LexisNexis® Legal Newsroom
Louisiana Federal Judge Remands Breach Of Health Care Contract

NEW ORLEANS - A Louisiana federal judge on Aug. 26 remanded a breach of health care contract suit to state court, finding that the defendant did not show that the amount in controversy for removal to federal court had been met (Omega Hospital LLC v. Blue Cross Blue Shield of Illinois, No. 13-4891, E.D. La.; 2013 U.S. Dist. LEXIS 12195).

Federal Judge Confirms $400 Million Award, Finds Mexican Court Erred

NEW YORK - A New York federal judge on Aug. 27 granted a Mexican corporation's request to confirm an approximately $400 million arbitration award that was issued in its favor in a dispute over contracts for the construction of offshore platforms, finding that a Mexican court that nullified the award improperly applied a law that was not in existence at the time the parties entered the underlying agreements (Corporacion Mexicana De Mantenimiento Intergral, S. De R.L. De C.V. v. Pemex-Exploracion Y Produccion, No. 1:10-cv-00206, S.D. N.Y.).

Insurer Fulfilled Duties, Judge Finds, Dismisses It From Foreclosure Dispute

RENO, Nev. - Finding it undisputed that an insurer fulfilled its obligations under a mortgage protection life insurance policy, a Nevada federal judge on Aug. 22 granted the insurer's motion to dismiss breach of contract, bad faith and other claims against it related to the foreclosure of the insured's property (Linda Downs v. River City Group LLC, No. 3:11-cv-00885, D. Nev.; 2013 U.S. Dist. LEXIS 119508).

Louisiana Jury Awards $5.95M In Mesothelioma Case

PLAQUEMINE, La. - A Louisiana jury awarded $5.95 million to a man who contracted mesothelioma after exposure to asbestos, sources told Mealey Publications on Aug. 22 (Sidney Mabile v. Dow Chemical Co., No. N/A., La. Dist., Iberville Parish).

Indiana Panel: Third-Party Claims, Reserve Info Is Discoverable In Bad Faith Case

INDIANAPOLIS - Information on similar hail damage claims made by other insureds is relevant to a property owner's bad faith and breach of contract claims against its insurer, an Indiana Court of Appeals panel ruled Aug. 15, upholding a lower court's order to compel, while stating that the information might ultimately not be admissible (Auto-Owners Insurance Co. v. C & J Real Estate Inc., No. 49A04-1209-PL-477, Ind. App.; 2013 Ind. App. Unpub. LEXIS 1060).

9th Circuit: Nurse Had No Property Interest In Contract Position

PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on Aug. 15 upheld a trial court's determination that a nurse had no constitutionally protected property interest in an independent contractor position (Christine Blantz v. California Department of Corrections and Rehabilitation, et al., No. 11-56525, 9th Cir.; 2013 U.S. App. LEXIS 16940).

South Carolina High Court: Construction Contract Case Should Be Arbitrated

COLUMBIA, S.C. - The South Carolina Supreme Court on Aug. 14 ruled that construction contract claims involving alleged defects at a marina should be arbitrated, concluding that "the trial court erred in finding the parties' transaction had an insufficient nexus to interstate commerce" (Cape Romain Contractors Inc. v. Wando E. LLC, et al., No. 27298, S.C. Sup.; 2013 S.C. LEXIS 203).

Judge: Airport Operator Cannot Make A Separate Bad Faith Claim Under New York Law

DETROIT - Finding a claim for bad faith and unfair trade practices to be duplicative of an airport operator's breach of contract claim, a Michigan federal judge on Aug. 14 held that the claim must be dismissed under New York law, which governs the claim (Wayne County Airport Authority v. Allianz Global Risks US Insurance Co., et al., No. 2:11-cv-15472, E.D. Mich.; 2013 U.S. Dist. LEXIS 114437).

Federal Judge Stays Action Seeking $25 Million, Finds Case Must Be Arbitrated

NEW YORK - After finding that claims related to an underlying financing contract and for fraudulent inducement are arbitrable, a New York federal judge on Aug. 15 stayed an action filed by a New Jersey corporation that seeks $25 million in damages and compelled arbitration of the dispute (MidOil USA LLC v. Astra Project Finance Pty Ltd., No. 12-8484, S.D. N.Y.; 2013 U.S. Dist. LEXIS 115678).

