LexisNexis® Legal Newsroom
    Mealey's Insurance - Panel Denies Rehearing Of Ruling On Joint Reinsurance Association's Duty To Costs

    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).

    Mealey's Insurance - 8th Circuit Upholds Denial Of Release Of Restitution Duties To Insurer's Receiver

    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).

    Mealey's Insurance - Wisconsin Federal Judge Finds Termination Of Benefits Was Not Arbitrary

    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).

    Mealey's Insurance - California Panel Affirms No Coverage For Dentist's Claim For Lost Practice Income

    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).

    Mealey's Insurance - Illinois Panel Finds Stay Of Coverage Suit Over Defamation Claim Is Appropriate

    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).

    Mealey's Insurance - Reinsurer Seeks Trial Date Move After Failed Settlement Discussions

    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.).

    Mealey's Insurance - Judge Orders Reinsurer To Provide Missing Tax Documents To Insurers

    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.).

    Mealey's Insurance - 8th Circuit Dismisses Appeal In Insolvent Insurer's ACA Suit Against Government

    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.).

    Mealey's Insurance - Disability Plan Did Not Abuse Its Discretion By Denying Benefits Claim, Judge Says

    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).

    Mealey's Insurance - Termination Of Disability Benefits Was Reasonable, 9th Circuit Panel Affirms

    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).

    Mealey's Insurance - Panel: Court Did Not Err In Granting State's Exception Of No Right Of Action

    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.).

    Mealey's Insurance - Judge: Lawsuits Arose Out Of 'Single Scheme'; No Professional Liability Coverage Due

    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).

    Mealey's Insurance - 9th Circuit: Court Properly Dismissed Complaint Without Leave To Amend

    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).

    Mealey's Insurance - Appeals Court Says Evidentiary Hearing Needed In Insurance Fraud Suit

    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).

    Mealey's Insurance - Claimant Owed Disability Benefits Under Plan's 'Own Occupation' Provision

    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).

    Mealey's Insurance - Insurer Was Not Entitled To Rescind Policy, California Panel Says In Reversal

    SAN FRANCISCO - A California appeals panel on June 12 reversed a lower court's finding that an insurer was entitled to rescind an "Owners, Landlords & Tenants Liability Coverage" insurance policy, finding that the insurer failed to satisfy its burden of showing that the insured made material misrepresentations on the insurance application (Victor Duarte v. Pacific Specialty Insurance Co., No. A143828, Calif. App., 1st Dist., Div. 2).

    Mealey's Insurance - Judge: Suit Challenges Rate, Not Entitlement To Payment, Evades ERISA Preemption

    DALLAS - A hospital group's state law claims challenge the rate an insurer paid and do not involve a dispute over the right to compensation, providing an independent duty and escaping ERISA preemption, a federal judge in Texas held June 9 (Kindred Hospitals Limited Partnership d/b/a Kindred Hospital Houston Medical Center, et al. v. Aetna Life Insurance Co., et al., No. 16-3379, N.D. Texas, 2017 U.S. Dist. LEXIS 89285).

    Mealey's Insurance - Judge: Insurer Has Duty To Defend Contractor In Airport Floor Damage Suit

    DENVER - A commercial general liability insurer has a duty to defend a contractor against claims of defective work on an airport hangar floor, a Colorado federal judge ruled June 12, also staying the case pending resolution of the underlying action (Auto-Owners Insurance Co. v. High Country Coatings Inc. and Zurich American Insurance Co., No. 16-03196, D. Colo., 2017 U.S. Dist. LEXIS 90127).

    Mealey's Insurance - Montana High Court Upholds Judgment Against Insurance Guaranty Association

    HELENA, Mont. - A trial judge did not err in granting summary judgment to an insured employer against the Montana Insurance Guaranty Association (MIGA) based on the exclusivity provision of the Montana Workers' Compensation Act (WCA), a majority of the Montana Supreme Court affirmed June 13 (Asurion Services LLC v. Montana Insurance Guaranty Association, No.16-0581, Mont. Sup., 2017 Mont. LEXIS 339).

    Mealey's Insurance - Texas High Court Deems Hailstorm MDL Attorney Fee Info Protected As Work Product

    AUSTIN, Texas - A Texas Supreme Court majority on June 9 granted an insurer's petition for mandamus in a discovery dispute, finding that a trial court and an appeals court abused their discretion by granting a group of insured's request for billing records from other cases in the same multidistrict litigation because such records are protected from discovery as work product (In Re National Lloyds Insurance Co., Wardlaw Claims Service Inc. and Ideal Adjusting Inc., No. 15-0591, Texas Sup., 2017 Tex. LEXIS 522).

    Mealey's Insurance - Federal Bankruptcy Judge Orders Specialty Reinsurance Company To Post $15M Bond

    NEW YORK - A New York federal bankruptcy judge held June 12 that a foreign specialty reinsurance company must post a bond in the amount of $15 million before a pending motion to compel arbitration of the dispute in Bermuda would be considered (In re: MF Global Holdings Ltd., et al. MF Global Holdings Ltd. as plan administrator, and MF Global Assigned Assets LLC v. Allied World Assurance Company Ltd., et al., Chapter 11 No. 11-15059, Adv. Proc. No. 16-01251, S.D. N.Y. Bkcy., 2017 Bankr. LEXIS 1585).

    Mealey's Insurance - Delaware Judge Determines Insurance Policies Were Properly Transferred

    WILMINGTON, Del. - A Delaware judge on June 8 denied a motion for summary judgment filed by an excess insurer in an asbestos coverage dispute after determining that the insurer's policies were not excluded from an asset transfer between the insured and its statutory trust after the insured went bankrupt (Motors Liquidation Co. DIP Lenders Trust v. Allianz Insurance Co., No. N11C-12-022 PRW, Del. Super., New Castle Co., 2017 Del. Super. LEXIS 279).

    Mealey's Insurance - Appeals Court Reverses Arson, Insurance Fraud Verdict Over Prosecutor's Misconduct

    ROCHESTER, N.Y. - A New York appellate panel on June 9 reversed a jury's verdict finding a woman guilty of arson, attempted insurance fraud and conspiracy after finding that the prosecutor's questioning of her husband about his criminal history and comments about the defendant's financial condition were prejudicial (People of the State of New York v. Shallamar L. Hayward-Crawford, No. 405 KA 14-01824, N.Y. Sup., App. Div., 4th Dept., 2017 N.Y. App. LEXIS 4506).

    Mealey's Insurance - Pennsylvania Federal Judge: Duty To Defend Is Owed For Contaminated Water Suit

    PITTSBURGH - Insurers have a duty to defend a school district and its superintendent against an underlying suit alleging that the district was negligent in failing to monitor a water system that became contaminated with lead and copper because the underlying complaint sounds in negligence and it is unclear if the underlying injuries were caused by the ingestion of lead, a Pennsylvania federal judge said June 9 (The Netherlands Insurance Co., et al. v. Butler Area School District, et al., No. 17-341, W.D. Pa., 2017 U.S. Dist. LEXIS 89073).

    Mealey's Insurance - Judge Approves $32M In Guaranty Association Claims In Reliance Liquidation

    HARRISBURG, Pa. - A Pennsylvania trial judge on June 7 granted a recommendation by the liquidator of Reliance Insurance Co. to approve 250 individual class (b) insurance guaranty associations (GAs) claims that were not previously submitted for approval for a total amount of $32,213,482.41 (In re: Reliance Insurance Co. in Liquidation, No. 1 REL 2001, Pa. Cmwlth.).