WASHINGTON, D.C. - The U.S. Supreme Court on June 24 refused to hear an appeal of a lower federal court's ruling that the application of the discretionary function exception (DFE) to the Federal Tort Claims Act (FTCA) completely insulates the U.S. government from liability for claimants' Hurricane Katrina flood damage (Kent Lattimore, et al. v. United States, et al., No. 12-1092, U.S. Sup.).
SPOKANE, Wash. - Because an insurance policy's arbitration provision required agreement from both parties, a Washington federal judge found June 19, an insurer did not act in bad faith by declining its insured's repeated demands for arbitration in a dispute over underinsured motorist (UIM) coverage (Mary 'Julie' Clark, et al. v. Amica Mutual Insurance Co., No. 2:13-cv-00082, E.D. Wash.; 2013 U.S. Dist. LEXIS 86451).
GULFPORT, Miss. - A Mississippi federal judge on June 20 ruled in favor of a homeowners insurer in a dispute arising from Hurricane Katrina property damage (Terry Stolz, et al. v. State Farm Fire and Casualty Co., No. 12-101, S.D. Miss., Southern Div.; 2013 U.S. Dist. LEXIS 86834).
HOUSTON - An insured's "bare-bones" claims against an insurer are insufficient to satisfy federal pleading standards, a Texas federal judge ruled June 19, granting the insurer's motion to dismiss the insured's suit seeking coverage for hailstorm damage but allowing the insured leave to file an amended complaint within 20 days (Sara Dalton v. State Farm Lloyd's Inc., et al.; No. 12-3004, S.D. Texas; 2013 U.S. Dist. LEXIS 86490).
HOUSTON - Despite having twice amended its complaint, an insured still failed to sufficiently identify any false statements made by its insurer, a Texas federal judge ruled June 19, granting a motion to dismiss the fraud-based claims against the insurer (Protectors Insurance and Financial Services LLC v. Lexington Insurance Co., No. 4:12-cv-03469, S.D. Texas; 2013 U.S. Dist. LEXIS 85726).
SAN FRANCISCO - An insurer has a duty to pay the defense costs incurred by an insured's directors and officers related to underlying reputational injury and fraudulent conveyance claims arising from an alleged manufacturing defect in the insured's injectable dermal fillers, a California federal judge ruled June 18 (Scottsdale Insurance Co. v. Coapt Systems Inc., et al., No. 12-1780, N.D. Calif.; 2013 U.S. Dist. LEXIS 86414).
TRENTON, N.J. - Asbestos claims against a bankrupt insured manufacturer are not covered under excess comprehensive general liability insurance policies issued by its insolvent insurer, the New Jersey Supreme Court held June 19, finding that the doctrine of collateral estoppel applies (In the matter of the liquidation of Integrity Insurance Co./The Celotex Asbestos Trust, No. 068970, N.J. Sup.; 2013 N.J. LEXIS 588).
SAN FRANCISCO - A disability plan insurer abused its discretion in violation of the Employee Retirement Income Security Act through its interpretation of the plan's provision regarding offsets for current income, the Ninth Circuit U.S. Court of Appeals ruled June 18 in an unpublished opinion (Jonathan E. Rivkin, M.D. v. The Union Central Life Insurance Company, No. 11-55975, 9th Cir.; 2013 U.S. App. LEXIS 12377).
NEW ORLEANS - No coverage exists for an insured's liabilities arising out of an oil spill because the insured did not provide notice of the incident within 30 days as clearly required by the policies' terms, the Fifth Circuit U.S. Court of Appeals said June 18 (St. Paul Fire & Marine Insurance et al. v. Settoon Towing LLC, et al., No. 11-31030, 5th Cir.; 2013 U.S. App. LEXIS 12424).
SCRANTON, Pa. - Questions about the timing of a plaintiff's production of requested documents and information create issues of fact as to whether his insurer acted in bad faith in the timing and amount of its settlement offers to him, a Pennsylvania federal judge held June 19, denying the insurer's summary judgment motion (Michael Scott v. GEICO General Insurance Co., No. 3:11-cv-01790, M.D. Pa.; 2013 U.S. Dist. LEXIS 85701).
WILMINGTON, Del. - A Delaware federal bankruptcy judge on June 20 granted relief from the automatic stay in The Flintkote Co.'s Chapter 11 case so that Flintkote and certain London market insurance companies can participate in binding arbitration to resolve disputes over insurance coverage for asbestos bodily injury claims (In re: The Flintkote Co., et al., No. 04-11300, D. Del. Bkcy.).
ATLANTA - The 11th Circuit U.S. Court of Appeals on June 20 affirmed a lower federal court's ruling that an insurer had no duty to defend a doctor and a medical practice in a medical negligence lawsuit because the policy's professional services exclusion barred coverage for the underlying claims (Nationwide Mutual Fire Insurance Co. v. Creation's Own Corporation, et al., No. 12-16223, 11th Cir.; 2013 U.S. App. LEXIS 12591).
SACRAMENTO, Calif. - An injured party's bad faith and breach of contract claims against an insurer are different than the issues he previously asserted against another party in a separate personal injury lawsuit, a California appeals panel found June 18, overturning a trial court's finding that the present case was precluded by collateral estoppel (Justin Barnes v. Western Heritage Insurance Co., No. C066002, Calif. App., 3rd Dist.; 2013 Cal. App. LEXIS 480).
