Cosby is defending against defamation lawsuits by Tamara Green, Therese Serignese, and Linda Traitz in Massachusetts, and Janice Dickinson in California, spurred by denials by the entertainer or his representatives of claims of sexual misconduct.

 In a filing in the federal court in Springfield, Massachusetts, Cosby said he would face "substantial prejudice" by being forced to defend simultaneously against AIG over the policies and against the women over the defamation claims.

 According to Reuters, Cosby's lawyers stated, "Forcing Mr. Cosby to fight a fourfront battle would demonstrate AIG's complete disregard for the best interests of Mr. Cosby. Not only does AIG's action bolster the underlying plaintiffs, who will perceive Mr. Cosby as under attack even from his supposed backers, but it splits Mr. Cosby's focus and drains his resources."

 In that regard it has been reported that more than forty women have accused Cosby of having drugged and sexually assaulted them within the last several decades. Cosby has not been criminally charged, and he and his lawyers have denied wrongdoing on his part.

 Green, Serignese, Traitz, and Dickinson are also named as defendants in AIG's lawsuits. The New York-based insurer said it was seeking relief that could affect their defamation cases. The cases are AIG Property Cas. Co v. Green, No. 15-30111, D. Mass., and AIG Property Cas. Co v. Cosby, No. 15-04842, D. Central Ca.

 There is no question that sexual molestation, especially sexual molestation of a child, is not subject to coverage under any liability policy, such as was decided in J. C. Penney Cas. Ins. Co. v. M. K., 52 Cal. 3d 1009 (1991). Cosby, though, has denied all of the allegations against him. Therefore, his argument, on balance, that the potential prejudice and hardship that could result from inconsistent factual determinations in the declaratory relief action and the tort actions brought by Green, Serignese, Traitz and Dickinson should outweigh any slight amount of prejudice AIG may suffer from a temporary stay.

 Additionally, a temporary stay may result in the simplification of issues in this action, as happened in State National Ins. Co., Inc., v. US-SINO Investment, Inc., Case No. 5:13-cv-05240-EJD, 2015 WL 5590842 (N.D. Cal. Sept. 23, 2015) and Selective Ins. Co. of America v. Dail, No. 4:14–CV–00103–F, 2015 WL 5330109 (E.D.N.C. Sept. 11, 2015).

 In Beazley Furlonge LTD v. Gateway Ambulance Service, LLC, No. 4:15CV918 JCH, 2015 WL 5254416 (E.D. Mo. Sept.9, 2015) the court concluded a declaratory relief action should be stayed rather than dismissed. Where the basis for declining to proceed is the pendency of a state proceeding, a stay will often be the preferable course because it assures that the federal action can proceed without risk of a time bar if the state case, for any reason, fails to resolve the matter in controversy.

 District courts possess significant discretion to dismiss or stay claims seeking declaratory relief, even though they have subject matter jurisdiction over such claims, as seen in R.R. Street & Co., Inc. v. Vulcan Materials Co., 569 F.3d 711 (7th Cir. 2009). If state and federal proceedings are parallel and the federal suit contains claims for both declaratory and nondeclaratory relief, the district court should determine whether the claims seeking nondeclaratory relief are independent of the declaratory claim. A claim for relief is independent of the declaratory claim if it has its own federal subject-matter-jurisdictional basis and its viability is not wholly dependent on the success of the declaratory claim. If the actions are parallel the court should avoid piecemeal litigation.

 Since the AIG declaratory relief actions require a finding that Cosby committed the sexual molestation actions alleged against him to prove the allegations of the declaratory relief action.

 The court in Cincinnati Ins. Co. v. Silvestri Paving Co., No. 10 C 07971, 2011 WL 4686437 (N.D. Ill. Oct. 4, 2011), quoting Nationwide Ins. v. Zavalisi, 52 F.3 689 (7th Cir.1995), found that when the argument that the declaratory relief actions are premature because a determination as to coverage could require determinations of fact that could bind the parties in the underlying litigation, the court is not required to dismiss or stay where "the insurer's duty to defend…'can be evaluated without any excursion into fact-finding that would interfere with the…underlying state court suit.'"

 However, Cosby's case is fact dependent. If Green, Serignese, Traitz, and Dickinson prove he molested them sexually and then defamed them when he denied their allegations, the declaratory relief action will be unnecessary to prove the same thing. Similarly, if Cosby proves in the tort actions that he did not sexually molest the four women nor did he defame them, the declaratory relief action is unnecessary. The facts should, therefore, be determined once and should prevent AIG from forcing Cosby to litigate in multiple lawsuits to determine the essential facts and staying the declaratory relief action will not prejudice AIG's rights.

