Harvard files late but appeals for coverage

Judges dubious on insurance claim

A three-judge panel of the US First Circuit Court of Appeals in Boston listened skeptically Wednesday as an attorney for Harvard argued that an insurance company should be required to cover the university’s legal expenses in a high-profile affirmative action case — even though Harvard did not file a formal claim before the deadline.

A US District Court judge ruled in November that Harvard could not use the $15 million policy with Zurich American Insurance Co. to cover costs in a lawsuit over the university’s race-conscious admissions policy because the Ivy League institution had not satisfied the policy’s requirements, even if Zurich had learned informally about the affirmative action case.

Appeals Court Judge Bruce M. Selya told attorneys for both sides Wednesday that the state’s Supreme Judicial Court has repeatedly ruled that Massachusetts law requires the filing of a formal claim within the deadline.

“Aren’t we bound by those precedents?” Selya asked Harvard’s attorney. “We can’t change the SJC’s law, and the law of the circuit says we can’t change our interpretation of the SJC’s law.”

Marshall Gilinsky, Harvard’s lawyer, acknowledged that the university had missed the deadline but argued that “the policy in this case had multiple requirements within a notice reporting revision.” He said Harvard had reported the case to the insurer by other means, and that Zurich had included that information in setting rates for Harvard’s policy.

Andrew L. Margulis, the attorney for the insurance company, said Harvard had not complied with “a clear condition” of its coverage under the insurance policy and denied that Zurich had revised rates based on the affirmative action case.

“The policy has a clear, plain, written reporting requirement . . . and it says, ‘As a condition precedent to the obligations of the insurers under this policy, written notice must be given in all events no later than 90 days after the policy,’” Margulis said. “Harvard admits it did not give notice until a year and a half later.”

The US Supreme Court is expected to rule soon in the case of Students for Fair Admissions v. Harvard, a lawsuit filed in 2014 alleging that Harvard’s admissions practices illegally discriminated against Asian American applicants.

Harvard notified its prima

ry insurer of the suit right away, according to court records, but delayed notifying Zurich, its excess insurer, until May 2017, more than a year after the deadline.

Harvard sued after Zurich refused to pay. It was unclear Wednesday when the Appeals Court will rule in the lawsuit, but the judges’ dubiousness was evident.

“I’m just questioning . . . looking at a case that has a general rule and then saying that, well, ‘This circumstance is factually different, so the general rule doesn’t apply,’” said Judge William J. Kayatta Jr. ”That’s a bit of a reach when we’re looking at state law, and you’ve chosen to bring it in the federal court, where our job isn’t to create new state law.”