LexisNexis® Legal Newsroom
Mealey's Insurance - Judge Says Denial Of Hurricane Claims May Have Been Arbitrary And Capricious

NEW ORLEANS - Genuine issues of material fact exist as to whether an insurer acted in an arbitrary and capricious manner by attributing a building's roof damage to tarps installed after it was damaged by a hurricane, a Louisiana federal judge ruled March 7, denying summary judgment on a bad faith claim against the building's insurers (Cedar Ridge LLC v. Landmark American Insurance Co., et al., No. 13-672, E.D. La.; 2014 U.S. Dist. LEXIS 29602).

Mealey's Insurance - Judge: Post-Hurricane Repairs Potentially Fall Under Insurance Policy's Faulty Work Exclusion

NEW ORLEANS - The installation of tarps and the use of adhesives following water damage caused by a hurricane constitute repairs and workmanship for purposes of interpreting an insurance policy's faulty workmanship exclusion, a Louisiana federal judge ruled March 5, granting partial summary judgment to insurers (Cedar Ridge LLC v. Landmark American Insurance Co., et al., No. 13-672, E.D. La.; 2014 U.S. Dist. LEXIS 28183).

Mealey's Insurance - Judge: 'Plausible Claim' Alleged In Dispute Over Hurricane Sandy Coverage

TRENTON, N.J. - A New Jersey federal judge on Feb. 26 denied an insurer's motion to dismiss a declaratory judgment and breach of contract lawsuit seeking coverage for damage caused by Hurricane Sandy, finding that the insured has offered evidence that could potentially establish that the insurer's application of the policy's Named Storm deductible was improper (AFP 104 Corp. v. Columbia Casualty Co., No.: 13-4077 [PGS][LHG], D. N.J.; 2014 U.S. Dist. LEXIS 24215).

Mealey's Insurance - Federal Judge Dismisses Texas Insureds' Suit Seeking Coverage For Foundation Damage

GALVESTON, Texas - Texas insureds' foundation damages are not covered under a standard flood insurance policy (SFIP), a Texas federal judge ruled Feb. 25, granting the insurer's motion for summary judgment in a dispute arising from Hurricane Ike damage (Mike Armstrong, et al. v. Fidelity National Property and Casualty Insurance Co., No. G-10-202, S.D. Texas; 2014 U.S. Dist. LEXIS 23508).

Mealey's IP/Tech - Federal Circuit Affirms: Hurricane Control System Patent Not Enabled

WASHINGTON, D.C. - The Patent Trial and Appeal Board properly rejected two inventors' application for a patent covering a "tropical hurricane control system," the Federal Circuit U.S. Court of Appeals ruled Feb. 25 (In re: Eugene Hoffmann et al., No. 13-1657, Fed. Cir.).

Mealey's Insurance - Judge Denies State Farm's Motion For New Trial, Orders Insurer To Pay $758,250

GULFPORT, Miss. - A Mississippi federal judge on Feb. 21 denied State Farm Fire and Casualty Co.'s renewed motion for judgment and, alternatively, for a new trial challenging a jury finding that it defrauded the U.S. government out of $250,000 by submitting a fraudulent Hurricane Katrina flood insurance claim. In a separate order, the judge ordered State Farm to pay $750,000 in trebled damages, plus a $8,250 civil penalty (United States of America ex rel. Cori Rigsby and Kerri Rigsby v. State Farm, et al., No. 06-433, S.D. Miss., Southern Div.).

Mealey's Insurance - Texas Federal Judge Denies Motion For New Trial; Finds No Error In Jury Verdict

HOUSTON - A Texas federal judge on Feb. 7 determined that a jury did not err in finding that damages sustained as a result of an oil spill in the wake of Hurricane Katrina were sudden and accidental as required by the policy at issue (Cox Operating LLC v. St. Paul Surplus Lines Insurance Co., No. 07-2724, S.D. Texas; 2014 U.S. Dist. LEXIS 15455).

Mealey's Insurance - Judge: No Additional Discovery Will Cure Failure To Submit Proper Proof Of Loss

NEW ORLEANS - Finding that no additional discovery will change the fact that an insured failed to submit a complete, sworn proof of loss in support of a supplemental claim for Hurricane Isaac damage, a Louisiana federal judge on Feb. 7 granted a motion by the Federal Emergency Management Agency to dismiss the insured's breach of contract and declaratory judgment lawsuit (Richard H. Clark, Sr., et al. v. FEMA, et al., No. 13-5232, E.D. La.; 2014 U.S. Dist. LEXIS 15871).

