LexisNexis® Legal Newsroom
    Mealey's Insurance - Reinsurer Says Reinsured Breached Facultative Reinsurance Certificates

    BOSTON - A reinsurer told a federal court in Massachusetts on Jan. 30 that its reinsured entered into a transaction with a different entity in which it transferred its rights and obligations under a number of facultative reinsurance certificates and that the reinsured is therefore in breach of certain provisions of the certificates (OneBeacon America Insurance Company v. Transatlantic Reinsurance Company, No. 14-cv-14067, D. Mass.).

    Mealey's Insurance - Judge: Insurer Failed To Allege Negligence, Breach Of Contract Claims

    SAN FRANCISCO - An insurer failed to assert third-party claims breach of contract and negligence against insureds in a subrogation action regarding settlement of an underlying construction defects case, a California federal judge ruled Jan. 29 (AIG Commercial Insurance Company of Canada v. American Guarantee & Liability Insurance Co., et al., No. 14-02610, N.D. Calif.; 2015 U.S. Dist. LEXIS 11386).

    Mealey's Insurance - Judge Grants Default Judgment To Insurer In Defects Coverage Dispute

    SAN JOSE, Calif. - A California federal judge on Jan. 30 granted default judgment in favor of an insurer regarding its duty to defend and indemnify insureds in an underlying construction defects case (Atain Specialty Insurance Co. v. North Bay Waterproofing Inc., et al., No. 14-04056, N.D. Calif.; 2015 U.S. Dist. LEXIS 11404).

    Mealey's Insurance - Louisiana Supreme Court Reinstates Defects Award In Favor Of Builder, Surety

    NEW ORLEANS - A property owner's claims against a builder and the builder's surety were untimely asserted outside the five-year period and, thus, were perempted, the Louisiana Supreme Court held Jan. 28, reinstating a district court's judgment confirming an arbitration award in favor of the builder and surety (Crescent Property Partners LLC v. American Manufacturers Mutual Insurance Co., et al., No. 2014-C-0969 c/w 2014-c-0973, La. Sup.).

    Mealey's Insurance - Judge: Ex-Wife Failed To Show She Is Entitled To Life Insurance Benefits

    TRENTON, N.J. - A federal judge in New Jersey on Jan. 29 dismissed an insurance breach of contract and bad faith lawsuit, ruling that an insurer did not act in bad faith by failing to provide a deceased man's life insurance benefits to his ex-wife individually or as trustee for the former couples' adult children (Linda Dean v. New England Mutual Life Insurance Co., et al., No. 14-2211, D. N.J.; 2015 U.S. Dist. LEXIS 10244).

    Mealey's Insurance - Dietz & Watson's Motions To Compel From Insurer In Bad Faith Case Mostly Denied

    PHILADELPHIA - A Pennsylvania federal magistrate judge on Jan. 28 found that many of the documents sought by Dietz & Watson Inc. from its insurer related to an underlying workplace injury lawsuit are covered by asserted privileges, denying in part the meat producer's motions to compel (Dietz & Watson Inc. v. Liberty Mutual Insurance Co., et al., No. 2:14-cv-04082, E.D. Pa.; 2015 U.S. Dist. LEXIS 9815).

    Mealey's Insurance - Judge: Libel Claims Do Not Arise From Activities Related To Attorney's Business

    CORPUS CHRISTI, Texas - Finding that underlying libel claims against an attorney insured fail to arise from activities related to his business, a Texas federal judge on Jan. 29 held that an insurer has no duty to defend or indemnify the insured and granted the insurer's motion for summary judgment in a declaratory judgment lawsuit (Mark A. DiCarlo v. Allstate Insurance Co., No. 2:14-CV-449, S.D. Texas; 2015 U.S. Dist. LEXIS 10157).

    Mealey's Insurance - Judge Rejects Coverage Suit Over Alleged Employee Theft Of Energy Drink Inventory

    MONTGOMERY, Ala. - An Alabama federal judge on Jan. 29 granted an insurer's motion to dismiss an insured's breach of contract and bad faith suit seeking coverage for missing inventory of 82,510 bottles of 5-Hour Energy drinks, finding that coverage is barred by the policy's inventory shortage exclusion (W. L. Petrey Wholesale Co., Inc. v. Great American Ins. Co., No. 2:14-CV-868-CSC, M.D. Ala., Northern Div.; 2015 U.S. Dist. LEXIS 10036).

