Coverage Issues in Active Shooter Claims: The Insured’s and Victim’s Perspectives
Last year (2020) was the least deadly year for U.S mass shootings in a decade.1 Yet, with the advent of spring 2021 and 200 mass shootings in a little over 100 days, inquiries for active shooter insurance policies have risen 50 percent, with a startling demand from the healthcare industry.2 There is some speculation that the isolation and stress caused by the COVID-19 pandemic has contributed to the recent spike in public violence.3
Of great concern to carriers is the potential exposure to liability of the insured owner of the premises where a shooting occurs. This concern has reached a fever pitch as of late. The concern is understandable in light of recent developments like the $800 million settlement reached in the MGM Las Vegas shooting litigation, $751 million of which will be funded by insurance.4
Under general principles of tort law, an owner of a premises that is the site of a shooting is only liable for injuries caused to patrons if the criminal acts of the shooter were foreseeable.5 More specifically, the judicial philosophy of the past was that an establishment had no duty to protect patrons from mass shootings because they were not reasonably foreseeable and were considered extremely unlikely, even if the owner was aware of some “warning signs” of potential violence.6 States have attempted to clarify the duty owed to patrons of businesses through laws such as the Colorado Premises Liability Act,7 but, as shootings continue to make recent headlines, courts are feeling the tension in deciding these tragic cases.
For example, in the prominent case Lopez v. McDonald’s Corp, a California Appeals court evaluated the liability of the McDonald’s Corporation after a mass shooting occurred in a McDonald’s in San Ysidro, California in 1984.8 Ultimately, the court concluded as a matter of law that the mass murder that occurred was not a foreseeable harm that could expose McDonald’s to liability.9 The court reached this conclusion despite the plaintiff’s introduction of evidence of previous violent crimes occurring on the premises, a higher crime rate at the location compared to the city at large, and testimony showing the McDonald’s had rejected a private security firm’s offer to provide services.10 The court found that the previous incidents of crime had no relationship to the homicidal nature of the mass shooting and that the shooting was simply not a foreseeable event that McDonald’s had a duty to prevent.11
It is heartbreaking to admit, but times have changed. The sad reality is that mass shootings are no longer “once-in-alifetime”12 occurrences. Consequently, courts are more willing to at least entertain the notion that these horrific events are foreseeable due to their increased frequency and can, therefore, impose liability on a premises owner.13
Compare the almost outright dismissal of claims in Lopez to the extensive analysis performed in the premises liability action filed after the El Paso Walmart shooting in 2019.14 The court in the Walmart case wrestled with the issue of whether discovery requests seeking information on related crimes and security information in other Walmart stores were reasonable and relevant.15 Intimately tied to these requests was the question of whether the information sought would produce evidence that the actions of the El Paso shooter were foreseeable.16 Previously, an individual entering a business to commit mass murder was an almost inconceivable notion; however, the Walmart court almost took for granted the fact that mass shootings are common enough that discoverable corporate policies related to active shooter situations could exist in the first place.17
Another critical consideration is whether the shooter’s conduct supersedes any negligence on the part of the premises owner, but such can be a context-specific inquiry. Until recently, the shooter’s intentional, criminal conduct was typically seen as “predominant” over any possible negligence on the part of the premises owner in failing to protect patrons.18 However, courts now seem more apt to consider all circumstances and actions of a premises owner leading up to a shooting in their evaluations of whether a shooter’s conduct truly “predominates” any negligent conduct by an owner.19
With regard to recovery against a shooter, a victim’s ability to collect upon a policy owned by the shooter often hinges upon the shooter’s intent. Factual inquiries surrounding denial of claims under intentional acts exclusions can be complex.20 For example, some courts are willing to infer the intent to injure as a matter of law from the violent, reckless nature of a shooter’s acts, even if the exact intent behind an inflicted injury is uncertain.21 Still others find that, depending on the wording of an exclusion provision, the criminal nature of an act voids coverage regardless of a shooter’s intent.22 Finally, in some instances the questions courts face can grow even more complicated when the perpetrator is deemed to be mentally ill.23
With the prevalence of mass shooting events, courts today may be more willing to find such conduct “foreseeable” to insured premises owners. The coming years will be telling in how far courts are willing to go in expanding the duties that business owners owe to their patrons in a world where mass shootings make regular headlines. The impetus then, lies on carriers to remain apprised of the current state of the law and to be meticulous when crafting criminal and intentional acts exclusions. The Insurance Company Team is able to assist you should you have questions in this regard.
