LexisNexis® Legal Newsroom
    Mealey's Insurance - Insureds' Collapse Loss From Water Damage Is Not Covered, Panel Says

    TRENTON, N.J. - A policy's anti-sequential clause and the exclusionary language for earth movement and water damage did not cover insureds' loss from a partial collapse of their building following Hurricane Irene, a New Jersey appeals panel affirmed Jan. 20, finding that water seepage caused soil erosion (Ashrit Realty LLC and Bhavika Realty LLC v. Tower National Insurance Co., No. A-1647-13T4, N.J. Super., App. Div.; 2015 N.J. Super. Unpub. LEXIS 107).

    Mealey's Insurance - Magistrate Judge Enters Judgment In Insured's Favor, Finds Insurer Owes Coverage

    PORTLAND, Ore. - An Oregon federal magistrate judge on Jan. 14 entered judgment in favor of an insured after determining that an insurer owes coverage under a policy period for costs related to a portion of environmental contamination (Siltronic Corp. v. Employers Insurance Company of Wausau, et al., No. 11-1493, D. Ore.; 2015 U.S. Dist. LEXIS 4287).

    Mealey's Insurance - Magistrate Judge Orders Insurer To Supply Reinsurance Documents To Insured

    LAKE CHARLES, La. - A magistrate judge in a federal court in Louisiana on Jan. 15 ordered an insurance company to produce documents related to reinsurance in a suit where a shipyard operator is suing the insurer over alleged damages and business interruption caused by flooding (Leevac Shipbuilders LLC v. Westchester Surplus Lines Insurance Company, No. 14-cv-00399, W.D. La.; 2015 U.S. Dist. LEXIS 5070).

    Mealey's Insurance - New Jersey Panel Affirms Plaintiffs Are Not Named Insureds Under Certain Policies

    TRENTON, N.J. - Plaintiffs seeking coverage for environmental contamination cleanup costs are not entitled to coverage under policies in which they were not named insureds and under excess policies that clearly included an absolute pollution exclusion, a New Jersey appellate panel said Jan. 16 (Newport Associates Phase I Developers Limited Partnership, et al. v. Travelers Casualty and Surety Co., f/k/a Aetna Casualty and Surety Co., et al., No. A-5543-11T1, N.J. Super., App. Div.; 2015 N.J. Super. Unpub. LEXIS 103).

    Mealey's Insurance - No Secondary Coverage For Chinese Drywall Claims, Federal Judge Says

    NEWPORT NEWS, Va. - No coverage exists under the secondary coverage provisions in commercial general liability insurance policies for Chinese drywall claims, a Virginia federal judge ruled Jan. 15, also finding that the insurer and insureds agree that the pollution exclusion bars coverage (Nationwide Mutual Insurance Co., et al. v. CG Stony Point Townhomes LLC, et al., No. 10-70, E.D. Va.; 2015 U.S. Dist. LEXIS 5682).

    Mealey's Insurance - Issues Of Fact Exist As To Whether Asbestos Bodily Injury Claims Are Excluded

    BRIDGEPORT, Conn. - A Connecticut federal judge on Jan. 16 determined that because issues of material fact exist regarding whether a policy exclusion precludes coverage for bodily injury claims arising out of exposure to asbestos, summary judgment against the insurer is not warranted (New England Reinsurance Corp. v. Ferguson Enterprises Inc., et al., No. 12-948, D. Conn.; 2015 U.S. Dist. LEXIS 5397).

    Mealey's Insurance - Judge: Insurer Shows Third-Party Beneficiary Interest In Subcontract

    NEW ORLEANS - A general liability insurer sufficiently alleges that it is a third-party beneficiary of a subcontract between an insured and a subcontractor for a project at dispute regarding allegedly improper work, a Louisiana federal judge ruled Jan. 15, denying the subcontractor's motion to dismiss a third-party claim (Hanover Insurance Co. v. Plaquemines Parish Government, No. 12-1680, E.D. La.; 2015 U.S. Dist. LEXIS 5171).

    Mealey's Insurance - Arizona Panel Finds Insurer Did Not Waive Privilege Over Counsel In Bad Faith Suit

    PHOENIX - Concluding that an insurer consulted with its counsel in underlying settlement negotiations but did not rely on its advice, an Arizona appeals panel majority on Jan. 15 held that the insurer did not waive its attorney-client privilege in the advice it received, reversing a lower court's order to produce the information in a bad faith lawsuit (Everest Indemnity Insurance Co. v. The Honorable John Rea, et al., No. 1 CA-SA 14-0094, Ariz. App., Div. 1).

