Acosta v. Clear Blue Specialty Ins. Co., 2026 WL 2093910,
No. CV-24-03681-PHX-DJH (D. Ariz. Jul. 21, 2026)

Plaintiffs are models trying to recover for claims resolved
by consent judgment in their underlying lawsuit, one of the many against adult
clubs around the country.

In various social media posts, the insured used plaintiffs’
images to advertise club events, such as “Champagne Saturdays,” “Latin Ladies
Night,” “Working Man Specials,” and “2 por 1 Martes.” Plaintiffs claim that
their injury constituted a “personal and advertising injury” under the policy.

But the Policy excludes coverage of “personal and
advertising injury” that arises out of “exhibitions and related marketing,”
defined as:

(a) The creation, production,
publication, performance, exhibition, distribution or exploitation of motion
pictures, television programs, commercials, web or internet productions,
theatrical shows, sporting events, music, promotional events, celebrity image
or likeness, literary works, and similar productions or work, in any medium
including videos, phonographic recordings, tapes, compact discs, DVDs, memory
cards, electronic software or media, books, magazines, social media, webcasts
and web sites.

(b) The conduct of individuals in
shows, theatrical productions, concerts, sporting events, or any other form of
exhibition.

(c) Merchandising, advertising or
publicity programs or material for the operations and material described in (a)
or (b) above.

Plaintiffs argued that a “promotional event” is not “a party
at a nightclub but rather an ‘event’ thrown in furtherance of promoting
something…”

The insurance company responded contested images were
advertisements for “promotional events” as the events advertised “were not
ordinary nightclub evenings.” They touted “drink specials, free admission for
women, reduced dance pricing, and other deals.”

The policy didn’t further define “promotional event,” so the
court analyzed the terms of the policy as written and from the “viewpoint of
one untrained in law or in the insurance business.” Sampedro v. Clear Blue
Specialty Insurance Company, 2026 WL 1291919 (M.D. Fla. May 12, 2026), held
that the same exclusion unambiguously excused the insurer from defending the
nightclub in a similar case involving ads for “the ‘Pretty Chicks & Kicks’
and ‘Tastee Tuesday’ events.” The court reasoned that, even under such a
definition, “[the nightclub’s] promotional events promoted the nightclub itself
through alcohol sales and DJ appearances.”

Nobriga v. Clear Blue Specialty Insurance Company, 2026 WL
1998727 (D. Conn. July 10, 2026), used dictionary definitions to define a
“promotional event” as “a noteworthy happening or social occasion or activity
serving the means of furthering the growth or development of something,
particularly the acceptance and sale of merchandise through advertising,
publicity, or discounting.” Based on this definition, ads for the café’s “Cinco
de Mayo Party,” “Halloween and St. Patrick’s Day parties,” and “Baseball Night”
constituted advertisements for “promotional events.” “[E]ach advertisement
offered discounts on food and entertainment with the goal of bringing
additional customers through [the café’s] doors, and tied such discounts to
specific holidays or themed nights such as baseball night” making them
“advertising” for “promotional events.”

The court agreed that a “promotional event” need not be in
furtherance of something other than a business itself. But it thought that the
common understanding of “promotional event” wasn’t broad enough to encompass
“every promotion put in place by a business.” While holiday parties qualify as
“promotional events,” the same couldn’t be said for ads “tied to…a recurring
weekly promotion[,]” such as “Baseball Night.”

Here, some of the events advertised seemingly occurred on
the same day each week or at a defined time every day. Those were “a routine
part of” the insured’s business, not a “noteworthy happening” or “social
occasion,” and were untethered to anything but the promotions themselves. There
was no special food; “merely offering drink and dance specials does not
definitively transform a promotion into a promotional event,” nor did giving
the promotion a title. “The lack of ties to a special occasion or specific occurrence”
made the exclusion inapplicable. “To rule otherwise would require reading the
word ‘event’ out of the phrase ‘promotional event.’”

The court also rejected the insurer’s argument for judgment
on the pleadings that the exclusion applied because the underlying litigation
arose out of the publication of a celebrity image or likeness. But not all
recognized models are “celebrities.” More facts were required.

Clear Blue Specialty Ins. Co. v. 05 Petete, Inc., 2026 WL
2196263, No. 26-1891 (E.D. Pa. Jul. 29, 2026)

Similar result here on the same language. One underlying
plaintiff pled herself out of coverage by pleading that she was a “social media
celebrity,” but the others didn’t. “Being well-known in one’s profession or
endeavors does not by itself raise one’s status to the level of a celebrity.”

As for the promotional events exclusion, “Contrabando’s
High-Voltage Wednesdays,” “Exclusive Fridays,” “Matinee Sundays,” and “Euphoric
Saturdays” were “certainly promoting Euphoria’s nightclub itself and are using
the images of plaintiffs to do so.” But the ads were

merely encouraging the presence of
patrons on Wednesdays, Fridays, Saturdays and Sundays generally and are not
pointing to any Wednesday, Friday, Saturday or Sunday in particular. It is the
standard business of a nightclub to sell liquor to its clientele and to provide
musical entertainment. The offer of reduced prices from time to time is a
standard business practice to entice customers. The reduced prices are not tied
to a specific event or events but are in place for all Wednesdays, Fridays,
Saturdays, and Sundays.

“While the World Series is an event, the baseball season is
not an event. Likewise, while the grand opening of Euphoria’s nightclub or the
opening of any business would be an event, its continual and regular day-to-day
operation is not in ordinary parlance deemed to be an event or series of
events. Such operation may continue for years.” Thus, the ambiguous policy
language was construed against the drafter/insurer and it had a duty to defend
against three of the underlying plaintiffs’ claims, and thus a duty to defend
in the underlying lawsuit.

from Blogger https://tushnet.blogspot.com/2026/08/insurer-cant-use-promotional-event.html