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The NCAA and Its Insurers Are Fighting Over Coverage for Concussion Lawsuits

(Editor’s Note: What follows is a brief excerpt of an article written by attorney Richard C. Giller of Polsinelli PC that appeared in the August 2015 Concussion Litigation Alert. For the rest of the article and numerous others, please subscribe at https://concussionpolicyandthelaw.com/subscribe/)

On June 10, 2014, Adrian Arrington, the lead plaintiff in a concussion class action lawsuit filed against the National Collegiate Athletic Association, fired his attorney claiming that he never approved a proposed $75 million settlement of the case.  Mr. Arrington has reportedly also asked the judge overseeing the litigation to reject the proposed settlement.  Arrington, a former strong safety and captain of the Eastern Illinois University football team, claims in his September 2011 lawsuit that he was forced to stop playing football because of health issues including “numerous and repeated concussions” he suffered during his college playing days.  Arrington claims that the five concussions set forth in his complaint, as well as other head injuries sustained playing college football, resulted in serious medical issues including memory loss, seizures and headaches, all of which cut short his football career.  The plaintiffs in the NCAA concussion case claim that the organization knew about but disregarded information concerning the long-term effects of concussions and other forms of head trauma on athletes, and that the Association ignored studies involving the link between the frequency and severity of concussions and certain types of sports.[1]

Sports concussion lawsuits trigger a number of important cultural, medical and legal issues.  However, the focus of this article will be on one of the more pedestrian topics; i.e., whether insurance coverage is available to the NCAA to help offset the tens or hundreds of millions of dollars in defense and indemnity payments arising out of these types of claims.  It has been reported that that the NCAA and several of its insurers have reached settlement agreements concerning coverage for concussion lawsuits and that the NCAA is engaged in negotiations with other insurers on a defense cost sharing agreement for the concussion cases.[2]  Despite this progress, several insurance companies are contesting coverage based upon a number of issues and this article will analyze the merits of the coverage positions staked out by some insurance carriers.

The NCAA Concussion Litigation and Proposed Settlement

Underlying Concussion Litigation

Arrington’s lawsuit against the NCAA was filed in federal court in Chicago and became the first of a number of concussion lawsuits filed against the Association.[3]  In fact, over the last few years there have been over a dozen additional proposed class action concussion cases filed across the country naming the NCAA as a defendant.[4]  In December 2013, the actions pending at the time were consolidated into a single multi-district litigation (MDL), which is currently pending in the United States District Court for the Northern District of Illinois.[5]

The NCAA MDL includes claims for negligence, fraudulent concealment, unjust enrichment and medical monitoring, and alleges that the Association breached certain duties purportedly owed to college athletes by not taking steps to prevent head injuries despite purportedly knowing how severe the repercussions might be for an athlete who suffers a concussion.[6] In addition to allegations that the NCAA withheld information from athletes regarding the long-term effects of concussions, the MDL plaintiffs also allege that the NCAA failed to properly train coaches and athletic trainers in how to identify concussion symptoms or to implement proper coaching methods for determining whether an athlete has suffered a concussion or when and for how long a player should refrain from athletic activities after suffering a concussion.

The MDL plaintiffs further allege that the NCAA failed to implement regulations to minimize or reduce activities which were likely to lead to concussions and head trauma, such as failing to implement proper tackling techniques in football, for example, or reducing the number of headers a soccer player is involved with during practice, among other claims.  Finally, the concussion MDL alleges that the NCAA failed to implement standard “return-to-play” guidelines in each of the sanctioned sports with respect to athletes who sustained head trauma.

Proposed Settlement in the Underlying Concussion Litigation

In 2014, the parties to the NCAA MDL reached a preliminary $75 million settlement of the medical monitoring portion of the litigation.  Pursuant to the proposed settlement, a $70 million common fund would be established for the creation of a medical monitoring program and the NCAA would contribute an additional $5 million over the next ten years to fund research regarding the prevention, treatment, and effects of concussions.  The proposed settlement class includes “all persons who played an NCAA-sanctioned sport at an NCAA member institution at any time through the date of Preliminary Approval.”  To characterize that class as being “broad” would be an understatement.  The settlement class is not limited to any particular sport or any level of competition and is estimated to encompass over four million current and former college athletes.  Instead, it apparently includes any athlete who played any sanctioned sport for any length of time at any NCAA member institution.

According to the Association’s website, “The NCAA and its insurance carriers will pay $70M to fund a medical monitoring program that will provide medical evaluations to qualifying class members over a period of 50 years. The medical monitoring program will be overseen by a medical science committee composed of four leading experts in the management and treatment of concussions, including NCAA Chief Medical Officer, Brian Hainline.”[7]  The Association’s website also notes that “the medical monitoring program will in some measure be funded through the NCAA’s insurance carriers.”  The website explains that under the terms of the proposed settlement, “certain of the NCAA’s insurers have agreed to pay a portion of the Settlement Amount.  If those insurers …

(For the rest of the summary with more details about the parties and claims, please subscribe to Concussion Litigation Reporter.)

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Insurance Coverage For Concussion Lawsuits

(In an article that appears in Concussion Litigation Reporter, attorneys Shaun Crosner and Michael Gehrt of Dickstein Shapiro examine how leagues, teams, and schools may be able to defray some or all of these expenses with frequently overlooked assets. To read the entire article, subscribe to CLR at https://concussionpolicyandthelaw.com/subscribe/)

As demonstrated by the recent wave of lawsuits against the NFL and its  member teams, concussions in sports continue to be a significant source of  potential legal liability for professional leagues and teams. The same is true  for colleges, universities, and secondary schools—all of which have seen an  appreciable increase in the number of concussion lawsuits filed by current and  former student-athletes.

This surge in concussion litigation is partially attributable to a  number of recent medical studies purporting to link certain head injuries to  long-term health problems caused by chronic traumatic encephalopathy (CTE), a  progressive degenerative disease of the brain found in individuals with a  history of repetitive concussions. According to these studies, the changes in  the brain caused by CTE can potentially continue months, years, or even decades  after an athlete’s last concussion or retirement from active athletic  participation.

Lawsuits brought by athletes seeking substantial damages for alleged  physical and emotional injuries can be extremely expensive to defend, and these  suits can subject leagues, teams, and schools to potential exposure in the form  of settlements and judgments. However, leagues, teams, and schools may be able  to defray some or all of these expenses with frequently overlooked assets:  their commercial general liability (CGL) insurance policies.

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