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Ticket Fairy challenges United Specialty’s capped defense in E&O fight
The ticketing firm says United Specialty told it it would pay only $2,500 toward legal defense despite a $1 million errors and omissions policy limit.
Insurance Business reports that Ticket Fairy, a Los Angeles ticketing company, sued United Specialty Insurance Company, arguing the insurer should fund its full legal defense rather than only a capped amount. According to the complaint, the dispute centers on an errors and omissions policy with a $1 million limit. Ticket Fairy alleges United Specialty asserted an endorsement that includes a Defense Cost Sub-Limit for a breach of contract endorsement, limiting defense payments to $2,500 instead of the full policy limit.
The underlying case, cited in the lawsuit, involves Twitch Interactive suing Ticket Fairy in San Francisco Superior Court for missing a deadline to release contract funds. Ticket Fairy says Twitch brought claims including breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, and conversion, and that those pleaded issues involve professional wrongful acts covered under the E&O policy.
Ticket Fairy further alleges the insurer did not issue a coverage decision within 40 days of the tender and declined to engage with legal analysis provided by its counsel. It is seeking coverage for the defense under the policy terms, it says, based on the facts alleged rather than how Twitch labeled its claims.