The opinion of the court was delivered by: United States District Judge Elaine E. Bucklo
MEMORANDUM OPINION AND ORDER
On September 6, 2012, plaintiff JAR Laboratories sued its insurer, Great American E&S Insurance Company, seeking a declaration that defendant has a duty to defend it in a lawsuit (the "underlying suit") filed by Teikoku Pharma USA ("TPU"). In addition to declaratory relief, plaintiff seeks damages for breach of contract and for vexatious and unreasonable denial of plaintiff's claim. Defendant answered the complaint and asserted numerous counterclaims including its own request for a declaratory judgment that it owed no duty to defend or indemnify plaintiff with respect to the underlying suit.
Now before me are the parties' cross-motions for summary judgment, in which each party seeks judgment in its favor on the respective declaratory claims; plaintiff seeks judgment on its contractual claim and on counts I through VII of defendant's counterclaim; and defendant seeks judgment in its favor on plaintiff's vexatious and unreasonable denial of coverage claim. For the following reasons, plaintiff's motion is granted, and defendant's motion is granted in part.
The bulk of the parties' dispute is over whether defendant must defend plaintiff in the underlying lawsuit, in which TPU, the distributor of a pharmaceutical product called Lidoderm, claims that it was injured by false and misleading representations plaintiff made in the course of promoting its own product, LidoPatch.*fn1 Except where noted, the following facts are not in dispute.
Defendant issued plaintiff two liability policies (a primary policy and an excess policy, to which I refer collectively as the "policies"), both of which were effective from December 1, 2011, to December 1, 2012. The policies provide coverage for, among other things, "personal and advertising injury" liability, which the policies define to include injury arising out of "[o]ral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services.." GAIC App. 165. [DN 24-11] *fn2
The primary policy includes an endorsement containing an "Exclusion of Claims and 'Suits' Alleging Infringement of Intellectual Property" (the "IP Exclusion"). The IP Exclusion states:
I. Coverage B -- Personal and Advertising Injury Liability, 2. Exclusions, I. Infringement of Copyright, Patent, Trademark or Trade Secret, is deleted and replaced by the following:
i. Claim or Suit Alleging Infringement of Intellectual Property
(l) Any claim or "suit" that alleges "personal and advertising injury" arising out of any actual, alleged, or threatened misappropriation, infringement, or violation of any one or more of the following rights or laws:
k) other right to or law recognizing an interest in any expression, idea, likeness, name, style of doing business, symbol, or title;
l) laws or regulations concerning piracy, unfair competition, unfair trade practices, or ...