Insurer Sues to Avoid Coverage for Templeton Whiskey’s Alleged Mislabeling

Society Insurance has filed a lawsuit in Iowa federal court seeking a declaration that its policy does not require it to defend or indemnify Templeton Rye Spirits in a putative consumer class action alleging that the whiskey distiller falsely represented its products as made from a Prohibition-era recipe. Soc’y Ins. v. Templeton Rye Spirits LLC, No. 15-0005 (S.D. Iowa, filed January 5, 2015).

The underlying lawsuit asserts that Templeton claims its whiskey is made in a “small batch” from a Prohibition-era recipe that was a favorite of Al Capone’s, but that the product is actually distilled at an MGP Ingredients, Inc. factory in accordance with a stock MGP recipe. Society seeks a judicial declaration that Templeton’s insurance policy, which Society argues covers only damages based on bodily injury, property damage or personal and advertising injury, will not require Society to indemnify a settlement or judgment against Templeton. The insurance company argues in the alternative that if the court finds that the policy agreement does cover the putative class action’s allegations, they either fall into a specific policy exclusion or are outside the policy period because Templeton began its alleged false representation before the policy took effect.

Issue 550