LexisNexis® Legal Newsroom
    Mealey's Insurance - Federal Judge Dismisses Superstorm Sandy Coverage Suit For Lack Of Jurisdiction

    CAMDEN, N.J. - A New Jersey federal judge on July 27 dismissed an ambulance owner insured's lawsuit arising from Superstorm Sandy damage without prejudice, finding that the court never possessed federal jurisdiction to hear the case because there was no basis for alleging that the insurer violated the National Flood Insurance Act (Sea Bright First Aid Squad Inc. v. Arch Insurance Co., No. 14-1447, D. N.J.; 2015 U.S. Dist. LEXIS 97410).

    Mealey's Insurance - Breach Of Contract Suit Over Hurricane Ike Claim Was Timely Filed, Magistrate Says

    GALVESTON, Texas - A federal flood insurer's denial of an insured's supplemental Hurricane Ike claim following its review of an adjuster's estimate and requests did not trigger the one-year limitations period, a Texas federal magistrate judge ruled July 28, finding that the insured's breach of contract lawsuit was timely filed (Savina Rocha Fernandez v. Fidelity National Property and Casualty Insurance Co., No. 10-460, S.D. Texas; 2015 U.S. Dist. LEXIS 98030).

    Mealey's Insurance - Bankruptcy Judge: Claims Against Insurer Barred By Johns-Manville Injunction

    NEW YORK - An asbestosis victim's claims that an insurance company conspired with Johns-Manville Corp. to withhold information from the public on the dangers of asbestos inhalation are barred by nearly 30-year-old court orders confirming Johns-Manville's bankruptcy reorganization plan and issuing an injunction protecting the company and its insurers from such claims, a New York federal bankruptcy judge held July 27 (In re Johns Manville Corporation, et al., No. 82-11656, S.D. N.Y. Bkcy.; 2015 Bankr. LEXIS 2455).

    Mealey's Insurance - N.J. Panel: Court Abused Its Discretion In Ordering Insurers To Produce Documents

    TRENTON, N.J. - A New Jersey appeals panel on July 27 found that a lower court erred when it ordered two insurers to produce withheld and redacted documents in a Superstorm Sandy warehouse fire coverage dispute, reversing and remanding for the court to conduct a careful in camera inspection of the requested documents to determine if they are discoverable and, if so, protected by a privilege or other restrictions (Alden Leeds Inc. v. QBE Specialty Insurance Co., et al., No. A-2034-14T1, N.J. Super., App. Div.; 2015 N.J. Super. Unpub. LEXIS 1793).

    Mealey's Insurance - Judge: Triable Issues Exist In Subrogated Insurer's Professional Negligence Suit

    PITTSBURGH - There are triable issues of fact in a subrogated insurer's professional negligence lawsuit against a contractor regarding water damage as to causation in the failure to comply with identified code and provide stamped drawings from a professional engineer for a fire sprinkler system, a Pennsylvania federal judge ruled on July 27 (Insurance Company of Greater New York, as subrogee of Five Star Hotels, LLC d/b/a Holiday Inn Parkway East v. Fire Fighter Sales & Service Co., No. 11-1078, W.D. Pa.; 2015 U.S. Dist. LEXIS 97467).

    Mealey's Insurance - Insurer's Denial Of Benefits Supported By Evidence, Maryland Federal Judge Says

    BALTIMORE - A disability insurer did not wrongfully terminate a claimant's long-term disability benefits because the evidence, including a surveillance video of the claimant participating in a number of physical activities, does not support the subjective severity of the claimant's condition, a Maryland federal judge said July 24 (Mario Realmuto v. Life Insurance Company of North America, No. 14-1386, D. Md.; 2015 U.S. Dist. LEXIS 96559).

    Mealey's Insurance - 9th Circuit Affirms $500,000 Punitive Damages Award Against Hotel Property Insurer

    SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on July 27 affirmed a lower federal court's $500,000 punitive damages award in favor of a hotel property owner in a coverage dispute over August 2008 Phoenix storm damage, rejecting the insurer's argument that the award was unconstitutionally excessive (Glendale & 27th Investments LLC v. Delos Insurance Co., No. 13-16063, 9th Cir.; 2015 U.S. App. LEXIS 12987).

    Mealey's Insurance - No Coverage Owed For Health, Safety Violations, Mass. Appeals Panel Says

    BOSTON - An underlying claim alleging health and safety code violations based on the presence of lead in fabrics manufactured by an insured does not constitute a "suit" pursuant to the terms of an insurance policy, the Massachusetts Appeals Court said July 22 in affirming that an insurer owes no coverage for the underlying claim alleged against the insured (30 Magaziner Realty LLC et al., v. Liberty Mutual Insurance Co., No. 14-P-790, Mass. App.; 2015 Mass. App. Unpub. LEXIS 782).

