SALT LAKE CITY - Insureds' failure to follow instructions in disconnecting a water tank, electrical wires and water lines prior to demolition work does not constitute an "occurrence" under a commercial general liability insurance policy, a Utah federal judge ruled May 24, finding that the insurer has no duty to defend or indemnify (Auto-Owners Insurance Co. v. Ryan Stevens Construction Inc. and Ryan Stevens, No. 15-406, D. Utah; 2016 U.S. Dist. LEXIS 68522).
PHILADELPHIA - A majority of the Third Circuit U.S. Court of Appeals on May 24 held that it lacks jurisdiction of an excess insurer's untimely appeal of a lower court's ruling dismissing an attorney from its lawsuit alleging that she was negligent in her representation of its insured in an underlying action that resulted in a $19 million award against the insured (State National Insurance Co. v. The County of Camden, et al., No. 14-4766, 3rd Cir.).
ST. LOUIS - The Eighth Circuit U.S. Court of Appeals on May 25 found that there is a factual dispute concerning an insurer's adjustment of a claim for hail-damaged soybean crops, reversing and remanding a lower federal court's ruling in favor of the insurer on the insured's breach of contract and bad faith claims (Bruhn Farms Joint Venture v. Fireman's Fund Insurance Co., No. 15-2202, 8th Cir.; 2016 U.S. App. LEXIS 9542).
NEW HAVEN, Conn. - A life insurance company told a federal court in Connecticut on May 23 that an arbitration panel's clarification of an arbitration award is valid and that the court should order a reinsurer to pay a certain amount to the insurer (General Re Life Corporation v. The Lincoln National Life Insurance Company, No. 15-cv-01860, D. Conn.).
DENVER - The 10th Circuit U.S. Court of Appeals on May 24 affirmed a lower federal court's ruling that coverage for an underlying $450,000 settlement is barred by an insurance policy's "Specific Entity Exclusion" and, therefore, the insurer has no duty to defend or indemnify against the underlying claims (P&S LLC v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 15-1308, 10th Cir.).
MISSOULA, Mont. - A Montana federal judge on May 23 granted an insurer's motion for summary judgment in its lawsuit disputing coverage for underlying claims that its advertising agency insured wrongfully used a newspaper's confidential and proprietary information to compete with the newspaper's own advertising agency (Mid-Century Insurance Co. v. Windfall Inc., No. 15-146, D. Mont.; 2016 U.S. Dist. LEXIS 67482).
CHICAGO - An Illinois appeals panel held May 23 that because an actual conflict exists between the notice required under Illinois and Indiana laws when a new exclusion is added to an insurance policy upon renewal, a lower court should have applied Indiana law in determining whether a Telephone Consumer Protection Act (TCPA) conduct exclusion barred coverage for an underlying class action lawsuit against an insured (Cincinnati Insurance Co. v. Arnold Chapman and C.T. Phoenix of Indiana, Inc., No. 1-15-0919, Ill. App., 1st Dist., 1st Div.; 2016 Ill. App. LEXIS 309).
OKLAHOMA CITY - Dismissal of an insurance breach of contract and bad faith lawsuit is not proper because insureds have shown that they have a "reasonable likelihood" of providing factual support for their claim, a federal judge in Oklahoma ruled May 19 (Steven Daniels, et al. v. Safeco Insurance Company of America, No. 16-360, W.D. Okla.; 2016 U.S. Dist. LEXIS 65964).
DALLAS - Because an insured failed to prove that a third-party administrator tortiously interfered with an insurance contract when handling underlying asbestos coverage claims on behalf of the insurer, a Texas federal judge on May 20 granted the third-party administrator's motion to dismiss and granted the insured's leave to amend its complaint to replead its claims against the third-party administrator (Celanese Corp. v. OneBeacon America Insurance Co., et al., No. 15-03822, N.D. Texas).
SEATTLE - An "all-risk" insurance policy does not address whether a specified peril under a water exclusion includes when water cannot enter a blocked drain, a Washington federal judge ruled May 20, finding that damage caused by that peril is a covered cause of loss (Eagle West Insurance Co. v. SAT 2400, LLC, et al., No. 15-1098, W.D. Wash.; 2016 U.S. Dist. LEXIS 66827).
CHICAGO - An Illinois judge on May 19 approved the settlement of an asbestos-related workers' compensation lien between the liquidator of an insolvent insurer and an out-of-state injury fund (People of the State of Illinois, ex rel. Andrew Boron, Director of Insurance of the state of Illinois v. Lumbermens Mutual Casualty Co., No. 12-24227, Ill. Cir., Cook Co.).
SEATTLE - A Washington federal judge on May 19 granted professional liability insurers' joint motion to dismiss a breach of contract and bad faith lawsuit brought by their psychologist insured, her spouse and their marital community property (Lana R. Staheli PH.D., et al. v. Chicago Insurance Company, et al., No. 16-0096, W.D. Wash.; 2016 U.S. Dist. LEXIS 66240).
