LexisNexis® Legal Newsroom
    Mealey's Insurance - Federal Judge Dismisses Bad Faith Claim, Says Insured Failed To Support Claim

    OKLAHOMA CITY - An Oklahoma federal judge on Feb. 20 dismissed an insured's bad faith claim against a health insurer after determining that the insured failed to allege facts supporting his claim that the health insurer's denial of coverage for proton beam radiotherapy was unreasonable (Anthony Woska, et al. v. Health Care Service Corp., et al., No. 17-89, W.D. Okla., 2018 U.S. Dist. LEXIS 26711).

    Mealey's Insurance - Judge: Fact Issues Preclude Ruling In Coverage Suit On Unfair Competition Claims

    NEWARK, N.J. - A New Jersey federal judge on Feb. 20 denied an insurer's motion for judgment on the pleadings in its lawsuit seeking a declaration that it has no duty to defend or indemnify its insured against underlying unfair competition claims (National Union Fire Insurance Company of Pittsburgh, Pa. v. Becton, Dickinson, and Company, No. 17-691, D. N.J, 2018 U.S. Dist. LEXIS 27847).

    Mealey's Insurance - Insured Alleges Viable Claim Against Adjuster; Suit Must Be Remanded, Judge Says

    AUSTIN, Texas - An insured's suit seeking coverage for property damages caused by a hail storm must be remanded to Texas state court because complete diversity of citizenship does not exist as the insured states a plausible claim for relief against the insurance adjuster, a Texas federal judge said on Feb. 20 (Melvin Nelson v. State Farm Lloyds et al., No. 17-962, W.D. Texas, 2018 U.S. Dist. LEXIS 26547).

    Mealey's Insurance - Long-Term Disability Claim Was Properly Denied As Time-Barred, Judge Rules

    SAN DIEGO - Dismissal of an insured's insurance breach of contract and bad faith lawsuit is necessary because her claims were not brought within the applicable statute of limitations and she has failed to show that the limitations period was tolled by the discovery rule, a federal judge in California ruled Feb. 20 in granting an insurer's motion to dismiss (Laurel Davis v. Liberty Life Assurance Company of Boston, No. 17-0738, S.D. Calif., 2018 U.S. Dist. LEXIS 27045).

    Mealey's Insurance - Judge: Insureds' Basement Cracking Is Not Covered Under 'Collapses' Provision

    BRIDGEPORT, Conn. - Progressive deterioration caused by a chemical reaction and resulting in cracking concrete is not covered under a homeowners insurance policy's "collapses" provision, a Connecticut federal judge ruled Feb. 20 (Bart Zamichiei, et al. v. CSAA Fire & Casualty Insurance Co., No. 16-739, D. Conn., 2018 U.S. Dist. LEXIS 26956).

    Mealey's Insurance - High Court Rejects Appeal Of California Commissioner's Denial Of Rate Increase

    WASHINGTON, D.C. - The U.S. Supreme Court on Feb. 20 denied an insurer's petition for writ of certiorari seeking review of the California Insurance commissioner's decision to deny its application to increase its homeowners insurance rates (Mercury Casualty Co., et al. v. Dave Jones, California Insurance Commissioner, et al., No 17-537, U.S. Sup., 2018 U.S. LEXIS 1242).

    Mealey's Insurance - New York Panel: Armored Car Company's Insurer Is Not Liable For Jewelry Loss

    NEW YORK - A New York appeals panel on Feb. 20 affirmed a lower court's ruling that an armored car company's insurer has no duty to compensate a freight carrier and its insurer for the loss of a gold jewelry shipment that was transported by its insured (AXA Winterthur Insurance Co. v Transvalue, Inc., et al., No. 4132, 650507/11, N.Y. Sup., App. Div., 1st Dept., 2018 N.Y. App. Div. LEXIS 1154).

    Mealey's Insurance - Claimants Seek Benefits From New Jersey Insurance Guaranty Association

    TRENTON, N.J. - Two claimants allege in a Feb. 16 complaint filed in the New Jersey federal court that they are entitled to benefits from the New Jersey Property Liability Guaranty Association (NJPLIGA) for injuries arising from a motor vehicle accident involving an unidentified motor vehicle owner and operator (Porfirio Torres, et al. v. New Jersey Property Liability Insurance Guaranty Association, No. 18-02290, D. N.J.).

