LexisNexis® Legal Newsroom
    Mealey's Insurance - Insurer Removes Insured's Suit Disputing Denial Based On Fungi Exclusion

    MILWAUKEE - An insurer filed a notice of removal on Aug. 27 in a Wisconsin federal court on the basis that complete diversity of citizenship exists in the suit filed by its insured alleging that the insurer acted in bad faith and breached its contract by denying coverage for moisture damages (Geneva Lakes Hotel Group LLC v. Westfield Insurance Co., No. 15-1042, E.D. Wis.).

    Mealey's Insurance - Federal Judge: Insured's Claim For Defense Costs Reimbursement Not Yet Ripe

    LOS ANGELES - A California federal judge found Aug. 28 that an insured's claim seeking a declaration regarding his right to reimbursement of defense costs is not yet ripe for a ruling, denying the insured's motion for partial summary judgment in a directors and officers liability coverage dispute (John B. Clark Jr. v. Travelers Casualty Insurance Company of America, No. 14-08248, C.D. Calif.; 2015 U.S. Dist. LEXIS 114877).

    Mealey's Insurance - Judge Denies Dismissal Of Insurer's Case Over Defense Of Excavation Damages Suit

    EAST ST. LOUIS, Ill. - An Illinois federal judge on Aug. 28 refused to dismiss an insurer's coverage action concerning its duty to defend an underlying lawsuit against its insureds for alleged damages sustained during excavation and construction activities (Auto-Owners Insurance Co. v. Osborn Homes, Inc. a/k/a Osborn Properties, et al., No. 14-1308, S.D. Ill.; 2015 U.S. Dist. LEXIS 114621).

    Mealey's Insurance - Judge: Primary Insurer Owes Excess Insurer $7.9M In Underlying Defense Costs

    CLEVELAND - An Ohio federal judge held Aug. 28 that a primary insurer is liable under the principles of equity to reimburse an excess insurer for the $7,996,655.57 in defense costs it was ordered to pay to their insured in connection with an underlying lawsuit arising from a failed real estate project in Orlando, Fla. (IMG Worldwide Inc., et al. v. Westchester Fire Insurance Co., No. 11-1594, N.D. Ohio, Eastern Div.; 2015 U.S. Dist. LEXIS 114659).

    Mealey's Insurance - Insurer Says It Followed Court's Order Regarding Reinsurance Arbitration Umpire

    NEW HAVEN, Conn. - An insurer gave notice to a federal court in Connecticut on Aug. 26 that it has supplied its reinsurer with a list of proposed arbitration umpires (American United Life Insurance Company v. Travelers Indemnity Company, et al., No. 14-cv-01339, D. Conn.).

    Mealey's Insurance - Judge OKs $7.8M Commutation Of Reinsurers' Obligations To Insolvent Insurer

    HARRISBURG, Pa. - A Pennsylvania judge on Aug. 26 approved a commutation, settlement agreement and release between an insolvent insurer and a pair of reinsurers (In re: Reliance Insurance Co. in liquidation, No. 1 REL 2001, Pa. Cmwlth.).

    Mealey's Insurance - N.Y. Federal Judge Refuses To Reconsider Judgment Against Insurer In Environmental Suit

    NEW YORK - A New York federal judge overseeing Olin Corp.'s environmental coverage litigation on Aug. 28 denied OneBeacon Insurance Co.'s motion to reconsider a judgment entered against it and reiterated that the insurer is responsible for approximately $5.4 million, which includes prejudgment interest, on the past costs associated with environmental contamination at one of the insured sites (Olin Corp. v. Insurance Company of North America, et al., No. 84-1968, S.D. N.Y.; 2015 U.S. Dist. LEXIS 114775).

    Mealey's Insurance - 2nd Circuit Panel Orders Lower Court To Choose Reinsurance Arbitration Umpire

    NEW YORK - In an unpublished opinion issued Aug. 26, the Second Circuit U.S. Court of Appeals vacated a lower court decision regarding jurisdiction over a reinsurance arbitration umpire dispute and remanded the case with instructions that the lower court appoint an umpire (Odyssey Reinsurance Company v. Certain Underwriters at Lloyd's London Syndicate 53, et al., No. 14-2840-cv, 2nd Cir.; 2015 U.S. App. LEXIS 15052).

