LexisNexis® Legal Newsroom
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 Banking & Finance - Panel Finds Court Erred In Dismissing Elder Abuse Claims Against Lenders

SAN FRANCISCO - After finding that the widow of a borrower, who obtained a reverse mortgage on a property that was later foreclosed on, sufficiently pleaded her claims for elder abuse and breach of contract, a California appeals court on Dec. 11 reversed a trial court's decision dismissing her claims against two lenders (Mary Aden v. OneWest Bank, N.A., et al., No. A146242, Calif. App., 1st Dist., Div. 3).

Mealey's PI/Product Liability - Texas Appeals Court Says Judge Erred When Dismissing Couple's Defects Suit

AMARILLO, Texas - A trial court judge in Texas erred when dismissing a couple's construction defects and breach of contract suit against a builder for want of prosecution without providing proper notice, a state appeals court panel ruled Dec. 11 (Patrick Pence, et al. v. S&D Builders LLC, et al., No. 07-16-00005-CV, Texas App., 7th Dist., 2017 Tex. App. LEXIS 11501).

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 Banking & Finance - Federal Judge Dismisses Fraud, Breach Of Contract Claims Against HSBC

HOUSTON - A Texas federal judge on Dec. 7 granted a bank's motion to dismiss claims for breach of contract and fraud asserted against it by a borrower who was attempting to enjoin foreclosure, finding that the property owner failed to state a claim upon which relief could be granted (Alan Battle v. HSBC Bank USA, et al., No. 4:17-CV-02552, S.D. Texas, 2017 U.S. Dist. LEXIS 202810).

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 - Georgia Federal Judge Says Insurer Had Reasonable Basis To Dispute Mold Claim

AUGUSTA, Ga. - A Georgia federal judge on Dec. 6 denied an insurer's motion for summary judgment on a breach of contract claim but granted the insurer's motion on a bad faith claim after determining that the insurer had a reasonable basis to deny the insured's claim for coverage of mold and water damages incurred to her home as a result of a hailstorm (Carrie Finch v. Owners Insurance Co., No. 16-169, S.D. Ga., 2017 U.S. Dist. LEXIS 200934).

Mealey's PI/Product Liability - Louisiana Appeals Court Affirms Judgment In Contractor's Favor In Defects Dispute

LAKE CHARLES, La. - A Louisiana appeals court panel on Dec. 6 affirmed a trial court judge's $1,125 award to a contractor accused of construction defects, finding that the evidence demonstrated that while the standards of the contractor's work were comparable to a "Volkswagen" rather than a "Cadillac," it did breach the terms of a construction contract (Calvin Paul Williams v. Vincent Alexander, Nos. CA-17-436, 17-437, La. App., 3rd Cir., 2017 La. App. Unpub. LEXIS 377).

Mealey's Insurance - Insured's Suit Against Adjuster In Hurricane Ike Coverage Dispute Is Untimely

GALVESTON, Texas - A Texas federal judge on Dec. 5 found that an insured's breach of contract and negligence lawsuit against an adjuster is time-barred by a two-year statute of limitations, granting the adjuster's motion for summary judgment in Hurricane Ike coverage dispute (Gracie Reese v. Aftermath Public Adjusters, Inc., et al., No. 16-273, S.D. Texas, 2017 U.S. Dist. LEXIS 199527).

Mealey's Antitrust/Unfair Competition - Judge Finds No Facts To Support Claim That Insurer Wrongfully Terminated Polices

LOS ANGELES - A California federal judge on Dec. 4 dismissed insureds' claims for violation of California's unfair competition law (UCL) and breach of contract, finding that they failed to show that an insurer's termination of their life insurance policies was unreasonable (Arthur Avazian, et al. v. Genworth Life & Annuity Insurance Co., et al., No. 2:17-cv-06459, C.D. Calif., 2017 U.S. Dist. LEXIS 199067).

