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).
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on July 7 determined that summary judgment in favor of a disability insurer was not appropriate because issues of material fact exist regarding whether the medical evidence supports the insurer's termination of benefits and whether the termination was arbitrary and capricious (Frank Reed v. Citigroup Inc., et al., No. 15-2094, 3rd Cir.; 2016 U.S. App. LEXIS 12523).
SYRACUSE, N.Y. - An insurer told a federal court in New York on July 5 that a non-party reinsurer involved in a similar asbestos reinsurance dispute does not have the right to see documents sealed in the instant action (Utica Mutual Insurance Company v. Munich Reinsurance America, Inc., No. 12-cv-00196, N.D. N.Y.).
JACKSON, Miss. - A Mississippi federal judge on July 1 dismissed an insured's claims for waiver and estoppel and for vicarious liability but allowed breach of contract and bad faith claims to proceed in a homeowners insurance coverage action (Brooke T. Martin v. Shelter Mutual Insurance Co., No. 15-675, S.D. Miss.; 2016 U.S. Dist. LEXIS 86112).
FORT WORTH, Texas - A federal judge in Texas on July 5 granted an insurer's motion for summary judgment in an insurance breach of contract and bad faith lawsuit, ruling that an insured can no longer bring her claims because the appraisal process has been completed and the insurer timely paid her the appraisal award (Yolanda Aguilar v. State Farm Lloyds, et al., No. 15-565, N.D. Texas; 2016 U.S. Dist. LEXIS 87600).
FRESNO, Calif. - A California federal judge on July 5 determined that a disability claims administrator did not abuse its discretion in terminating a claimant's benefits because the administrator identified two reasonable jobs within the proper zone that could be performed by the claimant (William Barnett v. Southern California Edison Company Long Term Disability Plan, No. 12-130, E.D. Calif.; 2016 U.S. Dist. LEXIS 86828).
FRESNO, Calif. - Summary judgment is not warranted in an insurance breach of contract and bad faith lawsuit because an insurer has failed to show that the doctrine of judicial estoppel should be invoked and has failed to show that no genuine issue of material fact exists related to claims made by insureds in suing the insurer, a federal magistrate judge in California ruled July 5 (Halonda Naff, et al. v. State Farm General Insurance Co., No. 15-0515, E.D. Calif.; 2016 U.S. Dist. LEXIS 86854).
SEATTLE - A federal judge in Washington on July 5 denied an insurer's motions for summary judgment and to dismiss in an insurance breach of contract and bad faith lawsuit, ruling that insureds have sufficiently pleaded their claims for relief against their health insurance provider (Lori Patnode, et al. v. HCC Life Insurance Co., d/b/a HCC Medical Insurance Services LLC, No. 15-0824, W.D. Wash.; 2016 U.S. Dist. LEXIS 86872).
HARRISBURG, Pa. - Finding that genuine issues of fact remain as to the cause of homeowners' water damage, a Pennsylvania federal judge on July 7 declined to grant summary judgment to an insurer based on exclusions for defective construction, seepage, neglect or known loss doctrine (The Cincinnati Insurance Co. v. Jonathan Drenocky and Deborah Drenocky, No. 15-762, M.D. Pa.; 2016 U.S. Dist. LEXIS 87711).
BOSTON - A subrogated insurer's rights to recover insurance proceeds paid for a condominium unit's water damage were not waived based on a clause in the bylaws of the insured's condominium trust that unit owners "shall carry insurance" and that "all such policies shall contain waivers of subrogation," the First Circuit U.S. Court of Appeals held July 5 (Pacific Indemnity Co. v. John Deming, No. 15-2386, 1st Cir.; 2016 U.S. App. LEXIS 12374).
CINCINNATI - The Sixth Circuit U.S. Court of Appeals on July 5 affirmed a lower federal court's finding that because underlying claims were based on an associate pastor's sexual acts, the victims and their parents cannot recover a $4.35 million award against the pastor from his church's insurer because the policy does not cover an individual's sexual misconduct and because Ohio public policy prohibits insurance for the sexual abuse of a minor (Jacquin Clifford, et al. v. Church Mutual Insurance Co., No. 15-4154, 6th Cir.; 2016 U.S. App. LEXIS 12541).
NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on July 7 affirmed a lower court's ruling in favor of a commercial property insurer in a breach of contract and bad faith dispute arising from Hurricane Ike damage to the insured's daycare center and warehouse (Steve Quibodeaux and the Kids Safari Inc., d/b/a Wee Care Childcare and Preschool v. Nautilus Insurance Co., No. 15-40567, 5th Cir.).
