LexisNexis® Legal Newsroom
    Mealey's Insurance - Judge Dismisses Negligent Procurement Of Insurance Claim Against Agent

    NEW ORLEANS - An insurance agent did not have a duty to properly advise homeowners of the correct amount of insurance coverage needed, a Louisiana federal judge ruled April 14, dismissing the claim for negligent procurement of insurance against the agent in a hurricane coverage dispute (Gale Hernandez, et al. v. State Farm General Insurance Co., et al., No. 13-5783, E.D. La.; 2014 U.S. Dist. LEXIS 51221).

    Mealey's Insurance - Oregon Federal Judge Says Fact Issues Exist On Payments Made On Insured's Behalf

    PORTLAND, Ore. - An Oregon federal judge on April 10 denied an insurer's motion for summary judgment after determining that issues of fact exist regarding whether two payments made on behalf of the insured in an environmental contamination suit qualify to reduce indemnity under the policy (Northwest Pipe Co. f/k/a Northwest Pipe and Casing Co. v. RLI Insurance Company of Wausau, No. 09-1126, D. Ore.; 2014 U.S. Dist. LEXIS 50531).

    Mealey's Insurance - CBO: ACA Will Cost $36B Less In 2014 Than Previously Estimated

    WASHINGTON, D.C. - Patient Protection and Affordable Care Act (ACA) insurance provisions will cost $36 billion in 2014 and $1,383 billion for the period of 2015 through 2024, reductions of almost $5 billion less this year $104 billion long term, according to an April 14 analysis by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT).

    Mealey's Insurance - Ohio Appeals Court Reverses Defense Judgment In Subrogation Case

    CLEVELAND - An Ohio appeals court on April 10 reversed a summary judgment decision in favor of the defendant in a health insurance subrogation case, saying that the contract at issue was ambiguous and that the defendant did not show that its interpretation of the policy was the only reasonable interpretation (Philip Laboy, et al. v. Grange Indemnity Insurance Co., et al., No. 100116, Ohio App., 8th Dist.; 2014 Ohio App. LEXIS 1460).

    Mealey's Insurance - D.C. Circuit Affirms Denial Of Medicare Payment For Depreciation After Merger

    WASHINGTON, D.C. - A District of Columbia Circuit U.S. Court of Appeals panel on April 11 affirmed a district court's decision affirming an administrative ruling by the U.S. Department of Health and Human Services (HHS) denying depreciation reimbursement under the Medicare program to a Catholic health care system after a merger with two other Catholic-related hospitals, saying the merger was not a bona fide sale because the hospitals were not given proper consideration for their assets in exchange for their debts (Catholic Healthcare West v. Kathleen Sebelius, in her official capacity as Secretary of Health and Human Services, No. 13-5090, D.C. Cir.; 2014 U.S. App. LEXIS 6662).

    Mealey's Insurance - Federal Judge Denies Motion To Reconsider Fraud Action

    NEW ORLEANS - A federal judge in Louisiana on April 9 denied a consumer's motion to reconsider the dismissal of a suit alleging that the Federal Deposit Insurance Corp. and others caused him to lose $84,000 by allowing funds to be fraudulently transferred from his account, finding that he "presents no new evidence or change in law" (Joseph Grubaugh v. Central Progressive Bank, et al., No. 13-3045, E.D. La.; 2014 U.S. Dist. LEXIS 49077).

    Mealey's Insurance - 6th Circuit Adopts Clear- Notice Standard For Plan's Failure To Provide Documents

    CINCINNATI - A federal district court did not abuse its discretion in denying a beneficiary's claim for accidental death benefits or in awarding a statutory penalty for the plan's failure to timely provide a copy of the policy upon written request because, under the "clear-notice" standard, the plan administrator knew or should have known which documents were being requested, the Sixth Circuit U.S. Court of Appeals ruled April 9 (Nicole Cultrona v. Nationwide Life Insurance Company, et al., Nos. 13-3558, 13-3585, 6th Cir.; 2014 U.S. App. LEXIS 6486).

    Mealey's Insurance - Bad Faith Claim Abated In Underinsured Motorist Dispute Pending Liability Finding

    MIAMI - Because there has not yet been a determination of an auto insurer's liability in a dispute over underinsured motorist (UIM) benefits, a Florida federal judge on April 9 opted to abate an insured's bad faith claim against the insurer until the coverage matter is resolved (Luis Perez, et al. v. General Insurance Company of America, No. 1:14-cv-20009, S.D. Fla.; 2014 U.S. Dist. LEXIS 49059).

