On January 17, the First Department unanimously affirmed Simpson Thacher’s win for Beazley against Lifelock’s demand for insurance coverage of consumer class actions alleging that Lifelock engaged in fraudulent advertising and deceptive trade practices.
LifeLock, which is advertised as a proactive identity theft prevention service, was accused of unlawfully inducing thousands of people to enter into contracts that violate federal law and do not provide the promised protections. Moreover, consumers claimed that a LifeLock promise to guarantee its services up to $1 million is “virtually worthless because it’s riddled with restrictions, waivers and limitations.”
In this case, LifeLock argued that a civil suit and 14 related consumer class actions alleging liability for web-based advertising and customer data liability issues were covered under an insurance policy issued by Firm client, the Beazley syndicates at Lloyd’s London. The First Department accepted Litigation Partner Bryce Friedman’s argument that policy exclusions apply since the allegations of misrepresentations and misleading statements appearing on LifeLock’s website occurred before 2008, when the coverage kicked in. Litigation Counsel Summer Craig and Associate Jamie Fell briefed the matter.
The case is LifeLock Inc. v. Certain Underwriters at Lloyd’s London, Syndicate Nos. 2623 and 623, case number 651577/2015 in the Supreme Court of the State of New York, County of New York.