LexisNexis® Legal Newsroom
    Mealey's Insurance - Insured Settles Environmental Contamination Coverage Claims With 1 Insurer

    INDIANAPOLIS - An insured and one of its insurers involved in a coverage dispute arising out of environmental contamination claims on Feb. 19 filed a joint motion to dismiss in Indiana federal court after reaching a confidential settlement (Eli Lilly and Co., et al., v. Arch Insurance Co., et al., No. 13-1770, S.D. Ind.).

    Mealey's Insurance - Chiropractor Sentenced To 7 Months For Obstructing Insurance Fraud Investigation

    WASHINGTON, D.C. - A chiropractor who pleaded guilty to obstructing a health care insurance fraud investigation was sentenced Feb. 16 by a federal judge in the District of Columbia to seven months in prison and five months of home confinement and ordered to pay $48,450 in restitution to the District of Columbia Medicaid program, according to a press release from the U.S. Attorney's Office for the District of Columbia (United States of America v. Rehman Mirza D.C., No. 15cr62, D. D.C.).

    Mealey's Insurance - Shareholder Seeks To Halt Merger Deal Until Details Of Plan Are Discussed

    SAN FRANCISCO - A shareholder filed a securities class action complaint in California federal court on Feb. 18, seeking to halt a company's proposed merger until the details of the merger plan are disseminated to stockholders as a result of the defendants' alleged misstatements made in the merger plan documents (Brent Talbert v. Mattson Technology Inc., et al., No. 16-0811, N.D. Calif.).

    Mealey's Insurance - Judge Dismisses State Farm's Fraudulent Billing Suit, Allows Amended Complaint

    PHILADELPHIA - A federal judge in Pennsylvania on Feb. 17 dismissed without prejudice a lawsuit brought by State Farm Mutual Automobile Insurance Co. and State Farm Fire and Casualty Insurance Co. (collectively, State Farm) against two chiropractors and their practices, after finding that the insurer failed to sufficiently plead that bills submitted by the defendants were fraudulent and that they were involved in a scheme to defraud the company (State Farm Mutual Automobile Insurance Company v. Leonard Stavropolskiy, P.T., D.C., et al., No. 15-cv-5219, E.D. Pa.; 2016 U.S. Dist. LEXIS 18805).

    Mealey's Insurance - Insured Allowed To Renew Motion To Show Extraordinary Circumstances Warrant Relief

    CAMDEN, N.J. - A New Jersey federal judge on Feb. 16 denied without prejudice an insured's motion to set aside a final judgment in a Superstorm Sandy coverage dispute based on the purported neglectful representation of her former counsel, allowing the insured to renew her motion to show that there are extraordinary circumstances that warrant relief from the judgment (Emma Linbald v. Nationwide Mutual Insurance Co., No. 14-908, D. N.J.; 2016 U.S. Dist. LEXIS 18100).

    Mealey's Insurance - Pollution Exclusion Does Not Apply To Release Of Sewer Gas, Federal Judge Says

    PHOENIX - Because the release of sewer gases caused by the improper installation of a plumbing system is not traditional environmental pollution, a policy's pollution exclusion does not preclude coverage for an underlying suit arising out of the release of gases into a shopping center; however, a question of fact exists regarding whether the insurer had a duty to contribute to the settlement of the underlying suit, an Arizona federal judge said Feb. 16 (National Fire Insurance Company of Hartford, et al. v. James River Insurance Co., et al., No. 14-765, D. Ariz.; 2016 U.S. Dist. LEXIS 19076).

    Mealey's Insurance - Motion To Dismiss In Breach Of Contract, Bad Faith Suit Denied As Moot

    LAS VEGAS - A federal judge denied an insurer's motion to dismiss as moot in an insurance breach of contract and bad faith lawsuit, ruling that since the parties agreed that the insured would amend her complaint, dismissal is not necessary (Cheri Strandberg v. State Farm Mutual Auto Insurance Co., No. 15-2468, D. Nev.; 2016 U.S. Dist. LEXIS 18346).

    Mealey's Insurance - Panel: No Coverage For Claim Over Alleged Negligent Handling Of Electronic Data

    ALBANY, N.Y. - A New York appeals panel on Feb. 18 held that coverage for an underlying claim for damages arising out of an insured's alleged negligent handling of customers' electronic data is barred, reversing and remanding a lower court's ruling (RVST Holdings, LLC, et al. v. Main Street America Assurance Co., No. 521419, N.Y. App., 3rd Dept.; 2016 N.Y. App. Div. LEXIS 1205).

