Zurich: Sony Is Not Covered for Defense

NU Online News Service, July 21, 3:06 p.m. EDT

Zurich American Insurance Co. is looking for a New York Supreme Court judge to determine that it is not obligated to indemnify or defend Sony Corp. against lawsuits and investigations related to the hacking of Sony’s PlayStation Network.

The suit says Sony has given notice to Zurich and is looking for the insurer to defend it against class-action claims, miscellaneous claims and potential attorney general probes related to the hacking of personal and financial information of millions of PlayStation Network users in April and June.

Sony has since been named in 55 class-action lawsuits in the U.S. and three in Canada, according to the suit. Each generally alleges Sony’s members suffered damages as a result of the unauthorized access to the information and by the alleged delay by Sony in notifying members of the cyber attack.

Zurich says its companies sold a primary commercial-liability policy to Sony Computer Entertainment America and an excess-liability policy to Sony Corp. of America—each in April.

The excess policy does not apply until Sony’s underlying insurance is exhausted, according to the lawsuit. Zurich says it has no duty to defend Sony even after underlying insurance is drained because the class-action complaints “do not allege injury or damages” covered by the policies.

Since the breach at PlayStation, Sony has offered insurance and identity-theft protection to customers.