CAMDEN, N.J. - A New Jersey federal judge on July 12 determined that an insurer did not breach its contract or act in bad faith when handling its insureds' claims for water and mold damages because the insurer paid for some of the damages and paid the full amount of the mold sublimit under the policy (Warren and Maryann Andrews v. Merchants Mutual Insurance Co., No. 14-5147, D. N.J.; 2016 U.S. Dist. LEXIS 89997).
CHICAGO - An Illinois judge on July 14 placed a Patient Protection and Affordable Care Act (ACA) health care marketplace co-op into rehabilitation because, according to the state's acting director of insurance, the insurer will suffer a $68 million loss due to the actions of Congress and the Centers for Medicare & Medicaid Services, which would place the insurer in a hazardous position (People of the State of Illinois, ex rel. Anne Melissa Dowling, Acting Director of Insurance of the State of Illinois v. Land of Lincoln Mutual Health Insurance Company, No. 2016CH09210, Ill. Cir., Cook Co., Chanc. Div.).
BIRMINGHAM, Ala. - An Alabama federal judge on July 12 held that a plaintiff did not exercise reasonable diligence in attempting to discover the identity of a defendant's errors and omissions insurer and, as a result, the notice of a claim was untimely and coverage was not triggered (Henry Nelson v. Northland Insurance Co., No.14-00112, N.D. Ala., Southern Div.; 2016 U.S. Dist. LEXIS 89996).
ATLANTA - A district court did not err in determining that a disability plan did not wrongfully terminate a claimant's long-term disability benefits, the 11th Circuit U.S. Court of Appeals said July 11 (Elizabeth Jenkins v. Grant Thornton LLP, et al., No. 14-15695, 11th Cir.; 2016 U.S. App. LEXIS 12729).
COLUMBUS, Ohio - Because it is not clear if an insured knew about a pollution condition prior to a policy's inception period and failed to report that condition to the insurer when the policy incepted, an Ohio federal judge on July 12 denied the insurer's motion for judgment on the pleadings (Tunnell Hill Reclamation LLC v. Endurance American Specialty Insurance Co., No. 15-2720, S.D. Ohio; 2016 U.S. Dist. LEXIS 90207).
NEW YORK - A New York federal judge on July 12 held that a directors and officers liability insurance policy's professional services exclusion unambiguously bars coverage for claims in an underlying Facebook IPO class action lawsuit but refused to grant summary judgment to the primary D&O insurer on a breach of contract claim involving the advancement of underlying defense costs (Beazley Insurance Co. Inc. v. ACE American Insurance Co., et al., No. 15-5119, S.D. N.Y.; 2016 U.S. Dist. LEXIS 90332).
SYRACUSE, N.Y. - A nonparty reinsurer involved in a similar asbestos-related case as the instant action told a federal court in New York on July 10 that the method of an insurer's attempts to restrict the reinsurer's access to certain sealed documents is contrary to controlling case law (Utica Mutual Insurance Company v. Munich Reinsurance America, Inc., No. 12-cv-00196, N.D. N.Y.).
NEWARK, N.J. - A federal judge in New Jersey on July 8 granted the federal government's motion for summary judgment in a False Claims Act (FCA) lawsuit and ordered a New Jersey couple and their companies to pay $7.7 million after finding them to be liable for knowingly submitting false claims to Medicare (United States of America, ex rel. Jane Doe v. Heart Solutions, et al., No. 14-cv-3644, D. N.J.; 2016 U.S. Dist. LEXIS 88614).
CHICAGO - A federal judge in Illinois on July 11 denied an insurer's motion to transfer an asbestos-related late notice reinsurance dispute to a federal court in California (R&Q Reinsurance Company v. The American Insurance Company, No. 16-cv-04199, N.D. Ill.).
CHICAGO - The Seventh Circuit U.S. Court of Appeals on July 12 affirmed a lower federal court's finding that an insurer has a duty to defend a paramedic services company against underlying claims for sexual harassment, assault and battery and retaliation for whistle-blowing, rejecting the insurer's argument that the company does not qualify as a "named insured" under the policy (American Alternative Insurance Corp. v. Metro Paramedic Services, Inc., 7th Cir., No. 15-2310; 2016 U.S. App. LEXIS 12794).
NEW YORK - A Second Circuit U.S. Court of Appeals panel on July 12 affirmed a woman's convictions for conspiracy to commit health care fraud, health care fraud and mail fraud, holding that the evidence presented at trial sufficiently showed that she was an owner of medical practices that routinely submitted false claims for reimbursement under New York's No-Fault Comprehensive Motor Vehicle Insurance Reparation Act (United States of America v. Tatyana Gabinskaya, et al., No. 15-776-cr, 2nd Cir.; 2016 U.S. App. LEXIS 12776).
NEW ORLEANS - The federal judge in Louisiana overseeing litigation stemming from the oil spill in the Gulf of Mexico following the explosion of the Deepwater Horizon oil rig in April 2010 did not err when refusing to consider a car dealership's request to review whether the claims administrator presiding over the Court Supervised Settlement Program (CSSP) abused his discretion when finding that it was not a start-up business, a Fifth Circuit U.S. Court of Appeals panel ruled July 11 (Holmes Motors Inc. v. BP Exploration & Production Inc., et al., No. 15-30860, 5th Cir.).
