LexisNexis® Legal Newsroom
Mealey's Toxic Tort/Environmental - Panel: Property Damage Exclusions Do Not Bar Claims For Negligent Installation

ATLANTA - A commercial general labiality insurance policy's "damage to property" exclusions do not preclude coverage for claims of an insured's alleged negligent installation, a Georgia appeals panel ruled July 8; however, the panel affirmed that a fungi exclusion bars coverage for the ensuing mold damage (Michael Dolan, et al. v. Auto Owners Insurance Co., No. A15A0384, Ga. App., 3rd Div.; 2015 Ga. App. LEXIS 421).

Mealey's Insurance - Texas Majority Finds Endorsement Ambiguous, Reverses Ruling In Favor Of Insurer

AMARILLO, Texas - A majority of a Texas appeals court on July 6 found that the language of a commercial general liability insurance policy's "clergy counseling professional liability coverage" endorsement is ambiguous and, therefore a lower court erred in granting summary judgment in favor of an insurer in a coverage dispute arising from claims for sexual abuse of minors (Doe #1, Doe #2 And Doe #3 v. National Union Fire Insurance Company of Pittsburgh, PA., No. 07-14-00109-CV, Texas App., 7th Dist.; 2015 Tex. App. LEXIS 6893).

Mealey's Insurance - Panel: Property Damage Exclusions Do Not Bar Claims For Negligent Installation

ATLANTA - A commercial general labiality insurance policy's "damage to property" exclusions do not preclude coverage for claims of an insured's alleged negligent installation, a Georgia appeals panel ruled July 8; however, the panel affirmed that a fungi exclusion bars coverage for the ensuing mold damage (Michael Dolan, et al. v. Auto Owners Insurance Co., No. A15A0384, Ga. App., 3rd Div.; 2015 Ga. App. LEXIS 421).

Mealey's Insurance - Insurer Has No Duty To Indemnify Settlement Of Fire Loss, Judge Concludes

RIVERSIDE, Calif. - A commercial general liability insurer has no duty to indemnify an insured's settlement over costs incurred by fire damage when no lawsuit was ever filed against the insured, a California federal judge ruled July 6 (D.W. Johnston Construction Inc. v. First Specialty Insurance Corp., No. 14-1269, C.D. Calif.; 2015 U.S. Dist. LEXIS 88119).

Mealey's Insurance - Business Risk Exclusions Bar Insured's Reimbursement Claim For Repairs, Panel Says

ATLANTA - A commercial general liability insurance policy's business risk exclusions preclude coverage for an additional insured general contractor's first-party claim seeking reimbursement of costs associated only with the repair and correction of the insured's faulty workmanship, a Georgia appeals panel held July 6 (Auto Owners Insurance Co. v. Gay Construction Co., No. A15A0145, Ga. App., 1st Div.; 2015 Ga. App. LEXIS 397).

Mealey's Litigation Procedure - Business Owners File Class Action Suit Over Santa Barbara Pipeline Rupture

LOS ANGELES - Commercial fisherman, fish buyers and owners of three businesses adversely affected by the May 19, 2015, rupture of Plains All American Pipeline LLC's Line 901, which discharged more than 100,000 gallons of crude oil onto the beaches of Refugio State Beach in Santa Barbara, Calif., and into the Pacific Ocean, filed a class action lawsuit against the company July 1 in California federal court, claiming that it negligently operated the 10-mile, 24-inch wide pipeline (Keith Andrews, et al. v. Plains All American Pipeline L.P., No. 15-cv-4989, C.D. Calif.).

Mealey's Toxic Tort/Environmental - Business Owners File Class Action Suit Over Santa Barbara Pipeline Rupture

LOS ANGELES - Commercial fisherman, fish buyers and owners of three businesses adversely affected by the May 19, 2015, rupture of Plains All American Pipeline LLC's Line 901, which discharged more than 100,000 gallons of crude oil onto the beaches of Refugio State Beach in Santa Barbara, Calif., and into the Pacific Ocean, filed a class action lawsuit against the company July 1 in California federal court, claiming that it negligently operated the 10-mile, 24-inch wide pipeline (Keith Andrews, et al. v. Plains All American Pipeline L.P., No. 15-cv-4989, C.D. Calif.).

Mealey's Insurance - Contractors Improperly Refused Insurer's Counsel In Defects Suit, Jury Finds

SAN JOSE, Calif. - Insured contractors breached their insurance contract with their commercial general liability insurer when they declined the insurer's selection of counsel to represent them in an underlying strict product liability lawsuit against an additional insured subcontractor, a California federal jury found July 2 (Travelers Property Casualty Company of America v. Kaufman & Broad Monterey Bay Inc., et al., No. 13-04745, N.D. Calif.).

