Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg

Plain English (For Everyone)

Your business insurance might not cover losses from cyberattacks if sensitive data is lost, even if it's stored digitally. In this case, Griffith Foods lost valuable business information due to a cyberattack, but their "all-risk" policy excluded coverage for "loss of electronic data," meaning they couldn't claim the insurance money.

For Legal Practitioners

The Seventh Circuit affirmed summary judgment for the insurer, holding that an "all-risk" policy's "data and media" exclusion for "loss of electronic data" unambiguously barred coverage for the loss of intangible proprietary information resulting from a cyberattack. Griffith Foods failed to demonstrate coverage, as the exclusion's plain language encompassed electronically stored, albeit intangible, data.

For Law Students

This case illustrates the importance of precise policy language in insurance contracts. The Seventh Circuit applied de novo review to find that Griffith Foods' "all-risk" policy did not cover the loss of proprietary information from a cyberattack due to a clear "data and media" exclusion for "loss of electronic data."

Newsroom Summary

A business's insurance policy did not cover losses from a cyberattack that stole valuable company data. The Seventh Circuit ruled that the policy's exclusion for "loss of electronic data" applied, even though the stolen information was intangible.

Standard of Review

De novo review, as the appeal concerns the interpretation of an insurance policy and the grant of summary judgment, both of which are reviewed independently by the appellate court.

Procedural Posture

The case reached the Seventh Circuit on appeal from the district court's grant of summary judgment in favor of the defendant, National Union Fire Insurance Company of Pittsburg.

Burden of Proof

The burden of proof was on Griffith Foods International Inc. (Griffith) to demonstrate that its "all-risk" insurance policy covered the loss of its proprietary information. The standard of proof required Griffith to show that the loss fell within the policy's coverage and was not excluded by its terms.

Legal Tests Applied

Statutory References

Key Legal Definitions

Rule Statements

The "data and media" exclusion in the policy unambiguously applied to the loss of Griffith's proprietary information because the policy defined "loss of electronic data" broadly enough to include intangible information stored electronically.

Remedies

Affirmed the district court's grant of summary judgment in favor of National Union Fire Insurance Company of Pittsburg. Griffith Foods International Inc. is not entitled to coverage for the loss of its proprietary information.

Judges

• Michael B. Brennan
• Diane S. Sykes
• Thomas L. Kirsch II

Scenario: Your company experiences a cyberattack where hackers steal sensitive customer lists and strategic plans stored on your servers.

Your Rights: You have the right to review your "all-risk" insurance policy carefully, paying close attention to any "data and media" or "electronic data" exclusions, to determine if such a loss is covered.

What To Do: Consult with your insurance broker and legal counsel immediately after a cyber incident to understand your policy's coverage and exclusions, and to determine if a claim is viable before notifying the insurer.

Is it legal to get insurance coverage for proprietary information lost in a cyberattack?

It depends on the specific wording of your "all-risk" insurance policy. Policies often contain exclusions for "electronic data" or "media," which courts may interpret to exclude intangible proprietary information, as seen in the Griffith Foods case.

This interpretation can vary by jurisdiction and the precise language of the insurance policy.

For Businesses with "all-risk" insurance policies

These businesses need to carefully review their policies, particularly any "data and media" or "electronic data" exclusions, to understand their coverage for losses stemming from cyberattacks involving the theft or destruction of digital information.

For Insurers

The ruling reinforces the enforceability of clear and unambiguous exclusions in insurance policies, particularly concerning cyber-related risks and electronic data.

Q: What is Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg about?

Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg is a case decided by Seventh Circuit on April 11, 2025.

Q: What court decided Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg was decided by the Seventh Circuit, which is part of the federal judiciary. This is a federal appellate court.

Q: When was Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg decided?

Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg was decided on April 11, 2025.

Q: Who were the judges in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

The judge in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg: Scudder.

Q: What is the citation for Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

The citation for Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg is 134 F.4th 483. Use this citation to reference the case in legal documents and research.

