LexisNexis® Legal Newsroom
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).

Mealey's Insurance - Panel: 'Other Insurance' Clause Is Unenforceable In Equitable Contribution Suit

SACRAMENTO, Calif. - An "other insurance" clause cannot be enforced in an equitable contribution action between successive primary insurers, a California appeals panel held April 11, also finding that enforcement of the clause in a primary commercial general liability insurance policy would violate public policy (Certain Underwriters at Lloyds, London v. Arch Specialty Insurance Co., No. C072500, Calif. App., 3rd Dist.; 2016 Cal. App. LEXIS 275).

Mealey's Insurance - Insurer Has No Duty To Pay $4M 'Blast Fax' Ads Settlement, Illinois Panel Affirms

CHICAGO - An Illinois appeals panel held on March 30 that a commercial general liability insurer is not obligated to indemnify its insured's assignee for an underlying $4 million settlement over a "blast fax" ads dispute, noting as an aside its concern that underlying Telephone Consumer Protection Act (TCPA) class lawsuits are not about compensating class members but have everything to do with compensating the class action lawyers (First Mercury Insurance Co. v. Nationwide Security Services Inc., et al., No. 1-14-3924, Ill. App., 1st Dist., Div. 3; 2016 Ill. App. Unpub. LEXIS 636).

Mealey's IP/Tech - Federal Judge: 2 Exclusions Bar Coverage For Dispute Over 'Got Milk?' Campaign

DULUTH, Minn. - A Minnesota federal judge on March 29 entered judgment in favor of a commercial general liability insurer one day after ruling that the insurer has no duty to defend or indemnify its insured against underlying counterclaims filed in a lawsuit over the ownership and use of the "got milk?" service marks and trademarks (Food Market Merchandising, Inc., Plaintiff, v. West Bend Mutual Insurance Co., No. 15-3347, D. Minn.; 2016 U.S. Dist. LEXIS 40770).

Mealey's Insurance - Federal Judge: 2 Exclusions Bar Coverage For Dispute Over 'Got Milk?' Campaign

DULUTH, Minn. - A Minnesota federal judge on March 29 entered judgment in favor of a commercial general liability insurer one day after ruling that the insurer has no duty to defend or indemnify its insured against underlying counterclaims filed in a lawsuit over the ownership and use of the "got milk?" service marks and trademarks (Food Market Merchandising, Inc., Plaintiff, v. West Bend Mutual Insurance Co., No. 15-3347, D. Minn.; 2016 U.S. Dist. LEXIS 40770).

Mealey's Litigation Procedure - Detroit Settles Class Suit Alleging It Overcharged For Water And Sewer

FLINT, Mich. - A Michigan federal judge on March 29 approved a settlement reached between the City of Detroit and the owners of multifamily dwellings alleging that they were improperly charged at a commercial rate for water and sewer (LaSalle Town Houses Cooperative Association, et al. v. City of Detroit, No. 12-13747, E.D. Mich.; 2016 U.S. Dist. LEXIS 40709).

Mealey's Insurance - Florida Federal Jury Says Construction Company Is Covered For Condo Defects

ORLANDO, Fla. - An additional insured is covered under another contractor's commercial general liability policy for an underlying construction defects lawsuit regarding damages to a condominium complex, a federal jury in Florida found March 23 (Core Construction Services Southeast, Inc. v. Crum & Forster Specialty Insurance Co., No. 14-1789, M.D. Fla.).

Mealey's Insurance - Pilot Car Services Are 'Professional Services' Under Policy Exclusion, Judge Says

SACRAMENTO, Calif. - Underlying claims that arise out of or relate to an insured's provision of pilot car services are barred from coverage by a commercial general liability insurance policy's professional services exclusion, a California federal judge held March 23 (Atain Specialty Insurance Co. v. Richard Szetela d/b/a D&D Pilot Car Services, et al., No. 2:14-cv-02991-KJM-KJN, E.D. Calif.; 2016 U.S. Dist. LEXIS 38059).

