LexisNexis® Legal Newsroom
    Mealey's Insurance - Defect Notice May Trigger Insurer's Defense Coverage, Florida High Court Rules

    TALLAHASSEE, Fla. - A Florida Statutes Chapter 558 proceeding for resolving construction defect disputes prior to litigation constitutes a "suit" under commercial general liability insurance policies that may trigger a duty to defend provided that an insurer consents to an insured's participation, a majority of the Florida Supreme Court held Dec. 14 (Altman Contractors Inc. v. Crum & Forster Specialty Insurance Co., No. SC16-1420, Fla. Sup., 2017 Fla. LEXIS 2492).

    Mealey's Insurance - Wisconsin Panel Says Policy Clearly Bars Coverage For Mold Damages

    WAUKESHA, Wis. - The Second District Wisconsin Court of Appeals on Dec. 13 affirmed that a trial court correctly entered judgment for an insurer in a suit seeking damages as a result of injuries caused by mold contamination in a rented apartment because the policy at issue clearly bars coverage for mold damages and mold-related injuries (Susan M. Smith v. Mumm Real Estate LLC, No. 2016AP1944, Wis. App., Dist. 2, 2017 Wisc. App. LEXIS 1039).

    Mealey's Insurance - Wisconsin Appeals Panel: No Error In Order On Insurer's Rehabilitation

    MADISON, Wis. - A trial judge did not err in issuing a clarification order in the rehabilitation proceeding of an insolvent insurer with regard to how the rehabilitation applies to other courts' jurisdiction, a Wisconsin appeals panel held Dec. 14 (Sean Dilweg v. Carlisle/Picatinny Family Housing L.P., et al., No. 2016AP2169, Wis. App., Dist. 4, 2017 Wisc. App. LEXIS 1023).

    Mealey's Insurance - Panel: Insolvent Insurer Did Not Show Mortgagor Consented To Jurisdiction

    MADISON, Wis. - An insolvent insurer failed to show that a mortgagor consented to personal jurisdiction by appearing in a rehabilitation proceeding, a Wisconsin appeals panel ruled Dec. 14, also finding no jurisdiction under Wisconsin's long-arm statute because there was no injury to the insurer in Wisconsin for purposes of its fraudulent inducement claim (Ambac Assurance Corp. v. Countrywide Home Loans Inc., No. 2015AP1493, Wis. App., 4th Dist., 2017 Wisc. App. LEXIS 1023).

    Mealey's Insurance - Additional Discovery Not Needed In Disability Suit, Maryland Federal Judge Says

    BALTIMORE - A Maryland federal judge on Dec. 13 denied a disability claimant's motion to compel the production of documents related to the doctors who reviewed the claimant's case after determining that the administrative record is sufficient to determine whether the insurer operated under a conflict of interest (Karin Reidy v. The Unum Life Insurance Company of America et al., No. 16-2926, D. Md., 2017 U.S. Dist. LEXIS 204705).

    Mealey's Insurance - New York High Court Finds No Set Rule On Reinsurer's Liability Cap On Defense Costs

    NEW YORK - In a coverage dispute over asbestos litigation costs, the New York Court of Appeals on Dec. 14 ruled that one of its previous rulings did not establish a general rule that a reinsurance contract's total liability cap encompasses both indemnity and defense costs incurred by an insurer (Global Reinsurance Corporation of America v. Century Indemnity Co., No. CTQ-2016, 0005, N.Y. App., 2017 N.Y. LEXIS 3723).

    Mealey's Insurance - 7th Circuit Says Suit Alleging Elderly People Lured Into Policy Purchase Cannot Stand

    CHICAGO - A district court properly granted a long-term care insurer's motion to dismiss an insured's suit alleging that the insurer lured elderly people into purchasing a policy by offering low premiums for the first 10 years and then instituted a 75 percent premium rate hike because the insured failed to state a claim upon which relief could be granted, the Seventh Circuit U.S. Court of Appeals said Dec. 14 (Sophie Toulon v. Continental Casualty Co., No. 16-1510, 7th Cir., 2017 U.S. App. LEXIS 25247).

    Mealey's Insurance - 5th Circuit Says 1-Year Statute Of Limitations Bars Disability Claimant's Suit

    NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Dec. 14 affirmed a district court's ruling that a disability claimant's suit is barred under Louisiana's applicable one-year statute of limitations because the suit was not filed within a year after the claimant requested plan documents from the plan administrator (Todd M. Babin v. Quality Energy Services Inc., No. 17-30059, 5th Cir., 2017 U.S. App. LEXIS 25275).

