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Insurance Law

The New 2013 Publication Update of New Appleman Insurance Law Practice Guide Arrives in November

The 2013 Publication Update of New Appleman Insurance Law Practice Guide Features:

   New Practice Commentary Throughout the Publication by Members of the Appleman Editorial Board

   Revision of 10 Chapters

   Case Updates Throughout  the Publication

   Completely Updated over 400-page Appendix of Multi-Jurisdictional Charts on Key Insurance Coverage Issues

The 2013 Edition of the New Appleman Insurance Law Practice Guide features new considerations, strategic points, timing requirements, exceptions, warnings, traps, insureds' perspectives, insurers' perspectives, and cedents' perspectives written by members of the Appleman Editorial Board, including: Prof. Aviva Abramovsky of the Syracuse University College of Law; William Barker of SNR Denton USA; Mark Maister of Irell & Manella LLP; Douglas Richmond of Aon Risk Services-Global Professions Practice; and Sherilyn Pastor of McCarter & English, LLP, as well as Timothy W. Volpe of Volpe, Bajalia, Wickes, Rogerson & Wachs.

Chapter 6, "Understanding Bad Faith," was substantially revised with new court decisions and commentary, including on exceptions in the application of the principles of bad faith.

Chapter 7, "Researching Insurance Coverage," has been enhanced with several new sections including  Understanding the purpose of Research, and under How to Select a Database for Research, new subsections on Choice of Law, Comparing Other Jurisdictions' Positions, Statutes and Regulations, Bulletins and Notices, and on Form Language.

Chapter 12, "Adjusting and Handling Insurance Claims," has been enhanced with commentary on anticipatory breach or anticipatory repudiation of an insurance policy.

Chapter 16, "Managing the Relationship Between the Coverage Case and Underlying Litigation," has been revised with enhanced discussions and strategies on determining an insurance policy's scope of coverage,  on policy conditions an insured generally must meet to be eligible for coverage, on ascertaining the insurer's duty to defend (including the involvement of extrinsic evidence) and the insured's right to independent counsel , discussion of "a splitting of the file" where  one claim representative is assigned to handle the insured's defense while a second claim representative is assigned to handle the coverage aspects of the matter, ascertaining of an "occurrence" under a policy and of an insured's intentional conduct, ascertain the applicability of the employer's liability exclusion, and the insured's criminal act exclusion,  the lack of permissive use exclusion in motor vehicle insurance, an insurer's excess letter, an insured's breach of the duty of noncooperation,  conditions for a insured's refusal to submit to an examination under oath as a basis for noncoverage, the insurability and impact of punitive damages as to a conflict of interest entitling the insured to independent counsel at the insurer's expense, insurer's defense counsel representing multiple insureds, and cases in which two insureds face probable excess liability to a single plaintiff, the legal effect of a reservation of rights letter, and strategies as to non-waiver agreements.

Chapter 17, "Drafting the Answer and Affirmative Defenses," includes new or enhanced discussions of the right to jury trial when both legal and equitable claims are at issue, waiver of an insured's claim for improper service of process, obtaining the benefits of relation back when a party's name is changed or a new party named, determining federal question jurisdiction and the right of removal, timing the removal of a suit, federal courts having broad discretion to stay or dismiss cases seeking purely declaratory relief when there are related state court proceedings, the law as to service of suit clauses when an insured sues an insurer, the issue of fraudulent joinder to defeat diversity jurisdiction, as well as the issue of fraudulent misjoinder, defendant's motion to dismiss a claim, denying the allegations of a complaint in the answer, and the pleading of affirmative defenses.

Chapter 20, "Conducting Discovery," newly discusses the various reasons for obtaining in discovery: the claims file including the claim's handlers notes, as well as the insurer's reserve information and the timing of the setting the reserves. It also newly discusses how to effectively depose appropriate individuals concerning the underwriting and claims files and newly enumerates various documents policyholder's counsel should consider requesting. It further discusses why policyholder's counsel should determine what standards, if any, an insurer has adopted and implemented to ensure claims are promptly and appropriately investigated.