    Mealey's Insurance - 5th Circuit: 'Your Work' Exclusion Bars Insurer's Duty To Indemnify Award

    NEW ORLEANS - A commercial general insurer has no duty to indemnify an underlying award because the "your work" exclusion bars coverage for damages arising out of the insured's preparation of the soil, the foundation and the house itself, the Fifth Circuit U.S. Court of Appeals held Aug. 27, affirming summary judgment to the insurer on claims for breach of contract, breach of the duty of good faith and fair dealing and violations of the Texas Insurance Code and the Texas Deceptive Trade Practices Act (James Feaster, et al. v. Mid-Continent Casualty Co., No. 15-20074, 5th Cir.; 2015 U.S. App. LEXIS 15310).

    Mealey's Insurance - No Coverage For Suit Against Deepwater Project Contractor, Panel Affirms

    NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Aug. 27 affirmed a lower federal court's ruling that primary and excess insurers have no duty to defend their insured against the United States' lawsuit arising from the insured's multimillion-dollar contract to upgrade eight U.S. Coast Guard vessels (XL Specialty Insurance Company v. Bollinger Shipyards, Incorporated, et al., No. 14-31283, 5th Cir.; 2015 U.S. App. LEXIS 15160).

    Mealey's Insurance - Insurer, Reinsurer Ask Court To Memorialize Discovery Confidentiality Agreement

    BOSTON - Parties to a reinsurance dispute asked a federal court in Massachusetts on Aug. 27 to formalize a discovery confidentiality agreement that the parties said they have reached (OneBeacon America Insurance Company v. Transatlantic Reinsurance Company, No. 14-cv-14067, D. Mass.).

    Mealey's Insurance - Indiana Panel Partially Remands Claims To Trial Court In Bad Faith Suit

    INDIANAPOLIS - No genuine issues of material fact exist as to whether an insurer breached its contract or acted in bad faith, an Indiana Court of Appeals panel ruled Aug. 24, because the insurer was not a party to a contract between the insured and a third-party personal property restoration company as part of a homeowners insurance dispute (Thomas Missler, et al. v. State Farm Insurance Co., et al., No. 29A05-1501-PL-30, Ind. App.; 2015 Ind. App. LEXIS 594).

    Mealey's Insurance - No Additional Coverage Owed For Damages Caused By Oil Seepage, Panel Says

    BALTIMORE - No additional coverage exists under an auto policy for property damages caused when oil was pumped into an incorrect home by the insured because the auto policy's limits were exhausted, the Maryland Special Court of Appeals said Aug. 25 (Griffith Energy Services Inc. v. National Union Fire Insurance Company of Pittsburgh, Pa., et al., No. 923, Md. App.; 2015 Md. App. LEXIS 104).

    Mealey's Insurance - Claimant Is Entitled To More Than $700,000 In Disability Benefits, Federal Judge Says

    DETROIT - A Michigan federal judge on Aug. 26 entered an amended judgment in favor of a disability claimant for more than $711,000 in accordance with the Sixth Circuit U.S. Court of Appeals' ruling that the claimant was totally disabled under the disability policies at issue (Louis Leonor v. Provident Life and Accident Co., et al., No. 12-15343, E.D. Mich.; 2015 U.S. Dist. LEXIS 112865).

    Mealey's Insurance - Washington Panel: Policy Exclusion Bars Coverage For Carbon Monoxide Poisoning

    SEATTLE - A trial court correctly determined that an insurer had no duty to defend underlying claims arising out of carbon monoxide poisoning because the policy's pollution exclusion clearly precluded coverage; however, issues of genuine fact exist regarding whether the insurer violated Washington's insurance code and consumer protection act, the state's Division I Court of Appeals said Aug. 24 (Zhaoyun Xia, et al. v. ProBuilders Specialty Insurance Co., et al., No. 71951-3-I, Wash. App., Div. 1; 2015 Wash. App. LEXIS 2026).

    Mealey's Insurance - Delaware Judge Finds Insurer Has A Duty To Defend Asbestos Suits

    WILMINGTON, Del. - A Delaware state judge on Aug. 21 determined that an insurer has a duty to defend its insured against underlying asbestos suits, but deferred ruling on whether the insured provided timely notice of the underlying claims (CNH Industrial America LLC v. American Casualty Company of Pennsylvania et al., No. N12C-07-108, Del. Super., New Castle Co.; 2015 Del. Super. LEXIS 418; Del. Super. LEXIS 419; Del. Super. LEXIS 420).

    Mealey's Insurance - Judge: Misrepresentations On Application Submitted By Agent Not Voidable

    BATON ROUGE, La. - A federal judge in Louisiana on Aug. 24 denied an insurance company's motion for summary judgment in a suit in which it seeks an order declaring a general commercial policy void ab initio, after finding that an insurance agent's completion of an application containing alleged misrepresentations creates a genuine issue of material fact as to whether the defendant intended to deceive the company (Century Surety Company v. Bassam Nafel, No. 14-101-JWD-RLB, M.D. La.; 2015 U.S. Dist. LEXIS 111575).