    Mealey's Insurance - Judge Issues Insurance Broker Partial Preliminary Injunction Against Employees

    GREENSBORO, N.C. - A North Carolina federal judge granted in part on April 11 an insurance broker a preliminary injunction against former employees from soliciting services from the broker's current employees (Superior Performers Inc. d/b/a National Agents Alliance v. Shawn L. Meaike, et al., No. 13-1149, M.D. N.C.; 2014 U.S. Dist. LEXIS 50302).

    Mealey's Insurance - Judge Allows Claims For Declaratory Judgment, Unfair Trade Practices To Proceed

    WILMINGTON, Del. - A Delaware federal judge on April 9 allowed a trustee's claims for declaratory judgment and unfair trade practices to proceed in a lawsuit challenging the practices of two life insurance companies (Wilmington Savings Fund Society, et al. v. PHL Variable Insurance Co., et al., No. 13-499-RGA, D. Del.; 2014 U.S. Dist. LEXIS 48877).

    Mealey's Insurance - Judge Will Defer Arbitration Umpire Selection Until After Disclosures Are Made

    NEW YORK - A federal judge in New York on April 9 told the parties to certain reinsurance agreements that he will defer his decision regarding the appointment of an arbitration umpire until the parties hold arbitration organizational meetings and review disclosures regarding a proposed umpire's neutrality (Employers Insurance Company of Wausau, et al. v. Arrowood Indemnity Co., No. 12-cv-8005; National Casualty Company v. Arrowood Indemnity Company, No. 12-cv-08006; Nationwide Mutual Insurance Company v. Arrowood Indemnity Company, No. 12-cv-08007, S.D. N.Y.).

    Mealey's Insurance - Judge Refuses To Dismiss Insolvent Insurers' Fraud Lawsuit Against Defendant

    ST. LOUIS - A Missouri federal judge on April 10 denied an incarcerated defendant's motion to dismiss or sever a lawsuit filed by the special deputy receiver (SDR) of three insolvent insurers alleging a fraudulent scheme conducted by the defendant regarding the insurers (Jo Ann Howard & Associates P.C., et al. v. J. Douglas Cassity, et al., No. 09-01252, E.D. Mo.; 2014 U.S. Dist. LEXIS 49622).

    Mealey's Insurance - 6th Circuit Panel: Judge Erred In Ruling On Nonfinal Reinsurance Arbitration

    CINCINNATI - A Sixth Circuit U.S. Court of Appeals panel reversed a lower court judgment on April 9 and said the lower court should not have interjected itself into a reinsurance arbitration dispute (Savers Property and Casualty Insurance Company, et al. v. National Union Fire Insurance Company of Pittsburg, PA, Nos. 13-2288 and 13-2289, 6th Cir.; 2014 U.S. App. LEXIS 6488).

    Mealey's Insurance - Panel Reverses In Hurricane Wilma Suit, Orders Court To Award Insurer Attorney Fees

    WEST PALM BEACH, Fla. - Finding that a lower court applied the wrong standard for determining whether a homeowners insurer was owed attorney fees in a Hurricane Wilma coverage dispute, a Florida appeals panel on April 9 reversed and remanded for the lower court to grant the insurer the right to attorney fees and decide the amount to be awarded (Citizens Property Insurance Corp. v. Magdiel Perez, No. 4D12-1412, Fla. App., 4th Dist.; 2014 Fla. App. LEXIS 5153).

    Mealey's Insurance - Insurer Is Denied Judgment In Construction Defects Dispute; Fact Issues Remain

    SEATTLE - While a managing company served as a joint venture's agent for conducting the joint venture's business, material issues of fact remain as to whether the joint venture's business included collecting rent, a Washington federal judge ruled April 9, denying summary judgment to an insurer in a coverage dispute for a construction defects case (Century Surety Co. v. Belmont Seattle LLC, No. 12-823, W.D. Wash.; 2014 U.S. Dist. LEXIS 49880).

    Mealey's Insurance - Insurance Broker Can Pursue Unjust Enrichment Claim Against Former Employee

    NEW YORK - An insurance brokerage firm can amend its complaint to add an unjust enrichment claim against a former employee but not a competing insurance broker the employee went to work for, a New York federal judge held April 9 (DeWitt Stern Group Inc. v. Richard Eisenberg, No. 13-3060, S.D. N.Y.; 2014 U.S. Dist. LEXIS 49374).

