A university may owe a general duty to defend professors from allegations of intellectual property theft by students

University insurer found to have duty to defend employees of university in context of claims by a former student for misappropriation of ideas and use of concepts.

Baiden v. Canadian Universities Reciprocal Insurance Exchange, [2011] O.J. No. 5850, December 15, 2011, Ontario Superior Court of Justice, C.J. Brown J.

Three insureds brought an application for a determination of their rights based on an interpretation of their policy of insurance issued by the insurer. The issue was whether the insurer had a duty to defend the insureds under the policy.

The insureds were a professor in the School of Engineering at Laurentian University, a research assistant, and a research development and prototyping company. The profefssor and the research assistant were principals of the insured company. There were two policies at issue, one that insured Laurentian University and a CGL policy that insured the company.

The three insureds were defendants in two actions commenced by a former graduate student at Laurentian University who was supervised by the professor. He alleged that the insureds had used his concepts and had them developed by the insured company.

The Court found that the policy insuring Laurentian University gave rise to a duty to defend and that the insurer could control the defence and retain counsel; however, the CGL insurer would be entitled to its own counsel with respect to those claims to which its policy responds.

This case was digested by Cameron B. Elder of Harper Grey LLP.

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