5th Circuit Upholds Insurer's Breach Of Contract Ruling Against Insurance Agent

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Aug. 14affirmed summary judgment to an insurer on a breach of contract claim against an insurance agent because the agent is blocked by the doctrine of quasi-estoppel from assertingthat he transferred all liabilities and responsibilities under anagency agreement to another company (American General Life Insurance Co. v. Sheldon Carter Bryan, No. 12-20435, 5th Cir.; 2013 U.S. App. LEXIS 16829).

Claims Over Restaurant Closed Due To Sewage Odor Properly Pleaded, Judge Finds

LAS VEGAS - A Nevada federal judge on Aug. 13 found a policyholder's breach of contract and bad faith claims against its insurer regarding claims related to the closure of its restaurant because of sewage odor to be plausible on their face, denying the insurer's motion to dismiss (Maddin Inc. v. Allied Insurance Company of America, No. 2:13-cv-00827, D. Nev.; 2013 U.S. Dist. LEXIS 114206).

Ohio Panel Finds Discovery On Bifurcated Bad Faith Claim Should Have Been Stayed

CLEVELAND - Finding that allowing discovery to proceed on a bifurcated, stayed bad faith claim would prejudice an insurer in defending against an underlying breach of contract claim, an Ohio appeals panel on Aug. 8 ruled that a lower court erred in not staying discovery on the bad faith claim (Kathleen R. Devito v. Grange Mutual Casualty Co., et al., No. 99393, Ohio App., 8th Dist.; 2013 Ohio 3435; 2013 Ohio App. LEXIS 3523).

Multidistrict Litigation Panel Refuses To Consolidate Pilot Flying J Cases

WASHINGTON, D.C. - The Judicial Panel on Multidistrict Litigation on Aug. 8 refused to consolidate eight suits and potential tag-along actions regarding a truck stop company's alleged scheme of withholding diesel fuel price rebates and discounts (In Re: Pilot Flying J Fuel Rebate Contract Litigation, MDL No. 2468, JPMDL; 2013 U.S. Dist. LEXIS 112360).

9th Circuit Reinstates Loan Modification Suits Against Wells Fargo

SAN FRANCISCO - A Ninth Circuit U.S. Court of Appeals panel on Aug. 8 reversed the dismissal of two lawsuits claiming that Wells Fargo Bank N.A. breached the terms of trial period plans (TPPs) offered to borrowers attempting to modify their home loans under the Home Affordable Modification Program (HAMP), finding that the TPPs were enforceable contracts (Philip R. Corvello v. Wells Fargo Bank N.A.,, No. 11-16234, Karen Lucia, et al. v. Wells Fargo Bank, N.A., No. 11-16242, 9th Cir.).

Hostess Sues Bakery For Losses Valued At $151,989.93 Related To Alleged Breach

NEW YORK - Bankrupt Old HB Inc., formerly known as Hostess Brands Inc., on Aug. 7 filed an adversary proceeding against a bakery seeking recovery of $157,989.93 in damages related to alleged breaches of contract related to bread it provided for Hostess (Old HB Inc. f/k/a Hostess Brands Inc. v. Papa Pita Bakery $(In Re: Old HB, f/k/a Hostess Brands Inc.$), No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

Judge Denies Dismissal Of Breach Of Contract Claim Against Insurance Agent

MINNEAPOLIS - A federal judge in Minnesota on Aug. 5 refused to dismiss a breach of contract claim against an insurance agent and its parent company regarding the purchase of forced-placed insurance on a mortgage (Jared Rapp v. Green Tree Servicing LLC, et al., No. 12-2496, D. Minn.; 2013 U.S. Dist. LEXIS 109461).

Federal Judge Dismisses Breach Of Contract Claim Against Insurance Agents

GULFPORT, Miss. - Insureds improperly joined insurance agents as defendants to a lawsuit alleging wrongful denial of coverage, a Mississippi federal judge held Aug. 2, dismissing breach of contract and negligent misrepresentation claims (Melvin Lonberger and Bobbie Lonberger v. OMNI Indemnity Co., et al., No. 13-243, S.D. Miss.; 2013 U.S. Dist. LEXIS 109703).

