PAX Dev: Insurance 101 for Video Game Developers and Publishers

Erin L. Webb

On August 28, 2014, I presented with insurance broker Sara Owens of GNW Evergreen, a division of HUB International, at PAX Dev in Seattle, Washington. PAX Dev is a conference devoted to the video game developer community and the topic of game making. Conference tracks focused on programming, design, business, art, music and more.

During our session, which was part of the business track, we talked about basic insurance concepts relevant to developers and publishers in the video game industry, including how to buy insurance and what to do in the event of a loss. Continue reading “PAX Dev: Insurance 101 for Video Game Developers and Publishers”

Exelon-Pepco Merger Highlights Importance of Insurance Coverage Analysis in Mergers and Acquisitions

Erin L. Webb

Exelon Corp., the largest United States nuclear operator, announced recently that it would agree to purchase Pepco Holdings, Inc. for $6.8 billion in cash. Pepco no longer generates its own power, but serves utility customers from Washington, D.C. to New Jersey. Bloomberg reports that this merger, if approved, would create the largest electric and natural gas utility in the Mid-Atlantic region.

The merger will require approval by both the Federal Energy Regulatory Commission and the public service commissions in the relevant states and the District of Columbia. It will also need to pass antitrust review by either the Department of Justice or the Federal Trade Commission. Lawyers, consultants, and accountants for both companies will undoubtedly conduct extensive diligence reviews. Continue reading “Exelon-Pepco Merger Highlights Importance of Insurance Coverage Analysis in Mergers and Acquisitions”

Target Data Breach Part 2: The Additional Insured

Erin L. Webb

More information has come to light about the data breach affecting Target, and it highlights the importance of “additional insured” coverage, as well as the need for companies to recognize that sophisticated cyberattacks can affect any company, not just those in the computer or technology industries.  Blogger Brian Krebs reports that the theft of credentials from a heating and cooling (HVAC) company may be linked to the Target breach.

How could it happen?  No details have yet been publicly confirmed, but it is possible that the HVAC company had access to Target’s network so that it could remotely monitor heating and cooling efficiency at multiple Target locations.  If Target’s electronic systems were linked – if one was accessible via another – a path for a hacker from HVAC information to credit card processing may have been possible. Continue reading “Target Data Breach Part 2: The Additional Insured”

Hospitality Law Conference 2014: Importance of Business Income From Dependent Properties Coverage

Jared Zola

Zola, JaredOn February 11, 2014, John Heintz and I spoke on a panel at the @Hospitality_Law 2014 Conference discussing maximizing coverage for large property and business interruption claims. We presented a hypothetical scenario in which Acme Hospitality is a full service Real Estate company that owns several hotels, including one in Galveston, Texas that a hurricane devastated to the point of total loss and a second in Houston, Texas that the same hurricane impacted with minimal physical damage and significant financial losses. One interesting fact presented was that a sports stadium located nearby the Houston hotel suffered major roof damage and is expected to be closed for six months. The Houston hotel typically sells out for every home game played at the sports stadium and other live events. We explored the question of whether the Houston hotel is entitled to coverage for lost business income resulting from the stadium’s closure. Continue reading “Hospitality Law Conference 2014: Importance of Business Income From Dependent Properties Coverage”

Target Data Breach Highlights Importance of Insuring Cyber Risks

Erin L. Webb

While cyber risks are sometimes thought of as “online” or Internet risks, a massive information theft recently occurred at Target’s brick-and-mortar stores when customers swiped cards and entered PINs while making in-store purchases. On December 19, 2013, Target disclosed that it was the victim of a serious data breach from at least November 27 to December 15 of 2013. More than 40 million debit and credit card numbers were stolen. Hackers stole customer names, card numbers, card expiration dates, the embedded codes on the magnetic strips on the backs of cards, and in some cases PINs for debit cards used at Target.

The card information has reportedly already begun to flood the black market, selling for between $20 and $100 per card. Target has stated that it will offer free credit monitoring services to affected customers. Continue reading “Target Data Breach Highlights Importance of Insuring Cyber Risks”

Disposal Site for Spent Nuclear Fuel Could Change the Insurance Picture for Nuclear Plant Owners

Erin L. Webb

A federal court of appeals and the Nuclear Regulatory Commission (NRC) recently made advances toward a national disposal site for spent nuclear fuel. My recent Law360 column analyzes the potential impact of an eventual spent nuclear fuel disposal site on insurance coverage for nuclear plant owners. Shipping spent nuclear fuel offsite for disposal presents very different risks from those associated with storing the spent fuel onsite, which is the situation at many nuclear power plants today.

The D.C. Circuit recently held that the U.S. government may not collect any more fees from nuclear plant owners under the Nuclear Waste Policy Act until it finalizes a disposal solution for spent fuel. Nat’l Ass’n of Regulatory Util. Comm’rs v. U.S. Dep’t of Energy, Nos. 11-1066, 11-1068, 2013 WL 6064021 (D.C. Cir. Nov. 19, 2013). Additionally, the NRC directed its staff last month to “complete and issue the Safety Evaluation Report” on the U.S. Department of Energy’s (DOE) application for consideration of the Yucca Mountain site as a disposal facility. In the Matter of U.S. Dep’t of Energy (High-Level Waste Repository), No. 63-001, __ N.R.C.___, slip op. at 23 (Nov. 18, 2013). Continue reading “Disposal Site for Spent Nuclear Fuel Could Change the Insurance Picture for Nuclear Plant Owners”

Insurance Implications for M&A Deals

Jared Zola

Zola, JaredInsurance-related issues are a critical aspect of any merger or acquisition and should be addressed early in the deal process. The insurance-related issues that may arise in deal contexts are too many to address here, but companies entering a potential deal should keep the following considerations in mind.

Evaluate liabilities, exposures, and insurance program. Evaluating a target company’s insurance program frequently sheds light on the company’s overall operations and quality of the company being purchased. A target company that presents a poor insurance risk relative to its loss history may also be a poor business risk. Accordingly, a party to a potential deal will be well-served to evaluate the target company’s operations to determine current liabilities and exposure to loss, and thoroughly examine the target company’s insurance portfolio to determine if existing insurance is likely to cover the liabilities. The analysis may also inform decisions regarding the need for future insurance purchases to fill any gaps in coverage for potential loss exposures. To conduct these evaluations and examinations, the company and its insurance coverage counsel should obtain the target company’s current and historical insurance policies, any coverage charts that may exist, pleadings from any litigation in which the target is involved, and loss history reports. Also, if possible, interviewing the target company’s internal legal and risk management teams and outside insurance coverage counsel frequently provides an efficient means to obtaining key information and answering questions. Continue reading “Insurance Implications for M&A Deals”