Jerry Sandusky Scandal

Second Mile's insurance company continues fight over defending Jerry Sandusky

The Second Mile’s insurance company is continuing its efforts to get a judge to declare it does not have to pay to defend Jerry Sandusky.

Federal Insurance Co. has stepped up his efforts since the former Penn State assistant coach was sentenced last month.

However, U.S. Middle District Chief Judge Yvette Kane has slowed them by placing a stay on activity until a scheduled conference with the attorneys on Nov. 29.

Federal claims it has no duty to defend Sandusky, who is serving a 30- to 60-year state prison sentence for molesting 10 boys, because Pennsylvania does not permit insurance coverage of a perpetrator on intentional sexual molestation of a minor.

The insurance company acknowledges Sandusky founded and was an executive of The Second Mile but argues abuse of children does not fall under the scope of his duties and such activity is contrary to that charity’s purpose.

Federal claims Sandusky’s acts “were outrageous and motivated purely by personal reasons. The actual acts of abusing and molesting young children were not committed during official TSM functions; nor was Sandusky following company directives in assaulting children.”

Kane ruled in June the insurance company was barred by public policy in Pennsylvania from paying any damage award but deferred a decision on whether it had to pay his defense costs.

One of the reasons she gave for deferring was Pennsylvania courts have not squarely addressed whether strong public policy makes unenforceable Federal’s duty to provide a defense to a criminal or civil action because of the nature of the conduct alleged.

On Oct. 28, Federal filed a motion for summary judgment on the unresolved issue. Sandusky’s attorney, Brian J. Osias objected, saying he had not done any discovery so any decision would be based on alleged undisputed facts.

It was his understanding after a conference with Kane in August the parties were not to engage in any discovery or file pending further discussion at the next conference, he wrote in a Nov. 7 letter to Kane.

Osias stated he believes Federal’s policy with The Second Mile requires coverage through a final, non-appealable judgment of the 45 counts on which Sandusky was convicted. He is appealing his conviction.