    Mealey's Insurance - Disability Insurer Not Entitled To Offset Benefits, Washington Federal Judge Says

    SEATTLE - A Washington federal judge on Jan. 27 granted a disability claimant's motion for summary judgment after determining that the disability insurer was not entitled to offset the claimant's benefits based on benefits she received under a franchise group insurance policy (Frances Hogan, M.D. v. Unum Life Insurance Company of America, No. 14-1028, W.D. Wash.; 2015 U.S. Dist. LEXIS 9272).

    Mealey's Insurance - Adjuster Lacks Standing To Bring False Claims Suit Against Insurers, Judge Finds

    HOUSTON - A federal judge in Texas on Jan. 29 held that an insurance adjuster lacked standing to bring claims that a number of insurance companies violated the False Claims Act (FCA) by preparing and submitting inflated claims on flood insurance policies backed by the Federal Insurance Administration's (FIA) National Flood Insurance Program (NFIP), while reducing claims paid on privately backed wind insurance policies, finding that his allegations were based on publicly disclosed information (United States of America, ex rel. Kermith Sonnier v. The Standard Fire Insurance Company, et al., No. H-12-1065, S.D. Texas; 2015 U.S. Dist. LEXIS 10006).

    Mealey's Insurance - Judge: Insurance Benefits Administrator Shielded By State Sovereign Immunity

    AUSTIN, Texas - A federal judge in Texas on Jan. 27 granted an insurance benefits administrator's motion for summary judgment in an insurance bad faith lawsuit, ruling that the benefits administrator is a state instrumentality that is shielded by sovereign immunity (Kerri Kirby v. Health Care Service Corp, No. 14-892, W.D. Texas; 2015 U.S. Dist. LEXIS 8953).

    Mealey's Insurance - Panel Says Umbrella Insurer Has No Duty For Costs As CGL Policies Not Exhausted

    COLUMBIA, S.C. - An umbrella insurer has no duty to indemnify costs incurred by an insured to repair property damage at several condominium projects because the commercial general liability insurance policies underlying the umbrella policies were not exhausted, a South Carolina appeals panel affirmed Jan. 28 (Crossmann Communities of North Carolina Inc. and Beazer Homes Investment Corp. v. Harleysville Mutual Insurance Co. and Cincinnati Insurance Co., No. 2012-213245, S.C. App.; 2015 S.C. App. LEXIS 5).

    Mealey's Insurance - Report: Even After ACA, Cost Remains Barrier To Insurance

    WASHINGTON, D.C. - Cost remains a barrier to obtaining medical insurance, with nearly one-third of uninsured but Patient Protection and Affordable Care Act (ACA)-eligible adults citing it as the reason they remain uninsured, according to a Henry J. Kaiser Family Foundation report issued Jan. 29.

    Mealey's Insurance - Asbestos Agreements Between Budd, Insurers Are Confidential, Judge Rules

    CHICAGO - An Illinois federal bankruptcy judge on Jan. 27 issued an agreed-to protective order designating as confidential nine agreements between Chapter 11 debtor The Budd Co. Inc. and insurance companies involving the settlement or defense of asbestos personal injury claims and documents related to any reserves established by Budd for asbestos-related claims (In re: The Budd Company, Inc., No. 14-11873, N.D. Ill. Bkcy.).

    Mealey's Insurance - 9th Circuit Majority Remands Disability Suit To Reconsider Evidence

    SAN FRANCISCO - Because a claimant did not submit a disability claim for a mental condition or mental illness, the claimant was not required to undergo a psychiatric evaluation that was suggested by some of the claimant's treating doctors, a Ninth Circuit U.S. Court of Appeals panel majority said Jan. 28 (Miae Decovich v. Anthem Life Insurance Co., No. 12-16803, 9th Cir.; 2015 U.S. App. LEXIS 1350).

    Mealey's Insurance - 9th Circuit Panel Overrules Woman's Challenge To Jury Instruction In Fraud Suit

    PASADENA, Calif. - A Ninth Circuit U.S. Court of Appeals panel on Jan. 28 denied a woman's request to overturn her conviction for mail and wire fraud in connection with a scheme to defraud life insurance companies, holding that the defendant waived her challenge to a jury instruction and that the instruction was not clearly erroneous or prejudicial (United States of America v. Jean Crump, No. 13-50179, 9th Cir.; 2015 U.S. App. LEXIS 1355).

