We all know who Amanda Knox is. We all know what she is alleged to have done, and that she has been cleared of the criminal charges in Italy. Many people are also aware that she’s on the hook for a judgement from a libel suit of around $50,000 because she pointed the finger at someone else who was completely uninvolved when she was first accused.
But did Knox and her family miss an opportunity to prevent that judgement? Are they entitled to a libel defense from their insurer?
Because we are not their insurer, several assumptions are made. The first, of course is that the Knox family had a homeowners insurance policy written on the industry standard HO-3 form, as amended for use in Washington State. We also presume that Knox is considered to be an insured. Even though she was in Italy, she was well under the age of 24 at the time, a student, and dependent upon her parents. Under the HO-3 policy, those facts combine to create a rebuttable presumption that she is an “insured” for purposes of the policy.
The standard HO-3 provides liability coverage under Section II, Coverage E, for “bodily injury” and “property damage,” both of which are clearly defined within the policy document. Neither would in any way offer coverage for libel, slander, or defamation of any kind. The Washington version of the HO-82 endorsement, “Personal Injury,” is assumed to have been present on the homeowners policy. Any assumption that they are entitled to a libel defense from their insurer absolutely hinges on the presence of that endorsement. Without it, game over.
The HO-82, in part, reads
“Personal injury” means injury arising out of one or more of the following… Oral, written or electronic publication of material that slanders or libels a person or organization or disparages a person’s or organization’s goods, products, or services…
Libel or slander are not defined within the policy or the endorsement, so they are to be broadly construed as tracking with the legal definitions of the same. Neither geographic location nor jurisdiction appear to be limited under the terms of a standard policy. An exception is made, of course, for acts caused “by or at the direction of an insured with the knowledge that the act would… inflict personal injury.” Note that “personal injury” has a very specific meaning in insurance, supra, and is completely different from the sort of “personal injury” litigation often advertised by attorneys.
Two separate libel suits are at issue. The first was filed against Amanda Knox for accusing someone else of the crimes for which she herself was later acquitted. This suit resulted in a roughly $50,000 judgement being lodged against her by an Italian court. She may have been entitled to a defense against the libel suit from her parents’ insurer, but likely not. Chances are strong that claim and defense costs would have been denied because she reasonably knew, or should have known, that her actions would cause defamation of character and that a claim or suit could arise based on those actions. Because she knowingly and intentionally made those false statements, the insurer likely would not be obligated to defend her or to pay the judgement on her behalf.
On the other hand, a suit was filed against her parents Edda Mellas and Curt Knox for a statement they made during an interview, later published, alleging that Amanda Knox had been treated poorly by the local police department during an interview. Speaking generally, libel requires that you present a statement as fact, and that you know it to be false at the time of utterance. A statement of opinion regarding the actions of an organization simply does not rise to the level of libel, the suit likely never should have been brought. further, the specifics they delved into were based on Amanda Knox’s recount of the experience. They had no reason not to trust their daughter as a source of fact, and even if the statements were flagrant falsehoods, they did not know, nor should they have known, that they were false. Since knowing a statement to be false is a necessary element of libel, the attorneys retained by the insurer would likely have had an easy time doing away with the claim.
The suit also would be unlikely to succeed, speaking broadly as a hypothetical, if properly defended. The standard homeowners policy provides for defense costs against suits or claims which would be covered by the policy. Since coverage is likely to be present, coverage for defense costs naturally follows. Were such a claim to be made against their policy, the defense costs and judgement, if any, would likely be paid by the insurer.
Ultimately, this is why you need homeowners or Renters Insurance. Not because of the risks you expect or can predict, but because of the risks you can’t possible anticipate, mitigate, or protect against in any other way. The fact that liability coverage pays for defense costs is worth the cost of the policy in and of itself. The average renters insurance policy costs less than one hour of a trial lawyer’s time, and far, far less than the cost of not having the coverage when you need it the most.
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