Damage Caused by Marijuana Cultivation Can Still Be Excluded, Even if Grown in A State Where it is Legal

August 27, 2018

The United States Court of Appeals for the Sixth Circuit has decided to affirm the lower courts ruling that the insurer properly denied coverage for a landlords insurance claim exceeding $500,000 in damage resulting from a tenants' use of the space to operate a medical marijuana-growing facility because the insured failed to demonstrate that the Michigan Medical Marihuana Act had been followed strictly, and therefore, the insurance policy's dishonest or criminal acts exclusion bars coverage. The case is K.V.G. Properties Inc. v. Westfield Insurance Co., No. 17-2421, 2018 U.S. App. LEXIS 23296 (6th Cir. Aug. 21, 2018)