Whether the “majority rule” (trigger at charging) controls here | Selective: cites cases holding coverage triggered at initiation of prosecution | RLI: those cases address different issue (injury timing vs exoneration) and do not apply where prosecution was lawful at inception and later became malicious | Court: majority‑rule cases distinguishable; here injury at filing preceded any tortious act, so they do not trigger RLI coverage |
| Whether a series‑of‑acts/"all loss arising out of such act or series of acts" clause makes RLI liable for later acts outside period | Selective: the definition groups interrelated wrongful acts as one occurrence and sweeps in losses across time | RLI: the clause refers back to acts that "must be committed during the policy period"; "such" limits application to acts within period | Court: rejected Selective’s interpretation; occurrence language requires the tortious act(s) to occur during the policy period |
| Whether probable cause for malicious prosecution disappeared prior to RLI's policy end (i.e., could loss have been caused during RLI period) | Selective: argues probable cause may have evaporated earlier based on investigation flaws | RLI: Ohio law presumes probable cause from conviction absent fraud; Brady withholding (Jan 1999) was the fraud/unlawful means that destroyed probable cause | Court: applied Ohio law (Vesey presumption) and held probable cause existed through the Brady violation; thus the malicious‑prosecution tort arose in Jan 1999 after RLI's policy expired |
Key Cases Cited
- Elkins v. Summit Cty., Ohio, 615 F.3d 671 (6th Cir. 2010) (interlocutory decision denying qualified immunity on due‑process claim based on withheld Mann memorandum)
- Genesis Ins. Co. v. City of Council Bluffs, 677 F.3d 806 (8th Cir. 2012) (discussing insurer liability timing for malicious prosecution claims and the rule triggering coverage at time injury is felt)
- City of Erie v. Guar. Nat. Ins. Co., 109 F.3d 156 (3d Cir. 1997) (treating time of injury as the trigger for malicious‑prosecution coverage disputes)
- Spurlock v. Satterfield, 167 F.3d 995 (6th Cir. 1999) (continued custody/prosecution without probable cause can give rise to § 1983 claim)
- Vesey v. Connally, 175 N.E.2d 876 (Ohio Ct. App. 1960) (conviction creates conclusive presumption of probable cause absent fraud or unlawful means)