Chapter 24, "Considerations Involved in the Settlement of the Underlying Case,"  has been substantially revised and features new sections on: disputes that can arise when the underlying lawsuit involves the same facts at issue in a related potentially criminal case; the consequences of an insured's refusal to consent to a settlement the insurer wants to accept; the insured's right to object to a settlement designed to truncate the duty to defend; the insurer's involvement in settlements and mediations; how the insured can protect against an insurer's voluntary payment arguments in some settings; and the dangers of an insurer denying coverage based on positions advanced in good faith by the insured in the underlying lawsuit.

Chapter 25, "Considering Alternative Dispute Resolution," was revised in several important ways for the latest edition.  First, and most significantly, the chapter has been enhanced with commentary and practice tips from a practicing mediator (Jeff Kichaven) and arbitrator (Nasri H. Barakat), both with substantial experience resolving insurance-related issues; their input is found in the new "Mediator's Perspective" and "Arbitrator's Perspective" sections of the chapter.  Like the "Judge's Perspective" sections in the last edition, the "Mediator's Perspective" and "Arbitrator's Perspective" sections provide helpful input from the viewpoint of professionals working in the insurance ADR field.  Second, the chapter was revised to account for trends and changes in the law since the last edition, including, for example, an enhanced discussion of handling claims against multiple insurers with disparate arbitration clauses.  Third, the chapter was revised to incorporate scholarly writing on insurance ADR published since the last edition.  Fourth and finally, the chapter was revised to reflect the real-world ADR experiences of the author since the last edition.

Chapter 26, "Strategies for Trial," has been updated and revised and features a new Part on Using Technology to Assist Your Case, including new sections on the use of technological equipment, the use of technology in opening statements, the use of technology in direct and cross examinations, and the use of technology in closing arguments.

Chapter 47, "Understanding Inland Marine Insurance," has been enhanced featuring new sections  on direct action statutes and the role of bonds with inland marine insurers.

The Appendix consisting of multi-jurisdictional charts of appellate court and statutory positions on 20 key insurance coverage issues has been completely updated.

In addition, there have been updates throughout the publication, reporting on significant recent court decisions. Here are some highlights:

Chapter 5: Retained Limit Provision Contrary to Public Policy of Preserving Tort Right of Recovery: Rosciti v. Ins. Co. of Pennsylvania, 659 F.3d 92 (1st Cir. 2011) - A retained limit provision in an excess insurance policy, which a bankrupt insured was unable to exhaust, was incompatible with Rhode Island's public policy, as reflected in R.I. Gen. Laws § 27-7-2.4, to preserve a tort victim's right of recovery when the insured became insolvent; thus, the limiting provision was unenforceable.

Chapter 9: Insured's Failure to Notify Acts as Bar to Collecting Default Judgment from Insurer: Steadele v. Colony Ins. Co., 361 Mont. 459, 260 P.3d 145 (Mont. 2011) - An insured's failure to properly notify the insurer of an occurrence and/or claim can act to bar a third-party's attempt to collect a default judgment from the insurer, particularly in a jurisdiction that does not require an insurer to show prejudice (insureds' failure to notify their insurance company of a lawsuit as required by their insurance policy absolved the insurance company of liability for the claim; therefore, summary judgment was properly granted in favor of the insurance company in a third-party's suit to recover under the policy for a default judgment obtained against the insureds).

Chapter 9: Connecticut Joins Majority of States in Requiring Insurer to Establish Late Notice Caused Prejudice: Arrowood Indem. Co. v. King, 304 Conn. 179, 203, 39 A.3d 712 (Conn. 2012) (overruling prior case law and joining "vast majority" of states requiring insurer to establish prejudice).

Chapter 25: Corbello v. Moore, 2011 U.S. Dist. LEXIS 42763 (W.D. Wash. Apr. 20, 2011) - Coverage under an E&O policy was excluded where a claim arose out of legal services performed for an existing business enterprise that at time of the act or omission giving rise to the claim, the attorney owned more than a 10% of the shares of that enterprise.