    Mealey's Insurance - Evidence About Patient Recruiting, Vehicle Purchases Is Relevant, Judge Says

    LOUISVILLE, Ky. - Evidence concerning the recruitment of patients to a chiropractic clinic that allegedly fraudulently billed Medicare, as well as information showing that participants in the scheme put down large cash payments for expensive automobiles, is relevant, a federal judge in Kentucky ruled Feb. 16 in denying in part a defendant's motion in limine (United States of America v. Claudia Lopez, et al., No. 15-CR-00054-JHM, W.D. Ky., 2018 U.S. Dist. LEXIS 25818).

    Mealey's Insurance - 6th Circuit: Pharmacist Used Others' Identifications To Further Fraud Scheme

    CINCINNATI - A federal judge in Kentucky erred when dismissing a count from an indictment charging a pharmacist with aggravated identity theft, a Sixth Circuit U.S. Court of Appeals panel ruled Feb. 20, finding that the defendant used the identities of a doctor and patient for the purpose of submitting a fraudulent claim to an insurance company (United States of America v. Philip E. Michael II, No. 17-5626, 6th Cir., 2018 U.S. App. LEXIS 3918).

    Mealey's Insurance - Judge Rules For Insurer In Suit Alleging It Wrongfully Offset Veterans' Benefits

    BOSTON - A Massachusetts federal judge on Feb. 14 granted summary judgment in favor of a disability insurer in a U.S. Army veteran's class action suit alleging that the insurer wrongfully offset disability benefits payable under its policy by disability benefits received from the U.S. Department of Veterans Affairs (Marco Martinez v. Sun Life Assurance Company of Canada, No. 16-12154, D. Mass.).

    Mealey's Insurance - 7th Circuit: Sales Manager Waived Untimeliness Argument In LTD Dispute

    CHICAGO - An employee seeking long-term disability (LTD) benefits effectively waived his right to challenge the untimeliness of the initial denial of his claim as he chose to pursue an appeal first rather than filing suit, a Seventh Circuit U.S. Court of Appeals panel ruled Feb. 14 (John Dragus v. Reliance Standard Life Insurance Company, No. 17-1752, 7th Cir., 2018 U.S. App. LEXIS 3444).

    Mealey's Insurance - Aetna Says California Investigation Based On 'Out Of Context' Comments

    SACRAMENTO, Calif. - Lawyers took deposition comments from a medical claims reviewer out of context to create trial and media leverage, Aetna Inc. says in a Feb. 14 response to an announcement that California would investigate the insurer's claims processing.

    Mealey's Insurance - Insurer's Liquidator Has No Interest To Land, New York Bankruptcy Judge Says

    WHITE PLAINS, N.Y. - Reversionary interests in land parcels are property of a reorganized debtor, and an insurer's liquidator is precluded from interfering with those interests, a New York federal bankruptcy judge ruled Feb. 15, ordering transfer of title to the reorganized debtor (In re: Frontier Insurance Group Inc., et al., Chapter 11, No. 05-36877, Benjamin Lawsky v. Frontier Insurance Group LLC, et al., Adv. Pro. No. 14-9022, S.D. N.Y. Bkcy., 2018 Bankr. LEXIS 442).

    Mealey's Insurance - Magistrate Judge Lifts Stay Against Idaho Insurance Guaranty Association

    BOISE, Idaho - An Idaho federal magistrate judge on Feb. 16 lifted a stay against the Idaho Insurance Guaranty Association (IIGA) in a trust bank's coverage dispute but declined to lift a stay and grant a preliminary injunction against an insolvent insurer (Idaho Trust Bank v. BancInsure Inc., et al., No. 12-00032, D. Idaho, 2018 U.S. Dist. LEXIS 26168).

    Mealey's Insurance - U.S. High Court Refuses To Review Arbitration Dispute Over Sexual Abuse Claims

    WASHINGTON, D.C. - The U.S. Supreme Court on Feb. 20 denied an excess insurer's petition for writ of certiorari challenging a California appeals court's denial of its motion to compel arbitration of a coverage dispute with a school district over sexual abuse claims (Safety National Casualty Corp. v. Los Angeles Unified School District, No. 17-921, U.S. Sup.)

    Mealey's Insurance - Kaiser Gypsum Debtors Agree To Claim Amount In Insolvent Insurers' Run-Off

    CHARLOTTE, N.C. - A North Carolina federal bankruptcy judge on Feb. 17 approved in a minute order a settlement between Chapter 11 debtors Kaiser Gypsum Co. Inc. and Hanson Permanente Cement Inc. and the joint scheme administrator for two insolvent British insurers, setting claim values for the debtors in the insurers' run-off proceedings (In re Kaiser Gypsum Company, Inc., et al., No. 16-31602, W.D. N.C. Bkcy.).