    Mealey's Insurance - Judge Orders Appraisal To Decide Amount, Cause Of Insured's Storm Loss

    MINNEAPOLIS - An insurer and its insured should proceed to appraisal because fact questions exist regarding the amount of loss and the cause of the loss sustained to buildings governed by a condominium association, a Minnesota federal judge ruled Feb. 16 (Condominiums of Shenandoah Place v. Secura Insurance, No. 15-165, D. Minn.; 2016 U.S. Dist. LEXIS 18608).

    Mealey's Insurance - Claimant Was Deprived Of Ability To File 2nd-Level Appeal, 10th Circuit Says

    DENVER - A disability insurer's failure to notify a claimant of its denial of an administrative appeal deprived the claimant of the ability to pursue a second-level administrative appeal and submit additional medical evidence in support of a disability claim, the 10th Circuit U.S. Court of Appeals said Feb. 17 in vacating and remanding a District Court's ruling (Allen Messick v. McKesson Corp., et al., No.15-4019, 10th Cir.).

    Mealey's Insurance - Untimely Notice Precludes Contribution Claims Against Insurer, Appeals Panel Says

    CHICAGO - An additional insured's untimely notice of an underlying negligence lawsuit bars coverage under an insurance policy, an Illinois appeals panel held Feb. 16, affirming summary judgment for the insurer on contribution claims asserted by another insurer that settled on behalf of the additional insured (AMCO Insurance Co. v. Erie Insurance Exchange, No. 11 CH 41151, Ill. App., 1st Dist., Div. 1; 2016 Ill. App. LEXIS 68).

    Mealey's Insurance - Insurance Policy Covers Hail Dents To Roofs, Federal Judge Concludes

    KANSAS CITY, Kan. - An insurance policy covers hail dents incurred to an insured's roofs under the section for "physical loss or damage" to the covered property, a Kansas federal judge ruled Feb. 11, granting summary judgment to the insured on coverage (Great Plains Ventures, Inc. v. Liberty Mutual Fire Insurance Co., No. 14-1136, D. Kan.; 2016 U.S. Dist. LEXIS 17751).

    Mealey's Insurance - Judge Refuses To Dismiss All Misconduct Claims Against Insurer In Coverage Dispute

    CHICAGO - An Illinois federal judge on Feb. 12 held that although an insurer's failure to provide independent counsel in an underlying wrongful termination dispute does not constitute vexatious or unreasonable conduct, the insured's remaining allegations of misconduct by the insurer are sufficiently supported by the facts (DHR International, Inc. v. Travelers Casualty and Surety Company of America, No. 15 C 4880, N.D. Ill.; 2016 U.S. Dist. LEXIS 17719).

    Mealey's Insurance - Parties Settle Gas Well Blowout Coverage Dispute; Insurers' Appeal Dismissed

    AUSTIN, Texas - The Texas Supreme Court on Feb. 12 dismissed an insurer's petition for review after the parties notified the high court that they settled the dispute arising out of coverage for damages associated with the blowout of an insured's gas well (St. Paul Fire & Marine Insurance Co., et al. v. Petroplex Energy Inc., No. 15-0805, Texas Sup.).

    Mealey's Insurance - Special Deputy Receiver Asks Court To OK $9 Million Payment To Asbestos Trust

    AUSTIN, Texas - The special deputy receiver (SDR) of an insurer in rehabilitation asked a Texas court on Feb. 16 to approve a nearly $9 million payment to an asbestos bodily injury trust (State of Texas v. Highlands Insurance Company, No. D-1-GV-03-004537, Texas, 53rd Dist., Travis Co.).

    Mealey's Insurance - New York Panel Says Insurer Owes City Coverage For Negligence Suit, Reverses

    NEW YORK - A New York appeals panel on Feb. 16 found that a commercial general liability insurer owes coverage for an underlying lawsuit alleging that negligence by the City of New York, its Administration for Children's Services and a foster care agency resulted in abuse and death, finding that the insurer failed to provide a timely disclaimer of coverage that was necessary to invoke a policy exclusion (The City of New York v Granite State Insurance Co., No. 236, 451366/12, N.Y. Sup., App. Div.; 1st Dept.; 2016 N.Y. App. Div. LEXIS 1125).

    Mealey's Insurance - Coverage Barred For Carbon Monoxide Poisoning Claims, Federal Magistrate Says

    ORLANDO, Fla. - A Florida federal magistrate judge, applying Texas law, on Feb. 12 granted an umbrella liability insurer's motion for summary judgment after determining that the umbrella policy's pollution exclusion clearly bars coverage for injuries arising out of carbon monoxide poisoning regardless of what caused the carbon monoxide to seep into the hotel guests' room (Kenneth E. Shaw, et al. v. Liberty Mutual Fire Insurance Co., No. 15-686, M.D. Fla.; 2016 U.S. Dist. LEXIS 17626).

