Insurance – Commercial Liability – Intellectual Property – California Law – Photograph – Unauthorized Use

ISS Research, LLC v. Federal Insurance Co. (Lawyers Weekly No. 10-04-1140, 9 pp.) (Graham C. Mullen, J.) W.D.N.C.

Holding: The plaintiff-insured was sued under California law for the unauthorized use of a photograph, which California law recognizes as an intellectual-property claim. Since the parties’ insurance policy excludes coverage for intellectual property claims, the defendant-insurer was not required to defend or indemnify its insured in the Calif. lawsuit.

Defendant’s motion for partial summary judgment is granted.

Paul Green sued the plaintiff-insured for the ‘misappropriation of his likeness’ for commercial gain. Calif. law, under which the insured was sued, recognizes that Green’s right to control the commercial use of his likeness is an intellectual property right. Moreover, the U.S. Supreme Court has held, ‘The state’s interest in permitting a ëright of publicity’ is in protecting the proprietary interest of the individual’ and is ‘closely analogous to the goals of patent and copyright law, focusing on the right of the individual to reap the reward of his endeavors.’ Zacchini v. Scripp-Howard Broadcasting Co., 433 U.S. 562 (1977).

The policy’s intellectual property exclusion applies to alleged violations of ‘judicial or statutory law recognizing an interest in any … likeness.’ The policy clearly excludes coverage for damages related to the misappropriation of a likeness. Therefore, the insurer had no duty to defend or indemnify its insured in the Calif. lawsuit brought by Green.