    Mealey's Insurance - Federal Judge: Fact Issues Preclude Ruling On Negligent Misrepresentation Claim

    KANSAS CITY, Mo. - A Missouri federal judge on July 24 partly denied summary judgment in favor of an insurance agent in a dispute over flood coverage for an insured's basement, finding that federal law does not preempt the negligent misrepresentation claim and there is a genuine dispute as to the material facts surrounding the agent's alleged negligent misrepresentation (Catherine Lynn Pittman, et al. v. Farmers Fire Insurance Exchange, et al., No. 13-380, W.D. Mo., Western Div.; 2015 U.S. Dist. LEXIS 96707).

    Mealey's Insurance - Pa. Superior Court Finds Negligence Claim Can Stand In Mold Coverage Suit

    PITTSBURGH - Because an insurer allegedly failed to exercise reasonable care when it provided advice regarding mold contamination, the insureds' negligence claim is cognizable and should not have been dismissed by a trial court, the Pennsylvania Superior Court said July 22 (David Bruno, et al. v. Erie Insurance Co., et al., No. 1154 WDA 2011, Pa. Sup.; 2015 Pa. Super. Unpub. LEXIS 2308).

    Mealey's Insurance - Endorsement Bars Coverage For Negligence Claim Against Realtor, Panel Says, Reverses

    INDIANAPOLIS - An Indiana appeals panel on July 22 found that a business owners insurance policy's "limitation of real estate operations" endorsement precludes coverage for an underlying negligence suit against a real estate listing agent insured, reversing and remanding a lower court's ruling against the insurer (Property-Owners Insurance Co. v. Gerald T. Powers and Phyllis J. Powers, et al., No. 73A05-1501-PL-2, Ind. App.; 2015 Ind. App. Unpub. LEXIS 826).

    Mealey's Insurance - Panel Dismisses Insurer's Appeal Because Order Did Not Address Duty To Indemnify

    LAKELAND, Fla. - A partial final judgment determining an insurer's duty to defend an insured against construction defect claims under certain policy periods but not the insurer's duty to indemnify is not a final appealable order, a Florida appeals panel held July 24 (Florida Farm Bureau General Insurance Co. v. Peacock's Excavating Service Inc., et al., No. 2D14-977, Fla. App., 2nd Dist.; 2015 Fla. App. LEXIS 11205).

    Mealey's Insurance - Insureds Improperly Joined Insurance Agent In Bad Faith Suit, Judge Rules

    DALLAS - A federal judge in Texas on July 21 denied a motion to remand filed by insureds in an insurance bad faith lawsuit, ruling that the insureds' insurance agent was improperly joined in the action (Renee Davis, et al. v. State Farm Lloyds, et al., No. 15-0596, N.D. Texas; 2015 U.S. Dist. LEXIS 95086).

    Mealey's Insurance - No Employers Liability Coverage For Independent Contractor's Suit, Panel Affirms

    CINCINNATI - The Sixth Circuit U.S. Court of Appeals on July 23 affirmed a lower federal court's ruling that an insurer has no duty to defend its farm insured against an underlying injury claim brought by an independent contractor because the employers liability coverage extends only to injuries of employees (Danny Swafford v. Forestry Mutual Insurance Co., No. 14-6475, 6th Cir.).

    Mealey's Insurance - Insured Failed To Give Timely Notice Of Claim, Texas Appeals Panel Says

    DALLAS - No coverage exists for an underlying environmental contamination claim arising out of leaking underground storage tanks because the insured failed to provide notice of the claim within 30 days as required by the policy, the Fifth District Texas Court of Appeals said July 21 (Nicholas Petroleum Inc. v. Mid-Continent Casualty Co., No. 05-13-01106-CV, Texas App., 5th Dist.; 2015 Tex. App. LEXIS 7489).

    Mealey's Insurance - Majority: Insurer Is Not Liable For Agent's Alleged Negligent Misrepresentations

    PHILADELPHIA - A majority of the Third Circuit U.S. Court of Appeals on July 23 affirmed a lower federal court's ruling that a federal flood insurer could not be held liable for an insurance agent's alleged misrepresentations in a dispute over flood coverage for a Subway franchise (Mahakali Krupa LLC, et al. v. Allstate Insurance Co., No. 14-3764, 3rd Cir.; 2015 U.S. App. LEXIS 12687).