    Mealey's Insurance - Judge: No Professional Liability Coverage For $1.75M Legal Malpractice Judgment

    WASHINGTON, D.C. - A professional liability insurer has no duty to cover the costs of a $1.75 million legal malpractice action filed against a law firm insured and two of its attorneys, a District of Columbia federal judge ruled April 10 (Chicago Insurance Co. v. Paulson & Nace, et al., No. 12-2068 [ABJ], D. D.C.; 2014 U.S. Dist. LEXIS 49616).

    Mealey's Insurance - Court Erred In Ruling Class Action Against Broker Was Not Covered, Panel Says

    MIAMI - A Florida appeals panel on April 9 found that a class action complaint seeking more than $168 million in damages against a mortgage broker insured is covered under a professional liability insurance policy, reversing and remanding a lower court's summary judgment ruling in favor of the insurer (Jerilynn Gidney and Michael Goldberg v. Axis Surplus Insurance Co., No. 3D12-1250, Fla. App., 3rd Dist.; 2014 Fla. App. LEXIS 5231).

    Mealey's Insurance - Del. High Court: Insolvent Insurer's Owner's Due Process Rights Were Not Violated

    DOVER, Del. - The delinquency proceedings for an insolvent nightclub insurer did not violate the constitutional due process rights of the insurer's owner or his company, the Delaware Supreme Court affirmed April 9 (Jeffrey B. Cohen and IDG Companies LLC v. State of Delaware, ex rel. The Honorable Karen Weldin Stewart, Delaware insurance commissioner, No. 545, 2013, Del. Sup.; 2014 Del. LEXIS 170).

    Mealey's Insurance - Judge Permits FTC's Lawsuit Over Wyndham Data Breach To Proceed

    NEWARK, N.J. - The Federal Trade Commission (FTC) has authority to bring an unfair and deceptive acts complaint against a hotel chain related to its data security, a New Jersey federal judge ruled April, declining to dismiss claims that sprung from breaches of the Wyndham Worldwide Corp.'s computer network (Federal Trade Commission v. Wyndham Worldwide Corp., et al., No. 2:13-cv-01887, D. N.J.; 2014 U.S. Dist. LEXIS 47622).

    Mealey's Insurance - Attorney-Client Privilege Cannot Be Invoked In Coverage Dispute, Magistrate Judge Says

    SACRAMENTO, Calif. - A California federal magistrate judge on April 7 determined that an insured cannot claim protection from the discovery of documents based on the attorney-client privilege under the common interest doctrine because the insured failed to prove that a sufficient common interest exists (Lennar Mare Island LLC v. Steadfast Insurance Co., et al., No. 12-2182, E.D. Calif.; 2014 U.S. Dist. LEXIS 48509).

    Mealey's Insurance - Judge: No Professional Liability Coverage For FDIC's Claims Against Bank Directors

    FRESNO, Calif. - An exclusion in an extended professional liability policy (ELP) bars coverage for claims the Federal Deposit Insurance Corp. brought against former directors of a failed bank in its capacity as a receiver, a California federal magistrate judge ruled April 7, granting the insurer's motion for summary judgment (Thomas T. Hawker, et al., Plaintiffs, v. BancInsurance Inc., et al., No. 1:12-cv-01261-SAB, E.D. Calif.; 2014 U.S. Dist. LEXIS 48649).

    Mealey's Insurance - Retrocessional Reinsurer Says Its Reinsured Has Asked For Too Large An Award

    TRENTON, N.J. - A retrocessional reinsurer told a federal court in New Jersey on April 7 that its reinsured's calculation of a $6.1 million judgment is too high and includes certain post-judgment claims (Munich Reinsurance America, Inc. v. American National Insurance Company, No. 09-cv-06435, D. N.J.).

    Mealey's Insurance - Insurer Sues Reinsurer For $108,704.91 In Allegedly Unpaid Reinsurance Billing

    NEW HAVEN, Conn. - An insurer told a federal court in Connecticut on April 9 that its reinsurer has failed to honor a $108,704.91 asbestos-related reinsurance billing (Travelers Casualty and Surety Company v. Excalibur Reinsurance Corporation, No. 14-cv-00471, D. Conn.).

    Mealey's Insurance - Panel Upholds Take- Nothing Judgment On Insurance Agent's Negligence

    SAN ANTONIO - A Texas appeals panel on April 9 affirmed a take-nothing judgment against an insured regarding its negligence claim against an insurance agent (TOKA General Contractors and Moore Sorrento v. Wm. Rigg Co., No. 04-12-00474-CV, Texas App., 4th Dist.; 2014 Tex. App. LEXIS 3776).