HARRISBURG, Pa. - The liquidator of an insolvent insurer asked a Pennsylvania court on July 6 to approve the liquidator's recommendation that a reinsurer be allowed to make direct payments to one of the insolvent insurer's insureds (In re: Reliance Insurance Company in Liquidation, No. 1 REL 2001, Pa. Cmwlth.).
SAN JOSE, Calif. - A plan administrator abused its discretion by failing to consider a disability claimant's functional capacity evaluation and an award of Social Security disability benefits before terminating the claimant's long-term disability benefits, a California federal judge said June 30 in remanding the benefits claim to the plan administrator (Olga Gorbacheva v. Abbott Laboratories Extended Disability Plan et al., No. 14-2524, N.D. Calif.; 2016 U.S. Dist. LEXIS 85702).
ROCHESTER, N.Y. - A New York federal judge on June 30 ordered a disability insurer to reinstate a claimant's disability benefits and pay past due benefits because the insurer's termination of benefits was arbitrary and capricious (Randi Dunda v. Aetna Life Insurance Co., No. 15-6232, W.D. N.Y.; 2016 U.S. Dist. LEXIS 85549).
ST. LOUIS - A disability claimant's complaint was dismissed July 1 because the claims administrator did not abuse its discretion in terminating the claimant's benefits, a Missouri federal judge said, noting that the claims administrator consulted with a number of independent physician advisers before terminating the benefits (Maria Domenica Moore v. Ascension Long-Term Disability Plan, No. 15-328, E.D. Mo.; 2016 U.S. Dist. LEXIS 85900).
MADISON, Wis. - Applying the four-corners rule to compare a complaint's language to the terms of an insurance policy, a majority of the Wisconsin Supreme Court ruled June 30 that an insurer did not breach its duty to defend an insured because a "your product" exclusion applies and no exceptions to this exclusion restore coverage (Water Well Solutions Service Group Inc. v. Consolidated Insurance Co., No. 2014AP2484, Wis. Sup.; 2016 Wisc. LEXIS 163).
CHICAGO - An insurer told a federal court in Illinois on July 5 that its reinsurer's case against it should be transferred to a federal court in California because the dispute is centered in California and not Illinois (R&Q Reinsurance Company v. The American Insurance Company, No. 16-cv-04199, N.D. Ill.).
PITTSBURGH - Under Pennsylvania law, commercial general liability insurers have no duty to defend or indemnify insureds for a negligent performance of contract claim arising out of alleged faulty workmanship, a Pennsylvania federal magistrate judge ruled June 30 (Peerless Insurance Co. and Ohio Security Insurance Co. v. Manown Builders, et al., No. 15-281, W.D. Pa.; 2016 U.S. Dist. LEXIS 85261).
BIRMINGHAM, Ala. - An Alabama federal judge on June 29 denied a disability insurer's motion for summary judgment after determining that a genuine issue of material fact exists regarding whether the insurer received the claimant's letter appealing the termination of disability benefits (Cheryl Hitt v. United of Omaha Life Insurance Co., No. 15-1790, N.D. Ala.; 2016 U.S. Dist. LEXIS 84119).
NEW YORK - A party to a reinsurance treaty removed a petition asking for vacatur of an arbitration award to a federal court in New York on July 5 (Yosemite Insurance Company v. Nationwide Insurance Company, No. 16-cv-05290, S.D. N.Y.).
ATLANTA - A disability insurer's decision to terminate a claimant's long-term disability benefits was not de novo wrong, the 11th Circuit U.S. Court of Appeals affirmed July 1, noting that the insurer's decision was supported by the evidence (Rassekh Sobh v. Hartford Life and Accident Insurance Co., No. 15-15586, 11th Cir.; 2016 U.S. App. LEXIS 12144).
MADISON, Wis. - A majority of the Wisconsin Supreme Court on June 30 affirmed that a professional liability errors and omissions insurance policy's business enterprise exclusion bars coverage for six underlying lawsuits against a professional trustee insured, finding that the insured relied on a "stunted strand of law" in arguing that the insurer has a duty to defend (David M. Marks v. Houston Casualty Co., et al., No. 2013AP2756, Wis. Sup.; 2016 Wisc. LEXIS 162).
HOUSTON - A Texas appeals panel on June 30 found that an insurer breached the policy when it refused to cover the physical loss to an insured's roof that was caused by a wind event, affirming a jury's award of $12,878 for damages and $70,000 for attorney fees (State Farm Lloyds v. Ginger Hanson, No. 14-15-00093, Texas App., 14th Dist.; 2016 Tex. App. LEXIS 6937).