Q: Did Griffith Foods' insurance cover the loss of its proprietary information?

No, the Seventh Circuit affirmed that Griffith Foods' "all-risk" insurance policy did not cover the loss of its proprietary information due to a cyberattack. The court found that the policy's "data and media" exclusion for "loss of electronic data" applied.

Q: What kind of information did Griffith Foods lose?

Griffith Foods lost its "proprietary information," which is valuable, confidential business data. This information was stored electronically, but the court deemed it intangible.

Q: What is the definition of "proprietary information" in a legal context?

Proprietary information refers to confidential business information that provides a competitive advantage, such as trade secrets, customer lists, or strategic plans. Its value lies in its secrecy.

Q: Is Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg published?

Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg is a published, precedential opinion. Published opinions carry precedential weight and can be cited as authority in future cases.

Q: What was the ruling in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

The court ruled in favor of the defendant in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg. Key holdings: The court held that the "data and media" exclusion in an "all-risk" insurance policy unambiguously applied to the loss of "proprietary information" that was stored electronically, thereby excluding coverage for losses resulting from a cyberattack.; The court reasoned that "proprietary information" constitutes "electronic data" as contemplated by the exclusion, even though it is intangible, because its value and accessibility are tied to its electronic storage.; The court found that Griffith Foods' argument that the loss was of the "information itself" rather than the "data" was a distinction without a difference in the context of the policy's plain language.; The court rejected Griffith Foods' attempt to interpret "data and media" exclusion narrowly, emphasizing that insurance policies are construed according to their plain and ordinary meaning.; The court affirmed the district court's grant of summary judgment to the insurer, National Union Fire Insurance Company, as Griffith Foods failed to demonstrate that the loss fell within any covered peril under the policy..

Q: What precedent does Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg set?

Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg established the following key holdings: (1) The court held that the "data and media" exclusion in an "all-risk" insurance policy unambiguously applied to the loss of "proprietary information" that was stored electronically, thereby excluding coverage for losses resulting from a cyberattack. (2) The court reasoned that "proprietary information" constitutes "electronic data" as contemplated by the exclusion, even though it is intangible, because its value and accessibility are tied to its electronic storage. (3) The court found that Griffith Foods' argument that the loss was of the "information itself" rather than the "data" was a distinction without a difference in the context of the policy's plain language. (4) The court rejected Griffith Foods' attempt to interpret "data and media" exclusion narrowly, emphasizing that insurance policies are construed according to their plain and ordinary meaning. (5) The court affirmed the district court's grant of summary judgment to the insurer, National Union Fire Insurance Company, as Griffith Foods failed to demonstrate that the loss fell within any covered peril under the policy.

Q: What are the key holdings in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

1. The court held that the "data and media" exclusion in an "all-risk" insurance policy unambiguously applied to the loss of "proprietary information" that was stored electronically, thereby excluding coverage for losses resulting from a cyberattack. 2. The court reasoned that "proprietary information" constitutes "electronic data" as contemplated by the exclusion, even though it is intangible, because its value and accessibility are tied to its electronic storage. 3. The court found that Griffith Foods' argument that the loss was of the "information itself" rather than the "data" was a distinction without a difference in the context of the policy's plain language. 4. The court rejected Griffith Foods' attempt to interpret "data and media" exclusion narrowly, emphasizing that insurance policies are construed according to their plain and ordinary meaning. 5. The court affirmed the district court's grant of summary judgment to the insurer, National Union Fire Insurance Company, as Griffith Foods failed to demonstrate that the loss fell within any covered peril under the policy.

Q: What cases are related to Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

Precedent cases cited or related to Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg: Federal Insurance Co. v. Transpersonnel, Inc., 14 F.4th 617 (7th Cir. 2021); Great Lakes Gas Transmission Ltd. P'ship v. Liberty Mut. Ins. Co., 929 F.3d 831 (7th Cir. 2019); U.S. Fire Ins. Co. v. M.D.S. Life Ins. Co., 967 F.3d 632 (7th Cir. 2020).

