LexisNexis® Legal Newsroom
    Mealey's Insurance - Judge Dismisses Subrogated Insurer's Negligence Claim Against Subcontractor

    HAMMOND, Ind. - A carpentry subcontractor is not liable for damages sustained as a result of a fire caused by a roof-heating cable because the subcontractor did not have any role in the installation of the roof-heating cable, an Indiana federal judge held March 16, granting summary judgment to the subcontractor on a subrogated insurer's negligence claim (Bankers Standard Insurance Co. as subrogee of Jerry and Norma Ferguson v. Coplen Construction, Inc., et al., No. 13-214, N.D. Ind.; 2016 U.S. Dist. LEXIS 33573).

    Mealey's Insurance - Judge: Bad Faith, Breach Of Fiduciary Duty Claims Are Actionable

    HARRISBURG, Pa. - A federal judge in Pennsylvania on March 18 substantially denied an insurer's motion to dismiss counterclaims for breach of fiduciary duty and bad faith in an insurance dispute, ruling that the claims sound in contract and, thus, are actionable (MONY Life Insurance Co. v. Carol Snyder, f/k/a Carol Eckert, and Pamela Eckert, No. 15-2109, M.D. Pa.; 2016 U.S. Dist. LEXIS 34371).

    Mealey's Insurance - New York Justice Denies New Trial In Environmental Contamination Dispute

    NEW YORK - A New York justice on March 16 denied an insurer's motion for judgment notwithstanding a jury's verdict in favor of the insured or, in the alternative, for a new trial after determining that the insurer failed to offer any new legal arguments as to why a jury's finding that the insurer owes coverage for environmental cleanup costs at two former manufactured gas plants in New York should not stand (Keyspan Gas East Corp. v. Munich Reinsurance America Inc., et al., No. 604715/1997, N.Y. Sup., New York Co.).

    Mealey's Insurance - Insurer Has No Duty To Defend, Indemnify Faulty Work, Federal Judge Says

    PHILADELPHIA - An insured's allegedly negligent failure to properly "tarp, wrap, cover, or otherwise protect" a home while installing a roof constitutes faulty workmanship that is not covered under an insurance policy, a Pennsylvania federal judge ruled March 17, finding that the insurer has no duty to defend or indemnify (State Farm Fire and Casualty Co. v. Moreco Construction, Inc., No. 15-6131, E.D. Pa.; 2016 U.S. Dist. LEXIS 34362).

    Mealey's Insurance - Judge Defines Surface Water, Finds Fact Issues On Cause To Insured Condo Losses

    DENVER - Surface water that enters a sewer system and backs up through or overflows from a sewer or drain is covered by an insurance policy, a Colorado federal judge ruled March 16, also finding that genuine issues of material fact exist regarding the character of the water that caused damage to insured condos and whether the damage was exclusively caused by sewer water backup (Chateau Village North Condominium Association v. American Family Mutual Insurance Co., No. 14-01583, D. Colo.; 2016 U.S. Dist. LEXIS 33989).

    Mealey's Insurance - Appeals Panel Says Question Exists On Whether Policy Included Discretionary Grant

    PHILADELPHIA - The Third Circuit U.S. Court of Appeals on March 18 vacated a district court's ruling after determining that a question of fact exists regarding whether a disability policy included a discretionary grant provision that allowed the insurer to award long-term disability benefits (Kenneth Baker v. Sun Life and Health Insurance Co., No. 15-1525, 3rd Cir.; 2016 U.S. App. LEXIS 4955).

    Mealey's Insurance - U.S. High Court Refuses To Review Decision On Internal Appeal Deadline

    WASHINGTON, D.C. - The U.S. Supreme Court on March 21 denied a disability insurer's petition for writ of certiorari, refusing to review the Ninth Circuit U.S. Court of Appeals' ruling that the deadline for an internal appeal of a disability claim can be extended if the deadline falls on a weekend (Andre LeGras v. Aetna Life Insurance Co., et al., No. 15-439, U.S. Sup.).

    Mealey's Insurance - Deputy Receiver Reports On Rehabilitation Estate's Assets And Liabilities

    AUSTIN, Texas - The special deputy receiver (SDR) of an insurer in receivership reported to a Texas court on March 15 that counting reinsurance recoverables, the receivership estate's total assets are greater than $132 million (State of Texas v. Highlands Insurance Company, No. D-1-GV-03-004537, Texas, 53rd Dist., Travis Co.).

