In this action, the insured filed a lawsuit against its insurer asserting that the insurer wrongfully denied its claim. This case is Universal Image Productions, Inc. v. Federal Insurance Company, 475 Fed. Appx. 569 (6th Cir. 2012). Note that this case was not selected for publication in the Federal Reporter.

Universal (the insured) is a television post-production company specializing in editing, special effects, and computer graphics. It leased a building for its work. After the insured moved in, the area experienced heavy rainstorms, and soon thereafter, a strong odor was detected on the first floor of the building. Numerous tests showed that the odor was caused by microbial contamination stemming from the sub-grade duct system on the first floor, and that a significant microbial contamination likely existed in the ventilation system. More tests revealed black mold and elevated bacteria in the ductwork. The HVAC system was shut down and the insured's business suffered severe disruptions. The insured eventually vacated the premises.

Universal provided notice to its insurer, Federal Insurance, of its alleged losses stemming from the mold and bacterial contamination. Specifically, Universal claimed damages by way of lost leasehold improvements, cleaning and moving expenses, and lost business income under its property insurance policy. Federal denied the claim and filed a motion for summary judgment. The district court held that Universal was not entitled to coverage under its policy and this appeal followed.