By Shaun Crosner
Spectator injuries at live sporting events have long been a source of potential liability for venues and professional sports teams. Legal disputes with spectators can result in significant litigation costs and significant judgments and settlements. However, venues and teams may be able to defray some or all of these expenses with frequently overlooked assets: their comprehensive or commercial general liability (“CGL”) insurance policies.
Given the broad coverage provided under most CGL policies, many spectator injury lawsuits should trigger a CGL insurer’s coverage obligations—including the insurer’s duty to defend the lawsuit. Thus, both with respect to defense costs and settlements or judgments, CGL policies may cover a wide range of spectator injury lawsuits.
The Spectrum of Spectator Injury Lawsuits
Spectator injury lawsuits, a number of which are currently being litigated throughout the country, can come in numerous forms and include a variety of allegations. For one, these disputes can stem from alleged injuries suffered at the hands of other spectators. In such instances, venues and teams may face liability for their alleged failure to provide adequate security. A recent high-profile lawsuit filed against the Los Angeles Dodgers provides a prime example. In May, the Dodgers were sued by the family of a man who suffered life-threatening injuries during a postgame beating in the parking lot of Dodgers Stadium. The lawsuit alleges that the team negligently failed to have security personnel roaming the parking lot. See Complaint, Stow v. Los Angeles Dodgers, Case No. BC462127 (filed May 24, 2011).
Additionally, some spectator injury lawsuits arise out of altercations with athletes themselves. These lawsuits might allege that a venue’s security personnel failed to protect the spectator from injury, or they could be brought against a team under a theory of vicarious liability. For instance, following the now-famous brawl between fans and players during a 2004 game against the Detroit Pistons, the NBA’s Indiana Pacers faced a number of lawsuits filed by spectators allegedly injured in the brawl. See, e.g., Complaint, Ryan v. Artest, Case No. 2:06-CV-13968 (E.D. Mich. Sept. 8, 2006). Although the Pacers ultimately prevailed in some of the lawsuits, others settled for undisclosed sums.
Wayward balls, pucks, bats, and other objects can also spur spectator injury lawsuits. See, e.g., Sciarrotta v. Global Spectrum, 194 N.J. 345, 349 (2008) (lawsuit filed against venue and NHL’s New Jersey Devils by spectator who was hit by a hockey puck during a Devils home game at Continental Airlines Arena). Lawsuits of this sort continue to be common, even though arenas and teams frequently argue that spectators expressly or impliedly assume certain risks of injury simply by attending a live sporting event.
Venues and teams also could face potential liability for injuries sustained because of allegedly unsafe conditions at a ballpark, stadium, or arena. For example, late last year, a child tragically died after falling from a Staples Center luxury box during a Los Angeles Lakers home game. Within months, arena owners were sued by the child’s family. See Complaint, Tang v. Anschultz Entertainment Group, Inc., Case No. BC462188 (filed May 24, 2011). The lawsuit alleges that the design of the arena’s luxury boxes is dangerous and contributed to the accident. Id.
Finally, some spectator liability lawsuits can stem from confrontations between spectators and security personnel. For instance, an aggrieved spectator could allege that he or she was wrongfully detained by security staff or ejected from the event. Or, in certain instances, a spectator might argue that he or she sustained physical injuries in an altercation with security personnel. See generally Krueger v. City of Anaheim, 130 Cal. App. 3d 166 (1982).
The Coverage Provided by CGL Policies
The various forms of spectator injury lawsuits described above may be covered under the CGL policies of venues and teams. CGL policies, which have traditionally provided the broadest liability insurance coverage available in the marketplace, obligate an insurer to defend and indemnify its insured against claims and liabilities covered by the policy.
Among other things, CGL policies typically cover claims of “bodily injury” (defined to include both bodily injury and death) arising from “occurrences” during the policy period. See, e.g., Commercial General Liability Coverage Form CG 00 01 12 07, § I – Coverages, Coverage A, Bodily Injury and Property Damage Liability, ¶ 1 (ISO Properties, Inc. 2006). So long as “bodily injury” is alleged to have occurred during a particular policy period, coverage is triggered—regardless of when a lawsuit is ultimately filed.