Mealey's Insurance - Judge: Faulty Work Claims Do Not Constitute 'Occurrence' Under Insurance Policies

PHILADELPHIA - Allegations of faulty workmanship in performance of a contract do not constitute an "occurrence" under commercial insurance policies and umbrella excess policies, a Pennsylvania federal judge ruled March 23, finding that an insurer has no duty to indemnify pre-tender defense costs and has no duty to provide an ongoing defense (Lenick Construction, Inc. v. Selective Way Insurance Co., No. 14-2701, E.D. Pa.; 2016 U.S. Dist. LEXIS 38119).

Mealey's IP/Tech - Federal Circuit Affirms Patent Noninfringement Summary Judgment Ruling

WASHINGTON, D.C. - A patent dispute over vacuum toilets commonly used on commercial aircraft was properly rejected on summary judgment, the Federal Circuit U.S. Court of Appeals concluded March 23 (MAG Aerospace Industries Inc. v. B/E Aerospace Inc., Nos. 15-1370, -1426, Fed. Cir.).

Mealey's Insurance - Insured Petitions 8th Circuit For Rehearing In Mold Remediation Coverage Suit

ST. LOUIS - An insured on March 9 filed a motion for rehearing in the Eighth Circuit U.S. Court of Appeals, arguing that the appeals panel failed to consider the insured's argument that coverage is owed under its commercial liability insurance policies because it was legally required to remediate mold damage (Busch Properties Inc. v. National Union Fire Insurance Co. of Pittsburgh, Pa., No. 14-3699, 8th Cir.).

Mealey's Insurance - $2.28M Superstorm Sandy Claim Fails To Meet Deductible, New York Panel Says

BROOKLYN, N.Y. - A New York appeals panel on March 9 held that an oil corporation insured's $2.28 million flood loss resulting from Superstorm Sandy did not meet the deductible of its commercial liability insurance policy, reversing a lower court's ruling against the insurer in a breach of contract lawsuit (Castle Oil Corporation v. ACE American Insurance Co., No. 55812/13, N.Y. Sup.; App. Div., 2nd Dept.; 2016 N.Y. App. Div. LEXIS 1623).

Mealey's Insurance - 9th Circuit: Insurer Has No Duty To Defend Claims For Faulty Plumbing Fittings

SAN FRANCISCO - A commercial general liability insurer has no duty to indemnify class action claims for an insured's alleged installation of defective plumbing fittings, the Ninth Circuit U.S. Court of Appeals ruled March 7, affirming summary judgment to the insurer on claims for insurance bad faith and violation of Nevada's Unfair Claims Practices Act, Nevada Revised Statute Section 686A.310 (Sharp Plumbing, Inc. v. National Fire & Marine Insurance Co., No. 14-15172, 9th Cir.; 2016 U.S. App. LEXIS 4270).

Mealey's IP/Tech - 'Failure To Conform,' 'Intellectual Property' Exclusions Bar Coverage, Judge Says

NORFOLK, Va. - A Virginia federal judge on Feb. 22 held that a commercial general liability insurance policy's "failure to conform" and "intellectual property" exclusions relieve the insurer of its duty defend and indemnify its flood vent manufacturer insured against an underlying lawsuit brought by a competitor, granting the insurer's motion for summary judgment (Selective Way Insurance Co. v. Crawl Space Door System, Inc. d/b/a Crawl Space Door Systems, Inc., No. 14-650, E.D. Va.; 2016 U.S. Dist. LEXIS 22097).

Mealey's Insurance - 'Failure To Conform,' 'Intellectual Property' Exclusions Bar Coverage, Judge Says

NORFOLK, Va. - A Virginia federal judge on Feb. 22 held that a commercial general liability insurance policy's "failure to conform" and "intellectual property" exclusions relieve the insurer of its duty defend and indemnify its flood vent manufacturer insured against an underlying lawsuit brought by a competitor, granting the insurer's motion for summary judgment (Selective Way Insurance Co. v. Crawl Space Door System, Inc. d/b/a Crawl Space Door Systems, Inc., No. 14-650, E.D. Va.; 2016 U.S. Dist. LEXIS 22097).

