DETROIT - A plan administrator did not err in denying long-term disability benefits to a claimant because the administrator's interpretation of the policy's offset provision and calculation of the claimant's workers' compensation benefits were reasonable, a Michigan federal judge said July 7 (Kyle Kennard v. Means Industries Inc., No. 11-15079, E.D. Mich.; 2015 U.S. Dist. LEXIS 87652).
SAN FRANCISCO - A California federal judge on July 2 granted an insurer's motion to intervene and to set aside a default judgment in a lawsuit arising out of liability for environmental contamination cleanup costs after determining that the defendant's insurer has a protectable interest in the outcome of the lawsuit (Dave Drilling Environmental Engineering Inc. v. Margaret Thersia Gamblin, No. 14-02851, N.D. Calif.; 2015 U.S. Dist. LEXIS 86919).
LAS VEGAS - A federal judge in Nevada on July 1 granted an insurer's motion for judgment the pleadings in an insurance bad faith lawsuit, ruling that, under state law, an insurer may not bring statutory bad faith claims against insurance agents (Nicole Erbe v. State Farm Fire and Casualty Co., et al., No. 15-356, D. Nev.; 2015 U.S. Dist. LEXIS 86619).
DENVER - The 10th Circuit U.S. Court of Appeals on July 6 held that an errors and omissions insurer failed to fulfill its duty to defend a securities broker insured in the lead-up to and during an arbitration hearing, reversing a lower federal court in part (Forrest Daryl Templeton v. Catlin Specialty Insurance Co., et al., No. 14-1261, 10th Cir.; 2015 U.S. App. LEXIS 11571).
MIAMI - The U.S. Department of Justice announced July 2 that American Access Care Holdings (AAC) agreed to pay $1.2 million to resolve allegations that it violated the False Claims Act by billing Medicare for medically unnecessary percutaneous transluminal angioplasties (PTAs) and thrombectomies and by billing for more PTAs per patient encounter than permitted (United States of America, ex rel. Dennis Souza v. American Access Care of Miami LLC, No. 11-cv-22686, S.D. Fla.).
NEWARK, N.J. - A New Jersey federal judge on July 1 adopted a federal magistrate's recommendation to dismiss an insurer's complaint because the insurer failed to meet its burden of proving that the New Jersey federal court has jurisdiction over its suit seeking a declaratory judgment regarding coverage for underlying personal injury suits arising out of asbestos cleanup work after the Sept. 11, 2001, terrorist attacks (Hudson Insurance Co. v. Greenwich Insurance Co., et al., No. 14-7326, D. N.J.).
SAN JOSE, Calif. - Insured contractors breached their insurance contract with their commercial general liability insurer when they declined the insurer's selection of counsel to represent them in an underlying strict product liability lawsuit against an additional insured subcontractor, a California federal jury found July 2 (Travelers Property Casualty Company of America v. Kaufman & Broad Monterey Bay Inc., et al., No. 13-04745, N.D. Calif.).
LAS VEGAS - A federal judge in Nevada on July 2 denied an insurer's motion for bifurcation in an insurance breach of contract and bad faith lawsuit, ruling that bifurcation is not warranted because an insured's bad faith claims are independent of her contractual claims (Charlene Oliver v. GEICO General Insurance Co., No. 15-204, D. Nev.; 2015 U.S. Dist. LEXIS 86618).
LAS VEGAS - A Nevada federal judge on July 2 denied an insurer's request for retaxation of costs following the dismissal of an insured's breach of contract claim regarding denial of coverage for scratches on glass windows at a condominium development project, where the dismissal was based on the policy's 12-month limitations period (Queensridge Towers LLC v. Allianz Global Risks US Insurance Co., No. 13-197, D. Nev.; 2015 U.S. Dist. LEXIS 86573).
CLARKSBURG, W.Va. - A federal judge in West Virginia on July 1 adopted a magistrate judge's recommendation to accept a woman's decision to plead guilty to one count of health care fraud for billing the West Virginia Offices of the Insurance Commission Workers Compensation Old Fund for services she was not providing (United States of America v. Sherri J. Slaven, No. 15-cr-00053, N.D. W.Va.).
ATLANTA - A trial court did not err in setting aside a business interruption award because there was evidence of partiality on the part of the umpire overseeing the appraisal process, the Second Division Georgia Court of Appeal said July 2 (Zurich American Insurance Co. v. Omni Health Solutions LLC, No. A15A0170, Ga. App., 2nd Div.; 2015 Ga. App. LEXIS 386).
DETROIT - Because an ambiguity exists between an exclusion for sewer and/or drain water backups and a policy provision providing coverage for accidental discharge or overflow of water from within a home's plumbing system, the ambiguity must be construed in favor of the insureds, a Michigan federal judge ruled July 2 (Frank Monteleone and Sheri Monteleone v. The AutoClub Group, et al., No. 13-12716, E.D. Mich.; 2015 U.S. Dist. LEXIS 86272).
CEDAR RAPIDS, Iowa - A commercial general liability insurance policy's impaired property exclusion precludes coverage for a university's loss-of-use claim which arose out of a delay or failure by an insured to perform under its subcontract, an Iowa federal magistrate judge found July 1, ruling that the insurer did not have a duty to defend (Peterson Contractors Inc. v. The Travelers Indemnity Co., No. 14-63, N.D. Iowa; 2015 U.S. Dist. LEXIS 86936).
