Harvard loses fight with insurance company over Affirmative Action lawsuit fees

Massachusetts District Judge Allison D. Burroughs ended Harvard University’s (HU) bid to sue its insurance company, Zurich American Insurance (ZAI), to pay legal fees for Affirmative Action lawsuit filed by Students For Fair Admissions (SFFA).

Burroughs granted ZAI’s request for summary judgment and explained in her opinion that HU’s lawsuit was “unavailing [and] unsupported by case law.”

“Harvard’s arguments to the contrary are all unavailing, unsupported by case law, controlling or otherwise,” she wrote. “Put simply, because an unambiguous insurance policy must be applied as written; the notice provision in a claims-made policy must be strictly construed; and Harvard’s failure to satisfy a condition precedent vitiates coverage, Zurich’s motion for summary judgment.”

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Further, the opinion pointed to the fact that HU was obligated by the insurance policy to provide notice by January 30, 2016, 90 days after the lawsuit by SFFA was filed, but failed to do so until May 23, 2017. 

This failure to provide notice removed ZAI’s obligation to provide coverage for legal fees and expenses according to the court. 

“Massachusetts law is clear that (1) the unambiguous terms of an insurance policy must be strictly enforced and (2) an insured’s failure to comply with the notice provision of a claims made policy bars coverage,” the opinion stated. 

Harvard filed the lawsuit on Sept. 21, 2021, after ZAI refused to cover the university’s legal fees incurred since 2014 after SFFA filed suit. HU claimed that the insurance company had prior knowledge of the lawsuit before the required deadline and, therefore, had an obligation to cover legal fees. 

“Upon information and belief, Zurich had knowledge of the SFFA Action by late 2014 or early 2015, and no later than January 30, 2016,” the lawsuit read. 

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The court did not agree with HU’s conclusion. 

“Nor is an insurer’s actual or constructive knowledge of a claim sufficient notice to trigger coverage obligations under such a policy,” Burroughs wrote. “Even in cases where insureds directly provided information about a claim to an insurer’s underwriters—not the case here—courts have still held that this was insufficient to be considered notice of a claim as required by the strict provisions of a claims-made policy.”

HU is currently awaiting a ruling from the Supreme Court after oral arguments regarding the Students for Fair Admissions Inc. v. President & Fellows of Harvard College lawsuit were heard on Oct. 31. 

The Court is expected to release a decision during the spring term in 2023. 

Campus Reform contacted Harvard, Zurich American Insurance Company, and SFFA. This article will be updated accordingly. 

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