State Farm loses effort to deny insurance protection to doctor whose advertising allegedly violated the Telephone Consumer Protection Act

A Flint-area doctor, Michael Kapraun, attempted to advertise by facsimile and ran afoul of the TCPA.  He was then served with a class action suit brought in an Illinois Court.  He referred the complaint to his Casualty insurer, State Farm, who had included in his commercial policy coverage for "advertising injury."  State Farm declined to defend Kapraun and brought a Michigan declaratory judgment action to uphold its denial.

The trial judge concluded that Kapraun's policy included coverage for the alleged violation and denied State Farm's effort to avoid coverage.  The Court of Appeals affirmed, noting, among other points, that contrary to State Farm's position, its policy expressly included coverage for causes of action arising outside Michgian jurisdiction.