On July 21, the Pennsylvania Supreme Court unanimously ruled that insurers cannot invoke public policy to refuse to deny coverage to hotels sued by trafficking victims. In 2023, the United States District Court for the Eastern District of Pennsylvania decided that state public policy bars coverage where an insured is alleged to have engaged in “particularly harmful criminal conduct.” The momentous ruling in Samsung Fire and Marine Insurance Co. v. RI Settlement Trusteffectively reverses that decision, finding that “neither an insurer’s duty to defend nor its duty to indemnify is abrogated on the basis of public policy when the insured is alleged to have enabled or profited from sex trafficking.”
As the CSE Institute previously reported, the underlying case stems from four separate civil lawsuits in which each plaintiff alleged that as a minor, she was a victim of sex trafficking at the Roosevelt Inn. On March 20, 2023, United States District Judge Chad F. Kenney held that the insurers had no defense or indemnity obligations to the Roosevelt Inn on the grounds that shielding hotels from the consequences of their criminal conduct would be “against the safety, morals, and welfare of the Commonwealth.” On October 12, 2023, the plaintiffs filed an amicus brief in which they alleged that the court incorrectly relieved the insurers.
According to the plaintiffs, “[a]s a matter of ‘public policy,’ this erroneous decision also has devastating implications regarding the availability of paid-for insurance coverage for any business that operates where crime can occur and where a victim may suffer personal injury resulting from negligence concurrent with a criminal act.”
On November 18, 2025, the Pennsylvania Supreme Court heard oral argument on the two certified issues: (1) whether Pennsylvania has an “overriding public policy” against sex trafficking that allows insurers to evade their duty to defend and/or indemnify when an insured is alleged to have enabled or profited from such trafficking and (2) whether that duty can be avoided when the insured’s alleged conduct would constitute a violation of 18 Pa.C.S. § 3011(a) if the insured recklessly disregards sex trafficking or knowingly benefits financially from such activity.
The Pennsylvania Supreme Court ruled that establishments profiting from sex trafficking are not barred from seeking coverage for any ensuing lawsuits just because the state criminalizes such activity. Relying on the plurality opinion in Minnesota Fire v. Greenfield, insurers reasoned that if compelling public policy against schedule 1 drugs allows insurance companies to avoid their duty to defend, the same reasoning should be applied to human trafficking. However, the Greenfield plurality stressed the limited scope of their holding and can be distinguished where establishments are alleged of negligence rather than criminality, as in this case.
In addressing the first certified question the judges first assumed “that [i]nsurers each have a contractual duty to defend.” Further, it is not the role of the court to rank the seriousness of the public policy underlying all the crimes defined in Pennsylvania’s Crimes Code. Insurance companies can exercise their own judgement to determine what should be excluded from coverage. Because of this finding, the judges did not address the second certified question posed to the court.
Samsung Fire is pending final ruling by the Third Circuit. However, if the circuit court adopts the Pennsylvania Supreme Court’s ruling, the plaintiffs will have a far easier time recovering judgement. For the underlying case specifically, since the hotel has declared bankruptcy, the Supreme Court’s ruling could ensure that the survivors would still be able to collect damages through the insurance company.
On July 20, Governor Shapiro signed into law House Bill 1286 as Act 31 of 2026, requiring Pennsylvania hotels, motels, and short-term rentals to train all staff on recognizing signs of human trafficking by July 20, 2027. The ruling in Samsung Fire, which came only one day after Governor Shapiro signed Act 31 into law, highlights the importance of legislative mandates for trafficking awareness trainings for staff working in industries that have frequent contact with trafficking victims and survivors. Act 31 effectively mitigates an unintended consequence of the Samsung Fire ruling: hotels failing to institute more robust trainings and systems to prevent trafficking within their establishments due to insurance reliance and ability to insulate against failures to intervene.
The CSE Institute urges hotel owners to preemptively implement thorough training regimens for employees to identify and report any occurrences of human trafficking on their premises. Proper training for hotel employees ensures early intervention and potential access to exit services for survivors. Further, the CSE Institute celebrates the passage and approval of H.B. 1286 and urges lawmakers to continue to push for accountability from other third-party facilitators of the commercial sex trade. The hospitality industry is a critical ally in the fight to end human trafficking and with adequate training systems, can both avoid financial liability and prevent future harm: a win for all involved.
The CSE Institute will continue to provide updates on this matter.
All views expressed herein are personal to the author and do not necessarily reflect the views of the Villanova University Charles Widger School of Law or of Villanova University.