 As stated by the court in Mullen v. Glens Falls Ins. Co., 140 Cal. Rptr. 605 (1977), in most states, an insurer is required to go beyond the face of a complaint and instruct an adjuster to perform a thorough, independent investigation to determine if other facts exist that may give rise to a potential duty to indemnify.

 This means that even if the complaint alleges that the insured planned to abuse the women and then defamed them by denying their allegations, an insurer may not be able to refuse to defend its insured on the "intentional act" exclusion or the "sexual molestation" exclusion without first conducting a thorough investigation establishing the wrongful intent. The investigation could show that the allegations of the complaint are totally false and fraudulent. Perhaps Cosby was not even in the city at the time of the alleged molestation or was free of fault on another basis.

 The duty to defend is not limited to cases where the suit against the insured is viable. The duty extends to those that are brought against the insured that are bad, false, or fraudulent. In Wild v. Subscription Plus Inc., 299 F.3d 618 (7th Cir. 2002), the Seventh Circuit was faced with a dispute over the duty to defend when there was a finding that the insurer, Scottsdale, had no duty to indemnify the two insureds because the accident was not covered by the policy after all.

 Scottsdale appealed the judgment that it had a duty to defend. It also appealed from the court's correlative order, based on Oklahoma insurance law, that it reimburse the insureds for the expense of defending against the tort suit.

 The Seventh Circuit, resolving the issue in favor of the insured, stated:

 If the suit against the insured were meritorious, the insurance company would pick up the tab for defending, but if the suit had no merit the expense of defending it would be borne by the insured. That would make no sense. The insured who has bought a liability policy that entitles him to defense as well as indemnification wants to be defended against claims of liability regardless of their merit. He doesn't want to be stuck with the lawyer's bill just because he wins and therefore doesn't need to look to the insurer for indemnification. If he wanted that he would just buy indemnification and not defense.

 In Chipokas v. Travelers Indem. Co., 267 N.W. 2d 393 (Iowa 1978), the court held that a duty to defend any suit against the insured "seeking damages which are payable under the terms of this policy, even if any of the allegations of the suit are groundless, false or fraudulent … does not import a duty to defend where there is no claim within the liability coverage."

 In McGaughey v. St. Paul Fire and Marine Ins. Co., 744 P. 2d 598 (Or. Ct. App. 1987) the Oregon Court of Appeal construed a duty to defend provision to apply to suits "for covered claims, even if the suit is groundless or fraudulent" to mean that the insurer had no duty to defend a suit, even if groundless, unless the claim would be covered under the policy.

 In Horace Mann Ins. Co. v. Barbara B., 4 Cal.4th 1076 (1993), the court found that under California law, an insurer has a duty to defend even if the claims against the insured are groundless, false, or fraudulent. Other jurisdictions have found the same, such as the court in U.S. Fid. & Guar. Co. v. Wilkin Insulation Co., 578 N.E. 2d 926 (Ill. 1991). The Illinois court also said, "Moreover, if the underlying complaints allege several theories of recovery against the insured, the duty to defend arises even if only one such theory is within the potential coverage of the policy." In Montrose Chem. Corp. v. Superior Court, 6 Cal.4th 287 (1993), the court said, "Any doubt as to whether the facts establish the existence of the defense duty must be resolved in the insured's favor."

 The court in Cincinnati Ins. Co. v. Eastern Atlantic Ins. Co., 260 F.3d 742 (7th Cir. 2001) stated, "What is important is not the legal label that the plaintiff attaches to the defendant's (that is, the insured's) conduct, but whether that conduct as alleged in the complaint is at least arguably within one or more of the categories of wrongdoing that the policy covers." The court went on to say that "the duty to defend is not limited to meritorious actions; it even extends to actions that are groundless, false, or fraudulent as long as there exists the possibility that the allegations implicate coverage."

 In Lexington Ins. Co. v. Charter Oak Fire Ins. Co., 81 A.3d 903 (Pa.Super.2013), the court declared, "The duty to defend persists until an insurer can limit the claims such that coverage is impossible."

 No one knows how the court will rule, but it appears the equities favor Cosby, who faces multiple accusations he claims are false. As a result, he has been sued and is entitled to a defense from his insurers until there exists proof that the exclusions apply. A decision on coverage should never be established by an allegation emphatically denied by an insured. Rather, there must be a finding from a preponderance of evidence that the exclusion applies.