NEWARK, N.J. - A disability insurer's termination of long-term disability benefits after approving the claimant's benefits for seven years was arbitrary and capricious because the insurer failed to properly define the material duties of the claimant's occupation and because the evidence does not support the insurer's termination, a New Jersey federal judge said Oct. 23 (Christopher Patterson v. Aetna Life Insurance Co., No. 15-8156, D. N.J., 2017 U.S. Dist. LEXIS 175543).
MOBILE, Ala. - A disability insurer did not act in bad faith in investigating and in failing to pay a disability claim because the insurer conducted an extensive investigation into the claim and had an arguable and debatable reason for denying the claim, an Alabama federal judge said Oct. 24 in granting the insurer's motion for summary judgment (Scott R. Weisberg, M.D., v. Guardian Life Insurance Company of America et al., No. 16-568, N.D. Ala., 2017 U.S. Dist. LEXIS 176021).
SAN FRANCISCO - The Trump administration has the better legal argument in a case challenging the elimination of the Patient Protection and Affordable Care Act (ACA) cost-sharing reduction (CSR) payments, and the relief sought by the plaintiff states would counterproductively harm their own residents, a federal judge in California said Oct. 25 in denying a preliminary injunction (The State of California, et al. v. Donald J. Trump, et al., No. 17-5895, N.D. Calif.).
SAN FRANCISCO - A California federal magistrate on Oct. 24 rejected an insurer's reliance on an "architects and engineers professional services exclusion" to bar directors and officers liability coverage for an underlying lawsuit brought against its environmental engineering company insured, finding that the insurer has a duty to defend (RMC Water and Environment v. Travelers Casualty and Surety Company of America, No. 17-00379, N.D. Calif., 2017 U.S. Dist. LEXIS 176107).
BILLINGS, Mont. - A Montana federal judge on Oct. 23 granted a disability claimant's motion for more than $28,000 in attorney fees because the claimant prevailed on her claim for disability benefits and the disability insurer failed to file a response to the claimant's motion (Theresa Sand-Smith v. Liberty Life Assurance Company of Boston, No. 17-0004, D. Mont., 2017 U.S. Dist. LEXIS 175177).
DAYTON, Ohio - An Ohio appeals panel on Oct. 20 overturned a trial court judge's ruling that resentenced a woman on one count of insurance fraud, holding that the judge should have found that the sentence would run concurrently with, rather than consecutive to, other charges (State of Ohio v. Eva Christian, No. 27236, Ohio App., 2nd Dist., 2017 Ohio App. LEXIS 4641).
BRIDGEPORT, Conn. - A Connecticut federal judge on Oct. 20 issued a ruling adhering to his May ruling in a lawsuit regarding whether damage to a freezer floor is barred by the policy's earth movement exclusion, but including clarifications (Thurston Foods Inc. v. Wausau Business Insurance Co., No. 15-14, D. Conn., 2017 U.S. Dist. LEXIS 173922).
SAN FRANCISCO - A federal agency did not act in breach of contract or misrepresent itself to a reinsured agricultural business by declining to divulge information about an investigation against a federal crop insurer before the farm signed a settlement that led to criminal charges, the Ninth Circuit U.S. Court of Appeals ruled Oct. 23 (POCO LLC v. Farmer's Crop Insurance Alliance Inc., No. 16-35310, 9th Cir., 2017 U.S. App. LEXIS 20853).
NEW YORK - The New York Court of Appeals on Oct. 19 accepted an amicus curiae brief by insurers arguing that the "follow-the-form" provision mandates concurrency between insurance and reinsurance in the context of expense coverage (Global Reinsurance Corporation of America v. Century Indemnity Co., No. CTQ-2016, 0005, N.Y. App., 2017 N.Y. LEXIS 3118).
MIAMI - An insured's suit seeking damages caused by the failure of a sprinkler system must be remanded because it is not clear if the state court's order severing the claims against the insurer and the sprinkler system company created two separate actions, a Florida federal judge said Oct. 19 in granting the insured's motion to remand (Caton Owner LLC v. Mt. Hawley Insurance Co., No. 17-22051, S.D. Fla., 2017 U.S. Dist. LEXIS 174229).
ROCHESTER, N.Y. - A New York federal judge on Oct. 23 granted a federal flood insurer's motion for summary judgment in a flood coverage dispute, finding that the insureds failed to timely submit a signed and sworn proof of loss for all their alleged damages caused by a June 1, 2015, flood (John Scharr, et al. v. Selective Insurance Company of New York, et al., No. 16-06821, W.D. N.Y., 2017 U.S. Dist. LEXIS 175222).
LANSING, Mich. - An injured person's health care provider has no independent statutory right to bring an action against an insolvent no-fault insurer for payment of personal injury protection (PIP) benefits, a Michigan appeals panel ruled Oct. 19, applying recent Michigan Supreme Court law (The Detroit Medical Center v. Michigan Property & Casualty Guaranty Association, et al., No. 326792, Mich. App., 2016 Mich. App. LEXIS 2596).
SAN FRANCISCO - No coverage is owed for underlying environmental contamination claims alleged against an insured because the policies at issue clearly preclude coverage for releases of pollutants that occur on the insured's premises and for releases of pollutants that are caused by third parties, the Ninth Circuit U.S. Court of Appeals said Oct. 19 in affirming a district court's ruling (Southern Nevada TBA Supply Co. d/b/a Ted Wiens Tire and Auto Centers v. Universal Underwriters Insurance Co., No. 15-16828, 9th Cir., 2017 U.S. App. LEXIS 20561).
