LexisNexis® Legal Newsroom
Mealey's IP/Tech - CGL Insurer Has No Duty To Defend Against Copyright Claims, Federal Judge Rules

AUSTIN, Texas - A Texas federal judge on June 17 held that a commercial general liability insurer has no duty to defend its insureds against copyright claims because the underlying complaint fails to allege any unauthorized use of an adult entertainment company's copyrighted advertising materials, slogan or title in the insureds' advertising (St. Paul Fire and Marine Insurance Co. v. Giganews Inc., et al., No. 15-89, W.D. Texas; 2016 U.S. Dist. LEXIS 79535).

Mealey's Banking & Finance - Federal Judge: Insured Did Not 'Own' Lost Earnings Under Commercial Crime Policy

HOUSTON - A Texas federal judge on June 21 held that an insured did not "own" its lost earnings stemming from a Ponzi scheme within the meaning of a commercial crime insurance policy (Cooper Industries, Ltd., et al v. National Union Fire Insurance Company of Pittsburgh Pa., No. 12-01591, S.D. Texas; 2016 U.S. Dist. LEXIS 80342).

Mealey's Insurance - CGL Insurer Has No Duty To Defend Against Copyright Claims, Federal Judge Rules

AUSTIN, Texas - A Texas federal judge on June 17 held that a commercial general liability insurer has no duty to defend its insureds against copyright claims because the underlying complaint fails to allege any unauthorized use of an adult entertainment company's copyrighted advertising materials, slogan or title in the insureds' advertising (St. Paul Fire and Marine Insurance Co. v. Giganews Inc., et al., No. 15-89, W.D. Texas; 2016 U.S. Dist. LEXIS 79535).

Mealey's Insurance - Federal Judge: Insured Did Not 'Own' Lost Earnings Under Commercial Crime Policy

HOUSTON - A Texas federal judge on June 21 held that an insured did not "own" its lost earnings stemming from a Ponzi scheme within the meaning of a commercial crime insurance policy (Cooper Industries, Ltd., et al v. National Union Fire Insurance Company of Pittsburgh Pa., No. 12-01591, S.D. Texas; 2016 U.S. Dist. LEXIS 80342).

Mealey's Insurance - Federal Magistrate Recommends Default Judgment Be Entered Against Insured

SACRAMENTO, Calif. - A federal magistrate judge in a California on June 16 recommend that a commercial general liability insurer's motion for a default judgment be granted and that a judgment be issued declaring that the insurer has no duty to defend or indemnify its insured against an underlying breach of contract and negligence lawsuit alleging the insured's pilot car services were performed "in an unworkmanlike manner" (Atain Specialty Insurance Co. v. Richard Szetela d/b/a D&D Pilot Car Services, et al., No. 14-2991, E.D. Calif.; 2016 U.S. Dist. LEXIS 78855).

Mealey's Insurance - Ruling Did Not Create New Standard For All Flood Policies, Delaware Judge Says

WILMINGTON, Del. - A Delaware judge on June 20 denied a commercial general liability insurer's request for certification of interlocutory appeal of a Jan. 27 ruling involving what falls under a policy's $25 million flood sublimit in a Superstorm Sandy coverage dispute (Almah LLC, et al. v. Lexington Insurance Co., No. N15C-01-237 EMD, Del. Super.).

Mealey's Insurance - Texas High Court Refuses To Rehear Coverage Suit Over Defective Flanges

AUSTIN, Texas - The Texas Supreme Court denied two motions to rehear a commercial general liability coverage dispute arising from faulty flanges that resulted in an underlying $6,345,824 settlement against the insured, according to its June 17 orders pronounced list (U.S. Metals Inc. v. Liberty Mutual Group Inc., et al., No. 14-0753, Texas Sup.).

Mealey's Insurance - Judge: Insurers Have No Duty To Indemnify As No Covered Property Damage Exists

SALT LAKE CITY - Homeowners failed to establish evidence that they suffered any property damage as a result of a contractor or subcontractor's work on their home that is covered under two commercial general liability insurance policies, a Utah federal judge ruled June 15, finding that the insurers have no duty to indemnify for underlying judgments (Auto-Owners Insurance Co. v. Timbersmith, Inc., et al. & George Fleming and Janis Fleming v. The Charter Oak Fire Insurance Co., No. 12-00786, D. Utah; 2016 U.S. Dist. LEXIS 78748).

