SAN FRANCISCO - A Ninth Circuit U.S. Court of Appeals panel on June 16 overruled arguments from a general contractor that a jury was not properly instructed about certain exclusions included in a policy obtained from ProBuilders Specialty Insurance Co., finding that the contactor was reading the exclusions too narrowly (ProBuilders Specialty Insurance Company, RRG v. Valley Corp. B., et al., No. 14-17544, 9th Cir., 2017 U.S. App. LEXIS 10716).
AUSTIN, Texas - A judgment in an underlying construction defect lawsuit is not binding on an insurer because its insured builder did not have a sufficient financial stake in the outcome due to a pretrial agreement, the Texas Supreme Court ruled June 16, granting a new trial over whether the insurer must cover the construction defect claims (Great American Insurance Co., et al. v. Glen Hamel, et al., No. 14-1007, Texas Sup., 2017 Tex. LEXIS 553).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on June 19 found that whether a manufacturer of hard-disk drives provided to a set-top box company was a direct supplier of a satellite television provider is a question of fact to be resolved by a jury, reversing and remanding a lower court's ruling in favor of an insurer in a business interruption coverage dispute arising from the Thailand flood (DirecTV v. Factory Mutual Insurance Co., No. 16-55313, 9th Cir., 2017 U.S. App. LEXIS 10787).
MIAMI - A federal magistrate judge in Florida on June 15 recommended denying a man's motion to vacate his 37-month sentence for mail fraud, finding that he should have raised the arguments regarding the ineffective assistance of counsel on direct appeal (Jason Keith Bailey v. United States of America, No. 16-CIV-23984-UNGARO, S.D. Fla., 2017 U.S. Dist. LEXIS 93102).
NEW YORK - A Brazilian reinsurer on June 14 argued that a New York federal court should deny an insurer's request for $5 million under an arbitration award in order to pay a settlement it reached with a steelmaker because the settlement does not require reinsurance coverage (National Indemnity Co. v. IRB Brasil Resseguros S.A., No. 15-3975, S.D. N.Y.).
NEW YORK - Three reinsurance executives on June 15 requested that a New York federal court send a $50 million Racketeer Influenced and Corrupt Organizations Act case against them to arbitration, arguing that the arbitration clause in the reinsurance agreement applies to them as well as their company (Bankers Conseco Life Insurance Co. and Washington National Life Insurance Co. v. Moshe M. Feuer, et al., No. 16-7646, S.D. N.Y.).
BROOKLYN, N.Y. - A New York federal judge on June 14 said a disability insurer did not act arbitrarily and capriciously in relying on the American Psychiatric Association's definition of mental illness when determining that bipolar disorder is a mental illness and subject to the plan's 24-month cap on disability benefits for a mental illness (Marry Kim v. The Hartford Life Insurance Co., No. 15-2474, E.D. N.Y., 2017 U.S. Dist. LEXIS 91660).
NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on June 14 affirmed a district court's ruling that a disability insurer did not abuse its discretion in terminating a claimant's long-term disability benefits because there is substantial evidence supporting the insurer's termination of benefits (Lashondra Davis v. Aetna Life Insurance Co., No. 16-10895, 5th Cir., 2017 U.S. App. LEXIS 10576).
LOS ANGELES - A California federal judge on June 13 ordered an insurer to show cause as to why an insured's breach of contract and bad faith lawsuit should be litigated in federal court and not be dismissed for lack of subject matter jurisdiction (Reseda Medical Clinic, et al. v. Liberty Mutual Ins. Company, et al., No. 17-3686, C.D. Calif., 2017 U.S. Dist. LEXIS 90932).
DALLAS - An insurer has a duty to defend its insured in an underlying suit alleging that the insured failed to properly remediate water damage to property in storage because the underlying suit claims that the insured's actions were negligent, a Texas federal judge said June 14 (Bedivere Insurance Co., f/k/a General Accident Insurance of America v. Pacific Van & Storage of Texas Inc., d/b/a Joyce Moving and Storage Co. Inc., et al., No. 16-1111, N.D. Texas, 2017 U.S. Dist. LEXIS 91265).
SAN FRANCISCO - Denying a petition for rehearing, a California appeals panel on June 14 upheld its earlier ruling that an insurance industry placement facility and joint reinsurance association is obligated by California Insurance Code Section 2051 to pay the costs to repair an insured's home, less depreciation, even if the amount exceeds the fair market value of her home (California Fair Plan Association v. Marlene Garnes, No. A143190, Calif. App., 1st Dist., Div. 2, 2017 Cal. App. LEXIS 552).
ST. LOUIS - In a criminal fraud case, an Arkansas trial court correctly denied, based on a lack of authority, a request by an insolvent insurer's owner to be released from any further obligations of restitution once payment of $300,000 was made to the insurer's receiver, the Eighth Circuit U.S. Court of Appeals ruled June 15 (United States of America v. Frank Whitbeck, No. 16-1720, 8th Cir., 2017 U.S. App. LEXIS 10606).