    Mealey's Insurance - Judge Dismisses Claim For Violation Of Deceptive Trade Practices Against Insurer

    CHARLOTTE, N.C. - Applying the lex loci test, a North Carolina federal judge on March 15 ruled that a claim against an insurer for violation of the North Carolina Unfair and Deceptive Trade Practices Act (NCUDTPA) in the handling of a claim for a defense in an underlying arbitration proceeding does not apply because it is governed by South Carolina law (Southeastern Underwater Services, Inc. and Crowder Construction Co. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 15-317, W.D. N.C.; 2016 U.S. Dist. LEXIS 33219).

    Mealey's Insurance - Efficient Proximate Cause Doctrine Was Correctly Applied, Panel Determines

    SAN FRANCISCO - A district court did not err in applying the efficient proximate cause doctrine in a suit seeking coverage for damage to machinery used to produce industrial chemicals, the Ninth Circuit U.S. Court of Appeals said March 17 in an unpublished opinion (Olin Corp. and Pioneer Americas LLC d/b/a Olin Chlor Alkali Products v. Continental Casualty Co., No. 14-15017, 9th Cir.; 2016 U.S. App. LEXIS 4905).

    Mealey's Insurance - Panel: Insured Owed Coverage For Debris Removal In Addition To $1M Flood Limit

    TRENTON, N.J. - A New Jersey appeals panel on March 14 held that an insured is owed $207,961.28 for debris removal in addition to $1 million in flood coverage under a surplus lines insurance policy, reversing a lower court's partial summary judgment ruling in favor of the insurer in a Superstorm Sandy coverage dispute (Oxford Realty Group Cedar, CLA Management and R.K. Patten LLC v. Travelers Excess and Surplus Lines Co., No. A-0342-14T3, N.J. Super., App. Div.; 2016 N.J. Super. Unpub. LEXIS 552).

    Mealey's Insurance - Insurer Has Duty To Pay Settlement, Defense Costs, New York Panel Says In Reversal

    BROOKLYN, N.Y. - A New York appeals panel on March 16 held that a certified home health care agency (CHHA) insured has submitted evidence demonstrating that an underlying class action complaint is covered under its general liability and professional liability insurance policies, reversing and remanding for the lower court to order the insurer to reimburse the insured $50,000 for the underlying settlement costs (Americare Certified Special Services Inc. v. Nautilus Insurance Co., No. 2014-02806, N.Y. Sup., App. Div.; 2nd Dept.; 2016 N.Y. App. Div. LEXIS 1784).

    Mealey's Insurance - Due Process For Claimant On Insurer Allegations Still An Issue, Federal Judge Finds

    NEW YORK - While a federal bankruptcy judge correctly found that an asbestosis victim's negligence and conspiracy claims against Johns-Manville Corp.'s longtime insurance broker are barred by the reorganization plan confirmation orders in the case, she erred in finding that the claimant received sufficient due process in connection with the entry of those orders and must decide that issue on remand, a New York federal judge ruled March 14 (The Bogdan Law Firm v. Marsh USA, Inc., et al., No. 15-6607, S.D. N.Y.; 2016 U.S. Dist. LEXIS 33457).

    Mealey's Insurance - Judge: Insured Not Entitled To Coverage Under 'Known Loss' Doctrine

    NEW YORK - Summary judgment in favor of an insurer in an insurance bad faith and breach of contract lawsuit is proper because an insured was not entitled to coverage for losses under an automobile insurance policy because the insured knew that the accident occurred after the policy had been canceled and before it had been reinstated, a federal judge in New York ruled March 15 (John A. Sefcik v. State Farm Fire and Casualty Co., No. 14-1978, E.D. N.Y.; 2016 U.S. Dist. LEXIS 33328).

    Mealey's Insurance - Minnesota Appeals Court Upholds Man's Convictions Of Arson, Insurance Fraud

    ST. PAUL, Minn. - A Minnesota trial judge did not err when allowing the prosecution to introduce some evidence of a defendant's prior bad acts because it was used to show that the man had a motive to set his home on fire in an attempt to collect insurance proceeds, a Minnesota Court of Appeals panel ruled March 14 (State of Minnesota v. Mark Allan Misgen, No. A15-0656, Minn. App.; 2016 Minn. App. Unpub. LEXIS 249).

    Mealey's Insurance - Judge Clarifies Claims That Remain Against Appraiser In Bad Faith Suit

    MEMPHIS, Tenn. - A federal judge in Tennessee on March 15 granted an appraiser's motion for judgment on the pleadings in an insurance breach of contract and bad faith lawsuit, ruling that, pursuant to a previous ruling, the only claims surviving against the appraiser are claims for breach of fiduciary duty, fraud and conspiracy to commit fraud (6111 Ridgeway Group LLC v. Philadelphia Indemnity Insurance Co., et al., No. 15-2561, W.D. Tenn.; 2016 U.S. Dist. LEXIS 32847).

