LexisNexis® Legal Newsroom
    Mealey's Insurance - Environmental Contamination Suit Not Barred By Statute Of Limitations, Judge Says

    SAN FRANCISCO - A California federal judge on Oct. 19 denied an insurer's motion to dismiss a suit filed against its insured and arising out of environmental contamination claims on the basis that the suit is not barred under the Comprehensive Environmental Response, Compensation, and Liability Act (Dave Drilling Environmental Engineering Inc. v. Margaret Thersia Gamblin, No. 14-02851, N.D. Calif.; 2015 U.S. Dist. LEXIS 141941).

    Mealey's Insurance - Judge Denies Insurer's Motion For Summary Judgment In Hailstorm Coverage Dispute

    KANSAS CITY, Mo. - A Missouri federal judge on Oct. 19 denied a homeowners insurer's motion for summary judgment in insureds' lawsuit alleging that the insurer unlawfully applied a policy's $1,000 deductible to an actual cash value payment in a hailstorm coverage dispute (Eric Lafollette v. Liberty Mutual Fire Insurance Co., No. 14-04147, W.D. Mo.; 2015 U.S. Dist. LEXIS 141633).

    Mealey's Insurance - Panel: 'Earth Movement' Exclusion Bars Insurance Coverage For Collapse

    NEW YORK - An "earth movement" exclusion precludes coverage for a collapse on an insured's premises, the Second Circuit U.S. Court of Appeals ruled Oct. 19, affirming summary judgment in favor of the insurer (Coney Island Auto Parts Unlimited, Inc. v. Charter Oak Fire Insurance Co., No. 14-3220, 2nd Cir.; 2015 U.S. App. LEXIS 18032).

    Mealey's Insurance - Liquidator: Insurer's Liquidation Estate More Than $10M Short Of Paying Claims

    LOS ANGELES - The liquidator of an insolvent insurer told a California court on Oct. 16 that the insurer's assets are inadequate to pay certain known claims and that it is therefore necessary to terminate the liquidation proceeding (Insurance Commissioner of the State of California v. Golden State Mutual Life Insurance Company, No BS123005, Calif. Super., Los Angeles Co.).

    Mealey's Insurance - Judge Orders Reinsurers To Send Questionnaires To Umpire Candidates

    NEW YORK - A federal judge in New York on Oct. 16 ordered two retrocessional reinsurers to comply with the court's earlier order and send out questionnaires to certain arbitration umpire candidates (Odyssey Reinsurance Company v. Certain Underwriters at Lloyd's London Syndicate 53, et al., No. 13-cv-09014, S.D. N.Y.).

    Mealey's Insurance - Judge: Bad Faith Claim Can't Be Maintained Under Special Relationship Theory

    PENDLETON, Ore. - Dismissal of insureds' remaining claims against their insurer is proper because their tort claim for breach of the implied covenant of good faith and fair dealing cannot be maintained under the insured's special relationship theory, a federal judge in Oregon ruled Oct. 16 (Travis Vail, et al. v. Country Mutual Insurance Co., No. 13-2029, D. Ore.; 2015 U.S. Dist. LEXIS 140984).

    Mealey's Insurance - Judge: Third Party Lacks Standing To Sue Insurer For Insurance Bad Faith

    BEAUFORT, S.C. - A federal judge in South Carolina on Oct. 19 granted in part and denied in part an insurer's motion to dismiss, ruling that a third party cannot sue the insurer for bad faith because the insured never assigned the bad faith claim to the third party (Terrence Davis v. Liberty Mutual Insurance Co., No. 15-2818, D. S.C.; 2015 U.S. Dist. LEXIS 141659).

    Mealey's Insurance - Magistrate Judge Dismisses Man's Claims Over Use Of Noncertified Technicians

    CHICAGO - A federal magistrate judge in Illinois granted in part an independent diagnostic testing facility's (IDTF) motion to dismiss when finding that a man could not pursue claims that it violated the False Claims Act (FCA) when allowing noncertified technicians to perform remote heart-monitoring services for patients and then billing Medicare for the service, but found that the rest of the man's lawsuit sufficiently stated claims against the defendant (United States of America, ex rel. Matthew Cieszynski v. LifeWatch Services Inc., No. 13 CV 4052, N.D. Ill.; 2015 U.S. Dist. LEXIS 141721).

    Mealey's Insurance - Panel Finds Insurer Has No Duty To Defend Based On Insured's Untimely Notice

    ATLANTA - An insured's failure to provide prompt notice relieved an insurer of any duty to defend against claims arising from a failed retaining wall at a mall, the 11th Circuit U.S. Court of Appeals affirmed Oct. 16, finding that an insurance agent was not acting as a dual agent for the insured and insurer (Johnson Landscapes, Inc. v. FCCI Insurance Co., No. 15-11352, 11th Cir.; 2015 U.S. App. LEXIS 17951).

