Insurance covering liabilities for copyright infringement is not provided by a commercial general liability (CGL) insurance policy unless the copyright infringement liability occurs in the course of advertising. While copying architectural plans would ordinarily not involve advertising, in a recent case livability for copying of the constructed architectural work, a model home, was co
vered by the CGL policy since the facts showed the model homes were themselves advertising for other homes to be built or sold.
Copyright in architectural works became firmly established in the United States in 1990 with the passage of the Architectural Works Copyright Protection Act. The Act added “architectural works” to the scope of works of authorship that might be copyrighted.. As a result architects may have a copyright infringement claim not only for infringement of original architectural plans anddrawing, but also for infringement of designs embodied in a structure.
In a recent case a homefuilder sought insurance coverage under a CGL insurance policy to pay a $3 million plus damage award for copyright infringement in favor of an architect against the builder. A homebuilder had commissioned an architect to create designs eleven different homes. The homebuilder only obtained a license to build one home for each design. The homebuilder constructed hundereds of houses based upon the design. license to buildwho exceeded a license from the architect to build only one home based upon each licensed design, the builder sought insurance coverage for the claim. between A homebuilder had commissioned an architect to design eleven different homes, and had obtain a to only build one home for each designed. license to build
under the Architectural Works Copyright Protection Act of 1990. Commercial General Liability insurance may cover infringement of the structural designs since the structure itself may be an advertisement.
Following a $3 million plus award for copyright infringement in favor of an architect against a builder who exceeded a license from the architect to build only one home based upon each licensed design, the builder sought insurance coverage for the claim. The homebuilder’s commercial general liability policies, commonly entitled CGL policies, excluded coverage for copyright infringement but had an exception arising out of “advertising injury” based upon copyright infringement in an “advertisement.” The appeals court held because the homebuilder used the infringing houses to market to other potential purchasers, the damages awarded were an “advertising injury” that the insurer must cover.
