LexisNexis® Legal Newsroom
Mealey's Banking & Finance - Panel: Insurer Breached Duty To Defend Claims Of Suspicious 'Flip' Transactions

CHICAGO - The Seventh Circuit U.S. Court of Appeals on April 10 found that an errors and omissions liability insurer has a duty to defend against underlying claims that its title insurance agency insured executed real estate "flip" transactions "contrary to the spirit and purpose" of its agency contract (Title Industry Assurance Co. v. First American Title Ins. Co., et al., No. 15-3310, 7th Cir., 2017 U.S. App. LEXIS 6092).

Mealey's Insurance - Panel: Insurer Breached Duty To Defend Claims Of Suspicious 'Flip' Transactions

CHICAGO - The Seventh Circuit U.S. Court of Appeals on April 10 found that an errors and omissions liability insurer has a duty to defend against underlying claims that its title insurance agency insured executed real estate "flip" transactions "contrary to the spirit and purpose" of its agency contract (Title Industry Assurance Co. v. First American Title Ins. Co., et al., No. 15-3310, 7th Cir., 2017 U.S. App. LEXIS 6092).

Mealey's Insurance - 4th Circuit: Insured's Faulty Design Of Student Housing Foundation Is Covered

RICHMOND, Va. - A professional liability insurance policy provided coverage for a general contractor's liability for defective design of a building's foundation, which resulted in the contractor becoming responsible to pay $1.77 million as part of the costs to repair, the Fourth Circuit U.S. Court of Appeals held April 4, affirming summary judgment on an insured's breach of contract counterclaim (Westchester Surplus Lines Insurance Co. v. Clancy & Theys Construction Co., Nos. 15-2299 & 15-2373, 4th Cir., 2017 U.S. App. LEXIS 5796).

Mealey's Litigation Procedure - Judge Finds Coke Had No Contractual Duty To Safeguard Employee Information

PHILADELPHIA - Finding that The Coca-Cola Co. (Coke) had neither an express nor implied contractual duty to protect its employees' personally identifiable information (PII), a Pennsylvania federal judge on March 31 granted summary judgment to the beverage company on a putative breach of contract class action related to the theft of laptops containing employee information (Shane K. Enslin v. The Coca-Cola Co., et al., No. 2:14-cv-06476, E.D. Pa., 2017 U.S. Dist. LEXIS 49920).

Mealey's Labor & Employment - Judge Finds Coke Had No Contractual Duty To Safeguard Employee Information

PHILADELPHIA - Finding that The Coca-Cola Co. (Coke) had neither an express nor implied contractual duty to protect its employees' personally identifiable information (PII), a Pennsylvania federal judge on March 31 granted summary judgment to the beverage company on a putative breach of contract class action related to the theft of laptops containing employee information (Shane K. Enslin v. The Coca-Cola Co., et al., No. 2:14-cv-06476, E.D. Pa., 2017 U.S. Dist. LEXIS 49920).

Mealey's IP/Tech - New Jersey Federal Judge Grants Howard Johnson Judgment Against Franchisee

NEWARK, N.J. - A New Jersey federal judge on April 3 granted Howard Johnson International Inc.'s (HJI) unopposed motion for summary judgment on breach of contract, breach of guarantee and Lanham Act claims against a franchisee, saying the franchisee did not provide any information refuting HJI's claims (Howard Johnson International Inc. v. SSR Inc., et al., No. 14-4611, D. N.J., 2017 U.S. Dist. LEXIS 51109).

Mealey's Insurance - Judge: Jury Must Decide If Enforceable Settlement Exists In Sandy Dispute

CAMDEN, N.J. - A New Jersey federal judge on March 31 denied an insurer's motions for summary judgment in a breach of contract and bad faith lawsuit arising from wind damage caused by Superstorm Sandy (Coleman Enterprises Co. v. Scottsdale Insurance Co., No. 14-07533, D. N.J., 2017 U.S. Dist. LEXIS 50078).

Mealey's Insurance - 11th Circuit: Dual Citizenship Can't Be Used To Establish Diversity Under CAFA

ATLANTA - There is no federal jurisdiction over a class complaint accusing two insurance companies of breach of contract, the 11th Circuit U.S. Court of Appeals ruled March 29, finding that dual citizenship can't be used to establish diversity under the Class Action Fairness Act (CAFA) where all parties are citizens of the same state (Life of the South Insurance Company, et al. v. Marquetta Carzell, et al., No. 16-90006, 11th Cir., 2017 U.S. App. LEXIS 5494).

Mealey's Antitrust/Unfair Competition - Judge Stays UCL And Other Claims Pending Review By Arbitrator

SAN DIEGO - A California federal judge on March 28 compelled claims for violation of breach of contract, violation of California's unfair competition law (UCL) and other causes of action to arbitration under a cable services agreement, finding that questions underlying the dispute must be decided by an arbitrator (Michael Song v. Charter Communications Inc., et al., No. 17cv325, S.D. Calif., 2017 U.S. Dist. LEXIS 45972.)

