Essex Insurance Company Prevails on Summary Judgment: Material Misrepresentations Void Coverage

Nicolaides Fink Thorpe Michaelides Sullivan LLP secured a victory for client Essex Insurance Company on March 14, 2014, with the denial of motions for reconsideration in the case of Essex Insurance Co. v. Galilee Medical Center, No. 11-cv-06934 in the U.S. District Court for the Northern District of Illinois.  The Honorable Judge John W. Darrah ruled that the professional liability insurance policy at issue is void under Section 154 of the Illinois Insurance Code due to material misrepresentations made by insureds in their applications.

Essex Insurance Company issued a professional liability policy to Galilee Medical Center and Dr. Luis Angarita, one of Galilee's physicians.  In an underlying lawsuit, plaintiff Rosa Ravelo sued the insureds for malpractice, alleging she suffered bodily injury in the form of granulomas as a result of “mesotherapy” treatments recommended by Dr. Angarita at a Galilee office and administered at Dr. Angarita's home.  Ravelo alleged mesotherapy treatment is a series of drug injections for “size reduction.”  

Essex sought a declaration that it did not owe coverage for the lawsuit due to material misrepresentations made by Galilee and Dr. Angarita in their insurance applications.  Specifically, both Galilee and Dr. Angarita answered “no” when asked if their practice involves the use of drugs for weight reduction.  The District Court granted Essex's motion for summary judgment, finding mesotherapy is a process used for weight loss, and the insureds had accordingly misrepresented that they do not use drugs for weight reduction in their practice. 

[Essex Ins. Co. v. Galilee Med. Ctr., Case No. 11-cv-06934, U.S. District Court for the Northern District of Illinois]