Mealey's Insurance - Insurer Says Insured Does Not Rely On Reinsurance Agreements In $26M Case

WASHINGTON, D.C. - A financial services company abandoned reliance on reinsurance agreements in its lawsuit seeking to recover a $26 million arbitration award directly from reinsurers, a credit insurer argues in a Dec. 1 reply brief to a District of Columbia federal court, seeking dismissal of the breach of contract lawsuit (Vantage Commodities Financial Services I, LLC v. Assured Risk Transfer PCC, LCC, et al., No. 17-01451, D. D.C.).

Mealey's Litigation Procedure - 9th Circuit Refuses To Compel Arbitration Of Estate's Claims In South Korea

HONOLULU - The Ninth Circuit U.S. Court of Appeals on Nov. 30 affirmed a district court's decision that denied a Korean corporation's motion to compel an estate's negligence claims related to the death of a seaman to arbitration in South Korea, finding that the corporation was not a signatory to the arbitral agreement in an underlying employment contract (Esther Margarita Limia Suarez Viuda De Yang, et al. v. Majestic Blue Fisheries LLC, et al., No. 15-16881, 9th Cir., 2017 U.S. App. LEXIS 24308).

Mealey's Labor & Employment - 3rd Circuit Overturns Barnes, Issues New Ruling On Seafarers' Contracts

PHILADELPHIA - A Third Circuit U.S. Court of Appeals panel of 12 judges on Dec. 4 overruled its decision in Barnes v. Andover Co., L.P. and held that where a seafarer freely enters a union contract, courts may not review that contract piecemeal unless there is evidence that the collective bargaining process was unfair (James L. Joyce v. Maersk Line Ltd., No. 16-3553, 3rd Cir., 2017 U.S. App. LEXIS 24433).

Mealey's PI/Product Liability - N.Y. Justice Rejects Power Company's Reargument Of Asbestos Indemnity Claim

NEW YORK - A power company's contracts with its contractors requires indemnification only after the establishment of liability, a New York justice held in denying reargument in an asbestos case in an opinion posted Nov. 30 (In re New York City Asbestos Litigation Michael Koulermos and Marian Koulermos v. A.O. Smith Water Products, et al., No. 190406/2014, N.Y. Sup., New York Co.; 2017 N.Y. Misc. LEXIS 4530).

Mealey's PI/Product Liability - Pennsylvania Judge Vacates No Coverage Ruling In Dispute Over Racetrack Death

PHILADELPHIA - A Pennsylvania judge found that a lower court erred in finding that a commercial umbrella liability insurer has no duty to indemnify its insured against $2.6 million in punitive damages that it paid to settle an underlying wrongful death and survival action, vacating and remanding for an entry of summary judgment in favor of the insured on the breach of contract claim and for reinstatement and further proceedings on the bad faith claim (Bensalem Racing Association, Inc., et al. v. Ace Property and Casualty Insurance Co., No. 530 EDA 2017, Pa. Super.).

Mealey's Banking & Finance - Judge Dismisses Seller's Claim For Liquidated Damages For Breach Of Contract

CHICAGO - An Illinois federal judge on Nov. 29 partially granted a motion filed by property investors who were unable to obtain a mortgage to dismiss a counterclaim by a seller for breach of contract for liquidated damages, finding that a liquidated damages provision in a modification to a purchase agreement was unenforceable (Randall Ewing, et al. v. 1645 W. Farragut LLC, No. 16-cv-9930, N.D. Ill., 2017 U.S. Dist. LEXIS 196197).

Mealey's Toxic Tort/Environmental - N.Y. Justice Rejects Power Company's Reargument Of Asbestos Indemnity Claim

NEW YORK - A power company's contracts with its contractors requires indemnification only after the establishment of liability, a New York justice held in denying reargument in an asbestos case in an opinion posted Nov. 30 (In re New York City Asbestos Litigation Michael Koulermos and Marian Koulermos v. A.O. Smith Water Products, et al., No. 190406/2014, N.Y. Sup., New York Co.; 2017 N.Y. Misc. LEXIS 4530).