ATLANTA - The 11th Circuit U.S. Court of Appeals on Oct. 19 held that a commercial general liability insurance policy's professional services exclusion bars coverage for an underlying wrongful death lawsuit alleging that the insured negligently designed and constructed the intersection where a fatal accident occurred (Witkin Design Group, Inc. v. Travelers Property Casualty Company of America, No. 17-10478, 11th Cir., 2017 U.S. App. LEXIS 20431).
NEW YORK - A declaratory insurance coverage action filed by Chapter 11 debtor Rapid-American Corp. is not the proper vehicle for insurers to use in search of evidence of fraud in the asbestos trust system, the debtor says in an Oct. 20 motion and memorandum seeking protection from the insurers' subpoenas in New York federal bankruptcy court (Rapid-American Corporation, et al. v. Travelers Casualty and Surety Company, et al., No. 15-01095, S.D. N.Y. Bkcy.).
PORTLAND, Ore. - Because the state of Oregon voluntarily filed a motion to intervene in an environmental contamination coverage suit, the state waived its right to assert sovereign immunity, an Oregon federal judge said Oct. 17 in rejecting the state's objections to a federal magistrate judge's recommendation to grant the state's motion to intervene (United Specialty Insurance Co. v. Clay Jonak, et al., No. 17-330, D. Ore., 2017 U.S. Dist. LEXIS 172150).
BOSTON - A complaint filed by insureds alleging that their insurer failed to pay them for the full value of their loss caused by a burst water pipe was dismissed Oct. 17 after a Massachusetts federal magistrate judge found that the evidence shows that the insurer fulfilled its contractual obligation by paying the insureds for the loss (Bearbones Inc., et al. v. Peerless Indemnity Insurance Co., No. 15-30017, D. Mass., 2017 U.S. Dist. LEXIS 171566).
PORTLAND, Ore. - The Ninth Circuit U.S. Court of Appeals on Oct. 19 reversed a lower federal court's denial of a claimant's request for prejudgment interest in an executive and organization liability insurance coverage dispute, remanding with instructions for the lower court to determine the start date for prejudgment interest and to calculate the amount due the claimant (Daryl J. Kollman, et al. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 15-35795, 9th Cir., 2017 U.S. App. LEXIS 20566).
CHICAGO - An Illinois appeals panel on Oct. 18 found that a lower court erred in determining that emergency medical services fell within the scope of an insurance policy's "products-completed operations hazard" provision, reversing and remanding a lower court's ruling in favor of the insurer in a dispute over coverage for an underlying $5.2 million jury verdict (The City of Park Ridge, et al. v. Clarendon American Insurance Company, et al., No. 01-17-0453, Ill. App., 1st Dist., 3rd Div., 2017 Ill. App. LEXIS 656).
LOUISVILLE, Ky. - An insurer is entitled to summary judgment on its insured's breach of contract claim arising out of a coverage dispute for water and mold damages because the breach of contract claim is barred by the policy's two-year limitations period, a Kentucky federal magistrate judge said Oct. 18 (Richard Lackey, et al. v. Property and Casualty Insurance Company of Hartford, No. 15-238, W.D. Ky., 2017 U.S. Dist. LEXIS 172067).
ORLANDO, Fla. - A Florida federal judge on Oct. 17 dismissed, rather than severing or staying, an insured's bad faith counterclaim against an auto insurer because under Florida law, a bad faith claim cannot be alleged until a determination of the insured's damages has been made (Owners Insurance Co. v. Michael Berke, No. 17-1505, M.D. Fla., 2017 U.S. Dist. LEXIS 171454).
OXFORD, Miss. - Remand of an insurance breach of contract and bad faith lawsuit to state court is proper because an insured has shown that the amount in controversy in the action will not exceed statutory limits, a federal judge in Mississippi ruled Oct. 17 in granting the insured's motion to remand (Strawberry Missionary Baptist Church v. Church Mutual Insurance Company Foundation Inc., No. 17-155, N.D. Miss., 2017 U.S. Dist. LEXIS 171545).
MIAMI - After previously reversing a lower court's ruling in favor of a homeowner in a Hurricane Wilma coverage dispute, a Florida appeals panel on Oct. 18 reversed the lower court's ruling on remand in favor of the insurer, finding that a genuine issue of material fact remains regarding whether a letter from the insurer constituted a denial of coverage (Haim Michel Ifergane, Appellant, vs. Citizens Property Insurance Corp., No. 3D16-1142, Fla. App., 3rd Dist., 2017 Fla. App. LEXIS 14745).
ATLANTA - A disability insurer acted arbitrarily and capriciously in determining the date of a claimant's disability, the 10th Circuit U.S. Court of Appeals said Oct. 17 in reversing a district court's judgment in favor of the insurer (Greggory B. Owings v. United Of Omaha Life Insurance Co., No. 16-3128, 10th Cir., 2017 U.S. App. LEXIS 20228).
PHILADELPHIA - A Pennsylvania federal judge on Oct. 12 remanded an insured's suit alleging claims for breach of contract and bad faith against an auto insurer and the insured's insurance agent after determining that the agent was not fraudulently joined to defeat jurisdiction (Melinda Bradley-Williams v. Agency Insurance Company of Maryland Inc., et al., No. 17-3755, E.D. Pa., 2017 U.S. Dist. LEXIS 169264).