CBS May Lack Cover For Janet Jackson Antic: UPDATED

By Caroline McDonald

NU Online News Service, Feb. 10, 2:33 p.m.EST?Broadcasters, facing possible legal fallout from JanetJackson's breast flashing during the Super Bowl halftime show,probably aren't covered by their standard media liability policies,insurance industry experts said.[@@]

So far, the Federal Communications Commission, which has theauthority to levy heavy fines, has said it will investigate and anangry viewer filed a prospective class action in Federal Court,which was withdrawn today.

The suit was filed by Terri Carlin, a Tennessee bank worker, whoasked billions in damages on behalf of herself and millions ofviewers injured by the "lewd behavior" of Ms. Jackson and fellowperformer Justin Timberlake during the broadcast of their halftimeact at the Super Bowl, according to the New York Post.

A notice of dismissal filed in federal court today said Ms.Carlin wants to see if "remedial measures" announced by federalregulators and the companies involved succeed in preventing similaractivity, the Associated Press reported.

The suit naming Ms. Jackson, Mr. Timberlake, CBS, MTV and theirparent Viacom, alleged that the broadcast companies and the singersbreached an "implied" contract with viewers?not to subject them tosexually explicit acts during what should have been familyentertainment, the Post reported.

Jim Borelli, vice president, claims, with Media/ProfessionalInsurance in Kansas City, Mo., the largest provider of medialiability coverage in the world, said a class action lawsuit as aresult of Janet Jackson's actions would not fall within the scopeof traditional media liability coverage.

"It would be a stretch because it wouldn't be a classicdefamation, invasion of privacy or intellectual property tort," hesaid.

"Our policies traditionally don't cover any type of indecency orregulatory matters or criminal matters," he said, although "oddballcoverage issues" would need to be examined individually by theinsurer to determine if there is a "duty to defend" under thepolicy.

Mr. Borelli said of the proposed class action that "it soundslike they have a long way to go to prevail on the case. It doesn'tsound like a strong case." He added, "It's not a surprise becausehigh profile incidents like this can generate these nontraditional,oddball-type litigations."

Mr. Borelli said that another immediate issue is fines orsanctions levied by the FCC.

"Our media liability policies don't respond to regulatoryactions like that," he said.

The company's standard coverages, he noted, are defamation;outrageous conduct and invasion of privacy; and intellectualproperty perils such as copyright infringement, trademarkinfringement and plagiarism.

Whether the entertainers have their own coverage for the event,he said, would depend on the contract. In this case, he noted,Janet Jackson and Justin Timberlake most likely were independentcontractors. They could be added to a standard policy if it isagreed to in advance of a claim.

Those covered under a traditional media liability policy wouldbe employees of the company acting within the scope of theiremployment.

"Our policy has an exclusion of judicially determined,dishonest, fraudulent or criminal acts," Mr. Borelli said. "I don'tknow if Janet did anything that was dishonest in this case, but itwould be something that could be looked at."

Lance Ewing, president of the Risk and Insurance ManagementSociety and executive director for Park Place Entertainment in LasVegas, Nev., said that getting coverage for violation of FCC rules"would almost be like getting insurance for an OSHA violation,which you hope you never have to do. I don't know anybody out therewriting OSHA."

He said that coverage of potential injury to a third party whowatched the halftime show would "depend on how loosely or tightlyconstrued the insurance policy would be on the [general liability]side."

A similar situation, he said, occurred in Las Vegas where RoyHorn of Siegfried and Roy was mauled by a white Siberian tiger atthe MGM Mirage Hotel-Casino while the audience looked on. "Ifsomeone was affected, would there be third-party liability?" heasked.

Mr. Ewing noted, "We can insure almost anything, including spacealien abduction. As long as we can get actuarial table arms aroundit, there is always a way to write a premium."

Gene Williams, vice president of Chubb and Son and entertainmentpractice leader for Chubb Commercial Insurance, in Warren, N.J.,said, "Something somebody did on purpose is not negligent. Thatbecomes a tort in legal terms. Intentional acts are generally notcovered in liability insurance?it has to be an accident."

Mr. Williams said anyone can bring a lawsuit over anything, "butwhether you will get any money is another question. There has to benegligence, there have to be damages. Just because someone is upsetdoesn't mean they have damages. And it doesn't necessarily meanthat anyone was negligent."

He added that there is a difference between the financial lossthat someone might suffer and insurance, "and not every financialloss is covered by insurance." And there certainly could befinancial losses here, he said. "MTV may never get to produceanother Super Bowl again, Janet Jackson was kicked off the GrammyAwards telecast, the list could go on and on. But that has nothingto do with negligence or legal liability."

He noted that another coverage, "death and disgrace," could comeinto play if a company has a contract with Janet Jackson for beinga spokesperson for their product.

"If they now felt that because of what happened, continuing withthe promotion involving Janet Jackson would not be good for thesales of their product, the D&D would reimburse them for thecost they have incurred on the advertising campaign to date, whichcould be a lot of money," he explained.

Mr. Williams added that, "I would suspect she is involved withat least one corporate sponsor of some sort, but I have no idea whoit is."

But having said that, he noted, "My guess would be that there isno death and disgrace insurance; it's not something that iscommonly purchased in North America. We've actually written more ofit in the U.K. than in the U.S."

Ms. Jackson's publicist, PMK/HBH in Beverly Hills, said they donot handle her insurance coverage and could not answer questionsabout it. Ms. Jackson is represented by an attorney who handlessuch issues, they said, but would not disclose the lawyer'sname.