NEW YORK - The Second Circuit U.S. Court of Appeals on Jan. 19 found that insureds' delay in notifying their insurers of an alleged burglary was unreasonable and inexcusable, affirming a lower federal court's ruling in favor of the insurers in a breach of contract lawsuit (Nikolai Minasian, et al. v. IDS Property Casualty Insurance Co., et al., No. 16-80, 2nd Cir.).
PHILADELPHIA - Bifurcating and staying bad faith claims in an insurance breach of contract and bad faith lawsuit would not be convenient for the parties, prejudice an insurer or economize the litigation, a federal judge in Pennsylvania ruled Jan. 18 in denying the insurer's motion (Eizen Fineburg & McCarthy P.C. v. Ironshore Specialty Insurance Co., No. 16-2461, E.D. Pa.; 2017 U.S. Dist. LEXIS 6985).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on Jan. 19 found that a lower federal court properly applied California law in finding that a bank insured breached its professional liability insurance policy by failing to request or obtain the insurer's written consent before executing a settlement in an underlying mortgage loan dispute (OneWest Bank, FSB, v. Houston Casualty Co., No. 15-55579, 9th Cir.; 2017 U.S. App. LEXIS 993).
WASHINGTON, D.C. - The U.S. Supreme Court on Jan. 17 denied review of a ruling by the Eighth Circuit U.S. Court of Appeals that enforced a forum-selection clause in a disability plan governed by the Employee Retirement Income Security Act (Lorna Clause v. U.S. District Court for the Eastern District of Missouri, et al., No. 16-641, U.S. Sup.).
KANSAS CITY, Mo. - A Missouri doctor who surrendered his medical license in 2010 after pleading to an insurance fraud scheme pleaded guilty on Jan. 17 to another insurance fraud scheme in which he conducted disability examinations on veterans (United States of America v. Wayne Williamson, No. 17cr25, W.D. Mo.).
COLUMBUS, Ohio - An insurer's "mere assertion" that simultaneously litigating an insurance bad faith claim with other claims in an insurance dispute will require it to prematurely divulge privileged information is not sufficient to require bifurcation and a stay of the bad faith claim, a federal judge in Ohio ruled Jan. 13 in denying the insurer's motion to bifurcate (Excel Direct Inc. v. Nautilus Insurance Co., No. 16-446, S.D. Ohio; 2017 U.S. Dist. LEXIS 5435).
DALLAS - A Texas federal judge on Jan. 13 dismissed claims alleging gender identity discrimination under Section 1557 of the Patient Protection and Affordable Care Act (ACA) against an insurer and an employer because the plaintiff failed to cite any controlling precedent that recognizes a cause of action under Section 1557 for gender identity discrimination (Charlize Marie Baker v. Aetna Life Insurance Co., et al., No. 15-3679, N.D. Texas; 2017 U.S. Dist. LEXIS 5665).
NEW YORK - The Second Circuit U.S. Court of Appeals on Jan. 19 certified two questions to the New York Court of Appeals in a dispute over whether a public benefit corporation has the capacity to challenge as unconstitutional a New York statute that revived claims against public corporations for personal injuries incurred during the rescue, recovery and cleanup efforts following the Sept. 11, 2001, terrorist attacks (In re: World Trade Center Lower Manhattan Disaster Site Litigation, Nos. 15-2181, 15-2283, 15-2285, 15-2487, 15-2506 and 15-2687, 2nd Cir.).
CHICAGO - An Illinois federal judge on Jan. 12 denied a plaintiff's motion to remand after determining that her state law claims arising out of the disclosure of medical records without consent are preempted by the Employment Retirement Income Security Act (Jane Doe v. Aetna Inc., et al., No. 16-8390, N.D. Ill.; 2017 U.S. Dist. LEXIS 4866).
SYRACUSE, N.Y. - A federal judge in New York on Jan. 13 denied a reinsurer's challenge to a magistrate judge's ruling, finding that the magistrate judge's finding that a certain document was privileged was not clearly erroneous (Utica Mutual Insurance Company v. Munich Reinsurance America, Inc., No. 12-cv-00196, and Munich Reinsurance America, Inc., v. Utica Mutual Insurance Company, No. 13-cv-00743, N.D. N.Y.).
NEW YORK - A federal judge in New York, who was ordered by the Second Circuit U.S. Court of Appeals to provide more detailed findings on the intended loss of an insurance fraud scheme that involved the redistribution of drugs originally provided to HIV and AIDS patients, on Jan. 17 affirmed his earlier decision that the scheme resulted in $2.9 million in losses to Medicare, finding that a ledger found at the man's apartment detailed the prices and quantities of the drugs (United States of America v. Bladimir Rigo, No. 13 CR 897, S.D. N.Y.; 2017 U.S. Dist. LEXIS 6228).
FORT MYERS, Fla. - A Florida federal judge on Jan. 13 entered judgment in favor of an insurer one day after finding that underlying negligent misrepresentation claims against its insured are "for or arising out of or resulting from" the failure of the insured's auction services to conform with a represented quality of performance contained in its advertising (Equipmentfacts LLC v. Beazley Insurance Co., Inc., No: 16-265, M.D. Fla.; 2017 U.S. Dist. LEXIS 4653).