    Mealey's Insurance - Panel: Third Party Failed To Bring Bad Faith Claim Within Statute Of Limitations

    NEW ORLEANS - A federal district court did not err in dismissing a third party's insurance bad faith claim against an insurer because the third party's bad faith claim was not brought within the one-year statute of limitations, a Fifth Circuit U.S. Court of Appeals panel ruled Aug. 21 (Michael L. Belanger v. GEICO General Insurance Co., No. 15-30018, 5th Cir.; 2015 U.S. App. LEXIS 14793).

    Mealey's Insurance - Remand Of Disability Suit Is Not A Final, Appealable Order, 3rd Circuit Panel Says

    PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Aug. 24 dismissed a disability insurer's appeal for lack of jurisdiction after determining that a district court's remand of the disability suit to the plan administrator was not a final appealable order (Joseph Stevens v. Santander Holdings USA Inc. Self Insured Short Term Disability Plan, et al., No. 14-1481, 3rd Cir.; 2015 U.S. App. LEXIS 14838).

    Mealey's Insurance - Massachusetts Federal Judge: Intellectual Property Exclusion Applies

    BOSTON - A plaintiff was denied judgment on the pleadings Aug. 21 by a Massachusetts federal judge, who instead agreed with an insurer that a "broad" intellectual property (IP) exclusion in a general liability insurance policy precludes coverage in an underlying copyright lawsuit (PTC Inc. v. Charter Oak Fire Insurance Company, No. 14-14056, D. Mass.; 2015 U.S. Dist. LEXIS 111398).

    Mealey's Insurance - Judge Refuses To Dismiss Hospital From Suit Over Alleged Insurance Fraud

    NEW ALBANY, Ind. - A federal judge in Indiana on Aug. 24 denied a hospital's motion to dismiss it from a former emergency room doctor's False Claims Act (FCA) lawsuit, after finding that the plaintiff's allegation that he was subject to retaliatory termination as a result of his complaints that the hospital was fraudulently billing Medicare are not subject to the heightened pleading requirement of Federal Rule of Civil Procedure 9(b) (James Thomas, M.D. v. EmCare Inc., et al., No. 14-cv-00130-SEB-TAB, S.D. Ind.; 2015 U.S. Dist. LEXIS 111514).

    Mealey's Insurance - Judge: Insured In Bad Faith Suit Failed To Make Proper Challenge To Removal

    BALTIMORE - A federal judge in Maryland on Aug. 20 denied an insured's motion to remand an insurance bad faith lawsuit, ruling that remand is not proper because the insured has "failed to articulate a proper challenge to removal" (Joe Gladney v. American Western Home Insurance Co., No. 15-1559, D. Md.; 2015 U.S. Dist. LEXIS 110131).

    Mealey's Insurance - Illinois Panel Affirms Summary Judgment In Insurance Bad Faith Suit

    CHICAGO - A state trial court did not err in granting an insurer's motion to dismiss in a breach of contract and insurance bad faith lawsuit because an insured failed to show that any breach of a homeowners insurance policy existed, an Illinois appellate panel ruled Aug. 21 (Robert Lytle v. Country Mutual Insurance Co., No. 1-14-2169, Ill. App., 1st Dist., 6th Div.; 2015 Ill App. Unpub. LEXIS 1855).

    Mealey's Insurance - Federal Judge Awards Pre- And Post-Judgment Interest To Insured For Mold Suits

    MINNEAPOLIS - A Minnesota federal judge on Aug. 20 awarded a mattress maker more than $1.5 million after calculating pre- and post-judgment interest and attorney fees owed on a jury's $400,000 award for coverage owed to the insured for an underlying action in which consumers alleged that mattresses developed mold (Select Comfort Corp. v. Arrowood Indemnity Co., et al., No. 13-2975, D. Minn.; 2015 U.S. Dist. LEXIS 111070).

    Mealey's Insurance - Judge Remands Insurance Bad Faith Lawsuit To State Court

    EL DORADO, Ark. - Remand of an insurance bad faith lawsuit to state court is proper because an insured has shown that the amount in controversy is less than $75,000, a federal judge in Arkansas ruled Aug. 21 (Tina L. Boone v. State Farm Mutual Automobile Insurance Co., No. 15-1047, W.D. Ark.; 2015 U.S. Dist. LEXIS 110887).