    Mealey's Insurance - Panel: Faulty Workmanship Exclusion Bars Insureds' Claim For Demolition Work

    TROY, Mich. - A faulty workmanship exclusion in a homeowners insurance policy precludes coverage for damage sustained to insureds' home from demolition work, a Michigan appeals panel affirmed March 15, also finding that the insureds failed to preserve evidence of mold (Michael Schwartz and Rochelle Schwartz v. Encompass Indemnity Co., No. 322702, Mich. App.; 2016 Mich. App. LEXIS 551).

    Mealey's Insurance - Judge Excludes Pathologist, Optometrist From Testifying On Injury In Bad Faith Suit

    DENVER - A speech and language pathologist and an optometrist may not testify that an insured experienced mild traumatic brain injury (MTBI) as a result of a motor vehicle accident, a Colorado federal judge ruled March 14, granting an insurer's motions to exclude in a breach of contract and bad faith lawsuit (Robin Dillon v. Auto-Owners Insurance Co., No. 14-00246, D. Colo.; 2016 U.S. Dist. LEXIS 32371).

    Mealey's Insurance - Insurers Refute Relator's Argument That Stay Would Prejudice U.S., N.J. Governments

    CAMDEN, N.J. - Insurers on March 11 replied to a relator's opposition to their motion to stay a qui tam action against them pending the outcome of a U.S Supreme Court case that is scheduled for oral argument in April (Elizabeth Negron v. Progressive Casualty Insurance Co., et al., No. 14-577, D. N.J.; 2016 U.S. Dist. LEXIS 24994).

    Mealey's Insurance - Judge Says Insurer Owes Pesticide Company Under 1984 Settlement Agreement

    NEW YORK - Noting that when a pesticide company formulated a settlement with a reinsurer to pay past due amounts from an earlier settlement the company became aware that one of its insurers also owed it under the earlier settlement, a federal judge in New York on March 11 found that the insurer and its successor are bound by the earlier settlement agreement (Olin Corp. v. Insurance Company of North America, et al., No. 84-1968, S.D.; N.Y. 2016 U.S. Dist. LEXIS 32079).

    Mealey's Insurance - Federal Judge Rules In Insurer's Favor In Hurricane Katrina Coverage Dispute

    NEW ORLEANS - A Louisiana federal judge on March 14 granted an insurer's motions for judgment on the pleadings and for summary judgment in an insured's breach of contract lawsuit arising from Hurricane Katrina property damage (Marion's Cleaners LLC v. National Fire & Indemnity Exchange, No. 11-2259 c/w No. 11-2376, E.D. La.; 2016 U.S. Dist. LEXIS 32389).

    Mealey's Insurance - Plan's Limitations Period Is Inapplicable, 1st Circuit Appeals Panel Determines

    BOSTON - A disability plan's limitations period of three years is inapplicable, and Puerto Rico's 15-year statute of limitations must be applied because the insurer violated Employee Retirement Income Security Act regulations when it failed to inform the disability claimant of the plan-imposed time limit for filing a suit, the First Circuit U.S. Court of Appeals said March 14 (Dionisio Santana-Diaz v. Metropolitan Life Insurance Co., No. 15-1273, 1st Cir.; 2016 U.S. App. LEXIS 4670).

    Mealey's Insurance - Judge Confirms International Arbitration Awards In Favor Of Reinsurer

    NEW YORK - A federal judge in New York on March 10 granted a reinsurer's petition to confirm a number of arbitration awards, finding that an arbitration umpire was not partial to the reinsurer (National Indemnity Company v. IRB Brasil Resseguros S.A., No. 15-cv-03975, S.D. N.Y.; 2016 U.S. Dist. LEXIS 30871).

    Mealey's Insurance - Certain Bad Faith Claims Fall Under State Motor Vehicle Law, Judge Rules

    SCRANTON, Pa. - A federal judge in Pennsylvania on March 14 partially dismissed an insurance bad faith claim in a breach of contract lawsuit, ruling that a number of claims made by an insured are covered by the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL) while others are not (Berkys Urena v. Allstate Insurance Co., et al., No. 15-570, M.D. Pa.; 2016 U.S. Dist. LEXIS 32562).

    Mealey's Insurance - Georgia Federal Judge Certifies Class Of Insureds Seeking Diminished Value Coverage

    MACON, Ga. - A Georgia federal judge on March 9 certified a class of homeowners seeking coverage from State Farm Fire and Casualty Co. for diminished value to their homes but declined to subdivide the class for the time being (John Thompson, et al. v. State Farm Fire and Casualty Company, No. 14-32, M.D. Ga.; 2016 U.S. Dist. LEXIS 30308).