    Mealey's Insurance - Federal Judge: Fusion Surgery Preauthorization Waived Insurer's Later Denial

    LOS ANGELES - A health insurer waived the right to deny coverage for vertebrate fusion surgery as experimental when it preauthorized the procedure, albeit with a different device, a federal judge in California held Dec. 12, entering judgment for the plaintiff on her Employee Retirement Income Security Act claims (Aubrey Cohorst v. Anthem Health Plans of Kentucky Inc., No. 16-7925, C.D. Calif., 2017 U.S. Dist. LEXIS 204362).

    Mealey's Insurance - Insured Can't Show That Remand Is Necessary In Bad Faith Suit, Judge Rules

    PITTSBURGH - An insured has failed to show that remand of his insurance breach of contract and bad faith lawsuit to state court is necessary since he asserts only claims under state law and, thus, a federal district court lacks jurisdiction over the claims because the insured does not seek a declaratory judgment and because he seeks damages in excess of the statutory limits, a federal magistrate judge in Pennsylvania ruled Dec. 12 in denying the insured's motion (Adam Carney v. GEICO, No. 17-1486, W.D. Pa., 2017 U.S. Dist. LEXIS 205042).

    Mealey's Insurance - Insurer's Failure To Exclude Parties Was A Mistake, 3rd Circuit Says In Affirming

    PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Dec. 14 affirmed a New Jersey federal judge's ruling in favor of an insurer in an environmental contamination dispute after determining that the insurer's failure to exclude coverage to certain parties involved in the contamination dispute clearly was a mistake or scrivener's error (Indian Harbor Insurance Co. v. NL Environmental Management Services Inc., et al., Nos. 16-3262, 16-3293, 3rd Cir., 2017 U.S. App. LEXIS 25277).

    Mealey's Insurance - Former Home Health Agency Owner To Serve 115 Months For $15M Fraud Scheme

    MIAMI - A federal judge in Florida on Dec. 11 sentenced the former owner and operator of a health care agency to 115 months in prison and ordered him to pay $15.1 million in restitution for his role in a conspiracy to defraud Medicare (United States of America v. Yunesky Fornaris, No 17cr20163, S.D. Fla.).

    Mealey's Insurance - 5th Circuit: Additional Insured Owed A Defense In Construction Defects Case

    NEW ORLEANS - A subcontractor's insurer had a duty to defend an additional insured in a construction defects lawsuit, the Fifth Circuit U.S. Courts of Appeals ruled Dec. 12, affirming in part and reversing in part awards issued in favor of the additional insured (Lyda Swinerton Builders Inc. v. Oklahoma Surety Co., No. 16-20195, 5th Cir., 2017 U.S. App. LEXIS 25048).

    Mealey's Insurance - Insurer's Conduct During Appraisal Is Relevant To Insured's Bad Faith Claims

    DENVER - A Colorado federal judge on Dec. 12 refused to dismiss an insured's statutory and common-law bad faith claims after determining that the insurer's conduct before, during and after an appraisal proceeding conducted to determine the value of the insured's claim for property damages caused by a hailstorm is relevant to the insured's allegations of bad faith conduct (Hometown Community Association Inc. v. Philadelphia Indemnity Insurance Co., No. 17-777, D. Col., 2017 U.S. Dist. LEXIS 203675).

    Mealey's Insurance - Evidence Of Man's Prior Acts Of Arson Should Be Admitted, Judge Finds

    BOWLING GREEN, Ky. - Evidence related to a man's prior acts of setting fire to three residences and one automobile to collect insurance proceeds should be admitted during his trial on similar claims, a federal judge in Kentucky ruled Dec. 13, finding that the information has probative value as to whether he committed the act as part of a common scheme or plan (United States of America v. Steven Allen Pritchard, No. 16-CR-00028, W. D. Ky., 2017 U.S. Dist. LEXIS 204958).

    Mealey's Insurance - 5th Circuit Panel Says Appellant Waived Right To Argue That Texas Law Applies

    NEW ORLEANS - An insured's assignee whose lungs were damaged by the inhalation of an excess amount of chlorine in the insured hotel's hot tub waived the right to argue that Oklahoma law, rather than Texas law, should be applied because the assignee failed to argue that the application of Texas law was a manifest injustice, the Fifth Circuit U.S. Court of Appeals said Dec. 13 in affirming the district court's ruling in favor of the insurer (Wesley Howard v. Maxum Indemnity Co., No. 16-11746, 5th Cir.).

    Mealey's Insurance - Court To Divine If Catholic Group Intervenes In ACA Contraceptive Mandate Suit

    SAN FRANCISCO - A religious group told a federal judge in California on Dec. 11 that it should be allowed to intervene in an action challenging new rules governing exemptions to the Patient Protection and Affordable Care Act (ACA) contraceptive mandate, saying that while the states give lip service to protecting religious beliefs, the reality is much more stark (State of California, et al. v. Don J. Wright, et al., No. 17-5783, N.D. Calif.).

