No duty to defend or indemnify City for class action seeking refund of fees wrongfully collected

by Chris Graham and Joseph Kelly

Onebeacon America Ins. Co. v. City of Granite City, et al, Case No. 12-CV-0156-DRH-DGW (S.D. Ill. Feb. 13, 2013)

Insurer granted summary judgment that it had no duty to defend or indemnify City of Granite City for underlying class action suit seeking return of car towing fees wrongfully collected. Court cited Level 3 Commc’ns v. Fed Ins. co., 272 F. 3d 908 (7th Cir. 2001) and Ryerson Inc. v. Fed. Ins. Co., 676 F.3d 610 (7th Cir. 2012) for the principle that suits seeking “restoration or an ill-gotten gain”, like this suit, aren’t a “loss” within the meaning of an insurance contract.

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