BATON ROUGE, La. - The First Circuit Louisiana Court of Appeal on Jan. 11 affirmed a trial court's ruling that no coverage is afforded under an auto policy for the discharge of raw sewage into a home caused by a pumping system attached to the insured's truck because the policy excludes coverage for bodily injury, property damage and pollution costs caused by the operation of equipment permanently attached to a vehicle (Shenetta West, et al. v. Clean Rite Septic Tank Service LLC, et al., No. 2016 CA 0306, La. App., 1st Cir.; 2017 La. App. LEXIS 59).
DES MOINES, Iowa - A trial court did not err in granting an insurer's motion for summary judgment because the insured, seeking coverage for damages caused by a sewage backup in his home, cannot prove that he acted to his detriment when he relied on his insurance agent's representation that coverage would be afforded for the damages, the Iowa Court of Appeals said Jan. 11 (Carl Budny v. MemberSelect Insurance Co., No. 16-1189, Iowa App.; 2017 Iowa App. LEXIS 46).
ALBUQUERQUE, N.M. - A federal judge in New Mexico on Jan. 11 granted the federal government's motion to exclude the testimony of an expert designated to discuss the medical necessity of tests administered by a holistic doctor who is accused of fraudulently billing Medicare and other insurers, after finding that the proposed testimony is not relevant and does not meet the standards of Daubert v. Merrell Dow Pharmaceuticals, Inc. (509 U.S. 579, 597 ) (United States of America v. Roy Heilbron, No. 15-CR-2030, D. N.M.; 2017 U.S. Dist. LEXIS).
MINNEAPOLIS - Because issues of material fact exist regarding how an outbreak of the avian flu virus was transmitted, a Minnesota federal judge on Jan. 12 denied both the insurer and insured's motions for summary judgment (Rembrandt Enterprises Inc. v. Illinois Union Insurance Co., No. 15-2913, D. Minn.; 2017 U.S. Dist. LEXIS 4946).
SAN FRANCISCO - A district court did not err in determining that an insured seeking coverage from three insurers for an underlying environmental lawsuit is not entitled to coverage under the policies because the insured failed to tender the underlying suit to the insurers and received a defense for the underlying suit from another insurer, the Ninth Circuit U.S. Court of Appeals said Jan. 13 (M.B.L. Inc. v. Federal Insurance Co., et al., No. 14-56107, 9th Cir.; 2017 U.S. App. LEXIS 695).
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on Jan. 13 certified two questions to the California Supreme Court regarding whether California's notice-prejudice rule is a fundamental public policy for the purpose of choice-of-law analysis and whether a consent provision can be interpreted as a notice provision (Pitzer College v. Indian Harbor Insurance Co., No.. 14-56017, 9th Cir.; 2017 U.S. App. LEXIS 668).
NEW ORLEANS - A Fifth Circuit U.S. Court of Appeals panel on Jan. 13 affirmed a verdict in favor of an insurance company, finding that evidence presented during a trial sufficiently showed that a man intended to destroy a 1956 Mercedes-Benz to obtain insurance proceeds (Foremost Insurance Company v. Charles Pendleton, No. 16-60240, 5th Cir.; 2017 U.S. App. LEXIS 706).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on Jan. 11 affirmed a lower federal court's ruling in favor of an insurer in a breach of contract lawsuit seeking coverage for property and business interruption losses (Bita Trading Inc. v. Nationwide Mutual Insurance Co., et al., No. 15-55371, 9th Cir.; 2017 U.S. App. LEXIS 521).
ST. LOUIS - A Missouri federal judge did not err in granting three insurers' motions for judgment on the pleadings in a suit filed by a class representative seeking to satisfy an $82 million judgment entered against the insured for damages arising out of water contamination, the Eighth Circuit U.S. Court of Appeals said Jan. 12, noting that radium is clearly barred by the policies' pollution exclusion (Barbara Williams v. Employers Mutual Casualty Co., No. 15-3573, 8th Cir.).
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Jan. 11 affirmed that an insurer was entitled to rescind a product contamination insurance policy because it is clear that the insured made an intentional misrepresentation on the policy application upon which the insurer relied before issuing the policy (H.J. Heinz Co. v. Starr Surplus Lines Insurance Co., No. 16-1447, 3rd Cir.).
SCRANTON, Pa. - A federal judge in Pennsylvania on Jan. 12 denied an insurer's motion to dismiss in an insurance breach of contract and bad faith lawsuit, ruling that insured has pleaded sufficient evidence to support the claim (Robert Hughes v. State Farm Mutual Automobile Insurance Co., No. 16-2240, M.D. Pa.; 2017 U.S. Dist. LEXIS 4852).
PASADENA, Calif. - A majority of the Ninth Circuit U.S. Court of Appeals on Jan. 10 found that a directors and officers liability insurance policy unambiguously excludes from coverage the Federal Deposit Insurance Corp.'s negligence, gross negligence and breach of fiduciary duty claims against a failed bank's former directors and officers, reversing and remanding a lower court (Federal Deposit Insurance Corporation, as Receiver for Security Pacific Bank v. BancInsure, Inc., No. 14-56132, 9th Cir.; 2017 U.S. App. LEXIS 452).
COLUMBIA, S.C. - The majority of the South Carolina Supreme Court on Jan. 11 affirmed a special referee's finding that coverage under commercial general liability insurance policies was triggered and calculation of an insurer's pro rata portion of the progressive damages based on its time on the risk (Harleysville Group Insurance v. Heritage Communities Inc., et al., No. 2013-001281 & 2013-001291, S.C. Sup.; 2017 S.C. LEXIS 8).