    Mealey's Insurance - Class: Life Insurer, Private Investment Firm Unlawfully Raised Prices In Policies

    NEW YORK - A life insurer and a private investment firm, which acquired the insurer, unlawfully increased the cost of premiums to recoup costs associated with the acquisition, among other reasons, plaintiffs allege in a Feb. 13 class action filed in a New York federal court (Derek Fan, et al. v. Phoenix Life Insurance Co., et al., No. 18-01288, S.D. N.Y.).

    Mealey's Insurance - Judge Declines To Apply 'Fraudulent Misjoinder' Standard In Bad Faith Suit

    SAN FRANCISCO - Remand of an insurance breach of contract and bad faith lawsuit to state court is necessary because the Ninth Circuit U.S. Courts of Appeals has yet to adopt the "fraudulent misjoinder" standard established by the 11th Circuit, which an insurer argues is the basis for the action's removal to federal court in the first place, a federal judge in California ruled Feb. 13 in remanding the action to state court (Maria I. Delgado v. Primerica Life Insurance Co., et al., No. 17-3744, N.D. Calif., 2017 U.S. Dist. LEXIS 23615).

    Mealey's Insurance - Insurers Owe Defense For Claims Arising Out Of Negligence, 11th Circuit Says

    ATLANTA - Commercial general liability insurers have a duty to defend allegations that an insured improperly constructed on land without taking reasonable steps to implement a workable drainage system, the 11th Circuit U.S. Court of Appeals held Feb. 13, reversing and remanding the entry of summary judgment to the insurers (Mid-Continent Casualty Co., et al. v. Adams Homes of Northwest Florida Inc., et al., No. 17-12660, 11th Cir., 2018 U.S. App. LEXIS 3538).

    Mealey's Insurance - Florida Majority Reverses $493,246 Attorney Fee Award In Sinkhole Coverage Suit

    LAKELAND, Fla. - A majority of the Second District Florida Court of Appeal on Feb. 14 reversed a lower court's $493,246.50 attorney fees award against an insurer in a sinkhole coverage dispute and remanded for further proceedings (Citizens Property Insurance Corporation v. Meghan Anderson, No. 2D16-616, Fla. App., 2nd Dist. 2018 Fla. App. LEXIS 2245).

    Mealey's Insurance - Panel Affirms Dismissal Of Remodelers' Suit Against Federal Flood Insurer

    CINCINNATI - The Sixth Circuit U.S. Court of Appeals on Feb. 14 affirmed a lower court's dismissal of a breach of contract, unjust enrichment, fraudulent inducement and intentional and negligent misrepresentation lawsuit against a federal flood insurer, reiterating that the claims are preempted by the National Flood Insurance Act (NFIA) (D&S Remodelers Inc. v. Wright National Flood Insurance Services LLC, et al., No.17-5554, 6th Cir., 2018 U.S. App. LEXIS 3382).

    Mealey's Insurance - Panel: Insured Cannot 'Swap Horses Midstream' In Appeal Of No Coverage Ruling

    PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Feb. 15 rejected an insured's appeal of a lower court's ruling that it was not owed professional liability coverage for an underlying third-party complaint, finding that the insured's primary argument was never raised in the lower court (Tri-Arc Financial Services, Inc. v. Evanston Insurance Company, et al., No. 16-4404, 3rd Cir., 2018 U.S. App. LEXIS 3526).

    Mealey's Insurance - Rapid-American Denied Protective Order For Insurers' Subpoenas

    NEW YORK - Chapter 11 debtor Rapid-American Corp. and asbestos claimants in its bankruptcy case do not have standing to challenge subpoenas served by insurers to asbestos claims-processing facilities seeking evidence of fraud in the asbestos trust system, and besides, the information sought is relevant to the debtor's declaratory judgment action against the insurers, a New York federal bankruptcy judge held Feb. 12 (Rapid-American Corporation, et al. v. Travelers Casualty and Surety Company, et al., No. 15-01095, S.D. N.Y. Bkcy., 2018 Bankr. LEXIS 378).

    Mealey's Insurance - Insurer Asks For Relief From Kaiser Gypsum's Stay To Seek Settlement Reimbursement

    CHARLOTTE, N.C. - An insurer of Chapter 11 debtor Hanson Permanente Cement Inc. sought relief from the automatic bankruptcy stay Feb. 13 in North Carolina federal bankruptcy court so it can pursue $2.8 million in reimbursements from other insurers for settlement payments made to asbestos personal injury claimants under a 2009 agreement (In re Kaiser Gypsum Company, Inc., et al., No. 16-31602, W.D. N.C. Bkcy.).