Mealey's Insurance - Insured's Mold Remediation Payments Did Not Arise From Imposed Liability, Panel Says

ST. LOUIS - An insured's payments for mold remediation are not covered under commercial general liability insurance policies because its legal obligation to remediate the mold did not spring from "liability imposed by law," the Eighth Circuit U.S. Court of Appeals affirmed Feb. 24 (Busch Properties Inc. v. National Union Fire Insurance Co. of Pittsburgh, Pa., No. 14-3699, 8th Cir.; 2016 U.S. App. LEXIS 3174).

Mealey's Insurance - 9th Circuit Affirms Court's Rulings In Suit Arising From 2008 California Wildfire

PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on Feb. 23 affirmed a lower federal court's post-trial rulings in a breach of contract and bad faith dispute arising from a 2008 wildfire (Craig Milhouse, et al. v. Travelers Commercial Insurance Co., Nos. 13-56959 and 13-57029, 9th Cir.; 2016 U.S. App. LEXIS 3145).

Mealey's Insurance - Insurers Were Prejudiced By Developer's Untimely Notice, 4th Circuit Affirms

RICHMOND, Va. - A real estate developer's untimely notice of a claim over alleged defective soil settlement issues prejudiced its commercial general liability insurers, the Fourth Circuit U.S. Court of Appeals held Feb. 23, upholding summary judgment to the insurers (St. Paul Mercury Insurance Co. and National Surety Corp. v. THF Clarksburg Development Two, LLC, et al., No. 15-1453, 4th Cir.).

Mealey's Insurance - Federal Judge Finds Water Exclusion Bars Insured's Damage From Failed Pipe

HOUSTON - A commercial property insurance policy's water exclusion endorsement precludes coverage for water damage from a failed pipe that does not qualify as personal property, a Texas federal judge ruled Feb. 19, granting summary judgment to an insurer on breach of contract and bad faith claims (Praetorian Insurance Co. v. Arabia Shrine Center Houston, No. 14-3281, S.D. Texas; 2016 U.S. Dist. LEXIS 20186).

Mealey's Insurance - New York Panel Says Insurer Owes City Coverage For Negligence Suit, Reverses

NEW YORK - A New York appeals panel on Feb. 16 found that a commercial general liability insurer owes coverage for an underlying lawsuit alleging that negligence by the City of New York, its Administration for Children's Services and a foster care agency resulted in abuse and death, finding that the insurer failed to provide a timely disclaimer of coverage that was necessary to invoke a policy exclusion (The City of New York v Granite State Insurance Co., No. 236, 451366/12, N.Y. Sup., App. Div.; 1st Dept.; 2016 N.Y. App. Div. LEXIS 1125).

Mealey's Labor & Employment - Pennsylvania Majority Rejects Argument That Exclusion Is Contrary To Public Policy

HARRISBURG, Pa. - A majority of the Pennsylvania Superior Court on Feb. 12 rejected an insured's argument that a commercial general liability insurance policy's employer's liability exclusion as it relates to a "leased worker" is unconscionable and against public policy, affirming a lower court's ruling in favor of an insurer in a coverage dispute arising from a workplace injury (Westfield Insurance Company v. Astra Foods Inc., et al., No. 1392 EDA 2014, Pa. Super.; 2016 Pa. Super. LEXIS 84).

Mealey's Insurance - Pennsylvania Majority Rejects Argument That Exclusion Is Contrary To Public Policy

HARRISBURG, Pa. - A majority of the Pennsylvania Superior Court on Feb. 12 rejected an insured's argument that a commercial general liability insurance policy's employer's liability exclusion as it relates to a "leased worker" is unconscionable and against public policy, affirming a lower court's ruling in favor of an insurer in a coverage dispute arising from a workplace injury (Westfield Insurance Company v. Astra Foods Inc., et al., No. 1392 EDA 2014, Pa. Super.; 2016 Pa. Super. LEXIS 84).

Mealey's Insurance - Water Damage Exclusion Bars Coverage, 5th Circuit Affirms

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Feb. 10 affirmed a lower federal court's ruling that a commercial general liability insurance policy's water damage exclusion bars coverage for an underlying claimant's damages that arose from the intrusion of rainwater, rejecting the insured's contention that the insurer committed breach of contract and bad faith (Mesa Underwriters Specialty Insurance Co. f/k/a Montpelier U.S. Insurance Co. v. LJA Commercial Solutions LLC, et al., No. 15-60360, 5th Cir.).