    Mealey's Insurance - Pennsylvania Supreme Court Reinstates $80M Award, Says Settlement Was Reasonable

    HARRISBURG, Pa. - In an opinion of first impression released July 21, the majority of the Pennsylvania Supreme Court reinstated a jury verdict entered in favor of an insured and said the insurers are required to reimburse the insurer for an $80 million settlement of a putative class action alleging exposure to fugitive radioactive material released from nuclear fuel refineries near Pittsburgh (The Babcock & Wilcox Co., et al. v. American Nuclear Insurers, et al., No. 2 WAP 2014, Pa. Sup.; 2015 Pa. LEXIS 1551).

    Mealey's Insurance - Judge: 'Owned Property' Exclusion Bars Insurance Coverage For Defect Claims

    ORLANDO, Fla. - The "owned property" exclusion precludes an insurer's duty to defend and indemnify an underlying settlement reached regarding construction defect claims in a condominium complex, a Florida federal judge ruled July 23 (Nationwide Mutual Fire Insurance Co. v. Cypress Fairway Condominium Association Inc., et al., No. 13-1565, M.D. Fla.; 2015 U.S. Dist. LEXIS 96196).

    Mealey's Insurance - Insurer Did Not Violate Policy In Depreciating Costs For Roof Repair, Judge Says

    KANSAS CITY, Kan. - A homeowners insurer did not violate its policy when it depreciated all costs necessary to recreating the property following hail damage to an insured's roof, including the costs associated with labor, when calculating actual cash value, a Kansas federal judge ruled July 22 (Margaret Graves v. American Family Mutual Insurance Co., No. 14-2417, D. Kan.; 2015 U.S. Dist. LEXIS 95127).

    Mealey's Insurance - Judge Denies Reconsideration Of Opinion Setting Reinsurer's Liability Limits

    SYRACUSE, N.Y. - In a summary order issued July 23, a federal judge in New York denied an insurer's motion for reconsideration of an earlier order limiting the liability of the insurer's reinsurer, holding that the case relied upon by the insurer is not precedential (Utica Mutual Insurance Company v. Clearwater Insurance Company, No. 13-cv-01178, N.D. N.Y.; 2015 U.S. Dist. LEXIS 95826).

    Mealey's Insurance - 3rd Circuit: Judge Did Not Err When Enhancing Sentencing For Fraud

    PHILADELPHIA - A federal judge in Pennsylvania did not err when sentencing a woman to 96 months in prison for her role in an insurance fraud scheme that resulted in Medicare and other supplemental insurers paying approximately $1.8 million in false claims, a Third Circuit U.S. Court of Appeals panel ruled July 23, finding that the judge properly found that the defendant's scheme involved 10 or more victims (United States of America v. Anna Mudrova, No. 14-3580, 3rd Cir.; 2015 U.S. App. LEXIS 12733).

    Mealey's Insurance - Slander Claims In Sexual Assault Case Do Not Warrant Coverage, Panel Affirms

    SAN JOSE, Calif. - A California appeals panel on July 22 affirmed a lower court's finding that there is no coverage under a homeowners insurance policy for underlying slander claims arising from the alleged sexual assault of a minor (Ryan Kanzaki, et al v. Fire Insurance Exchange, No. H038540, Calif. App., 6th Dist.; 2015 Cal. App. Unpub. LEXIS 5137).

    Mealey's Insurance - Magistrate Judge Denies Insurers' Bid To Dismiss Claims In Defects Suit

    TOPEKA, Kan. - A Kansas federal magistrate judge on July 22 denied a request by two umbrella insurers to deduct $44 million from an insured's $63 million damages claim in a lawsuit over coverage for construction defects in four power plants; however, the magistrate judge ordered the insured to produce more documentation to support its claim (Black & Veatch Corp. v. Aspen Insurance [UK] Ltd., et al., No. 12-2350, D. Kan.; 2015 U.S. Dist. LEXIS 95125).

    Mealey's Insurance - Judge: Insured Failed To File Insurance Claim Within 2-Year Limitation Period

    SAN DIEGO - Dismissal of an insured's breach of contract and insurance bad faith lawsuit is proper, a California appellate panel held July 20, because an insured failed to file its claim for coverage within the two-year contractual limitation on the right to sue (Thee Sombrero Inc. v. Markel International Insurance Co. Ltd, et al., No. E060705, Calif. App., 4th Dist., Div. 2; 2015 Cal. App. Unpub. LEXIS 5112).

    Mealey's Insurance - Massachusetts Panel Upholds Woman's Conviction For Fraud Over Policy Applications

    BOSTON - A Massachusetts Appeals Court panel on July 22 ruled that a former insurance agent who was convicted on charges of insurance fraud and larceny for submitting motor vehicle insurance policy applications with false information was unable to show that the evidence presented at trial did not support the jury's verdict (Commonwealth of Massachusetts v. Virgen Millie Lima, No. 13-P-1746, Mass. App.; 2015 Mass. App. LEXIS 78).