Mealey's Insurance - Pennsylvania Judge Vacates No Coverage Ruling In Dispute Over Racetrack Death

PHILADELPHIA - A Pennsylvania judge found that a lower court erred in finding that a commercial umbrella liability insurer has no duty to indemnify its insured against $2.6 million in punitive damages that it paid to settle an underlying wrongful death and survival action, vacating and remanding for an entry of summary judgment in favor of the insured on the breach of contract claim and for reinstatement and further proceedings on the bad faith claim (Bensalem Racing Association, Inc., et al. v. Ace Property and Casualty Insurance Co., No. 530 EDA 2017, Pa. Super.).

Mealey's Insurance - Federal Judge: Insurer Didn't Breach Contract When It Denied Nursing Home Benefits

SEATTLE - Finding that a long-term-care insurance policy unambiguously defines the requirements of receiving nursing home benefits versus assisted living facility benefits, a Washington federal judge on Nov. 30 affirmed a lower court's finding that the insurer did not breach the contract when it denied a request for nursing home benefits (Mike Howisey, et al. v. Transamerica Life Insurance Co., No. 17-00009, W.D. Wash., 2017 U.S. Dist. LEXIS 197220).

Mealey's PI/Product Liability - Airline Expert Permitted To Testify In Injured Worker's Negligence Action

MIAMI - An aviation industry expert can testify about whether the training received by a worker who was injured in an aircraft-moving tractor from an employee of the company that made the tractor was adequate but cannot offer opinions on the sales contract for the tractor because doing so involves issues of law, a Florida federal magistrate judge held Nov. 30 (Roy Maltez v. Trepel Airport Equipment GMBH, No. 16-24465, S.D. Fla., 2017 U.S. Dist. LEXIS 196458).

Mealey's Litigation Procedure - Judge Stays Class Action Challenging Insurance Practices After Settlement Announced

JEFFERSON CITY, Mo. - A Missouri federal judge in a Nov. 29 text order granted a joint motion to stay a class action alleging that a homeowners insurer committed breach of contract when it unlawfully applied a policy's $1,000 deductible to an actual cash value (ACV) payment in a hailstorm coverage dispute after the parties announced that they reached a settlement (Jean Heckmann v. Liberty Mutual Fire Insurance Co., No. 14-04147, W.D. Mo.).

Mealey's Insurance - Judge Stays Class Action Challenging Insurance Practices After Settlement Announced

JEFFERSON CITY, Mo. - A Missouri federal judge in a Nov. 29 text order granted a joint motion to stay a class action alleging that a homeowners insurer committed breach of contract when it unlawfully applied a policy's $1,000 deductible to an actual cash value (ACV) payment in a hailstorm coverage dispute after the parties announced that they reached a settlement (Jean Heckmann v. Liberty Mutual Fire Insurance Co., No. 14-04147, W.D. Mo.).

Mealey's Litigation Procedure - Airline Expert Permitted To Testify In Injured Worker's Negligence Action

MIAMI - An aviation industry expert can testify about whether the training received by a worker who was injured in an aircraft-moving tractor from an employee of the company that made the tractor was adequate but cannot offer opinions on the sales contract for the tractor because doing so involves issues of law, a Florida federal magistrate judge held Nov. 30 (Roy Maltez v. Trepel Airport Equipment GMBH, No. 16-24465, S.D. Fla., 2017 U.S. Dist. LEXIS 196458).

Mealey's PI/Product Liability - Panel: No Indemnity Obligation Owed To Target In Relation To Personal Injury Suit

CINCINNATI - The Sixth Circuit U.S. Court of Appeals on Nov. 29 held that an indemnification arrangement involving Target Corp. and hamper suppliers is not an "insured contract" pursuant to an insurance policy issued to one of the suppliers, affirming a lower court's grant of summary judgment in favor of the insurer in a coverage dispute over an alleged eye injury caused by a pop-up laundry hamper that was purchased at Target in 2010 (Northern Insurance Company of New York v. Target Corporation, et al., No. 16-2222, 6th Cir., 2017 U.S. App. LEXIS 24156).