MADISON, Wis. - A Wisconsin federal judge on June 14 granted summary judgment in favor of a disability plan after determining that the plan's decision to terminate a claimant's benefits after learning that the claimant worked as a dog trainer was not arbitrary and capricious (Sarah B. Kalnajs v. The Lilly Extended Disability Plan, No. 16-62, W.D. Wis., 2017 U.S. Dist. LEXIS 91276).
SACRAMENTO, Calif. - A California appeals panel on June 13 affirmed a lower court's ruling in favor of an insurer in a dispute over coverage for an individual dentist's claim for lost dental practice income due to a sewage backup (William A. Gilbert v. The Dentists Insurance Company, Inc., No. C075959, Calif. App., 3rd Dist., 2017 Cal. App. Unpub. LEXIS 4041).
ELGIN, Ill. - An Illinois appeals panel on June 14 reversed and remanded a lower court's denial of an insured's motion to stay his insurer's declaratory judgment lawsuit challenging coverage for an underlying defamation claim (State Farm Fire & Casualty Company v. David John and Wheaton College, No. 2-17-0193, Ill. App., 2nd Dist., 2017 Ill. App. LEXIS 378).
UTICA, N.Y. - Following failed settlement talks, a reinsurer in a June 12 letter requests that a New York federal court move the trial date in a reinsurance dispute from September to October to accommodate the schedule of its two key witnesses (Utica Mutual Insurance Co. v. Fireman's Fund Insurance Co., No. 09-cv-00853, N.D. N.Y.).
ATLANTA - In a case over fraudulent transfers of reinsurance funds, a Georgia federal judge granted in part insurers' motion to compel on June 12, ordering a reinsurer to provide missing tax documents to the insurers (Canal Insurance Co. and Canal Indemnity Co. v. Golden Isles Reinsurance Company Ltd., et al., No. 15-cv-03331, N.D. Ga.).
ST. LOUIS - The Eighth Circuit U.S. Court of Appeals on June 13 dismissed an appeal of a ruling that an insolvent insurer's case against the government over its handling of the Patient Protection and Affordable Care Act (ACA) risk corridor and how it offset debts properly belongs before the U.S. Court of Federal Claims (Doug Ommen, in his capacity as liquidator of CoOpportunity Health Inc.; Dan Watkins, in his capacity as special deputy liquidator of CoOpportunity Health Inc. v. U.S. Department of Health and Human Services, et al., No. 17-1662, 8th Cir.).
HOUSTON - A Texas federal judge on June 14 granted a disability plan's motion for judgment on the administrative record after determining that the plan did not abuse its discretion when it denied a former National Football League player's disability claim (Brian C. Jackson v. NFL Disability and Neurocognitive Benefit Plan, et al., No. 16-1278, S.D. Texas, 2017 U.S. Dist. LEXIS 91042).
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on June 12 affirmed a district court's ruling that the termination of a disability claim was reasonable based on the plan's mental health coverage limitation and the medical evidence considered by the disability insurer (Kathee A. Colman v. American International Group Inc. Group Benefit Plan, et al., No. 15-15903, 9th Cir., 2017 U.S. App. LEXIS 10394).
NEW ORLEANS - A Louisiana appeals panel on June 14 affirmed a lower court's ruling that granted the State of Louisiana's exception of no right of action maintaining that it was not liable for a contractor's alleged negligence in elevating the insureds' home following Hurricane Katrina, rejecting the homeowners insurer's argument that the state's administration of the elevation program sufficiently negated the exception of no right of action (Louisiana Citizens Property Insurance Corp., v. LAA Shoring, et al., No. 2016-CA-1136 consolidated with No. 2016-CA-1137, La. App., 4th Cir.).
DENVER - A Colorado federal judge on June 12 entered a final judgment in favor of a professional liability insurer after finding that it has no duty to defend or indemnify against an underlying lawsuit alleging that its insured entered into a "kickback contract" to steer additional subcontractor work to city-employee-controlled companies (Ciber, Inc. v. Ace American Insurance Co., No. 16-1189, D. Colo., 2017 U.S. Dist. LEXIS 89895).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on June 13 affirmed a lower federal court's dismissal of an insured's lawsuit against its partners management liability reimbursement insurer, finding that the lower court did not abuse its discretion in denying the insured leave to amend its complaint (Cove Partners, LLC v. XL Specialty Insurance Company, No. 16-55315, 9th Cir., 2017 U.S. App. LEXIS 10504).
LOS ANGELES - An evidentiary hearing should have been held to determine whether a California Highway Patrol (CHP) officer had sufficient information in 2010 to begin an investigation into whether a man committed insurance fraud by further damaging a tow truck, a California appeals panel ruled June 12 (Mark Jeffrey Tornow v. Superior Court of Los Angeles County, et al., No. B271895, Calif. App., 2nd Dist., 7th Div., 2017 Cal. App. Unpub LEXIS 4020).
SAN FRANCISCO - Following a one-day bench trial, a California federal judge on June 13 determined that a disability claimant submitted sufficient evidence showing that he was disabled under a plan's "own occupation" provision but failed to prove that he was disabled under the plan's "any occupation" standard (Robert Bosley v. Metropolitan Life Insurance Co., No. 16-00139, N.D. Calif., 2017 U.S. Dist. LEXIS 90803).