PHILADELPHIA - Insurance policies were properly rescinded and declared null and void, and an additional insured is not entitled to more coverage than that afforded to the named insured for claims arising from allegedly defective fire suppression systems, a Pennsylvania federal judge ruled June 17, also finding that the insurer had a duty to defend the additional insured (Toll Bros. Inc. v. Century Surety Co., et al., No. 07-1296, E.D. Pa.; 2013 U.S. Dist. LEXIS 85101).
INDIANAPOLIS - An Indiana federal judge on June 17 overruled an insured's objections to a magistrate judge's discovery ruling after determining that the documents sought by the insured were not relevant to the choice-of-law analysis in an environmental contamination coverage dispute (Visteon Corp. et al. v. National Union Fire Insurance Company of Pittsburgh, Pa. et al., No. 11-200, S.D. Ind.; 2013 U.S. Dist. LEXIS 84628).
WILMINGTON, N.C. - A North Carolina federal judge on June 14 entered judgment in favor of an insurer seeking a declaration that no coverage is owed for an auto accident because the defendants did not respond to the insurer's complaint and the insurer offered proof that the alleged facts in its complaint support its claim for relief (Progressive Northern Insurance Co. v. Summit Management Services LLC, et al., No. 12-56, E.D. N.C.; 2013 U.S. Dist. LEXIS 84106).
TRENTON, N.J. - A special master and a liquidation court correctly disallowed asbestos-related bodily injury claims made against excess insurance policies issued by an insolvent insurance company, a New Jersey appeals panel affirmed June 17 (In the matter of the liquidation of Integrity Insurance Co., No. A-5273-10T1, N.J. Super., App. Div.; 2013 N.J. Super. Unpub. LEXIS 1476).
CHARLESTON, W.Va. - A commercial general liability insurance policy does not provide coverage for construction defect claims, the West Virginia Supreme Court of Appeals held June 18, reversing a trial court's ruling granting summary judgment to the insurer (Lisbeth L. Cherrington, et al. v. Erie Insurance Property and Casualty Co., No. 12-0036, W.Va. Sup.; 2013 W.Va. LEXIS 724).
WEST PALM BEACH, Fla. - An insurance professionals errors and omissions policy's criminal conduct exclusion absolves the insurer of its duty to defend its insured against two underlying lawsuits, a Florida federal judge ruled June 18, granting the insurer's motion for partial summary judgment (Certain Interested Underwriters at Lloyd's, London v. AXA Equitable Life Insurance Co., et al., No. 10-62061, S.D. Fla.; 2013 U.S. Dist. LEXIS 85444).
NEW ORLEANS - An excess insurer has no duty to provide coverage to an insured for a pollution occurrence because the insured did not comply with the notice requirement in the policy's pollution endorsement, the Fifth Circuit U.S. Court of Appeals said June 18 (Starr Indemnity & Liability Co. v. SGS Petroleum Service Corp., No. 12-20545, 5th Cir.; 2013 U.S. App. LEXIS 12425).
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on June 18 affirmed a federal court's decision to grant summary judgment in favor of an insurer, finding that mold-related property damage and certain fees were not covered under an excess insurance policy (Barry Shy, et al. v. The Insurance Company of the State of Pennsylvania, No. 11-56887, 9th Cir.; 2013 U.S. App. LEXIS 12379).
JACKSON, Miss. - There is no coverage for underlying claims against a Mississippi school district stemming from a teacher's alleged physical and verbal abuse of a handicapped student, a Mississippi federal judge ruled June 13, rejecting the school district's contention that it is entitled to coverage under the policy exception for "mental distress arising out of a wrongful employment practice" (Acadia Insurance Co. v. Hinds County School District, et al., No. 3:12-CV-188 c/w Nos. 3:12-CV-332 and 3:12-CV-731), S.D. Miss.; 2013 U.S. Dist. LEXIS 83240).
DALLAS - The Employee Retirement Income Security Act preempts a health plan's action seeking subrogation from several insurers under the plan's coordination of benefits (COB) provision of benefits it paid to its participants, even though ERISA would not preempt a subrogation action brought by the participants, a federal judge in Texas ruled June 13 (Central States, Southeast and Southwest Areas Health and Welfare Fund v. Health Special Risk, Inc., et al., No. 3:11-CV-2910-D, N.D. Tex.; 2013 U.S. Dist. LEXIS 83400).
LAS VEGAS - A Nevada federal judge on June 13 refused to dismiss a trade libel claim filed by insurers against an insurance agent because the insurers established negligence (Sentry Insurance, et al. v. Estrella Insurance Service Inc., et al., No. 13-169, D. Nev.; 2013 U.S. Dist. LEXIS 83282).
PHOENIX - Because a homeowners policy did not provide for payment of new building code upgrades in the repair of a damaged home, an Arizona federal judge on June 13 held that an insurer did not act in bad faith by denying a claim for such costs (Joseph Didyoung, et al. v. Allstate Insurance Co., et al., No. 2:12-cv-00348, D. Ariz.; 2013 U.S. Dist. LEXIS 83271).