Mealey's Insurance - Florida Panel: Suit Seeking Additional Coverage For Hurricane Damage Was Timely

MIAMI - A Florida appeals panel on Feb. 5 found that an insured's breach of contract lawsuit seeking additional coverage for Hurricane Wilma damage was timely filed and not barred by a Florida five-year statute of limitations, reversing and remanding a lower court's ruling in favor of the insurer (Angela M. Rizo v. State Farm Florida Insurance Co., No. 3D12-3088, Fla. App., 3rd Dist.).

Mealey's Insurance - Federal Judge Refuses To Set Aside Appraisal Award In Hurricane Ike Coverage Suit

HOUSTON - A Texas federal judge on Jan. 30 denied insureds' motion to set aside an appraisal award in a dispute over coverage for Hurricane Ike damage (United Neurology, et al. v. Hartford Lloyd's Insurance Co., No. 10-4248. S.D. Texas, Houston Div.; 2014 U.S. Dist. LEXIS 11664).

Mealey's Insurance - Excess Policy Was Not Triggered, Panel Rules, Reverses $1.3M Ruling Against Insurer

ATLANTA - The 11th Circuit U.S. Court of Appeals on Jan. 24 reversed and remanded a lower federal court's $1.3 million judgment against an excess insurer in a Florida property manager's lawsuit seeking excess coverage for Hurricane Wilma damage, finding that Florida's insurable interest statute bars recovery beyond the property manager's revenue stream from the damaged property (Banta Properties Inc. v. Arch Specialty Insurance Co., No. 12-14186, 11th Cir.; 2014 U.S. App. LEXIS 1419).

Plaintiffs Appeal Ruling In Favor Of United States In Floodwall Breach Dispute

NEW ORLEANS - Contending that their claims of flood damage from the Army Corps of Engineers' alleged negligent dredging of the Mississippi River Gulf Outlet (MRGO) are not foreclosed, plaintiffs on Jan. 14 appealed a federal district court's ruling in favor of the United States in a Hurricane Katrina dispute (In re: Katrina Canal Breaches Consolidated Litigation, No. 05-4182, E.D. La.; 2013 U.S. Dist. LEXIS 180464).

Judge: Fact Issues Exist As To Whether Broker, Insured Had A 'Special Relationship'

WEST PALM BEACH, Fla. - A Florida federal judge found Jan. 13 that there are genuine issues of material fact as to whether a "special relationship" existed between an insurance broker and a condominium association insured, denying the broker's renewed motion for summary judgment in a lawsuit arising from damage caused by Hurricanes Frances and Jeanne (Tiara Condominium Association Inc. v. Marsh USA Inc., No. 08-80254, S.D. Fla.; 2014 U.S. Dist. LEXIS 3677).

Federal Magistrate Judge Rules In Favor Of Insurer In Hurricane Ike Coverage Suit

GALVESTON, Texas - A Texas federal magistrate judge on Jan. 9 granted a federal flood insurer's motion for summary judgment in a coverage dispute arising from Hurricane Ike damage, dismissing all claims against the insurer with prejudice (Christina Melinder v. Texas Farmers Insurance Co., et al., No. G-10-516, S.D. Texas; 2014 U.S. Dist. LEXIS 2596).

Magistrate Judge Enters Final Judgment In Favor Of Insurer In Hurricane Ike Suit

GALVESTON, Texas - A federal magistrate judge on Jan. 7 entered final judgment in favor of a federal flood insurer in a coverage dispute over Hurricane Ike damage, finding that the insured violated the policy by swearing to false statements in the proof of loss (Peter Charnock v. Fidelity National Property and Casualty Insurance Co., No. G-10-cv-450, S.D. Texas; 2014 U.S. Dist. LEXIS 1491).

Insurer's Reformation Of 2 Policies Was Mandated By Federal Law, Judge Rules

TRENTON - An insurer's reformation of two of a condominium association insured's four Standard Flood Insurance Policies (SFIPs) was mandated by federal law, a New Jersey federal judge ruled Dec. 4, dismissing with prejudice the insured's breach of contract claim based on those two policies (The Residences at Bay Point Condominium Association Inc. v. The Standard Fire Insurance Company, et al., No. 13-02380 (FLW)(LHG), D. N.J.; 2013 U.S. Dist. LEXIS 170811).

Federal Judge: Claims Not Properly Joined In Superstorm Sandy Coverage Dispute

CENTRAL ISLIP, N.Y. - A New York federal judge on Dec. 3 found that plaintiffs' breach of contract claims are not properly joined in a lawsuit seeking federal flood coverage for damage caused by Superstorm Sandy (Linda Salle, et al. v. Allstate Insurance Co., No. 13 CV 6020 (SJF)(GRB), E.D. N.Y.; 2013 U.S. Dist. LEXIS 171026).

