I have no reason to believe that an indemnification provision is in play here. Perhaps you have some information that is not apparent from reading Division I's opinion. The enforceability of provisions which allocate control over settlement and litigation decisions to the insurance carrier has been well established by the courts.
I will disagree with your position that the business judgment rule would immunize the board if it were to forfeit insurance coverage through an advertant breach of the insurance policy and that fofeiture of coverage resulted in a huge award against REI that would have otherwise been covered by insurance. If you have authority that the BJR has been applied in such a way, please advise and I will eat crow.
But, again, this misses the point. If writing letters to REI and/or refusing to patronize REI makes people feel better, then have at it. REI marketed a dangerously defective fork and there is nothing wrong with being outraged by that and refusing to do biz with such a company. But confining one's action to REI merely preserves the status quo and paves the path for more injustice to victims like Monika in the future. The insurance carrier, not REI, decided not to compensate Monika and to instead appeal. And the carrier relies on a statute which is the product of the insurance lobby and which has resulted in great injustices to many other victims and will do so in the future. If people are going get get angry, direct the anger where it belongs, i.e., the insurance industry lobby and the legislators in its hip pocket.