Mealey's Bankruptcy - 2nd Circuit Addresses Withdrawal Liability Claim Against Bankruptcy Estate

NEW YORK - A multiemployer pension plan failed to demonstrate the amount of unfunded benefits attributable to post-petition operation of a bankruptcy estate, the Second Circuit U.S. Court of Appeals ruled on July 2 in a summary order disallowing the plan's administrative expense claim for a portion of the estate's withdrawal liability (Food Employers Labor Relations Association and United Food and Commercial Workers Pension Fund v. The Great Atlantic & Pacific Tea Company, No. 14-3349-bk, 2nd Cir.; 2015 U.S. App. LEXIS 11402).

Mealey's Insurance - Magistrate Judge: Impaired Property Exclusion Bars Claim For Insured's Negligence

CEDAR RAPIDS, Iowa - A commercial general liability insurance policy's impaired property exclusion precludes coverage for a university's loss-of-use claim which arose out of a delay or failure by an insured to perform under its subcontract, an Iowa federal magistrate judge found July 1, ruling that the insurer did not have a duty to defend (Peterson Contractors Inc. v. The Travelers Indemnity Co., No. 14-63, N.D. Iowa; 2015 U.S. Dist. LEXIS 86936).

Mealey's Insurance - Arizona Panel: Jury's $1.1M Verdict Against Broker Is Excessive, Unjustified

PHOENIX - An Arizona appeals panel held June 30 that a jury's final verdict that awarded $1,134,442 in damages to a commercial diving services company on its breach of contract and negligence claims against its insurance broker was excessive and not justified by the evidence on record, vacating the award and remanding for a new trial on the issue of damages (Deepwater Divers Inc. v. Wells Fargo Insurance Services USA Inc., No. 1 CA-CV 13-0518, Ariz. App., Div. 1; 2015 Ariz. App. Unpub. LEXIS 862).

Mealey's Labor & Employment - 2nd Circuit Addresses Withdrawal Liability Claim Against Bankruptcy Estate

NEW YORK - A multiemployer pension plan failed to demonstrate the amount of unfunded benefits attributable to post-petition operation of a bankruptcy estate, the Second Circuit U.S. Court of Appeals ruled on July 2 in a summary order disallowing the plan's administrative expense claim for a portion of the estate's withdrawal liability (Food Employers Labor Relations Association and United Food and Commercial Workers Pension Fund v. The Great Atlantic & Pacific Tea Company, No. 14-3349-bk, 2nd Cir.; 2015 U.S. App. LEXIS 11402).

Mealey's Insurance - Judge: Insurance Settlement Agreement Barred Future Claims

CAMDEN, N.J. - Summary judgment in an insurance bad faith lawsuit is warranted, a federal judge in New Jersey ruled June 29, because insureds' signing of a settlement agreement barred all future claims under a commercial lines policy (Antonio Giaccone, et al. v. Canopius US Insurance Co., No. 14-6939, D. N.J.; 2015 U.S. Dist. LEXIS 83682).

Mealey's IP/Tech - 7th Circuit: Insurers Should Have Foreseen Danger Of $20M Settlement From Outset

CHICAGO - The Seventh Circuit U.S. Court of Appeals on June 29 affirmed that primary and excess commercial general liability insurers' motion to intervene in a Telephone Consumer Protection Act (TCPA) lawsuit after a $20 million settlement was reached was untimely (CE Design Ltd., et al. v. King Supply Co., LLC, et al., No. 12-2930, 7th Cir.; 2015 U.S. App. LEXIS 11117).

Mealey's Insurance - 7th Circuit: Insurers Should Have Foreseen Danger Of $20M Settlement From Outset

CHICAGO - The Seventh Circuit U.S. Court of Appeals on June 29 affirmed that primary and excess commercial general liability insurers' motion to intervene in a Telephone Consumer Protection Act (TCPA) lawsuit after a $20 million settlement was reached was untimely (CE Design Ltd., et al. v. King Supply Co., LLC, et al., No. 12-2930, 7th Cir.; 2015 U.S. App. LEXIS 11117).

Mealey's Insurance - Panel: Whether Insured's Claim Was Barred By Known-Loss Provision Is Triable Issue

SAN FRANCISCO - There is a triable issue as to whether an insured's claim for property damage under a commercial general liability insurance policy was precluded by the known-loss provision, the Ninth Circuit U.S. Court of Appeals ruled June 25, reversing the entry of summary judgment to an insurer and remanding (Randy Kaady v. Mid-Continent Casualty Co., No. 13-35036, 9th Cir.; 2015 U.S. App. LEXIS 10754).

Mealey's Insurance - Panel: Insurer Has No Duty To Reimburse Insurer For Costs Incurred Over Defect Claims

SAN FRANCISCO - A pollution liability insurer has no duty to reimburse $241,392.87 to a commercial general liability insurer for costs incurred in defending underlying lawsuits arising out of damages from construction work, the Ninth Circuit U.S. Court of Appeals ruled June 23, finding that the pollution liability policy was excess and did not apply until the primary coverage was exhausted (Gemini Insurance Co. v. Indian Harbor Insurance Co., No. 13-16643, 9th Cir.; 2015 U.S. App. LEXIS 10616).