CGL policies will also usually include coverage for allegations of “personal and advertising injury.” See, e.g., Commercial General Liability Coverage Form CG 00 01 12 07, § I – Coverages, Coverage B, Personal and Advertising Injury Liability, ¶ 1a (ISO Properties, Inc. 2006). The phrase “personal and advertising injury” is typically defined to include false arrest or imprisonment, as well as “wrongful eviction from . . . a room, dwelling, or premises that a person occupies.” Id., § V, ¶ 14.
The broad coverage provided by most CGL policies could be a valuable asset to those insured venues and teams named as defendants in spectator injury lawsuits—not only in terms of judgments and settlements, but also with respect to the cost of defending against such claims.
The Duty to Defend
One of the most valuable provisions in a CGL policy is the provision obligating the insurance carrier to defend its insured, or pay its insured’s defense costs, in a lawsuit that is potentially covered. This can be especially true with respect to spectator injury lawsuits, which can be costly to litigate.
Although the precise contours of an insurer’s duty to defend can vary slightly from state to state, some general rules apply across jurisdictions. The first step in determining whether a CGL insurer has a duty to defend a spectator injury lawsuit is to compare the allegations of the complaint against the terms of the policy. Any claim that asserts allegations potentially falling within the policy’s coverage will trigger the liability insurer’s duty to defend. See, e.g., Gray v. Zurich Ins. Co., 65 Cal. 2d 263, 275 (1966); Town of Massena v. Healthcare Underwriters Mutual Ins. Co., 98 N.Y.2d 435, 443 (2002). If any allegation in a complaint could be read to potentially trigger coverage, then the insurer has a duty to defend the entire lawsuit. Furthermore, even if an insured is all but certain to avoid liability for the underlying claimant’s alleged injuries, the insured may nonetheless be entitled to a defense. See, e.g., Mary Kay Cosmetics, Inc. v. N. River Ins. Co., 739 S.W.2d 608, 612 (Tex. App. 1987) (insurer cannot ignore its duty to defend by arguing that the underlying plaintiff will not recover against the insured or that the allegations of the underlying complaint are meritless).
Often, an insurer’s duty to defend will hinge on a the application of a particular policy exclusion. However, because a CGL insurer’s broad duty to defend obligates it to defend against all potentially covered lawsuits, it is well-settled that an insurer cannot rely on an exclusion to deny a defense unless it can conclusively prove that the exclusion applies to bar coverage for each and every allegation of the underlying lawsuit. See, e.g., Montrose Chem. Corp. v. Superior Court, 6 Cal. 4th at 300 (“[T]he insured need only show that the underlying claim may fall within policy coverage; the insurer must prove it cannot.”); see also Wexler Knitting Mills v. Atl. Mut. Ins. Co., 382 Pa. Super. 405, 408 (1989).
Given the breadth of a CGL insurer’s duty to defend, insured venues and teams may be able to obtain a defense to the range of spectator injury lawsuits described above. Indeed, spectator injury lawsuits will often seek damages for alleged physical injuries and death (i.e., “bodily injury”). Some spectator injury lawsuits could also be read to allege false imprisonment, wrongful detention, or some other form of “personal and advertising injury” on the part of a team or venue’s security personnel. Unless an insurer can conclusively establish that an exclusion or other coverage limitation applies to bar coverage, the insured should at a minimum be entitled to a defense—and possibly indemnity as well.
Tips for Obtaining Coverage
To avoid coverage disputes with insurers, and to maximize the chances of obtaining coverage for a spectator injury lawsuit, insured venues and professional sports teams should make every effort to comply with their policies’ terms and conditions. First and foremost, upon receipt of any potentially covered complaint, an insured should promptly notify its CGL insurer. Then, as necessary, the insured should reasonably cooperate in the insurer’s investigation of the claim.
Other policy terms and conditions may likewise be relevant, even operating as prerequisites to coverage in some instances. Accordingly, venues and teams should carefully review their policies—both when purchasing them and also when pursuing a claim for coverage. Doing so may pay dividends for venues and teams seeking insurance coverage for spectator injury lawsuits.
Shaun Crosner, a Los Angeles-based attorney in Dickstein Shapiro LLP’s Insurance Coverage Practice, is the co-leader of the Firm’s Entertainment and Sports Insurance Coverage Initiative. His practice focuses on the representation of policyholders in disputes with their insurers. Mr. Crosner has written and spoken on a variety of topics related to sports and entertainment insurance, and he is an editor and primary author of LexisNexis’s New Appleman Sports and Entertainment Insurance Law & Practice Guide (2010).