Insureds Show No Special Circumstances With Broker For Coverage, Panel Finds

BOSTON - The absence of special circumstances and of a specific promise to procure a particular coverage between an insurance broker and insureds precludes claims against the broker for negligence, negligent misrepresentation and breach of contract, the Massachusetts Appeals Court affirmed Aug. 1 (Robert H. Guida, et al. v. Herbert H. Landy Insurance Agency Inc., No. 12-P-1214, Mass. App.; 2013 Mass. App. Unpub. LEXIS 803).

Judge Rejects Insurer's Contention That Contract, Fraud Exclusions Bar Coverage

PROVIDENCE, R.I. - A Rhode Island federal judge on Aug. 2 found that a claimant has pleaded sufficient allegations to support the availability of corporate liability insurance coverage for an underlying intentional misrepresentation verdict, rejecting the insurer's reliance on the policy's contract and fraud exclusions in denying coverage (TranSched Systems Limited v. Federal Insurance Co., No. 12-939-M, D. R.I.; 2013 U.S. Dist. LEXIS 108736.)

South Dakota High Court Revives Construction Firm's Breach Of Contract Claims

PIERRE, S.D. - The South Dakota Supreme Court on July 31 ruled that a trial court erred by granting summary judgment for the defendant in a breach of construction contract case, remanding the action for further proceedings (Donald Bucklin Construction v. McCormick Construction Co., No. 26505, S.D. Sup.; 2013 S.D. LEXIS 85).

Arizona High Court Revives Tort Claims Against Construction Company

PHOENIX - The Arizona Supreme Court on July 31 affirmed a court of appeals ruling that reversed dismissal of tort claims brought against a construction firm by the second owners of a property, ruling that "if the homeowner does not have a contract with the homebuilder, we hold that the economic loss doctrine does not bar the homeowner's negligence claims to recover damages resulting from construction defects" (John F. Sullivan, et al. v. Pulte Home Corp., No. CV-12-0419-PR, Ariz. Sup.; 2013 Ariz. LEXIS 162).

Alleged Intentional Acts Are Not An 'Occurrence,' Miss. Appeals Court Rules

JACKSON, Miss. - Because an underlying plaintiff only pleaded intentional actions by a construction company and its subcontractors, a Mississippi appeals court on July 30 unanimously affirmed a lower court's finding that there had been no "occurrence" or accident to trigger coverage under a commercial general liability policy related to the underlying breach of contract and negligence lawsuit (W.R. Berkley Corp., et al. v. Rea's Country Lane Construction Inc., No. 2009-CA-01223-COA, Miss. App.; 2013 Miss. App. LEXIS 464).

Louisiana Federal Judge Rules On Motions Seeking Maritime Attachments

NEW ORLEANS - A Louisiana federal judge on July 30 issued a ruling on various motions in relation to disputes over payments made under shipping contracts for the purchase and transport of pig iron (Stemcor USA Inc. v. Cia Siderurgica Do Para Cosipar, No. 12-2966, E.D. La.; 2013 U.S. Dist. LEXIS 106549).

1 Claim Remains In Breach Of Health Insurance Contract Dispute

OKLAHOMA CITY - An Oklahoma federal judge on July 29 partially granted summary judgment in favor of a health care provider in a breach of contract dispute, leaving only the plaintiff's claim that she is a third-party beneficiary seeking to enforce restrictions on permitted billing of members for services that are not covered (Elizabeth Cates v. Integris Health Inc., No. 12-763, W.D. Okla.; 2013 U.S. Dist. LEXIS 105437).

Guarantor Obligated To Pay On Loan Acquired By City National Bank

ROANOKE, Va. - A federal judge in Virginia on July 26 granted summary judgment to City National Bank (CNB), which acquired a $3.2 million loan from a failed bank, holding that the fact that CNB possibly cannot enforce the note against the signer of a promissory note "has no bearing on whether it can enforce the Guaranty, an independent contract" (City National Bank v. Moishe Tress, et al., No.7:11-cv-73, W.D. Va.; 2013 U.S. Dist. LEXIS 105398).