General Liability Insurer Must Defend In Spite of Fact That Injury Occurred at Workplace

In True North Me. v. Liberty Mutual Ins. Co., 2020 U.S. Dist. LEXIS 13941 (Jan. 28, 2020), a federal district court sitting in Maine applied the so-called “comparison test” — comparing the allegations of the underlying complaint with the provisions of the relevant insurance policy — and held that an employer’s general liability insurer was required to defend the employer in a negligence action filed against it and co-workers by a plaintiff-employee in spite of the fact that the alleged tort occurred during the workday and was allegedly perpetrated by the plaintiff’s co-employees. The Court stressed that under the circumstances of the case, the liability policy’s workers’ compensation exclusion did not totally foreclose the possibility of coverage.

Background: Plaintiff Unconscious for Prolonged Period

In as much as the Court was entertaining Liberty Mutual’s motion to dismiss, the court’s statement of the facts was sketchy, at best. At first blush, the case seemed Taylor-made for use of the workers’ compensation exclusion within the policy. The plaintiff-employee had sued the employer and various co-workers for injuries that the employee alleged he had sustained at the workplace. The quirk here was that the plaintiff alleged his injuries occurred because he had been unconscious for most of a work shift and that he had been ignored by the other co-workers.

Did the Injury Arise Out of and in the Course of the Employment

The Court reasoned that it could certainly be argued that a person left unconscious throughout a scheduled shift was not engaged in work activity, and that fellow employees who effectively abandoned such a person were not acting in the employer’s interest. The Court also stated that the allegations described a harm different in kind from the sort of harms excluded from coverage by the policy’s employment-related practices exclusion [e.g., demotion, discipline, discrimination, and the like]. Under these circumstances, the employee had a plausible basis for relief against the employer and the carrier, therefore, had a duty to defend the employer under the terms of the general liability policy.