DAYTON, Ohio - An Ohio federal judge on May 19 ruled in favor of an insurer's administrator in a coverage dispute arising from an underlying $275,825.29 legal malpractice judgment against an attorney insured, reiterating that the legal malpractice claim was not timely filed (David C. McCarty, et al. v. National Union Fire Insurance Company of Pittsburgh, PA, et al., No. 15-247, S.D. Ohio; 2016 U.S. Dist. LEXIS 66016).
GRETNA, La. - A homeowners insurer is not liable for homeowners' medical expenses and general damages arising out of a contractor's defective roof repairs to their home, a Louisiana appeals panel affirmed May 19, rejecting the homeowners' theory of vicarious liability argument (Richard Rubin and Mary Rubin v. The American Insurance Co., et al., No. 16-CA-53, La. App., 5th Cir.; 2016 La. App. LEXIS 995).
NEW YORK - Because an insured failed to disclose material information about a dry dock's condition to its insurers, the insurers were entitled to rescind the policies, the Second Circuit U.S. Court of Appeals said May 20 (Fireman's Fund Insurance Company, et al. v. Great American Insurance Company of New York, et al., No. 14-1346, 2nd Cir.; 2016 U.S. App. LEXIS 9306).
NEW YORK - An insurer brought up in a federal court in New York on May 17 the Second Circuit U.S. Court of Appeals' recent decision in the NFL "Deflategate" case, claiming that party-appointed arbitrators are not meant to be neutral but only disinterested (Certain Underwriting Members at Lloyd's, London Subscribing to Treaty No. 0272/04 v. Insurance Company of the Americas, No. 16-cv-00374, S.D. N.Y.).
NEW YORK - A federal judge in New York on May 17 granted a Brazilian insurer's motion to stay enforcement of the confirmation of a number of reinsurance arbitration awards while the confirmations are pending appeal (National Indemnity Company v. IRB Brasil Resseguros S.A., No. 15-cv-03975, S.D. N.Y.).
SCRANTON, Pa. - A federal magistrate judge in Pennsylvania on May 17 issued a report and recommendation in an insurance breach of contract and bad faith lawsuit, recommending that the district court deny an insurer's motion to dismiss so that it may file a motion for summary judgment and recommending that the insured in the action file a more definite statement regarding her bad faith claim (Sarah Long v. New Jersey Manufacturers Insurance Co., et al., No. 14-2428, M.D. Pa.; 2016 U.S. Dist. LEXIS 65575).
PHILADELPHIA - A federal judge in Pennsylvania on May 18 denied a motion to dismiss State Farm Mutual Automobile Insurance Co.'s amended lawsuit accusing a medical practice of submitting fraudulent bills, holding that the company need not prove that it justifiably relied on the bills (State Farm Mutual Automobile Insurance Company v. Leonard Stavropolskiy, P.T., D.C., et al., No. 15-cv-5929, E.D. Pa.; 2016 U.S. Dist. LEXIS 65234).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on May 17 affirmed a lower federal court's ruling that there is no commercial insurance coverage for surface water damage to a leather goods retailer insured's merchandise following a rainstorm (Lucky Leather, Inc. v. Mitsui Sumitomo Insurance Group, et al., No. 14-55019, 9th Cir.; 2016 U.S. App. LEXIS 9018)
CHICAGO - The liquidator of an insolvent insurer told an Illinois court on May 16 that she disallowed a school board's construction delay claim because the schools in question were in use before the period in which the board says the delays took place (People of the State of Illinois, ex rel. Andrew Boron, Director of Insurance of the state of Illinois v. Lumbermens Mutual Casualty Co., No. 12-24227, Ill. Cir., Cook Co.).
CONCORD, N.H. - A New Hampshire federal judge on May 16 granted an insurer's motion for judgment on the pleadings after determining that the claimant failed to show how he was prejudiced by not receiving requested information from the insurer in a timely manner (Gary Hopper v. Aetna Life Insurance Co., No. 14-450, D. N.H.; 2016 U.S. Dist. LEXIS 64630).
SOUTH BEND, Ind. - An Indiana federal judge on May 17 found that an errors and omissions insurer breached its duty to defend its life insurance company insured against an underlying lawsuit alleging fraud, negligent misrepresentation, negligence, unjust enrichment, "money had and received" and violations of the Texas Insurance Code (Columbus Life Insurance Co. v. Arch Insurance Co., No. 14-01659, N.D. Ind.; 2016 U.S. Dist. LEXIS 64449).
ALLENTOWN, Pa. - Dismissal of an insurance breach of contract and bad faith lawsuit is proper because insureds failed to show that an insurer lacked a reasonable basis for denying their underinsured motorist coverage claims, a federal judge in Pennsylvania ruled May 16 (Steven Kiss, et al. v. State Farm Insurance Co., No. 15-6572, E.D. Pa.; 2016 U.S. Dist. LEXIS 64572).
SAN FRANCISCO - A federal district court did not err in granting an insurer's motion for summary judgment in an insurance bad faith lawsuit because plaintiffs failed to show that the insurer refused to settle the claim, a Ninth Circuit U.S. Court of Appeals panel ruled May 16 (Matthew Grayson, et al. v. Allstate Insurance Co., No. 14-55959, 9th Cir.; 2016 U.S. App. LEXIS 8946).