Rescission of Professional Liability Policies Granted Where Policyholder Concealed Material Information From Insurer

The Upper Deck Co. v. Endurance American Specialty Ins. Co., (S.D. Cal., December 15, 2011)

The court granted an insurer’s claim for rescission of two errors and omissions after the start of an underlying action which involved the copying and printing of rare cards and alleged claims for federal trademark counterfeiting and infringement. The policyholder did not disclose this information when applying for insurance. The court found that the concealment of this scheme constituted material information that had to be disclosed and therefore allowed the insurer to rescind the contracts of insurance pursuant to Cal. Ins. Code § 331.