Michael KeeleyMichael Keeley Clark Hill
Michael Keeley is a trial lawyer who began his career handling securities cases and other commercial litigation, but now devotes the entirety of his practice to insurance coverage and defense. He is known as one of only a couple of “go-to” lawyers in the U.S. in fidelity, crime and F.I. matters. He has significant experience representing insurers in a wide range of significant coverage disputes involving most types of insurance products, with particular proficiency in the areas of fidelity/crime, directors and officers insurance, and professional liability and errors and omissions policies. He also is experienced in defending professional and fiduciary insureds, and also is called upon to assist in the defense of many other types of insureds. Because of his experience, Mr. Keeley is frequently retained to represent insurers in complex coverage disputes in both federal and state courts across the country, and occasionally in Mexico, South America, and overseas. He is also hired to represent insurers in significant coverage appeals throughout the country. Mr. Keeley also assists clients in developing and expanding products and in drafting policies.
Mr. Keeley has extensive experience throughout the U.S. representing insurers in significant computer fraud, social engineering and cyber claims, Ponzi schemes and warehouse lending losses, including scandals involving Madoff, Pearlman, and Petters, and he has been involved in other high profile disputes such as Enron, HealthSouth and WorldCom. He also has significant experience in handling claims involving the FDIC and other regulators. Other significant coverage matters have included the seldom litigated “war” exclusion in a media policy involving the 50-day war between Israel and Hamas, a tragic railroad accident, an oil well explosion, and non-subscriber policies, ERISA, and class action insurance litigation.
Mr. Keeley is the Chair of Clark Hill's Fidelity, Surety and Coverage business unit. He is a past Chair of the Fidelity & Surety Law Committee of the American Bar Association, an Advisor to The Surety & Fidelity Association of America and to the Fidelity Law Association, the Editor-in-Chief of the Fidelity Law Journal, a past Editor-in-Chief of the Tort & Insurance Law Journal, and author and editor of well-known books and articles on fidelity and crime insurance.
- Currently represents insurer in federal court in Virginia involving a hacking claim resulting from a well-known Russian cyber-crime group that sent phishing emails to the bank, leading to millions of dollars of withdrawals from ATMs around the world. The National Bank of Blacksburg v. Everest National Insurance Co.; No. 7:18-cv-00310-GEC (W.D. Virginia).
- Currently represents insurers in a vendor fraud lawsuit in state court in which the insured seeks computer fraud coverage resulting from fraudulent invoices sent via emails. Westlake Chemical Corp. v. Berkley Regional Insurance Co. and Zurich American Insurance Co.; No. 2017-43569 (Harris County, Texas).
- Successfully represented insurer in appeal of significant employee dishonesty loan loss case. In Renasant Bank v. St. Paul Mercury Insurance Co., 17-60168, 2018 U.S. App. LEXIS 2903 (5th Cir. Feb. 6, 2018), the Fifth Circuit Court of Appeals was asked to rule that the financial benefit requirement of the Financial Institution Bond issued to the bank was unenforceable because the bond was a "statutory bond" that failed to comply with a Depression-era Mississippi statute requiring bank employees to obtain a surety bond against acts of dishonesty without any conditions to coverage. In a noteworthy opinion for the insurance industry, the Fifth Circuit disagreed, relying upon a number of articles written by Mr. Keeley in concluding that the requirements of the policy helped to preserve the distinction between fidelity insurance and credit insurance. The opinion also is significant because only three other decisions had previously addressed this issue.
- On the eve of trial in federal court in Los Angeles, Mr. Keeley and a team of lawyers in Strasburger's Insurance Practice Group obtained summary judgment in a complicated and hard-fought lawsuit in which Strasburger's insurance client had denied coverage for a significant claim on the basis of the War Exclusion of the policy. NBCUniversal was in the process of filming a television show in Israel when an extended military conflict erupted between Israel and Hamas. NBCUniversal moved filming to Croatia and New Mexico, and sought coverage under a media insurance policy for loss due to imminent peril. NBCUniversal argued its losses were covered because the conflict involved terrorism, not War. Keeley and his team were able to side step the many political implications of the case and persuade the court that the conflict amounted to a War, resulting in a complete defense judgment. While the case was not one of first impression, there are very few cases in the history of American jurisprudence involving the War exclusion, so the lawsuit presented challenging legal issues in addition to a true battle with NBCUniversal and its counsel. UCP, et al. v. Atlantic Specialty Insurance Co., No. 2:16-cv-04435-PA (C.D. Cal. June 2, 2017).
