In Yahoo! Inc. v. National Union Fire Insurance Co., the Supreme Court today concludes an insurance policy covering “injuries ‘arising out of . . . [o]ral or written publication, in any manner, of material that violates a person’s right of privacy” might protect an insured being sued for sending unsolicited text messages that violate the federal Telephone Consumer Protection Act. Not definitively answering a question posed by the Ninth Circuit, the court includes the caveat that the law it states is “assuming such coverage is consistent with the insured’s reasonable expectations,” an issue the court doesn’t reach.

The court’s unanimous opinion by Justice Martin Jenkins interprets the policy language as possibly covering a “publication” violating a privacy right of seclusion, not just publication of “material” that violates a privacy right of secrecy. The court acknowledges that “the inclusion of the word ‘material’ implies that the policy does not cover right-of-seclusion liability,” but says the policy provision is ambiguous and “must be interpreted in a way that fulfills Yahoo!’s objectively reasonable expectations, which must be determined in further litigation” in federal court. If the “reasonable expectations” can’t be found, the opinion states the ambiguous language should be interpreted against the insurer as the policy provision’s drafter.

The court also doesn’t consider potentially applicable exclusions in the policy because, the court says, the Ninth Circuit didn’t ask about them.

In finding possible coverage, the opinion “reach[es] a different conclusion” than in a Second District, Division Four, Court of Appeal opinion (State Farm General Ins. Co. v. JT’s Frames, Inc. (2010) 181 Cal.App.4th 429) and a decision by the Second District, Division Three (ACS Systems, Inc. v. St. Paul Fire & Marine Ins. Co. (2007) 147 Cal.App.4th 137).

Horvitz & Levy is appellate counsel for the defendant insurer in the case.