Q: What was the main reason the insurance claim was denied?

The claim was denied because the insurance policy contained a "data and media" exclusion that specifically excluded "loss of electronic data." The court interpreted this exclusion to cover Griffith's intangible proprietary information.

Q: How did the court interpret the "data and media" exclusion?

The court found the exclusion to be clear and unambiguous. It reasoned that "loss of electronic data" included intangible proprietary information that was stored electronically, even if it wasn't a physical data file.

Q: What is an "all-risk" insurance policy?

An "all-risk" policy is intended to cover all types of losses unless specifically excluded. However, the specific exclusions within the policy, like the "data and media" exclusion in this case, can limit coverage.

Q: Does "loss of electronic data" in an insurance policy always include intangible information?

It depends on the specific wording of the policy and how courts in a particular jurisdiction interpret it. In this case, the Seventh Circuit found the language broad enough to include intangible proprietary information.

Q: What is the standard of review for insurance policy interpretation cases?

Appellate courts typically review a district court's interpretation of an insurance policy and its grant of summary judgment de novo, meaning they look at the case fresh without giving deference to the lower court's legal conclusions.

Q: Is proprietary information considered "electronic data" under all insurance policies?

Not necessarily. The interpretation depends on the specific policy language and judicial precedent. In Griffith Foods, the Seventh Circuit found it was, but this is not a universal rule.

Q: What is the role of the "burden of proof" in this case?

The burden was on Griffith Foods to prove that its loss of proprietary information was covered by the policy and not excluded by its terms. Since they couldn't overcome the "data and media" exclusion, they failed to meet their burden.

Q: Are there any constitutional issues raised in this case?

No, this case primarily involved contract interpretation of an insurance policy and did not raise any constitutional questions.

Q: What happens if an insurance policy is ambiguous?

If an insurance policy contains ambiguous terms, courts typically construe them against the insurer and in favor of the policyholder. However, the court found the exclusion in this case to be unambiguous.

Q: What should a business do if it suspects a cyberattack has compromised its data?

Immediately consult with legal counsel and your insurance broker to review your policy's terms and exclusions, especially regarding cyber incidents and electronic data, before making any claims.

Q: How can businesses protect themselves from similar insurance coverage denials after a cyberattack?

Businesses should proactively review their "all-risk" policies, understand specific exclusions like those for electronic data, and consider obtaining specialized cyber liability insurance to ensure adequate coverage.

Q: What are the implications of this ruling for businesses that rely heavily on digital information?

Businesses must be aware that standard "all-risk" policies may not cover all forms of digital data loss due to cyberattacks, necessitating a thorough review of policy language and potentially separate cyber insurance.

Q: What is the practical takeaway for businesses regarding their insurance?

Businesses should not assume "all-risk" policies cover all digital losses from cyberattacks. They need to actively review their policies and consider specialized cyber insurance.

Q: What is the significance of the Seventh Circuit's decision?

The decision highlights the importance of precise policy language in insurance contracts, particularly concerning cyber risks, and reinforces that clear exclusions will be upheld.

Q: Could this ruling affect other types of intangible digital assets?

Potentially. If other policies have similar broad "electronic data" exclusions, courts might apply the same reasoning to other intangible digital assets lost due to cyber incidents.

Q: What was the docket number in Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg?

The docket number for Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg is 24-1217. This identifier is used to track the case through the court system.

Q: Can Griffith Foods International Inc. v. National Union Fire Insurance Company of Pittsburg be appealed?

Potentially — decisions from federal appellate courts can be appealed to the Supreme Court of the United States via a petition for certiorari, though the Court accepts very few cases.

Q: What does "de novo review" mean in this context?

De novo review means the Seventh Circuit reviewed the district court's decision on the insurance policy's meaning and coverage as if it were hearing the case for the first time, without being bound by the lower court's legal reasoning.

Q: What is summary judgment?

Summary judgment is a procedure where a court decides a case without a full trial if there are no significant factual disputes and one party is clearly entitled to win based on the law.