Mealey's Insurance - No Coverage For Filmmaker's Archive Destroyed In Wildfire, Texas Panel Affirms

AUSTIN, Texas - A Texas appeals panel held June 18 that an insurer did not waive any geographic limitation to its commercial personal property policy coverage because the covered locations were described in the renewal certificate and supplemental declarations of the policy, affirming a lower court's ruling in favor of an insurer in a coverage dispute over a filmmaker's archive of materials destroyed in a wildfire (3109 Props, L.L.C., et al. v. Truck Insurance Exchange, No. 03-13-00350-CV, Texas App., 3rd Dist.; 2015 Tex. App. LEXIS 6146).

Mealey's Insurance - Judge Approves Settlement Between Insurer, Insured In Construction Defects Dispute

RENO, Nev. - A Nevada federal judge on June 18 approved a settlement between a commercial general liability insurer and its insured and vacated orders finding that the insurer has a duty to defend an underlying construction defects case because a designated work exclusion and a pre-existing damage exclusion do not apply (Gemini Insurance Co. v. North American Capacity Insurance Co., No. 14-00121, D. Nev.; 2015 U.S. Dist. LEXIS 80239).

Mealey's Insurance - Panel: Insurer Had Duty To Reimburse Hail Damage To Roof, Did Not Act In Bad Faith

CHICAGO - Although an insurer had a duty to reimburse an insured for a new roof following damage from a hailstorm, the insurer did not act in bad faith in denying the claim, the Seventh Circuit U.S. Court of Appeals affirmed June 11 (Advance Cable Company LLC and Pinehurst Commercial Investments LLC v. Cincinnati Insurance Co., Nos. 14-2620 & 14-2748, 7th Cir.; 2015 U.S. App. LEXIS 9805).

Mealey's Insurance - Judge Orders Insurers To Brief Self-Insured Retention Issue For Defects Lawsuit

FRESNO, Calif. - A California federal judge on June 10 ordered two commercial general liability insurers to brief the issue of whether any one of the $10,000 self-insured retentions (SIR) in a policy on a "per-home" basis was met regarding the defense of a contractor accused of faulty construction in homes (Evanston Insurance Co. v. North American Capacity Insurance Co., No. 13-01365, E.D. Calif.; 2015 U.S. Dist. LEXIS 75265).

Mealey's Insurance - 11th Circuit: Insurer Has Duty To Indemnify Breach Of Contract Jury Verdict

ATLANTA - A commercial general liability insurer has a duty to indemnify an underlying breach of contract jury verdict entered against an insured regarding roof replacement work that allegedly caused leaking because the conduct was accidental, the 11th Circuit U.S. Court of Appeals ruled June 10, finding that a "contractual liability" exclusion does not apply (Pennsylvania National Mutual Casualty Insurance Co. v. St. Catherine of Siena Parish and Kiker Corp., No. 14-12151, 11th Cir.; 2015 U.S. App. LEXIS 9659).

Mealey's Insurance - Judge Quashes Insurer's Subpoena Of Penn State Lawyer In Sandusky Case

PHILADELPHIA - A commercial general liability insurer on June 9 was blocked from subpoenaing a Pennsylvania State University (PSU) attorney who was involved in the investigation of the sexual abuse allegations against now-convicted former Penn State coach Gerald Sandusky, as a Pennsylvania judge granted the attorney's motion to quash (Pennsylvania Manufacturers' Association Insurance Co. v. The Pennsylvania State University, et al., No. 04126, Pa. Comm. Pls., Philadelphia Co.).

Mealey's Litigation Procedure - Judge Quashes Insurer's Subpoena Of Penn State Lawyer In Sandusky Case

PHILADELPHIA - A commercial general liability insurer on June 9 was blocked from subpoenaing a Pennsylvania State University (PSU) attorney who was involved in the investigation of the sexual abuse allegations against now-convicted former Penn State coach Gerald Sandusky, as a Pennsylvania judge granted the attorney's motion to quash (Pennsylvania Manufacturers' Association Insurance Co. v. The Pennsylvania State University, et al., No. 04126, Pa. Comm. Pls., Philadelphia Co.).

Mealey's Insurance - Panel: Insurer Has No Duty To Defend, Indemnify Breach Of Contract Claim

RICHMOND, Va. - A commercial general liability insurer has no duty to defend or indemnify an insured against a breach of contract claim regarding the insured's alleged failure to excavate a site for the construction of a school, the Fourth Circuit U.S. Court of Appeals affirmed June 9 (Westfield Insurance Co. v. Carpenter Reclamation Inc. and The Board of Education of Greenbrier County, West Virginia, No. 14-2027, 4th Cir.; 2015 U.S. App. LEXIS 9600).