PHOENIX - An Arizona appeals panel held June 30 that a jury's final verdict that awarded $1,134,442 in damages to a commercial diving services company on its breach of contract and negligence claims against its insurance broker was excessive and not justified by the evidence on record, vacating the award and remanding for a new trial on the issue of damages (Deepwater Divers Inc. v. Wells Fargo Insurance Services USA Inc., No. 1 CA-CV 13-0518, Ariz. App., Div. 1; 2015 Ariz. App. Unpub. LEXIS 862).
INDIANAPOLIS - A federal magistrate judge in Indiana on July 2 granted in part an insured's motion to reconsider an April 7 order regarding its motion to compel production of its insurer's underwriting material and claims handling manual (Indianapolis Airport Authority v. Travelers Property Casualty Company of America, No. 13-01316, S.D. Ind.; 2015 U.S. Dist. LEXIS 86315).
CHARLOTTE, N.C. - A federal judge in North Carolina on July 1 substantially denied a motion to dismiss in an insurance bad faith lawsuit, ruling that an insurer has failed to show that an insured's state law claims are preempted by the Employee Retirement Income Security Act (ERISA) (Craig Bryson, et al. v. UnitedHealthcare Insurance Co., et al., No. 15-0142, W.D. N.C.; 2015 U.S. Dist. LEXIS 85594).
PHILADELPHIA - The National Railroad Passenger Corp. (Amtrak) on June 30 joined in the request of 16 plaintiffs to consolidate in the U.S. District Court for the Eastern District of Pennsylvania all suits stemming from the May 12 derailment of an Amtrak passenger train in Philadelphia (In re Amtrak Train Derailment in Philadelphia, PA, on May 12, 2015, No. 2654, JPMDL).
LOS ANGELES - A California federal judge found June 30 that although a civil rights lawyer's alleged conduct in representing a client is, at a minimum, abhorrent, a $250,480 default judgment against the lawyer cannot be recovered under his legal malpractice insurance policy (Michael Petersen v. Arch Insurance Co., No. 15-00832, C.D. Calif.; 2015 U.S. Dist. LEXIS 85183).
SAVANNAH, Ga. - A condominium association failed to establish that a stay is necessary in an insurer's declaratory judgment action regarding coverage for breach of fiduciary duty and negligence claims arising out of property damage to a condominium project, a Georgia federal judge ruled July 1 (The Cincinnati Insurance Co. v. Thunderbolt Harbour Phase II Condominium Association Inc. and Michael F. Ryan, No. 14-222, S.D. Ga.; 2015 U.S. Dist. LEXIS 85836).
FORT MYERS, Fla. - An insured owes deductible payments in the amount of $305,000 to its insurer for the resolution of Chinese drywall claims made in a multidistrict litigation, a Florida federal judge held July 1 (Mid-Continent Casualty Co. v. Hansen Homes of South Florida Inc., No. 14-35, M.D. Fla.; 2015 U.S. Dist. LEXIS 85760).
NEW YORK - A Second Circuit U.S. Court of Appeals panel on June 30 affirmed a federal district court's dismissal of an insurance breach of contract and bad faith lawsuit, ruling that it agreed with the district court's findings in coming to its decision (Mariah Re Ltd. [In Liquidation], acting by and through Geoffrey Varga and Jess Shakespeare, in their capacities as Liquidators thereof v. American Family Mutual Insurance Company, et al., No. 14-4062, 2nd Cir.).
WASHINGTON - The U.S. Supreme Court on June 29 let stand a Ninth Circuit U.S. Court of Appeals ruling that a district court did not err in ordering a disability insurer to pay attorney fees incurred by a plan on behalf of a participant because the plan supported the participant and assumed the same position as a plaintiff in the participant's lawsuit (Sun Life Assurance Company of Canada v. Group Disability Benefits Plan for Gynecologic Oncology Associates Partners, LLC, No. 14-1251, U.S. Sup.).
PHILADELPHIA - An expert may opine regarding, among other things, how Patient Protection and Affordable Care Act (ACA) medical loss ratio (MLR) regulations affect class ascertainability, a federal judge held June 30 in decertifying a class of indirect purchasers of Wellbutrin XL (In re: Wellbutrin XL Antitrust Litigation, No. 08-2433, E.D. Pa.; 2015 U.S. Dist. LEXIS 84444).
NEW ORLEANS - A majority of the Louisiana Supreme Court on June 30 refused to reconsider its May 5 ruling that reversed and remanded an appeals court's finding that a patient has proven that a doctor insured's actions in rushing to implant a pacemaker fell below the standard of care, according to the high court's new release (Clyde Snider Jr., et ux. v. Louisiana Medical Mutual Insurance Co., et al., No. 2014-C-1964, La. Sup.).
CAMDEN, N.J. - Summary judgment in an insurance bad faith lawsuit is warranted, a federal judge in New Jersey ruled June 29, because insureds' signing of a settlement agreement barred all future claims under a commercial lines policy (Antonio Giaccone, et al. v. Canopius US Insurance Co., No. 14-6939, D. N.J.; 2015 U.S. Dist. LEXIS 83682).