    Mealey's Insurance - Majority Partly Reverses, Finds Insureds Did Not Tender Defense Of Claim To Insurer

    PASADENA, Calif. - A majority of the Ninth Circuit U.S. Court of Appeals on Jan. 15 found that a lower federal court erred in finding that insureds tendered the defense of their claim to their directors, officers and organization liability insurer, reversing and remanding in part a summary judgment ruling in favor of the insureds in their lawsuit seeking coverage for claims that they made misrepresentations and omissions to home buyers (Corky McMillin Construction Services, Inc. v. U.S. Specialty Insurance Co., No. 12-56787, 9th Cir.; 2015 U.S. App. LEXIS 644).

    Mealey's Insurance - Insurer Files For Judgment By Default Against Alleged Reinsurer

    NEW YORK - An insurer on Jan. 14 filed an affidavit for judgment by default in a federal court in New York against its claimed reinsurer, which has not responded to the court regarding a petition to confirm an arbitration award (Employers Insurance Company of Wausau v. Continental casualty Company, No. 14-cv-09192, S.D. N.Y.).

    Mealey's Insurance - Disability Carrier Must Pay Company's Attorney Fees, 9th Circuit Panel Affirms

    SAN FRANCISCO - A district court did not err in ordering a disability insurer to pay attorney fees incurred by a company plan on behalf of a claimant because the company supported the claimant and assumed the same position as a plaintiff in the claimant's lawsuit, the Ninth U.S. Circuit Court of Appeals said Jan. 15 in an unpublished opinion (John Paul Micha M.D., et al. v. Group Disability Benefits Plan for Gynecologic Oncology Associates Partners LLC, No. 12-55816, 9th Cir.; 2015 U.S. App. LEXIS 646).

    Mealey's Insurance - Insurer Abused Discretion By Limiting Benefits Based On Mental Disorder, Majority Says

    NEW ORLEANS - A disability insurer abused its discretion in determining that a claimant's entitlement to benefits was limited because a mental disorder contributed to the claimed disability, the majority of the Fifth Circuit U.S. Court of Appeals panel said Jan. 15 (Robert George v. Reliance Standard Life Insurance Co., No. 14-50368, 5th Cir.; 2015 U.S. App. LEXIS 658).

    Mealey's Insurance - 9th Circuit Reverses Ruling In Favor Of Directors, Officers Liability Insurer

    PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on Jan. 15 found that a lower federal court erred in granting summary judgment in favor of an insurer in a lawsuit seeking coverage for fraud and breach of fiduciary duty claims brought by creditors against three former officers of a now-bankrupt company (Michael J. Dobson, et al. v. Twin City Fire Insurance Co., et al., No. 12-56729, 9th Cir.; 2015 U.S. App. LEXIS 647).

    Mealey's Insurance - Judge Finds Insurer's Denial Of Coverage Was Not In Bad Faith

    LAFAYETTE, La. - An insurer's denial of coverage after a fire department's investigation into an insured's property damage claim was not in bad faith despite coverage being later determined, a Louisiana federal judge ruled Jan. 14, granting summary judgment to the insurer on its statutory penalty claim (Houston Specialty Insurance Co. v. Meadows West Condo Association, et al., No. 13-02150, W.D. La.; 2015 U.S. Dist. LEXIS 4590).

    Mealey's Insurance - Florida Panel Reverses Rulings In Insurer's Favor In Sinkhole Coverage Suit

    LAKELAND, Fla. - A Florida appeals panel on Jan. 14 reversed and remanded two summary judgment rulings in favor of an insurer in a coverage dispute over sinkhole damage (Robert Curtis v. Tower Hill Prime Insurance Co., No. 2D13-689, Fla. App., 2nd Dist.; 2015 Fla. App. LEXIS 398).

    Mealey's Insurance - Insurers Owe Duty To Defend Insured Even If Claims Are Groundless

    CHICAGO - An insured named in numerous underlying suits alleging injuries arising out of exposure to asbestos, benzene and other harmful materials is entitled to a defense in the cases in which it is alleged to have been directly liable even if the underlying allegations are groundless, the Second Division of the First District Illinois Appellate Court said Jan. 13 (Illinois Tool Works Inc. et al. v. Travelers Casualty and Surety Co., et al., No. 1-13-2350, Ill. App., 1st Dist., 2nd Div.; 2015 Ill. App. LEXIS 18).

    Mealey's Insurance - Insurers Were Prejudiced By Insured's Untimely Notice, Judge Concludes

    CLARKSBURG, W.Va. - An insured's untimely notice of a claim over soil settlement issues prejudiced its commercial general liability insurers, a West Virginia federal judge ruled Jan. 14, granting summary judgment to the insurers (St. Paul Mercury Insurance Co. v. National Surety Corp., et al., No. 14-45, N.D. W.Va.; 2015 U.S. Dist. LEXIS 4363).

