In Scottsdale Ins. Co. v. Columbia Ins. Group, Inc,1 the Seventh Circuit Court of Appeals recently held that a subcontractor’s insurer was obligated to defend and indemnify the project owner’s insurer for damages associated with the subcontractor's employee's personal injury lawsuit where the underlying complaint alleged negligence by the additional insureds. The case cements the notion that under Illinois law, one can significantly benefit from the facts presented in third party complaints as a basis for additional insured coverage.

Rockwell Properties (“Rockwell”) was the project owner, along with Prairie Management & Development (“Prairie”), the general contractor, on a construction project in Chicago. Prairie subcontracted HVAC services to TDH Mechanical (“TDH”). When an employee of TDH Mechanical sustained serious injuries performing work at a construction site, a suit was lodged against Rockwell and Prairie in state court. The lawsuit did not bring any claims against TDH but instead alleged that both Rockwell and Prairie had negligently failed to supervise the subcontractors’ work on-site, thus contributing to the worker’s injuries.