Justin Wilson, incoming associate with the class of 2022, contributed to this article.
1 Noor Hussain & Carolyn Cohn, Mass shooting insurance in high demand as U.S. emerges from lockdown, Reuters, (May 13, 2021).
4 Michael Steinlage, Liability for Mass Shootings: Are We at a Turning Point? American Bar Association (Feb. 7, 2020).
5 See Rest. (2d) of Torts § 344 cmt. f (1965) (“Since the possessor is not an insurer of the visitor’s safety, he is ordinarily under no duty to exercise any care until he knows or has reason to know that the acts of the third person are occurring, or are about to occur.”)
6 See Lopez v. McDonald’s Corp, 193 Cal. App. 3d 495 (Cal. Ct. App. 1987).
7 Colo. Rev. Stat. § 13-21-115 (2006).
8 Lopez, 193 Cal. App. 3d at 500.
9 Id. at 509.
10 Id. at 502.
11 Id. at 509 (“[T]he risk of a maniacal, mass murderous assault is not a hazard the likelihood of which makes McDonald’s conduct unreasonably dangerous. Rather, the likelihood of this unprecedented murderous assault was so remote and unexpected that, as a matter of law, the general character of McDonald’s nonfeasance did not facilitate its happening. Huberty’s [the shooter’s] deranged and motiveless attack . . . is so unlikely to occur within the setting of modern life that a reasonably prudent business enterprise would not consider its occurrence in attempting to satisfy its general obligation to protect business invitees from reasonably foreseeable criminal conduct.”)
12 Id. at 504.
13 See Axelrod v. Cinemark Holdings, Inc., 65 F.Supp.3d 1093, 1099 (D. Colo. 2014) (“I do not disagree at all with the holding in the Lopez case. But what was ‘so unlikely to occur within the setting of modern life’ as to be unforeseeable in 1984 was not necessarily so unlikely by 2012.”)
14 See In Re Walmart, Inc. 620 S.W.3d 851 (Ct. App. Tex. 2021)
15 Id. at 855-56.
17 Id. at 862 (“The trial court could have concluded that the request is reasonably calculated to lead to the discovery of information related to Walmart policies and procedures related to active shooter-type situations involving armed criminals posing a direct threat to human life.”)
18 See e.g., Nowlan v. Cinemark Holdings, Inc., 2016 WL 4092468, at *3 (D. Colo. Jun. 24, 2016) (holding Aurora theater shooter’s actions were predominant cause of plaintiffs’ losses)
19 Rocky Mountain Planned Parenthood, Inc. v. Wagner, 467 P.3d 287, 289 (Colo. 2020) (holding genuine issue of material fact existed as to whether shooter’s conduct was predominant cause of plaintiffs’ injuries and therefore liability due to conduct of premises owner as a substantial factor in the cause of plaintiffs’ injuries could still exist)
20 See Allstate Ins. Co. v. Pond Bar, No. 3-94-1310, 1995 WL 568399 (D. Minn. May 19, 1995).
21 Id. at *8.
22 Liebenstein v. Allstate Ins. Co., 517 N.W.2d 73, 75 (Ct. App. Minn. 1994).
23 See e.g., Municipal Mut. Ins. Co of West Virginia v. Mangus, 443 S.E.2d 455, 458 (holding that intentional act exclusion provision applied and mental illness of insured did not prevent him from intending his actions); cf. Swift v. Fitchburg Mut. Ins. Co, 700 N.E.2d 288, 289 (Ct. App. Mass. 1998) (holding that criminal acts exclusion was inapplicable because insured was mentally ill and found not guilty by reason of mental illness in related criminal proceeding)