Panel: Excess Insurer Has Duty To Defend Against Inverse Condemnation Claims

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Dec. 6 affirmed a lower federal court's ruling that an excess public entity insurer has a duty to defend its state parish government insured against damages it allegedly caused in condemning and demolishing properties deemed unsafe after Hurricane Katrina (Lexington Insurance Co. v. St. Bernard Parish Government, No. 13-30300, 5th Cir.).

Panel: Policy Rescission Does Not Moot Negligence Claims Against Insurance Agents

TRENTON, N.J. - The rescission of an insurance policy does not render moot an insured's claims for indemnification and professional negligence against insurance agents regarding denied coverage for hurricane damage, a New Jersey appeals panel held Nov. 20 (Those Certain Underwriters at Lloyd's, London subscribing to policy number BUY1780 v. Cleopatra LLC d/b/a Eden ROC Motel and Affifa Michael v. KK Insurance Agency Inc. and Kiran M. Sondhi, No. A-1312-12T3, N.J. Super. App. Div.; 2013 N.J. Super. Unpub. LEXIS 2797).

Mississippi High Court Finds Burden Shifting Erroneous In Insurance Dispute

JACKSON, Miss. - A trial court correctly admitted expert testimony that wind from Hurricane Katrina damaged a couple's roof structure, but it wrongly shifted the burden of proof for other damage to the property owners, the Mississippi Supreme Court held Nov. 7 in reversing a directed verdict for the insurer on coverage (Jack and Margaret Ann Hoover v. United Services Automobile Association, No. 2011-CA-01486-SCT, Miss. Sup.; 2013 Miss. LEXIS 578).

Louisiana Panel Finds Insurer Satisfied Judgment In Full In Hurricane Rita Suit

LAKE CHARLES, La. - A Louisiana appeals panel on Nov. 6 reversed a lower court's ruling rejecting an insurer's request to have a judgment against it in a Hurricane Rita coverage dispute declared as satisfied, further reversing the lower court's judgment ordering the insurer to pay $36,853.86 to the insured or suffer an interest penalty (Clarence M. Leland, et al. v. Lafayette Insurance Co., No. 13-476, La. App., 3rd Cir.; 2013 La. App. LEXIS 22892013 La. App. LEXIS 2289).

Judge: Fact Issues Preclude Summary Judgment In Hurricane Isaac Coverage Suit

NEW ORLEANS - A Louisiana federal judge on Nov. 7 found that fact issues preclude a summary judgment ruling in favor of an insured in a dispute over building coverage for flood damage caused by Hurricane Isaac (Lisa Hillard v. Bankers Specialty Insurance Co., No. 13-200, E.D. La.; 2013 U.S. Dist. LEXIS 159674).

Mississippi High Court: Church's Motion For New Trial Tolled Statute Of Limitations

JACKSON, Miss. - A church insured's July 8, 2009, motion to set aside judgment or, in the alternative, for a new trial in a Hurricane Katrina coverage dispute tolled the statute of limitations on the underlying breach of contract claim; therefore, the trial court erred in dismissing the insured's second complaint against its insurer, the Mississippi Supreme Court ruled Oct. 31 (Sweet Valley Missionary Baptist Church v. Alfa Insurance Corp., et al., No. 2010-CT-01807-SCT, Miss. Sup.; 2013 Miss. LEXIS 574).

Sale Of Unrepaired Property Did Not Extinguish Insurance Claims, 7th Circuit Says

CHICAGO - The sale of a hurricane-damaged apartment complex "in its unrepaired state did not extinguish $(the policyholder's$) right to recover on $(its$) mature claim," a Seventh Circuit U.S. Court of Appeals panel ruled Oct. 25, reviving the policyholder's breach of contract and bad faith claims against its excess insurer (Edgewood Manor Apartment Homes LLC, et al. v. RSUI Indemnity Co., No. 12-1480 and 12-1508, 7th Cir.; 2013 U.S. App. LEXIS 21939).

Panel Remands For Court To Determine General Contractor Overhead Expense Issue

WEST PALM BEACH, Fla. - A Florida appeals panel on Oct. 23 reversed and remanded a hurricane coverage dispute for a trial court to decide whether homeowners were reasonably likely to incur general contractor overhead and profit expenses as part of their damages (Ronald Juvonen, et al. v. United Property and Casualty Insurance Co., No. 4D12-230, Fla. App., 4th Dist.; 2013 Fla. App. LEXIS 16775).