Mealey's Insurance - Insured's Defective Work Is An 'Occurrence' Under CGL Policy, Iowa High Court Says

DES MOINES, Iowa - An insured's faulty work may constitute an "occurrence" under an excess commercial general liability insurance policy, a majority of the Iowa Supreme Court affirmed June 10, also finding that a trial court did not err in instructing a jury to determine whether damages arose due to an "accident" constituting an "occurrence" by considering the insured's viewpoint and what it intended or should reasonably have expected (National Surety Corp. v. Westlake Investments, LLC, No. 14-1274, Iowa Sup.; 2016 Iowa Sup. LEXIS 71).

Mealey's Insurance - Pollution Exclusion Bars Coverage For Contamination Claims, Federal Judge Says

SAN FRANCISCO - A California federal judge on June 3 determined that a commercial general liability policy's pollution exclusion clearly bars coverage for underlying environmental contamination claims filed against an insured; however, the judge said a potential for coverage exists under the applicable business auto policies (American Guarantee and Liability Insurance Co., et al. v. Technichem Inc., et al., No. 15-03611, N.D. Calif.; 2016 U.S. Dist. LEXIS 72793).

Mealey's Insurance - 2nd Circuit Reverses Court's Ruling That Knowing Violation Exclusion Bars Coverage

NEW YORK - The Second Circuit U.S. Court of Appeals on June 1 reversed and remanded a lower federal court's ruling that a commercial general liability insurance policy's knowing violation exclusion precludes personal and advertising coverage for two class action lawsuits alleging that the insured conspired with two companies to deceptively trap customers into recurring credit card charges (National Fire Insurance Company of Hartford, et al. v. E. Mishan & Sons Inc., No. 15-2248, 2nd Cir.; 2016 U.S. App. LEXIS 10151).

Mealey's Antitrust/Unfair Competition - Judge Orders Business To Pay Damages For Unlawful Broadcast

LOS ANGELES - A California federal judge on May 26 granted summary judgment on numerous claims asserted by a commercial distributor of sporting events for violation of California's unfair competition law (UCL) and violation of certain broadcasting laws, ordering the owner of an establishment who unlawfully broadcast a program to pay damages (Joe Hand Promotions Inc. v. Danny Kim, No. 14-05951, C.D. Calif.; 2016 U.S. Dist. LEXIS 69413).

Mealey's Insurance - Insureds' Failure To Properly Disconnect Tank Prior To Work Is No 'Occurrence,' Judge Says

SALT LAKE CITY - Insureds' failure to follow instructions in disconnecting a water tank, electrical wires and water lines prior to demolition work does not constitute an "occurrence" under a commercial general liability insurance policy, a Utah federal judge ruled May 24, finding that the insurer has no duty to defend or indemnify (Auto-Owners Insurance Co. v. Ryan Stevens Construction Inc. and Ryan Stevens, No. 15-406, D. Utah; 2016 U.S. Dist. LEXIS 68522).

Mealey's Insurance - No Coverage For Water Damage To Leather Goods Merchandise, Panel Affirms

PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on May 17 affirmed a lower federal court's ruling that there is no commercial insurance coverage for surface water damage to a leather goods retailer insured's merchandise following a rainstorm (Lucky Leather, Inc. v. Mitsui Sumitomo Insurance Group, et al., No. 14-55019, 9th Cir.; 2016 U.S. App. LEXIS 9018)

Mealey's Insurance - Policy Unambiguously Did Not Provide Defense For Wrongful Death Suit, Panel Affirms

CHICAGO - An Illinois appeals panel on May 13 affirmed a lower court's ruling that a commercial general liability insurer has no duty to defend against underlying wrongful death and negligence claims arising from a fatal highway accident, rejecting the plaintiff's argument that the insurer is estopped from denying coverage (FHP Tectonics Corporation v. American Home Assurance Co., et al., No. 1-13-0291, Ill. App., 1st Dist., 5th Div.; 2016 Ill. App. Unpub. LEXIS 936).

Mealey's Insurance - Ohio High Court: No Coverage For Damages Based On Vicarious Liability In Abuse Suit

COLUMBUS, Ohio - The Ohio Supreme Court on May 12 found that a commercial liability insurance policy's abuse or molestation exclusion precludes coverage for an award of damages based on an insured's vicarious liability for intentional infliction of emotional distress (IIED) arising from its employee's physical abuse of a minor while in the insured's care and custody, further finding that the policy does not provide coverage for an attorney fees award and post-judgment interest (World Harvest Church v. Grange Mutual Casualty Co., No. 2014-1161, Ohio Sup.; 2016 Ohio LEXIS 1306).

Mealey's Insurance - Judge: Insureds Failed To Show They Have A Valid Claim In Insurance Dispute

DALLAS - Summary judgment in an insurance coverage dispute is proper because insureds have failed to provide sufficient evidence showing that a genuine issue of material fact exists that would show they were entitled to coverage under a commercial property insurance policy, a federal judge in Texas ruled May 6 (Seneca Insurance Co. Inc. v. Hamilton Properties Inc., et al., No. 15-0829, N.D. Texas; 2016 U.S. Dist. LEXIS 60275).