    Mealey's Insurance - Judge: Insured Alleged Sufficient Facts To Support Bad Faith Claim Against Insurer

    OKLAHOMA CITY - An Oklahoma federal judge on Dec. 12 denied an insurer's motion to dismiss an insured's claims for bad faith and breach of contract arising out of the handling of two auto claims after determining that the insured alleged sufficient facts in support of the claims and properly relied on Oklahoma's Unfair Claims Settlement Practices Act to support her claim for bad faith (Rachel Curtis, et al. v. Progressive Northern Insurance Co., No. 17-1076, W.D. Okla., 2017 U.S. Dist. LEXIS 203759).

    Mealey's Insurance - Genuine Issues Of Fact Regarding Settlement Of Auto Claim Exist, Judge Says

    COLUMBUS, Ga. - Genuine issues of fact preclude summary judgment on a bad faith failure-to-settle claim because a jury could find that the insurer did not act reasonably in responding to a settlement offer for the full limits of an auto policy, a Georgia federal judge said Dec. 12 in denying the insurer's and a trustee's motions for summary judgment (Fife M. Whiteside v. GEICO Indemnity Co., No. 16-313, M.D. Ga., 2017 U.S. Dist. LEXIS 203617).

    Mealey's Insurance - 11th Circuit: 'Overwhelming Evidence' Supported Health Care Fraud Conviction

    ATLANTA - An 11th Circuit U.S. Court of Appeals panel on Dec. 12 upheld a man's conviction and sentence for his role in a health care fraud scheme, finding that the government presented "overwhelming evidence" to prove that he received illegal kickbacks and conspired with his co-defendants (United States of America v. Carlos Rodriguez Nerey, No. 16-13614, 11th Cir., 2017 U.S. App. LEXIS 25026).

    Mealey's Insurance - Judge Finds Laboratory Lacks Standing To Pursue ERISA Claims, Dismisses Case

    RALEIGH, N.C. - After finding that a laboratory failed to show that it received a valid assignment of benefits under the Employee Retirement Income Security Act, a North Carolina federal judge on Dec. 7 dismissed its claims against a group of insurers in relation to allegedly unpaid amounts for services rendered (AvuTox LLC v. Cigna Health and Life Insurance Co., et al., No. 5:17-CV-250, E.D. N.C., 2017 U.S. Dist. LEXIS 201296).

    Mealey's Insurance - Insurer Argues Delaware Judge Properly Found Excess Policies Were Not Triggered

    WILMINGTON, Del. - Review of a Delaware judge's ruling that a number of excess insurance policies are not triggered by underlying asbestos claims filed against an insured is not warranted because the primary policies at issue were not exhausted, an insurer asserts in a Dec. 8 joinder brief filed in the Delaware Supreme Court (Motors Liquidation Co. DIP Lenders Trust v. Allstate Insurance Co., et al., No. 381, 2017, Del. Sup.).

    Mealey's Insurance - Panel: Insurance Benefits Company Is Entitled To Producer Commission

    CHICAGO - An insurance benefits company is entitled to a producer commission but not a marketer's fee for a health insurer's breach of an oral contract under a marketing agreement amended following the health insurer's termination of a reinsurance agreement, an Illinois appeals panel affirmed Dec. 7 (Insurance Benefit Group Inc. v. Guarantee Trust Life Insurance Co., No. 1-16-2808, Ill. App., 1st Dist., 4th Div., 2017 Ill. App. LEXIS 763).

    Mealey's Insurance - Federal Judge Denies Motion To Dismiss In Chemical Exposure Coverage Dispute

    CHICAGO - An Illinois federal judge on Dec. 7 denied an insurer's motion to dismiss after rejecting the insurer's argument that the potential indemnitor for underlying liabilities arising out of exposure to polychlorinated biphenyls should be named as the defendant pursuant to a 1999 settlement between the insurer and the potential indemnitor because the coverage dispute is based on the insured's contracts with the insurer (Magnetek Inc. v. The Travelers Indemnity Co., et al., No. 17-3173, N.D. Ill.).

    Mealey's Insurance - Minnesota Appeals Panel: Filed-Rate Doctrine Bars Claims Against Reinsurer

    MINNEAPOLIS - The filed-rate doctrine precludes employers' claims to recover assessments that Workers' Compensation Reinsurance Association (WCRA) levied against them, a Minnesota appeals panel affirmed Dec. 11 (Ambassador Press Inc., et al. v. Trifac Workers' Compensation Fund, et al., Nos. A17-0307 & A17-0323, Minn. App., 2017 Minn. App. Unpub. LEXIS 1016).