Mealey's Litigation Procedure - 11th Circuit: Dual Citizenship Can't Be Used To Establish Diversity Under CAFA

ATLANTA - There is no federal jurisdiction over a class complaint accusing two insurance companies of breach of contract, the 11th Circuit U.S. Court of Appeals ruled March 29, finding that dual citizenship can't be used to establish diversity under the Class Action Fairness Act (CAFA) where all parties are citizens of the same state (Life of the South Insurance Company, et al. v. Marquetta Carzell, et al., No. 16-90006, 11th Cir., 2017 U.S. App. LEXIS 5494).

Mealey's Insurance - Insured's Misrepresentation Defeats Coverage, Bad Faith Claim, Judge Rules

BALTIMORE - Finding that a policyholder was bound by a material misrepresentation made by its insurance broker on a policy application, a Maryland federal judge on March 27 held that an insurer was entitled to rescind the policy, defeating the insured's breach of contract and bad faith claims (Dominant Investments 113 LLC v. United States Liability Insurance Co., No.1:16-cv-03081, D. Md., 2017 U.S. Dist. LEXIS 44008).

Mealey's PI/Product Liability - Woman Can Pursue Contract Claim Against Roof Installer, New York Federal Judge Says

WHITE PLAINS, N.Y. - A woman who claims that a roofing subcontractor defectively installed the roof on her home that eventually needed to be replaced can pursue a cause of action for breach of contract but cannot assert claims for unjust enrichment and attorney fees, a federal judge in New York ruled March 24 (Debra Rothberg v. Phil's Main Roofing, LLC, No. 14-cv-10095, S.D. N.Y., 2017 U.S. Dist. LEXIS 44839).

Mealey's Insurance - Judge: Bifurcation Won't Result In Quicker Resolution Of Claims In Bad Faith Suit

ALBUQUERQUE, N.M. - Bifurcation and a stay of all noncontractual claims in an insurance breach of contract and bad faith lawsuit is not proper because bifurcation would not result in a "more expeditious resolution" of the action, a federal judge in New Mexico ruled March 27 in denying an insurer's motion to bifurcate (Theresa Martinez v. State Farm Mutual Automobile Insurance Co., No. 16-1029, D. N.M., 2017 U.S. Dist. LEXIS 44277).

Mealey's Labor & Employment - Supreme Court Denies Cert In ERISA Class Action Against Verizon Communications

WASHINGTON, D.C. - In a two-sentence order, the U.S. Supreme on March 27 denied a petition for writ of certiorari filed by a defined-benefit pension plan participant and the Pension Rights Center in which they asked the court to consider whether the participant has standing to file a breach of fiduciary duty suit challenging the transfer of plan assets to a group annuity contract, regardless of loss to the participant's benefits (Edward Pundt, et al. v. Verizon Communications, Incorporated, et al., No. 16-762, U.S. Sup.).

Mealey's IP/Tech - Panel: Architect Did Not Have 'Deemed Allowed' Claim That Constitutes Res Judicata

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on March 24 denied an architect's appeal seeking to reverse a ruling in favor of a home builder's insurer in a breach of contract dispute arising from an underlying $63,471,000 copyright infringement dispute, rejecting the architect's argument that an unobjected-to proof of claim in a bankruptcy case should be allowed and should become a final judgment when the bankruptcy case is closed (Kipp Flores Architects, LLC v. Mid-Continent Casualty Co., No. 16-20255, 5th Cir., 2017 U.S. App. LEXIS 5241).

Mealey's Bankruptcy - Panel: Architect Did Not Have 'Deemed Allowed' Claim That Constitutes Res Judicata

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on March 24 denied an architect's appeal seeking to reverse a ruling in favor of a home builder's insurer in a breach of contract dispute arising from an underlying $63,471,000 copyright infringement dispute, rejecting the architect's argument that an unobjected-to proof of claim in a bankruptcy case should be allowed and should become a final judgment when the bankruptcy case is closed (Kipp Flores Architects, LLC v. Mid-Continent Casualty Co., No. 16-20255, 5th Cir., 2017 U.S. App. LEXIS 5241).

Mealey's Insurance - Federal Judge: Excess Insurer Has No Duty To Defend, Indemnify Manufacturer

EVANSVILLE, Ind. - An Indiana federal judge on March 22 ruled in favor of an excess insurer in a manufacturer insured's breach of contract and bad faith lawsuit seeking coverage for an underlying lawsuit alleging claims for breach of contract, breach of express warranty, breach of implied warranty of fitness for a particular purpose, breach of implied warranty of merchantability and negligence (Berry Plastics Corporation v. Illinois National Insurance Co., No. 15-00170, S.D. Ind., 2017 U.S. Dist. LEXIS 41546).