    Mealey's Insurance - Pollution Exclusion Does Not Bar Coverage; Ambiguity Exists, Wisconsin Panel Says

    MADISON, Wis. - Because a policy's pollution exclusion is ambiguous as to whether a certain bacteria is a pollutant, a reasonable insured could expect coverage under the policy, the District Four Wisconsin Court of Appeals said Oct. 15 in reversing a ruling in favor of an insurer (Patrick J. Connors v. Zurich American Insurance Co., et al., No. 2014AP2990, Wis. App., Dist. 4; 2015 Wisc. App. LEXIS 755).

    Mealey's Insurance - Wisconsin Panel: Exclusion Not Clear As To Whether Certain Bacteria Are Pollutants

    MADISON, Wis. - The District Four Wisconsin Court of Appeals on Oct. 15 reversed a ruling in favor of an insurer after determining that a policy's pollution exclusion is ambiguous as to whether a certain bacteria constitute pollutants (Carmen Ramos, et al. v. The Charter Oak Fire Insurance Co., et al., No. 2014AP2039, Wis. App., Dist. 4; 2015 Wisc. App. LEXIS 753).

    Mealey's Insurance - Judge: Insured Failed To Cure Pleading Deficiencies In Bad Faith Lawsuit

    SAN FRANCISCO - Dismissal of an insured's first amended complaint in an insurance breach of contract and bad faith lawsuit is proper because the insured failed to cure a number of discrepancies that led to the dismissal of the original complaint, a federal judge in California ruled Oct. 16 (Arryanne Moss v. Infinity Insurance Co., et al., No. 15-3456, N.D. Calif.; 2015 U.S. Dist. LEXIS 141311).

    Mealey's Insurance - California Federal Judge Dismisses Portions Of Insurer's Counterclaims

    SACRAMENTO, Calif. - A California federal judge on Oct. 16 dismissed an insurer's breach of contract counterclaim on the basis that the insureds did not breach their contract by filing environmental contamination claims they knew would not be covered under the policy because the insurer reserved the right to deny coverage for any noncovered claims (Lennar Mare Island LLC v. Steadfast Insurance Co., et al., No. 12-2182, E.D. Calif.; 2015 U.S. Dist. LEXIS 141305).

    Mealey's Insurance - Sublimit Provision Caps Liability At $1M, 2nd Circuit Determines

    NEW YORK - Because there is no ambiguity in an insurance policy regarding the terms "underground storage tank" and "associated piping," an insurer is required to pay only the policy's $1 million sublimit of liability for underground storage tanks and associated piping, the Second Circuit U.S. Court of Appeals said Oct. 16 (Two Farms Inc. v. Greenwich Insurance Co., No. 12-50, S.D. N.Y.; 2015 U.S. App. LEXIS 17940).

    Mealey's Insurance - 3rd Circuit Panel Vacates Ruling In Favor Of Insurer On Issue Of Renewal Policy

    PHILADELPHIA - An insurer was not entitled to summary judgment in its favor on the issue of whether it renewed an insurance policy because the insurer breached its promised by not offering the same terms in the original policy as in the renewal policy, the Third Circuit U.S. Court of Appeals said Oct. 15 in vacating a district court's opinion (Indian Harbor Insurance Co. v. F&M Equipment LTD., f/k/a Furnival Machinery Co., No. 14-1897, 3rd Cir.; 2015 U.S. App. LEXIS 17901).

    Mealey's Insurance - Wrongful Conduct Underlying 2 Claims Is 'Identical,' Federal Judge Says

    WORCESTER, Mass. - A Massachusetts federal judge on Oct. 15 found that there is no professional liability coverage for two underlying claims stemming from an attorney's alleged malpractice in handling his client's appeal of a zoning decision, granting the insurer's motion for summary judgment (Samer Gandor v. Torus National Insurance Co., No. 13-40132, D. Mass.; 2015 U.S. Dist. LEXIS 140542).

    Mealey's Insurance - Panel: Sparse Record Devoid Of Any Documentation Of Expert Cardiologist's Fees

    SHREVEPORT, La. - A Louisiana appeals panel on Oct. 14 affirmed a lower court's refusal to order the unsuccessful plaintiffs in a medical malpractice dispute to pay the defendants' expert cardiologist's $34,064.41 witness fee (William McDougald, et al. v. St. Francis North Hospital, Inc., et al., No. 50,079-CA, La. App., 2nd Cir.; 2015 La. App. LEXIS 2020).