Chapter 26: Aletheia Research & Mgmt. v. Houston Cas. Co., 831 F. Supp. 2d 1210 (C.D. Cal. 2011) - While a Summons with Notice provided a list of claims and parties involved in a lawsuit, mere recitation of causes of action, without more, was not sufficient to provide notice pursuant to the insurance policies.

Chapter 27: Land O' Lakes, Inc. v. Emplrs. Mut. Liab. Ins. Co. of Wis., 2012 U.S. Dist. LEXIS 29173 (D. Minn. Mar. 6, 2012) - Finding that the Oklahoma Supreme Court would likely adopt the majority view and hold that a "Potentially Responsible Party" letter from the EPA or a similar state agency constitutes "suit" for purposes of a CGL policy.

Chapter 29: Recall Total Info. Mgmt. v. Fed. Ins. Co., 2012 Conn. Super. LEXIS 227 (Conn. Super. Ct. Jan. 17, 2012) - Where computer data tapes were lost, and the insured brought a claim for preventative measures taken because of theft or loss of the use of the data on the tapes rather than for actual damage to the tapes or for their cost; the claim was not for damage to tangible property and the court found no coverage for it as property damage.

Chapter 30: Electronic Data Held to Be "Physical." Landmark American Ins. Co. v. Gulf Coast Analytical Laboratories, Inc., 2012 U.S. Dist. LEXIS 45184 (M.D. La., March 26, 2012) - Under Louisiana law, although electronic data is not tangible, it can be observed and altered though human action and is, therefore, physical. Thus, analysis of chemical samples stored as electronic data on a hard disk storage system was movable or physical in nature and had physical existence. Since it was physical in nature it was susceptible to "direct, physical loss or damage."

Chapter 30: DISH Network Corp. v. Arch Specialty Ins. Co., 659 F.3d 1010 (10th Cir. 2011) - A suit for patent infringement can, under narrow circumstances, allege "misappropriation" of advertising ideas and where the appellant allegedly committed a patent infringement by using another's technology to sell its own non-infringing satellite television products and services and where the advertising technique itself was patented, the infringement may constitute an "advertising injury."

Chapter 30: Deliberate indifference to a known risk that a patent exists is not the appropriate standard under the applicable patent statute. Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060, 179 L. Ed. 2d 1167 (2011) -Given the long history of willful blindness and its wide acceptance there was no reason why the doctrine should not apply in civil lawsuits for induced patent infringement. The deliberate indifference test departed from the proper willful blindness standard in two important respects: it would permit a finding of knowledge when there was merely a "known risk" that the induced acts were infringing; and, in demanding only "deliberate indifference" to that risk, the test would not require active efforts by an inducer to avoid knowing about the infringing nature of the activities.

Chapter 30: Complaint Did Not Constitute a Claim for Trade Dress Infringment: James River Ins. Co. v. Bodywell Nutrition, LLC., 2012 U.S. Dist. LEXIS 16402 (S.D. Fla., Feb. 1, 2012) - Although trade dress involves packaging or design of a product, an underlying complaint seeking destruction of advertising, flyers, containers, labels, or packaging bearing trademarked word did not constitute a claim for trade dress infringement as it contained no allegation that the insured used any product or packaging closely related to the plaintiff's product in its total look, design, or shape, but instead alleged the insured advertised, promoted, offered to sell, and sold products that were closely related to those of plaintiff and used marks, words, and symbols that were identical to or confusingly similar to those of plaintiff.

Chapter 32: Third-Circuit Applies Choice of Law Analysis to Determine Applicable Stacking and Bad Faith Laws: Amica Mut. Ins. Co. v. Fogel, 656 F.3d 167, 171-172 (3d Cir. Pa. 2011) - Although New Jersey had some interest in the insureds' policy--as the place of contracting and the initial location of both parties--after the insureds notified the insurer of their relocation to Pennsylvania, there was no longer a justified expectation that New Jersey remained the principal location of the insured risk.

Chapter 44: Tenth Circuit Holds that Allegations of Patent Infringement Fall Within Advertising Injury Coverage: DISH Network Corp. v. Arch Specialty Ins. Co., 659 F.3d 1010 (10th Cir. 2011): The Tenth Circuit held that allegations of patent infringement can fall within CGL advertising liability coverage.

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