Penn State insurer seeks to deny coverage

A  Joe Paterno statue has been removed. A lawsuit by the school's insurer is the latest fallout from the Sandusky case.

Story highlights

  • Penn State insurer says former officials withheld information on Jerry Sandusky's behavior
  • One of those administrators denied this week any role in a cover-up
  • Also Wednesday, Penn State board meets, discusses recent NCAA sanctions
  • Statement from board says penalties, though harsh, could have been worse

Penn State's legal battles continued Wednesday with the university's primary general liability insurer filing a motion claiming coverage should be denied because the administration failed to disclose what it knew about former coach Jerry Sandusky's behavior, according to legal documents.

The motion, filed in common pleas court by the Pennsylvania Manufacturer's Association, says Penn State did not provide it with information relevant to the insurable risk the association assumed. The association has already sued Penn State over the coverage of one of Sandusky's victims' claims against the university, filed in November 2011.

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The association has insured Penn State under general liability policies since 1976.

"It would be unlawful and contradictory to public policy to require PMA to provide coverage to PSU under any policy issued to PSU after May 1998 with respect to PSU's concealment of Sandusky's sexually abusive conduct ... and failure to take appropriate action to prevent Sandusky from molesting minors," the motion read.

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The motion comes days after former Penn State President Graham Spanier denied a role in a university cover-up of Sandusky's actions. Spanier has not been criminally charged in the case. However, an investigation by ex-FBI chief Louis Freeh concluded that he helped university officials conceal allegations of sexual abuse against the former assistant football coach.

No one from the Pennsylvania Manufacturer's Association was immediately available for comment.

Penn State slapped with $60 million fine
Penn State slapped with $60 million fine


    Penn State slapped with $60 million fine


Penn State slapped with $60 million fine 02:28
Wall around Paterno statue demolished
Wall around Paterno statue demolished


    Wall around Paterno statue demolished


Wall around Paterno statue demolished 00:47
NCAA president: PSU fine goes to victims
NCAA president: PSU fine goes to victims


    NCAA president: PSU fine goes to victims


NCAA president: PSU fine goes to victims 02:38
'Mike & Mike' on Penn State's sanctions
'Mike & Mike' on Penn State's sanctions


    'Mike & Mike' on Penn State's sanctions


'Mike & Mike' on Penn State's sanctions 03:20

Sandusky, 68, was convicted in late June of 45 of the 48 sexual abuse counts he faced, involving 10 victims. He was an assistant football coach at Penn State for more than 40 years until he resigned in 1999 but still had access to Penn State facilities through his charity until he was arrested in 2011.

Sandusky founded The Second Mile, a nonprofit organization for underprivileged youth and several of his victims attended the program. The foundation announced in May it will close.

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He will be sentenced in September.

The Penn State Board of Trustees met Wednesday night to discuss football sanctions handed down by the NCAA. According to a statement, the members found the sanctions difficult, but understood that they could have been much worse, reportedly a multiyear shut down of the team, a traditional major college football power.

No votes were taken, the statement said.

"The university and board resolve to move forward together to recognize the historical excellence in Penn State's academic and athletic programs," the board said. "We anticipate and look forward to demonstrating our outstanding performance in complying with the sanctions."

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On Thursday, Steve Garban became the first Penn State Board of Trustees member to resign since the Freeh report.

The NCAA handed Penn State a number of severe and unprecedented sanctions Monday for "perpetuating a 'football first' culture that ultimately enabled serial child sexual abuse to occur," according to the NCAA website.

The sanctions include a record $60 million fine, a four-year postseason ban, a four-year reduction in football scholarships and five years of probation. Penn State was also forced to vacate its football victories since 1998, including 111 by the late Joe Paterno, costing him the record as the winningest coach in the NCAA's top division.

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