- Represented the Surety & Fidelity Association of America as Amicus Curiae in helping to persuade the Fifth Circuit to reverse and render for the insurer following the trial court's erroneous decision to grant summary judgment that the insured's losses were covered under the Computer Fraud Insuring Agreement of a commercial crime insurance policy. Apache Corp. v. Great American Ins. Co., 662 F. App'x 252 (5th Cir. 2016). This decision has since been the subject of numerous legal articles and has been relied on by courts in holding that losses for similar social engineering claims are not covered under commercial crime policies. For example, see Am. Tooling Ctr., Inc. v. Travelers Cas. & Sur. Co. of Am., No. 16-12108, 2017 U.S. Dist. LEXIS 120473 (E.D. Mich. Aug. 1, 2017).
- Represented commercial crime insurer in several-week trial in New York state court involving investment advisors' claims for significant losses resulting from Bernie Madoff Ponzi scheme, as well as bad faith claims, resulting in a complete defense verdict. U.S. Fire Ins. Co. v. Nine Thirty FEF Investments, LLC, 17 N.Y.S.3d 118 (N.Y. App. Div. 2015). Mr. Keeley successfully handled the appeal of the trial court's decision.
- Represented insurers in complex coverage lawsuit filed by over thirty banks in Minnesota involving multi-million dollar Louis Pearlman Ponzi scheme, obtaining summary judgment that was affirmed by the Minnesota Court of Appeals: Alerus Financial National Association v. St. Paul Mercury Ins. Co., No. A11-680 (Minn. App. 2012).
- Represented insurer in commercial general liability coverage litigation in California in which plaintiffs sought in excess of $100 million in damages involving identity theft and Ponzi scheme, obtaining summary judgment on both duty to defend and duty to indemnify and recovering several million in defense costs previously advanced, with decision being affirmed by the California Court of Appeals: Chicago Title Ins. Co. v. St. Paul Mercury Ins. Co., No. B221489 (Cal. App. 2011).
- Represented insurers in class action lawsuit filed in state court alleging multiple violations of the Texas non-subscriber statue and seeking to invalidate coverage under 73 separate insurance policies involving coverage of hundreds of millions of dollars. Successfully argued issues of first impression in order to remove lawsuit to federal court under the Class Action Fairness Act despite non-diverse defendants and non-federal question jurisdiction and defeated putative class plaintiffs' multiple efforts to remand case to state court, leading to a de minimus settlement of entire lawsuit.
- Represented fidelity bond insurers in litigation in New York involving claims by investors in the Bernie Madoff Ponzi scheme, obtaining partial summary judgment on coverage and bad faith issues.
- Represented insurer in complicated and far reaching employee dishonesty claim involving the alleged purchase of illegal tax credits in Sao Paulo, Brazil, with numerous depositions taken in Brazil and Argentina.
- Represented excess insurer in complicated coverage lawsuit filed by a bank in Tennessee seeking over $50 million in damages arising from a massive Ponzi scheme involving fraudulent warehouse loans, obtaining summary judgment that was affirmed by the Sixth Circuit. Union Planters Bank, N.A. v. Continental Casualty Co., 478 F.3d 759 (6th Cir. 2007).
- Represented insurer in litigation involving technology errors and omissions policy, obtaining summary judgment which was affirmed by Fifth Circuit. SingleEntry.com, Inc. v. St. Paul Fire & Marine Ins. Co., 330 F. Supp. 2d 827 (W.D. Tex. 2003), aff'd, 117 Fed. Appx. 933 (5th Cir. 2004).
- Represented insurer in litigation inn Florida filed by Taylor, Bean & Whitaker Mortgage Corp. seeking to recover alleged losses arising out of massive fraudulent scheme alleging involving Lee Farkas.
- Represented a fidelity bond insurer in obtaining a cost of defense settlement resulting from a complex and far-reaching fidelity bond scheme in Aberdeen, Scotland.