SAN FRANCISCO - A California federal judge on July 8 denied an insurer's motion for judgment on the pleadings in its lawsuit seeking equitable contribution from another insurer for $15.8 million in underlying settlements over students' claims that a school district and its administrators were negligent in their supervision of a teacher accused of sexual molestation (Westport Insurance Corp. v. California Casualty Management Co., No. 16-01246, N.D. Calif.; 2016 U.S. Dist. LEXIS 88924).
SAN FRANCISCO - Reconsideration of a California federal judge's finding that a policy deductible does not apply to defense costs incurred as a result of an environmental contamination dispute is not warranted, an insured argues in its July 7 response to the insurers' motion for reconsideration (American Guarantee and Liability Insurance Co., et al. v. Technichem Inc., et al., No. 15-03611, N.D. Calif.).
NEW YORK - An insured filed a motion for rehearing on July 7 in the Second Circuit U.S. Court of Appeals, arguing that the panel failed to consider applicable Massachusetts law when it ruled that an insurer does not have a duty to defend the against an underlying environmental contamination suit (The Narragansett Electric Co. v. Century Indemnity Co., et al., Nos. 15-1137, 15-1397, 2nd Cir.).
PHILADELPHIA - Although insureds did not exercise reasonable care in maintaining heat to prevent pipes from freezing in their home while they were away, a question of fact exists as to whether the insureds' home was unoccupied when the loss occurred, a Pennsylvania federal judge said July 7 (Joseph Jugan, et al. v. Economy Premier Assurance Co., No. 15-4272, E.D. Pa.; 2016 U.S. Dist. LEXIS 87876).
PHILADELPHIA - A federal judge in Pennsylvania on July 11 awarded summary judgment to two lawyers accused of civil conspiracy, finding that Church Mutual Insurance Co. failed to present sufficient evidence that the attorneys agreed with other defendants to pursue fraudulent claims and that they acted with malice (Church Mutual Insurance Company v. Alliance Adjustment Group, et al., No. 15-461, E.D. Pa.; 2016 U.S. Dist. LEXIS 89194).
CINCINNATI - The Sixth Circuit U.S. Court of Appeals on July 11 affirmed that there is no coverage for an insured's $1 million check theft loss caused by an employee because the insured discovered wire fraud by the same employee before the policy's inception and the check theft and wire fraud constitute a single loss under the policy (Construction Contractors Employer Group, LLC v. Federal Insurance Co., No. 15-4352, 6th Cir.; 2016 U.S. App. LEXIS 12710).
LAKELAND, Fla. - A Florida appeals panel held July 6 that a lower court erred in awarding $233,610.02 in damages payable directly to insureds without regard for an insurance policy's loss settlement provision as to subsurface repair, reversing the lower court's ruling in part (Citizens Property Insurance Corp. v. James Stieben, et al., No. 2D14-4412, Fla. App., 2nd Dist.; 2016 Fla. App. LEXIS 10296).
ELIZABETH CITY, N.C. - A North Carolina federal judge on July 7 denied an insurer's motion to stay enforcement of a $700,194 total judgment against it in a Hurricane Irene coverage dispute (Gary Woodson, et al. v. Allstate Insurance Co., No. 13-21, E.D. N.C., Northern Div.; 2016 U.S. Dist. LEXIS 87971).
HARRISBURG, Pa. - The liquidator of an insolvent insurer asked a Pennsylvania court on July 6 for approval of an agreement under which a reinsurer will make direct payments of claims to the insolvent insurer's insured (In re: Reliance Insurance Company in Liquidation, No. 1 REL 2001, Pa. Cmwlth.).
SALT LAKE CITY - An insured failed to show that an underlying breach of contract action involved the same parties and issues as its insurer's coverage action regarding the duty to defend and indemnify the insured, a Utah federal judge ruled July 8 (Acuity, a mutual insurance company v. McGinnis Homes, LLC, No. 16-58, D. Utah; 2016 U.S. Dist. LEXIS 88974).
SEATTLE - Under Washington law, an insurer is not liable for damage to apartments from hidden decay under its policies' "collapse" provisions, a Washington federal judge ruled July 7, finding that the insurer's coverage decision and claims handling were reasonable (American Economy Insurance Co. v. CHL, LLC, No. 15-899, W.D. Wash.; 2016 U.S. Dist. LEXIS 88286).
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on July 7 affirmed a district court's finding that there is no ambiguity in a residual disability policy regarding the policy's use of the term "occupation" and the policy rider's use of the term "insured's occupation" (Daniel S. Bowerman, D.C. v. National Life Insurance Co., No. 15-1129, 3rd Cir.; 2016 U.S. App. LEXIS 12503).
NEW ORLEANS - A panel of the Fifth Circuit U.S. Court of Appeals on July 8 affirmed that the Employee Retirement Income Security Act governs a case in which a laid-off employee was denied severance compensation for failing to return all company property as required by a severance agreement (Mark Gomez v. Ericsson Inc., No. 15-41479, 5th Cir.; 2016 U.S. App. LEXIS 12604).