    Mealey's Insurance - 5th Circuit: Insurer Has No Duty To Defend Suit Arising From Noncompete Agreement

    NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Jan. 14 affirmed a lower federal court's ruling that an insurer has no duty to defend or indemnify its insured against underlying claims, including tortious interference with contractual relations and business advantages, civil conspiracy, conversion, aiding and abetting a fiduciary breach and misappropriation of trade secrets (Nationwide Mutual Insurance Co. v. Gum Tree Property Management, LLC, et al., No. 14- 60302, 5th Cir.; 2015 U.S. App. LEXIS 595).

    Mealey's Insurance - Insurer Owes Partial Obligation To Reimburse Repair Costs, Judge Says

    BALTIMORE - A commercial general liability insurer has a partial duty to reimburse repair costs for cracking damage to two buildings, a Maryland federal judge ruled Jan. 13, also dismissing counterclaims for breach of contract, negligence and bad faith (American Home Assurance Co. v. KBE Building Corp., No. 13-1941, D. Md.; 2015 U.S. Dist. LEXIS 4076).

    Mealey's Insurance - Federal Judge Dismisses 1 Claim From Health Care Reimbursement Suit

    TAMPA, Fla. - A Florida federal judge on Jan. 12 partially dismissed a complaint alleging that a health insurance company wrongfully declined to reimburse two health care providers for services, dismissing a fraud claim and granting the plaintiff leave to amend the complaint to assert claims under the Employee Retirement Income Security Act, but otherwise denied the motion (Tran Chiropractic Wellness Center Inc., et al. v. Aetna Inc., et al., No. 14-47, M.D. Fla.; 2015 U.S. Dist. LEXIS 3124).

    Mealey's Insurance - Federal Judge Amends Judgment In Hurricane Isaac Suit To Prevent Double Recovery

    NEW ORLEANS - A Louisiana federal judge on Jan. 12 denied a homeowners insurer's renewed motion for judgment as a matter of law in a Hurricane Isaac coverage dispute but granted its alternative motion to amend a jury's award for dwelling damages from $70,000 to $69,448.89 to prevent the insureds from receiving $551.11 in double recovery (Tracey Arcement, et al. v. GeoVera Specialty Insurance Services Inc., No. 13-5436, E.D. La.; 2015 U.S. Dist. LEXIS 3902).

    Mealey's Insurance - New Hampshire High Court Affirms Woman's Conviction For Soliciting Insurance Fraud

    CONCORD, N.H. - The New Hampshire Supreme Court on Jan. 13 upheld a woman's conviction for one count of soliciting an accomplice to commit insurance fraud and two counts of witness tampering, holding that the evidence supported the jury's findings and that the trial court judge did not err when rejecting the defendant's proposed jury instructions (State of New Hampshire v. Colleen Carr, No. 2014-044, N.H. Sup.; 2015 N.H. LEXIS 1).

    Mealey's Insurance - Judge Imposes Sanctions On Attorneys For Filing Unfounded Superstorm Sandy Suit

    NEWARK, N.J. - A New Jersey federal judge on Jan. 13 revoked the pro hac vice admission of two attorneys and their law firm for one year after they failed to respond to an order to show cause as to why the court should not impose sanctions for filing a Superstorm Sandy lawsuit that lacked basis (Lighthouse Point Marina & Yacht Club LLC v. International Marine Underwriters, No. 14-2974 [WHW][CLW], D. N.J.; 2015 U.S. Dist. LEXIS 3827).

    Mealey's Insurance - Federal Judge Dismisses Parties From Insurer's Duty-To-Indemnify Case

    TAMPA, Fla. - A Florida federal judge on Jan. 13 dismissed two parties from an insurer's duty-to-indemnify lawsuit regarding property damage sustained from fire caused by a welding operation because the parties were made whole (Essex Insurance Co. v. Kart Construction Inc., et al., No. 14-356, M.D. Fla.; 2015 U.S. Dist. LEXIS 3859).

    Mealey's Insurance - Judge Finds Insured Is Not Entitled To Attorney Fees In Garnishment Suit

    JEFFERSON CITY, Mo. - An insured and a condominium association are not entitled to attorney fees for an insurer's removal of a garnishment action regarding construction defects judgment, a Missouri federal judge ruled Jan. 13 despite previously finding no jurisdiction (Plaza Gardens on the Lake Condominium Owners' Association Inc. and Schlup Investment Inc. v. Colony Insurance Co., No. 14-04232, W.D. Mo.; 2015 U.S. Dist. LEXIS 3569).