- Represented the primary fidelity bond insurer in lawsuit in federal court in connection with the fidelity bond claim submitted by Enron Corporation.
- Represented D&O insurers in HealthSouth, Enron and WorldCom claims.
- Represented insurer in employee dishonesty scheme involving the alleged theft of titanium from company based in England.
- Represented primary insurer in multi-party litigation in Nevada involving alleged fraudulent scheme by 1031 Tax Exchanger to embezzle exchanger funds for alter ego's own personal use.
- Represented architects' and engineers' insurer in rescission action in U.S. District Court in Phoenix, Arizona, involving a construction project at Phoenix Sky Harbor International Airport.
- Represented surety in a lawsuit in state court in San Antonio, Texas, in which the estate of a mother and child killed in an automobile accident is suing various parties, including the firm's client, as the completing surety.
- Represented insurer in a complex coverage dispute in which the bank allegedly lost multi-millions of dollars resulting from an employee embezzlement scheme involving Chinese nationals.
- Represented sureties in various performance and payment bond disputes throughout Texas, including an alleged default involving the Ellis County Courthouse in Waxahachie, Texas, as well as other governmental projects throughout the state.
- Represented surety in prosecuting a qui timet and exoneration claim against principal and indemnitors in a large performance bond dispute in Bexar County, San Antonio, Texas.
- Represented the American Insurance Association in preparing an amicus brief and successful appeal by surety, leading to an opinion that a surety does not owe a duty of good faith and fair dealing to its principal. Associated Indem. Corp. v. C.A.T. Contracting, 964 S.W.2d 276 (Tex. 1998).
- Represented insurer in obtaining important opinion that generic notice by the Federal Deposit Insurance Company does not comply with the notice provisions of a directors and officers insurance policy. McCullough v. Fid. & Dep. Co. of Maryland, 2 F.3d 110 (5th Cir. 1993).
- Represented insurer in landmark decision ruling that regulatory and insured v. insured exclusions of a directors and officers liability policy do not violate public policy. Fid. & Dep. Co. of Maryland v. Conner, 973 F.2d 1236 (5th Cir. 1992).
- Represented insurer in obtaining important decision that constructive notice does not suffice under a directors and officers insurance policy. FDIC v. Barham, 995 F.2d 600 (5th Cir. 1993).
- Represented insurer in obtaining important decision that majority shareholders and directors of a bank do not have standing to seek recovery for losses under a financial institution bond. Warfield v. Fid. & Dep. Co., 904 F.2d 322 (5th Cir. 1990).
- Represented fidelity bond insurer in obtaining ruling that Kansas law does not recognize a tort for bad faith refusal to pay a fidelity bond claim. RTC v. Fid. & Dep. Co. of Maryland, 885 F. Supp. 228 (D. Kan. 1995).
- Represented insurer in successfully obtaining a summary judgment finding that, despite fact that the bank's president had made un-creditworthy loans to friends and family members under suspicious circumstances, the president did not have the manifest intent to cause the bank to sustain a loss. Progressive Cas. Ins. Co. v. First Bank, 828 F. Supp. 473 (S.D. Tex. 1993).
