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Infringement of Copyright in Architectural Design Embodied in Custom-Designed Home Covered as an Advertisement under Commercial General Liability Insurance (CGL)

Copyright, Insurance

Architects have a copyright infringement claim not only for infringement of original architectural plans and drawings, but also for infringement of designs embodied in a structure under the Architectural Works Copyright Protection Act of 1990. The infringer’s Commercial General Liability insurance may cover infringement of the structural designs since the completed 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 that 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.

Mid-Continent Cas. Co. v. Kipp Flores Architects, L.L.C., 602 F. App’x 985 (5th Cir. 2015)

 

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