Mealey's Insurance - Homeowner's Insurer Paid Full Amount Of Claims, Magistrate Judge Concludes

PHILADELPHIA - A homeowner's insurer paid the entire amount it owed to insureds for damage to their home because the insureds failed to offer expert reports to rebut the insurer's evidence that the unpaid portions were not covered, a Pennsylvania federal judge ruled March 22, granting summary judgment to the insurer on a breach of contract claim (Scot Fazio and Dawn Fazio v. State Farm Fire and Casualty Co., No. 16-1987, E.D. Pa., 2017 U.S. Dist. LEXIS 41604).

Mealey's Labor & Employment - 4th Circuit: CBA Language Kills Retirees' Claim That Health Benefits Had Vested

RICHMOND, Va. - Health benefits for United Steel Workers retirees of a West Virginia aluminum manufacturer did not vest and were properly altered unilaterally by the company because union contracts expressly provided that the benefits remained in effect only for the term of the contracts, which had expired, the Fourth Circuit U.S. Court of Appeals held March 22 (Ronald Barton, et al v. Constellium Rolled Products-Ravenswood, LLC, et al., No. 16-1103, 4th Cir., 2017 U.S. App. LEXIS 5087).

Mealey's Insurance - New York Law Applies In Environmental Dispute, Delaware High Court Says, Reversing

WILMINGTON, Del. - The Delaware Supreme Court on March 23 determined that the law of New York should be applied in a dispute over the allocation of environmental contamination claims because New York has the most significant relationship with the parties and applying the law of the state in which an environmental cleanup site is located, as proposed by the lower court, would result in an inconsistent application of a policy's contract language (Chemtura Corp. v. Certain Underwriters at CCLC Lloyd's, et al., No. 371, 2016, Del. Sup., 2017 Del. LEXIS 127).

Mealey's Insurance - Panel: Architect Did Not Have 'Deemed Allowed' Claim That Constitutes Res Judicata

NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on March 24 denied an architect's appeal seeking to reverse a ruling in favor of a home builder's insurer in a breach of contract dispute arising from an underlying $63,471,000 copyright infringement dispute, rejecting the architect's argument that an unobjected-to proof of claim in a bankruptcy case should be allowed and should become a final judgment when the bankruptcy case is closed (Kipp Flores Architects, LLC v. Mid-Continent Casualty Co., No. 16-20255, 5th Cir., 2017 U.S. App. LEXIS 5241).

Mealey's Litigation Procedure - Judge Nixes Class In Insureds' Suit Claiming Pharmacy Gouged On Generic Drugs

SAN FRANCISCO - The variety of contracts at issue and evidence that at least some of the contracted pharmacy benefit managers (PBMs) understood that a pharmacy's usual and customary rate did not include the rate offered for generic drugs in its membership program defeat a motion for class certification of insured purchasers of generic drugs, a federal judge in California held March 21 (Christopher Corcoran, et al. v. CVS Health, et al., No. 15-3504, N.D. Calif., 2017 U.S. Dist. LEXIS 40783).

Mealey's Labor & Employment - Judge Nixes Class In Insureds' Suit Claiming Pharmacy Gouged On Generic Drugs

SAN FRANCISCO - The variety of contracts at issue and evidence that at least some of the contracted pharmacy benefit managers (PBMs) understood that a pharmacy's usual and customary rate did not include the rate offered for generic drugs in its membership program defeat a motion for class certification of insured purchasers of generic drugs, a federal judge in California held March 21 (Christopher Corcoran, et al. v. CVS Health, et al., No. 15-3504, N.D. Calif., 2017 U.S. Dist. LEXIS 40783).

Mealey's Health Law - Judge Nixes Class In Insureds' Suit Claiming Pharmacy Gouged On Generic Drugs

SAN FRANCISCO - The variety of contracts at issue and evidence that at least some of the contracted pharmacy benefit managers (PBMs) understood that a pharmacy's usual and customary rate did not include the rate offered for generic drugs in its membership program defeat a motion for class certification of insured purchasers of generic drugs, a federal judge in California held March 21 (Christopher Corcoran, et al. v. CVS Health, et al., No. 15-3504, N.D. Calif., 2017 U.S. Dist. LEXIS 40783).

Mealey's Litigation Procedure - Judge Refuses To Compel Arbitration Of Investor's Claims In China

WILMINGTON, Del. - A Delaware federal judge on March 22 denied a motion filed by several companies to compel arbitration of claims asserted by an investor in relation to supply and operating agreements, finding that neither of the arbitration provisions in the contracts applies to his claims (Pei Chuang v. OD Expense, et al., No. 1:16-cv-00915, D. Del., 2017 U.S. Dist. LEXIS 40913).