- Cybercrime: Prevention, Insurance, and Limiting Losses: Moderated panel consisting of distinguished underwriters, claim handlers, insurance counsel, consultants, and an FBI agent pertaining to cyber threats faced in the U.S. and elsewhere, including social engineering, ransomware and data breach cases, what is being done to prevent and catch cybercriminals, insurance products available to protect against cyber losses and claims handling. ABA/TIPS Section Conference (May 2018)
- Practical Points: Establishing the Personal Connection in the Claim, ABA Fall Meeting of the Fidelity & Surety Law Committee (November 2017)
- Employee Dishonesty: The Essential Elements of Coverage Under Insuring Agreement (A), ABA Fall Meeting of the Fidelity & Surety Law Committee (November 2016)
- Employee Dishonesty Claims: Manifest Intent and Theft, ABA Fall Meeting of the Fidelity & Surety Law Committee (November 2015)
- Unraveling the Duty to Defend, Reservation of Rights, and Related Coverage Disputes, Panel moderator regarding the obligations of the insurer and insured, the right of the insured to independent counsel, and considerations affecting the potential withdrawal of a defense and the rights and duties that arise. ABA/TIPS Section Conference (April 2015)
- Claim Investigations in the Twenty-First Century, ABA Annual Mid-Winter Meeting of the Fidelity & Surety Law Committee (January 2013)
- Electronic Discovery: What Every Claim Professional Needs to Know in the Handling of Fidelity Bond Claims, ABA Fall Meeting of the Fidelity & Surety Law Committee (November 2012)
- Sailing the Seven Seas of Late Notice: The New and Improved Fifty-State Survey of the Notice/Prejudice Rule, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2012)
- Timing is Everything, Except When it Isn't: The Notice/Prejudice Rule (A 50 State Survey), ABA Annual Mid-Winter Meeting of the Fidelity & Surety Law Committee (January 2012)
- The Subprime Mortage Crisis and Bond Claims Pursued by Federal Regulators, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2011)
- Parsing Through and Surviving Claims Involving Multiple Carriers and Coverages: How to Handle the Complexities and Potential Conflicts, of the "Mega Claims," ABA Annual Mid-Winter Meeting of the Fidelity & Surety Law Committee (January 2011)
- "Superpowers" of Federal Regulators: The Subprime Mortgage Crisis and Bond Claim Issues Arising from Take Over by the FDIC, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2010)
- Ponzi Schemes: Claims, Coverage Issues and Quantification of Losses, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2009)
- Ethical Issues in Construction and Fidelity Matters, Gulfcoast Fidelity & Surety Institute Annual Meeting (May 2008)
- Where Does the Responsibility Lie for a Mortgage Banker's Fraudulent Activities?, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2007)
- Insured Agreement (A): Will the Recent Revisions to the Manifest Intent Requirement Clear the Waters or Make them Muddier than Ever?, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2006)
- The Attorney-Client Privilege and Work Product Doctrines: The Boundaries of Protected Communications Between Insured and Insurers, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2005)
- Rescission of Fidelity Bond Insuring an ERISA Employee Benefit Plan, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2004)
- Discovery of Loss, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2003)
- Employee Dishonesty: The Essential elements of Coverage Under Insuring Agreement (A): Where Are We Now With "Manifest Intent"?, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2002)
- E-Signature Act (Encrypted Signatures), ABA Insurance Risk Management Annual Conference (2002)
- Trying to Try the Complex Employee Dishonesty Claim; Motions for Summary Judgment; Discovery and Evidentiary Issues; and The Court's Charge. ABA Annual Mid-Winter Meeting of the Fidelity & Surety Law Committee (2000)
- Investigating the Employee Dishonesty Claim: Interviewing Witnesses, Obtaining Documents, and Other Important Issues in Handling Fidelity Bond Claims, ABA Fall Meeting of the Fidelity & Surety Law Committee (October 1999)
- Current Issues Involving Claims Against Directors and Officers, Strasburger Corporate Counsel Series (1998)
- "Superpowers" of Federal Regulators: Their Effect on Fidelity Bond Claims, ABA Annual Meeting (1995)