    Mealey's Insurance - Virginia Federal Judge Denies Motion To Remand, Says Complete Diversity Exists

    RICHMOND, Va. - A Virginia federal judge on Jan. 27 denied an insured's motion to remand a suit seeking coverage for lead-based paint injuries that occurred at the insured property after determining that complete diversity of citizenship exists because the parties were misaligned (Patricia E. Smith v. Nationwide Mutual Fire Insurance Co., et al., No. 14-819, E.D. Va.; 2015 U.S. Dist. LEXIS 9181).

    Mealey's Insurance - Judge: Errors, Omissions Clause Bars Reinsurance Coverage For Malpractice Insurer

    RALEIGH, N.C. - Finding that an errors and omissions clause in a reinsurance policy precludes coverage for underlying bad faith claims against a medical malpractice insurer, a North Carolina federal judge on Jan. 27 granted the reinsurer's motion for summary judgment in a dispute arising from a $4.6 million medical malpractice jury verdict (Greenwich Insurance Co. v. Medical Mutual Insurance Company of North Carolina, No. 14-295, E.D. N.C.; 2015 U.S. Dist. LEXIS 9342).

    Mealey's Insurance - Louisiana Federal Judge Stays Contamination Suit Until Underlying Case Is Resolved

    BATON ROUGE, La. - A Louisiana federal judge on Jan. 23 stayed an insurer's suit seeking a coverage declaration for wastewater dumping that resulted in contamination of a city sewer system (Endurance Specialty Insurance Co. v. City of Baton Rouge/Parish of East Baton Rouge, et al., No. 14-624, M.D. La.; 2015 U.S. Dist. LEXIS 7973).

    Mealey's Insurance - Judge: Government's Evidence Supported Guilty Verdict In Health Care Fraud Suit

    DETROIT - A federal judge in Michigan on Jan. 27 denied a defendant's motion for acquittal and new trial, ruling that the government presented sufficient evidence to support the jury's finding that the man conspired to commit health care fraud (United States of America v. Vinod Patel, No. 11-20468-36, E.D. Mich.; 2015 U.S. Dist. LEXIS 8952).

    Mealey's Insurance - Excess Insurer Prejudiced By Insufficient Notice To Broker, 5th Circuit Affirms

    NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Jan. 27 found that an insured's notice of a slip-and-fall claim to a broker did not satisfy an excess policy's notice requirements and that the excess insurer was prejudiced as a result, affirming a lower federal court's ruling in favor of the excess insurer (Berkley Regional Insurance Co. v. Philadelphia Indemnity Insurance Co., No. 13-51180 c/w No. 14-50099, 5th Cir.; 2015 U.S. App. LEXIS 1284).

    Mealey's Insurance - Judge Awards Partial Fees, Costs, Prejudgment Interest To Insured In Coverage Suit

    SEATTLE - An insured is entitled to partial fees, costs and prejudgment interest in a coverage dispute arising from earth movement damage, a Washington federal judge held Jan. 26, granting in part and denying in part the insured's motion (MKB Constructors v. American Zurich Insurance Co., No. 13-0611, W.D. Wash.; 2015 U.S. Dist. LEXIS 9325).

    Mealey's Insurance - District Court Properly Dismissed Insured From Bad Faith Suit, Panel Rules

    ATLANTA - A federal district court did not err in dismissing an insured from an insurance bad faith declaratory relief lawsuit because an insurer failed to show that she had any bad faith claims against the insurer, an 11th Circuit U.S. Court of Appeals panel ruled Jan. 26 in a per curiam opinion (GEICO General Insurance Co. v. Hussien H. Farag, et al., No. 14-10978, 11th Cir.; 2015 U.S. App. LEXIS 1088).

    Mealey's Insurance - Judge OKs Insurer Dropping Claim To Enjoin Arbitration With Reinsurer

    NEW HAVEN, Conn. - A federal judge in Connecticut on Jan. 26 granted an insurer's unopposed motion to withdraw its claim asking the court to enjoin an arbitration with a reinsurer (American United Life Insurance Company v. Travelers Indemnity Company, et al., No. 14-cv-01339, D. Conn.).

    Mealey's Insurance - Judge: Exclusions Do Not Bar Coverage For Claims Against Bank's Former Officers

    CEDAR RAPIDS, Iowa - An Iowa federal judge on Jan. 23 found that neither an "insured vs. insured" exclusion nor an "investment loss carve-out" in a directors and officers/company liability insurance policy precludes coverage for the Federal Deposit Insurance Corp.'s lawsuit against former officers and directors of a failed bank (Progressive Casualty Insurance Co. v. Federal Deposit Insurance Corp., et al., No.12-4041, N.D. Iowa; 2015 U.S. Dist. LEXIS 7805).