    Mealey's Insurance - Federal Judge Refuses To Reconsider Ruling In Dispute Over $1.2M Employee Theft

    ALBANY, N.Y. - A New York federal judge on Oct. 15 rejected an insurer's motion to reconsider its summary judgment ruling in a coverage dispute over a $1.2 million theft by the insured's former manager of accounting (Dataflow Inc., et al. Peerless Insurance Co., No. 11-1127, N.D. N.Y.; 2015 U.S. Dist. LEXIS 140181).

    Mealey's Insurance - Panel Rejects Reargument In Directors, Officers Liability Coverage Dispute

    NEW YORK - A New York appeals panel on Oct. 15 rejected a directors and officers liability insurer's reargument that a merger litigation and an adversary proceeding constitute one continuous claim, reaffirming that coverage for the adversary proceeding is not subject to a 2006-07 policy's insured versus insured (IVI) exclusion (American Casualty Company of Reading, P.A., et al. v. Morris Gelb, et al., No. 15335 653280/11, N.Y. Sup., App. Div., 1st Dept.; 2015 N.Y. App. Div. LEXIS 7590).

    Mealey's Insurance - Panel: Failure To Timely Notify Insurer Of Potential Malpractice Bars Coverage

    INDIANAPOLIS - An Indiana appeals panel held Oct. 15 that an attorney insured knew or reasonably should have known of his client's potential legal malpractice claim at the time he renewed his professional liability insurance policy and, therefore, his failure to notify the insurer of the potential claim precludes coverage, reversing a lower court (The Bar Plan Mutual Insurance Co. v. Likes Law Office, et al., No. 02A03-1502-CT-65, Ind. App.; 2015 Ind. App. LEXIS 680).

    Mealey's Insurance - Appeals Court Affirms Couple's Attorney Fees Award For Defending Counterclaim

    MIAMI - A Florida appellate panel on Oct. 14 affirmed a trial court judge's decision to award attorney fees to a couple for successfully defending against their insurer's counterclaim that they were unjustly enriched when receiving a $28,000 payout for a water damages loss claim even though a jury also found in favor of the insurer on its argument that the couple made misrepresentations when submitting the claim (Citizens Property Insurance Corp. v. Ernesto Bascuas, et al., No. 3D14-2434, 3D14-1549, Fla. App., 3rd Dist.; 2015 Fla. App. LEXIS 15138).

    Mealey's Insurance - Pennsylvania Federal Judge Says Choice Of Law Ruling Will Not Be Changed

    HARRISBURG, Pa. - A Pennsylvania federal judge on Oct. 13 denied an insurer's motion for reconsideration, determining that the addition to the record of a portion of the insurer's affidavit does not change the conclusion that Pennsylvania law, not New York law, governs the insured's lawsuit seeking coverage for underlying asbestos liabilities (York International Corp. v. Liberty Mutual Insurance Co., No. 10-0692, M.D. Pa.; 2015 U.S. Dist. LEXIS 138927).

    Mealey's Insurance - Louisiana High Court Reverses Ruling Against Insurer In Hurricane Katrina Dispute

    NEW ORLEANS - The Louisiana Supreme Court on Oct. 14 found that the doctrine of lis pendens applies to plaintiffs' individual lawsuits even though they were not named parties or joined in first-filed Hurricane Katrina class actions, reversing and remanding a lower court's ruling that denied the insurer's exception of lis pendens (Thelma Aisola v. Louisiana Citizens Property Insurance Corp., 2014-CC-1708, La. Sup.).

    Mealey's Insurance - Texas Panel Affirms Take-Nothing Judgment In Hurricane Ike Coverage Suit

    HOUSTON - A Texas appeals panel on Oct. 13 affirmed a lower court's ruling that entered a take-nothing judgment against an insurer in a coverage dispute over the insured's roof and other damage allegedly caused by Hurricane Ike (John Davis d/b/a J.D. House Of Style v. National Lloyds Insurance Co., No. 14-00278, Texas App., 1st Dist.; 2015 Tex. App. LEXIS 10506).

    Mealey's Insurance - California Federal Judge Says Insured Owed Coverage Under Contamination Policy

    SACRAMENTO, Calif. - An insured seeking coverage for more than $12 million in expenses that it incurred as a result of the suspension of its poultry operations because of salmonella contamination is owed coverage under a policy's accidental contamination coverage provision and the policy's government recall provision, a California federal judge said Oct. 9 (Foster Poultry Farms Inc. v. Certain Underwriters at Lloyd's London, No. 14-953, E.D. Calif.; 2015 U.S. Dist. LEXIS 138609).