- Critical Loan Loss Issues Under Insuring Agreement (A) of the Financial Institution Bond, ABA Annual Mid-Winter Meeting of the Fidelity & Surety Law Committee (1993)
- Investigating Fidelity Bond Claims Pursued by Federal Regulators, ABA Annual Meeting (1989)
- Unraveling the Duty to Defend, 16 The Brief 47 (Spring 2018)
- The Initial Handling of the Claim: Issue Spotting, Reservation of Rights Letters, Gathering Evidence and Other Key Issues, Northeast Surety & Fidelity Claims Conference Annual Meeting (2017)
- Misrepresentations in the Application: Is Rescission Still a Viable Remedy in Fidelity Policies, Northeast Surety & Fidelity Claims Conference Annual Meeting (2017)
- Editor, Financial Institution Bonds, 4th ed. (ABA Press 2016)
- Get on It While the Trail Is Hot, But Don’t Burn Yourself, Investigating Crime Claims in the 21st Century, Northeast Surety & Fidelity Claims Conference Annual Meeting (2016)
- Co-author.Trying to Fit a Square Peg Into a Round Hole, Part 2: The Scope and Limits of Insuring Agreement (E) in Connection with Electronic Crime Claims, Northeast Surety & Fidelity Claims Conference Annual Meeting (2016)
- The Insuring Agreements-Employee Theft Coverage, Annotated Commercial Crime Insurance Policy (2015)
- The Insuring Agreements-Employee Dishonesty Coverage, Annotated Commercial Crime Insurance Policy (2015)
- Editor-in-Chief. New Appleman on Insurance Law Library Edition, Suretyship (2014)
- Editor-in-Chief. New Appleman on Insurance Law Library Edition, Fidelity Insurance (2014)
- Insuring Agreement (A) - Employee Dishonesty, New Appleman on Insurance Law Library Edition, Fidelity Insurance (2014)
- An Introduction to Fidelity Insurance: Essential Terms, Background, and History, New Appleman on Insurance Law Library Edition, Fidelity Insurance (2014)
- Cybercrime: Current Issues in Insurance Coverage, Gulfcoast Fidelity & Surety Institute Annual Meeting (June 2014)
- Editor. Annotated Financial Institution Bond (2013)
- Insuring Agreement (A)-Fidelity, Annotated Financial Institution Bond (2013)
- Insuring Agreement (E) of the Financial Institution Bond-Revisited, XVII Fid. L.J. 203 (2011)
- You Can't Ask That! Asserting Work Product Protection for Deposition Preparation Materials, 34 The Brief 40 (Winter 2011)
- "Superpowers" of Federal Regulators: The Subprime Mortgage Crisis and Bond Claim Issues Arising From Take Over by the FDIC, XVI Fid. L.J. 1 (November 2010)
- Employee Dishonesty: The Essential Elements of Coverage Under Insuring Agreement (A), in Financial Institution Bonds, Duncan Clore (2008)
- The Attorney-Client Privilege and the Work Product Doctrines - The Boundaries of Protected Communications Held by Insureds and Insurers, XIV Fid. L.J. 1 (October 2008)
- Loan Loss Coverage Under Insuring Agreement (A), in Loan Loss Coverage Under Financial Institution Bonds, (2007)
- Employee Dishonesty Coverage in Annotated Commercial Crime Policy (2006)
- Editor. Investigating the Employee Dishonesty Claim in Handling Fidelity Bond Claims (2005)
- Editor. Handling Fidelity Bond Claims (2005)
- Editor. Annotated Financial Institution Bond (2004)
- The Electronic Signatures in Global and National Commerce Act: A Fidelity Bond Professional's Guide to E-Sign, VIII Fid. L.J. 1 (October 2002)
- Manifest Intent - The Waters Are Clearing; Or Are They?, Fidelity & Surety Law Committee Newsletter (Fall 2000)
- The Rock Has Been Lifted in Texas (a surety does not owe its principal a duty of good faith and fair dealing in Texas), Fidelity & Surety Law Committee Newsletter (Summer 1998)
- Employee Dishonesty Claims: The Essential Elements of Coverage Under Insuring Agreement (A), in Financial Institution Bonds 41 (September 1998)
- The Attorney-Client Privilege and Work Product Doctrines: The Boundaries of Protected Communications Between Insureds and Insurers, 33 Tort & Ins. L.J. 1169 (1998)
- "Superpowers'' of Federal Regulators: How the Banking Crisis Created an Entire Genre of Bond Litigation, 31 Tort & Ins. L.J. 817 (Summer 1996)
- Overcoming Attorney-Client, Work Product, Bank Privacy and Other Evidentiary Objections to the Insurer's Claim, II Fid. L.J. 51 (Fall 1996)
- Employee Dishonesty Claims: Discerning the Employees Manifest Intent, XXXII Tort & Ins. L.J. (Summer 1995)
- Discovery of Loss: The Contractual Predicate to the Claim, Financial Institution Bonds (1995)
- The Insured's Obligation to Discover and Establish its Loss, in Bankers and Other Financial Institution Blanket Bonds (1989)
- OneBeacon Says Texas Law Bars $30M Recovery For Law Firm, Law360 (April 2015)