Expedia Can Seek AIG Unit Insurance Payout for Ad Suit Defense

Expedia Inc. can continue to seek an insurance payout from an AIG unit for its costs defending a false advertising lawsuit brought by four hotel operators, a Washington federal judge said.

In an order issued Tuesday, Judge Robert Lasnik of the U.S. District Court for the Western District of Washington denied National Union Fire Insurance Co.'s motion for partial judgment. Expedia’s policy exclusions didn’t relieve the insurer of its duty to defend the travel booking site, he ruled.

National Union initially agreed to cover Expedia’s claims for defense costs, but later sought a judicial declaration waiving its obligation. Expedia faced ...