The injured party in this case was a woman who allowed nude photographs to be taken of her. The film containing the nude pictures were sent to a photo lab for development. At the lab, the employee doing the development made unauthorized extra copies of the pictures for himself and some friends. The pictures were distributed accordingly.

One of the friends of the lab employee who received copies of he photos, also happened to know the woman in the pictures. The friend of the woman notified her of the incident and gave her the copies of the photos. The woman experienced loss of privacy, humiliation, embarrassment and mental anguish. Accordingly, she filed a civil suit against the lab as a business and the lab employee as an individual--a 20-year old man who was still living at home with his parents.

The lab employee filed a claim with his parent's homeowners insurance company under Coverage C-Personal Liability. The insurance company began defense but also protected itself with a reservation of rights. The insurance company eventually withdrew defense and denied coverage.

When the injured woman won her civil case and was awarded a quarter of a million dollars in damages, the lab employee listed the insurance company as a creditor to the judgment and then filed suit against the homeowner's insurance company for "bad faith." The original decision made by the trial court was in favor of the insured lab employee and against the insurance company.

However, on appeal to the Court of Appeals for the Third District of Texas, the initial decision was overturned. The Appeals Court determined that "bodily injury, as defined in the . . . policy, does not include purely emotional injuries, . . . and unambiguously requires in injury to the physical structure of the human body." It was also decided that even though in Texas physical manifestations of the mental anguish may at times be deemed as covered under bodily injury, the woman did not allege such manifestations in the suit filed and thus, there was no liability for bodily injury. It was further ruled that even though the lab employee did not know the victim and had no intentions to harm her nor did he except any such harm to occur, the acts of making copies and taking the pictures from the premises were voluntary and intentional, and thus deemed not to be a covered occurrence.

(Trinity Universal Insurance Company et al., Petitioners v. Cowan, Respondent. Texas Supreme Court, Court of Appeals for the Third District of Texas. TexSCCt. No. 95-1160. May 16, 1997. CCH 1997 Fire and Casualty Cases, Paragraph 6207.)