Baker Sterchi secured a dismissal with prejudice for a D&O insurer on breach of contract and vexatious refusal claims. The plaintiffs sought to recover in excess of $600,000 in attorneys’ fees and costs expended in defense of an investor suit against the company’s president individually, vexatious refusal penalties, attorneys’ fees, and other damages.
Baker Sterchi obtained dismissal with prejudice based upon a policy endorsement that excluded from coverage claims “based upon, arising from, or in consequence of” a written agreement. Plaintiffs argued that the policy was vague and ambiguous, and that the exclusionary endorsement did not apply because the plaintiffs in the underlying action asserted equitable and common law claims in addition to contract claims. A magistrate judge in the U.S. District Court for the Eastern District of Missouri found the endorsement to be applicable and unambiguous, excluding coverage and entitling the insurer to dismissal.