    Mealey's Insurance - Panel: Insurer Did Not Act In Bad Faith In Denying Defense In Tort Action

    SAN FRANCISCO - A federal district court did not err in granting partial summary judgment in favor of an insurer in an insurance breach of contract and bad faith lawsuit because the insurer had no duty to defend its insureds in a tort action, a Ninth Circuit U.S. Court of Appeals panel ruled Feb. 11 (Michael Zimmerman, et al. v. Allstate Insurance Co., No. 13-57091, 9th Cir.; 2016 U.S. App. LEXIS 2553).

    Mealey's Insurance - Judge: Insurer Hasn't Shown Amount In Controversy Exceeds Statutory Limits

    LAS VEGAS - A federal judge in Nevada on Feb. 11 granted an insured's motion to remand an insurance breach of contract and bad faith lawsuit to state court, ruling that the insurer failed to show that the amount in controversy was greater than the statutory limits (Aurelio Bravo-Aguilar v. State Farm Mutual Automobile Insurance Co., No. 15-2045, D. Nev.; 2016 U.S. Dist. LEXIS 17027).

    Mealey's Insurance - Appeals Court Reinstates Conviction For Engaging In Pattern Of Corrupt Activity

    DAYTON, Ohio - An Ohio Court of Appeals panel on Feb. 12 reinstated a woman's conviction for engaging in a pattern of corrupt activity after a state high court's ruling established that there is nothing in the state's rules that require that an enterprise and a pattern of corrupt activity must be proven with separate evidence (State of Ohio v. Eva Christian, No. 25256, Ohio App., 2nd Dist.; 2016 Ohio App. LEXIS 452).

    Mealey's Insurance - Judge Denies Insured's Motion To Remand Insurance Bad Faith Suit To State Court

    LAS VEGAS - Remand of an insurance breach of contract and bad faith lawsuit is not proper, a federal judge in Nevada ruled Feb. 12, because an insurer has shown that the amount in controversy will exceed statutory limits (Kenya L. Kelly v. State Farm Mutual Automobile Insurance Co., No. 15-2169, D. Nev.; 2016 U.S. Dist. LEXIS 17710).

    Mealey's Insurance - Pennsylvania Majority Rejects Argument That Exclusion Is Contrary To Public Policy

    HARRISBURG, Pa. - A majority of the Pennsylvania Superior Court on Feb. 12 rejected an insured's argument that a commercial general liability insurance policy's employer's liability exclusion as it relates to a "leased worker" is unconscionable and against public policy, affirming a lower court's ruling in favor of an insurer in a coverage dispute arising from a workplace injury (Westfield Insurance Company v. Astra Foods Inc., et al., No. 1392 EDA 2014, Pa. Super.; 2016 Pa. Super. LEXIS 84).

    Mealey's Insurance - New Jersey High Court Affirms Insurer Not Required To Show It Suffered Prejudice

    TRENTON, N.J. - The New Jersey Supreme Court on Feb. 11 affirmed a lower court's ruling that a directors and officers liability insurer was not required to demonstrate that it suffered prejudice before denying coverage based on the insured's failure to give timely notice of an underlying claim stemming from a failed real estate transaction, finding that the "claims made" policy was "not a contract of adhesion but was agreed to by sophisticated parties" (Templo Fuente De Vida Corp. and Fuente Properties Inc. v. National Union Fire Insurance Company of Pittsburgh, P.A., No. A-18 September Term 2014, 074572, N.J. Sup.; 2016 N.J. LEXIS 144).

    Mealey's Insurance - Insurer Failed To Assert Design Defect, Failure-To-Warn Claims, Judge Says

    SOUTH BEND, Ind. - An Indiana federal judge on Feb. 9 granted in part summary judgment to a manufacture in an insurer's subrogation lawsuit on claims for design defect and failure to adequately warn (The Cincinnati Insurance Co. a/s/o Jason and Michelle Howard v. Lennox Industries, Inc., No. 14-1731, N.D. Ind.; 2016 U.S. Dist. LEXIS 15385).

    Mealey's Insurance - Federal Judge Denies Reconsideration, Says Suit Against Insurer Was Timely

    TACOMA, Wash. - A Washington federal judge on Feb. 9 denied an insurer's motion for reconsideration, reiterating that a condominium association's lawsuit seeking coverage for water intrusion problems was timely because the limitation period began to run after the hidden damage was discovered (Eagle Harbour Condominium Association v. Allstate Insurance Co., No. 15-5312, W.D. Wash.; 2016 U.S. Dist. LEXIS 15791).