Shannon Gracey Attorneys Successfully Defends Chrysler Insurance for Alleged Defamation Case Before The Supreme Court of Texas
Friday, October 30, 2009
The Supreme Court of Texas has found that Chrysler Insurance Co. owes no duty to defend or indemnify a Dodge dealership for litigation over alleged defamation of a former employee who claimed managers called him a racial slur and accused him of stealing cars.
At issue in Chrysler Insurance Co. v. Greenspoint Dodge of Houston, Inc., was whether an exclusion for defamatory statements applied when the statements were made by managerial employees found in the underlying liability suit to be vice-principals of the corporation. The corporation argued that, for purposes of insurance coverage, the corporation could only be held responsible for the acts of those persons who were defined as "persons insured" under the policy. The Texas Supreme Court rejected this contention and adopted the argument on behalf of Chrysler Insurance that the acts of corporate vice-principals were, by definition, the act of the corporation itself not only for purposes of imposing liability to the tort claimant, but also for purposes of deciding whether policy exclusions eliminated coverage.
The court’s ruling reversed a lower court judgment awarding damages for the insurer’s alleged failure to provide defense and indemnification coverage to the dealership in the case filed by a former inventory control manager, which resulted in a $1.5 million damage award. The court’s decision is one of only a handful of opinions on the subject from all of the courts in the nation.
Chrysler Insurance Co. was represented at all phases of the case, by Lisa Songy, partner in the Dallas office of Shannon, Gracey, Ratliff & Miller, LLP. Ms. Songy was assisted in the presentation to the Texas Supreme Court by Stephen Gibson, also a partner in the Dallas office and a member of the firm’s appellate section.
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About Shannon Gracey
For more than 80 years, attorneys at Shannon, Gracey, Ratliff & Miller, LLP have steadily built a legacy of working smart, helping our clients make better decisions as they navigate complex legal challenges and a changing business environment. We are a highly diversified Texas firm with offices in Arlington, Austin, Dallas, Fort Worth, and Houston. We have served our clients in varied business and commercial settings, including real estate, banking, corporate, securities, health care, estate planning and probate, oil & gas, intellectual property, tax, insurance, governmental law, and employment practices. For more information call (817) 336-9333 or visit shannongracey.com.
