Insurer for Pennsylvania-Based Sandusky Charity Argues Over Payouts

An insurance company for a charity founded by Jerry Sandusky argued in a federal complaint Friday that it should not have to pay legal expenses or claims for the former Penn State assistant football coach now accused of molesting children.

Federal Insurance Co. said it would be wrong for the company to have to cover Sandusky because he is accused of conduct that did not involve his position as an executive or employee of The Second Mile, a charity for at-risk youth he founded in 1977.

In addition, “Pennsylvania courts have found that a person who sexually abuses a minor should not expect his insurer to cover his misconduct, particularly where the average insured purchasing insurance would cringe at the very suggestion that he was paying for coverage arising out of sexual abuse of a child,” lawyers for the New Jersey-based company wrote.

Sandusky is charged with sexually abusing 10 boys over more than a decade. He has denied the allegations and is awaiting trial in Centre County after waiving a preliminary hearing earlier this month.

His criminal defense lawyer, Joe Amendola, said Friday he had not seen the complaint, filed in federal court in Williamsport. Amendola said Sandusky was served Wednesday with a lawsuit filed in Philadelphia by one alleged victim and was getting a different lawyer to represent him in civil cases.

“I can say it’s not unexpected that the insurance carrier would attempt to get out from under representing Jerry,” Amendola said.

Dennis Mulvihill, a lawyer for Federal Insurance, referred questions to Mark Greenberg, the company’s chief information officer. Greenberg did not immediately return a message left at his office after hours Friday.

A spokesman for The Second Mile said the matter was between Federal and Sandusky, and declined further comment.

The complaint asks the court to rule that Federal has no obligation to pay Sandusky’s criminal defense costs or to indemnify him for civil or criminal claims related to alleged sexual abuse of children.

“Extending insurance coverage to Sandusky is unlawful because providing insurance coverage for claims arising from sexual assault, molestation, and/or abuse of minors is repugnant to Pennsylvania public policy,” according to the complaint.

Amendola said Sandusky has not sought coverage regarding the criminal case.