The insurance company seeking approval to stop paying Jerry Sandusky’s legal costs had that request denied Monday in federal court.
A U.S. Middle District Court ruled it didn’t have enough factual information to absolve Federal Insurance Co. from paying for Sandusky’s defense in criminal or civil matters.
Chief Judge Yvette Kane said Federal, which represents Sandusky through The Second Mile, urged the court to rule for judgment at the beginning of the case, before discovery.
The company contended it didn’t have to pay Sandusky’s defense costs or cover him for civil or criminal judgments because of the nature of the charges against him.
It acknowledged The Second Mile’s policy provided coverage for legal costs, but contended paying those costs in a case involving alleged sexual abuse of children violated Pennsylvania public policy and should be barred for that reason.
Kane, in her ruling, agreed that the insurance company should not cover Sandusky for civil or criminal judgments based on the charges.
But Kane said the court did not have enough factual information to absolve Federal from paying Sandusky’s defense costs.
“The parties have cited no case and the court’s own research has discovered no case in which the Pennsylvania courts have evaluated any ... policy that specifically provides coverage for defense costs, let alone one involving the most infamous of crimes,” she wrote.
Brian Osias, who represented Sandusky in the insurance claim case Monday, said in a statement he is pleased with the decision.
The court determined that this matter cannot be decided without further analysis and factual information, the statement said.
Federal continues to pay Sandusky’s defense costs while the insurance case is pending, he said.
A former Penn State assistant football coach, Sandusky is facing 52 counts that allege he abused boys he met through The Second Mile, a nonprofit he founded for at-risk children. He has maintained his innocence.
Osias said the case had “broad public policy implications.” He previously wrote that Federal Insurance wanted the court to impose a sweeping rule barring any coverage for allegations of sexual misconduct involving minors, regardless of guilt or innocence, policy language and any other facts or circumstances.
Sandusky contends his insurance policy explicitly insures him in the defense of criminal and unwanted sexual behavior and provides a defense unless there is an adjudication or admission of guilt.
Matt Carroll can be reached at 231-4631. Follow him on Twitter @Carrollreporter