The Seventh Circuit revived the latest installment of a decade-long dispute between Creation Supply Inc. and Selective Insurance Company of the Southeast over the insurer’s refusal to defend CSI in a 2012 trademark lawsuit.

Having already won some damages from Selective, after an Illinois state court found that the insurance company breached its duty to defend CSI, CSI sued Selective in federal court to pursue additional damages under a breach of contract theory.

Ordinarily, claim preclusion would have barred further litigation. But in this case, the state court expressly reserved CSI’s right to file its lawsuit in federal court, the …