Mealey's Insurance - Panel: No Duty To Defend, Indemnify Additional Insured In Construction Defects Suit

CHICAGO - A commercial general liability insurer had no duty to defend or indemnify an additional insured in an underlying construction defect case, an Illinois appeals panel held May 4, affirming summary judgment to the insurer (Westfield Insurance Co. v. West Van Buren, LLC and 933 Van Buren Condominium Association, No. 1-14-0862, Ill. App., 1st Dist., 3rd Div.; 2016 Ill. App. Unpub. LEXIS 873).

Mealey's PI/Product Liability - Texas Appeals Court: Settlement Did Not Result In Merger Of Subcontracts

WACO, Texas - A settlement agreement that resolved a payment dispute between a general contractor that was hired to construct a housing complex on Sam Houston State University's (SHSU) campus and the subcontractor that installed the heating, ventilation and air conditioning (HVAC) system did not result in a merger of the indemnity clause between the parties' subcontracts, a Texas appellate panel ruled April 28 in reversing the subcontractor's summary judgment award (Capstone Building Corporation v. IES Commercial Inc., No. 10-15-00182-CV, Texas App., 10th Dist.; 2016 Texas App. LEXIS 4449).

Mealey's Insurance - Arkansas High Court: CGL Insurance Policies Do Not Cover Breach Of Contract

LITTLE ROCK, Ark. - A commercial general liability insurance policy does not extend basic coverage for a claim of breach of contract, a majority of the Arkansas Supreme Court held April 28, finding that there is no coverage and considering certified questions moot (Columbia Insurance Group Inc. and Columbia Mutual Insurance Co. Inc. v. Cenark Project Management Services, Inc., et al., No. CV-15-804, Ark. Sup.; 2016 Ark. LEXIS 153).

Mealey's Insurance - Insurer's Suit Over Defects Coverage Should Be Dismissed, Magistrate Judge Recommends

AUSTIN, Texas - A commercial general liability insurer's declaratory judgment lawsuit with regard to an underlying construction defect case should be dismissed on the basis that the case lacks ripeness and jurisdiction, a federal magistrate judge in Texas recommended April 28 (Mid-Continent Casualty Co. v. Christians Development Company, Inc. and Aquarena Plaza, LLC, No. 16-31, W.D. Texas; 2016 U.S. Dist. LEXIS 56973).

Mealey's Litigation Procedure - Virginia Federal Judge Confirms 3 Awards Totaling $16.5 Million

NORFOLK, Va. - A Virginia federal judge on April 26 confirmed three arbitration awards totaling more than $16.5 million from the International Commercial Arbitration Court at The Chamber of Commerce and Industry of the Russian Federation (ICAC) (Research and Development Center "teploenergetika" v. EP International LLC, et al., No. 2:15-cv-362, E.D. Va.; 2016 U.S. Dist. LEXIS 55843).

Mealey's Insurance - Panel: Court Erred By Declining To Exercise Jurisdiction In Warehouse Theft Dispute

ATLANTA - The 11th Circuit U.S. Court of Appeals held April 20 that a federal district court abused its discretion when it declined to exercise jurisdiction without adequately considering the relevant factors in a commercial general liability coverage dispute arising from theft and vandalism at a Miami warehouse (First Mercury Insurance Co. v. Excellent Computing Distributors Inc., et al., No. 15-10120, 11th Cir.; 2016 U.S. App. LEXIS 7111).

Mealey's Insurance - Loss Of Power Constitutes Single Occurrence, Louisiana Panel Says In Reversal

NEW ORLEANS - A Louisiana appeals panel found April 20 that the loss of power to a hospital's cooling system following Hurricane Katrina is a single occurrence under a commercial general liability insurance policy and that an insured is responsible for only one retained limit of $50,000, reversing a lower court's ruling that the insured owed a separate retained limit for each claim related to the power outage (David Thebault v. American Home Assurance Company, et al., No. 2015-CA-0800, La. App., 4th Cir.; 2016 La. App. LEXIS 764).

Mealey's Insurance - Judge: Underlying Suits Provide No Evidence That Insurers Had A Duty To Defend

SEATTLE - Summary judgment in an insurance bad faith lawsuit against two general commercial liability insurers is proper because insureds have failed to show that either of the insurers had a duty to defend the insureds in two underlying lawsuits, a federal judge in Washington ruled April 18 (American Management Services East LLC, et al. v. Scottsdale Insurance Co., et al., No. 15-1005, W.D. Wash.; 2016 U.S. Dist. LEXIS 51768).