Insurers Duty to Defend in Trade Secrets Cases Involving Bad Faith: An Analysis of Lionbridge Technologies LLC v. Valley Forge Insurance Co. Ruling


In this case, the court ruled that Valley Forge had a duty to defend Lionbridge against TPG’s bad faith allegations. The court held that the underlying complaint’s allegations of bad faith related to the publication of material that disparaged TPG’s goods, products, or services. The court also found that the policy’s exclusions for knowing conduct and misuse of trade secrets did not apply to the bad faith allegations in the underlying complaint.

The Lionbridge Technologies LLC v. Valley Forge Insurance Co. ruling is significant for policyholders in trade secrets cases involving bad faith allegations. It highlights the potential scope of the duty to defend in such cases and serves as a reminder that insurers may be obligated to defend policyholders even in cases where certain policy exclusions apply. Policyholders should be aware of their rights and the potential for coverage in cases involving bad faith allegations.

It’s important to note that the outcome of this case may not be the same in all jurisdictions, and legal advice should be sought in order to understand the rights and obligations of both insurer and policyholder in any specific case. This article was written by Samuel Lopez, investigative paralegal and journalist for the USA Herald, who has been following the case closely.