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Bertelsmann files suit against insurance co.

Attorneys for Bertelsmann Music Group filed a lawsuit Monday, seeking more than $ 6 million in damages from an insurance company that allegedly denied coverage and refused to pay attorneys to defend consumer lawsuits stemming from the Milli Vanilli lip-syncing debacle.

In a complaint filed in Los Angeles Superior Court, BMG alleges Centennial Insurance initially agreed to pay for the defense of four of the 25 class action claims brought by consumers who purchased Milli Vanilli albums and later learned the artists were merely lip-syncing on the album and in live performances.

Emotional distress

Attorneys for BMG say the insurer agreed to defend the four claims because they included allegations of emotional distress, something not included in the other 21 lawsuits.

Bertelsmann said it spent more than $ 3.8 million in attorneys fess and just over $ 2 million in settlements as a result of the class action lawsuits.

Centennial Insurance Co. allegedly denied Bertelsmann’s claims on the grounds that its policies covered only advertising injury and personal injury and the suits did not fit into those categories. Bertelsmann claimed there is no legal basis for the coverage denial.

The suit also seeks unspecified punitive damages. A Centennial spokesperson declined comment.

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