Western Capital Partners, LLC v. Chicago Title Insurance Compa

SYKES, Circuit Judge.

This insurance dispute is governed by Illinois law and raises a question of first impression in that state: May a title insurer contractually limit its duty to defend its insured to claims or causes of action specifically covered by its policy?

The question arises in complex coverage litigation between Philadelphia Indemnity Insurance Company, a general liability carrier; Chicago Title Insurance Company, a title insurer; and Western Capital Partners LLC, a high-risk real-estate lender insured by both companies. When Western Capital attempted to foreclose on some mortgaged…