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Mealey's Insurance - Judge Dismisses Majority Of Claims In Kickback Scheme Over Lender-Placed Insurance

CHICAGO - In a lawsuit alleging a kickback scheme in lender-placed insurance, an Illinois federal judge on Feb. 8 dismissed most of the claims except for breach of contract and bad faith claims pertaining to alleged overcharging of nonexistent inspections (Mariusz Dolegiewicz v. U.S. Bank Trust, N.A...

Mealey's Insurance - 2nd Circuit Finds Investors To STOLI Policies Were Victims, Affirms Restitution

NEW YORK - A federal judge in Connecticut did not err when finding that investors in three stranger obtained life insurance (STOLI) policies were victims under the Mandatory Victim Restitution Act (MVRA) and ordering a man who pleaded guilty to insurance fraud to pay $1.9 million in restitution, a Second...

Mealey's Insurance - 6th Circuit Rejects Insurer's Liquidator's Reverse-Preemption Argument In Arbitration Suit

CINCINNATI - In a dispute between an insolvent insurer's liquidator and an administrative services provider over whether work for the insurer should be arbitrated, the Sixth Circuit U.S. Court of Appeals held Feb. 9 that the McCarran-Ferguson Act does not reverse-preempt the enforcement of a contractual...

Mealey's Insurance - Judge: 'Your Work' Exclusion Relieves Insurer From Defending Contractor

MIAMI - An insurance company has no duty to defend a general contractor accused in an underlying suit of construction defects, a federal judge in Florida ruled Feb. 7, holding that the "your work" exclusion to the policy warrants a denial of coverage (Mid-Continent Casualty Company v. JWN Construction...

Mealey's Insurance - Panel: Auto Insurer Is Liable For Additional Insured's PIP Benefits

TRENTON, N.J. - An auto insurer is liable for personal injury protection (PIP) benefits for an unnamed additional insured under terms of a voided insurance contract, a New Jersey appeals panel affirmed Feb. 8 (Tyrone S. Henry Sr., et al. v. Santosh S. Bhowmik, et al., No. A-3331-15T4, N.J. Super., App...

Mealey's Insurance - Claimant Failed To Prove Back Pain Was Sole Cause Of Disability

PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Feb. 12 affirmed a district court's ruling that a disability insurer's termination of benefits was not arbitrary and capricious because the claimant failed to prove that she suffered solely from a physical disability that precluded her...

Mealey's Insurance - 2nd Circuit Affirms Ruling In Insurer's Favor In Dispute Over Civil Lawsuit

NEW YORK - The Second Circuit U.S. Court of Appeals on Feb. 8 affirmed a lower federal court's ruling in favor of a general liability insurer in an insured's declaratory judgment lawsuit seeking coverage for an underlying civil lawsuit, finding that the policy limits coverage for mental injury...

Mealey's Insurance - Reinsurer Tells Nebraska Federal Court Promissory Note Is Void, Unenforceable

LINCOLN, Neb. - A reinsurer moved for summary judgment on Feb. 9 in Nebraska federal court, arguing that a promissory note executed pursuant to a reinsurance participation agreement (RPA) is void and unenforceable as a matter of public policy (Applied Underwriters Inc. v. Top's Personnel Inc., No...

Mealey's Insurance - Court Erred In Finding Faulty Work Can Never Be An 'Occurrence,' Majority Says

DENVER - A majority of the 10th Circuit U.S. Court of Appeals concluded Feb. 13 that a lower federal court erred in finding that a subcontractor's faulty workmanship that caused damage to an insured's own work can never be an "occurrence," reversing and remanding (Black & Veatch...

Mealey's Insurance - Panel Vacates, Remands Denial Of Insurer's Intervention In Forfeiture Proceedings

NEW YORK - The Second Circuit U.S. Court of Appeals on Feb. 13 vacated and remanded a lower federal court's dismissal of an insurer's petition to assert a third-party interest in a criminal forfeiture proceeding but denied the insurer's appeal of the lower court's denial of its request...

Mealey's Insurance - Insurer Has Duty To Defend, Indemnify Negligent Installation Claims, Appeals Panel Finds

HARRISBURG, Pa. - A commercial general liability insurer has a duty to defend and indemnify an insured subcontractor against a contractor's claims of negligent installation, the Pennsylvania Superior Court affirmed Feb. 9 (J.J.D. Urethane Co. v. Westfield Insurance Co., et al., Nos. 1440 EDA 2017...

Mealey's Insurance - Government Did Not Violate Insurers', Reinsurers' 5th Amendment Rights, Panel Says

WASHINGTON, D.C. - The U.S. government's termination of insurers and reinsurers' lawsuits pursuant to a claims settlement agreement between it and Libya and its subsequent legislation and executive order did not constitute a compensable taking under the Fifth Amendment, the Federal Circuit U...

Mealey's Insurance - Judge Allows Insurer To Amend Complaint To Provide Details Of Fraud Scheme

FLINT, Mich. - A statutorily created insurance program that provides insurance coverage for pedestrians struck by vehicles and passengers in automobile accidents can file a second amended complaint that provides additional details of a fraudulent scheme that submitted bills to insurance companies, a...

Mealey's Insurance - Judge Allows Breach Of Contract Claim Against Insurer To Proceed To Trial

NEW HAVEN, Conn. - After dismissing all claims based on a "collapse" from faulty concrete against one homeowners insurer for not occurring during its policy period, a Connecticut federal judge on Feb. 13 dismissed all but a breach of contract claim against another insurer because a reasonable...

Mealey's Insurance - Panel: Insured Cannot 'Swap Horses Midstream' In Appeal Of No Coverage Ruling

PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Feb. 15 rejected an insured's appeal of a lower court's ruling that it was not owed professional liability coverage for an underlying third-party complaint, finding that the insured's primary argument was never raised in the lower...

Mealey's Insurance - Panel Affirms Dismissal Of Remodelers' Suit Against Federal Flood Insurer

CINCINNATI - The Sixth Circuit U.S. Court of Appeals on Feb. 14 affirmed a lower court's dismissal of a breach of contract, unjust enrichment, fraudulent inducement and intentional and negligent misrepresentation lawsuit against a federal flood insurer, reiterating that the claims are preempted by...

Mealey's Insurance - Florida Majority Reverses $493,246 Attorney Fee Award In Sinkhole Coverage Suit

LAKELAND, Fla. - A majority of the Second District Florida Court of Appeal on Feb. 14 reversed a lower court's $493,246.50 attorney fees award against an insurer in a sinkhole coverage dispute and remanded for further proceedings (Citizens Property Insurance Corporation v. Meghan Anderson, No. 2D16...

Mealey's Insurance - Insurers Owe Defense For Claims Arising Out Of Negligence, 11th Circuit Says

ATLANTA - Commercial general liability insurers have a duty to defend allegations that an insured improperly constructed on land without taking reasonable steps to implement a workable drainage system, the 11th Circuit U.S. Court of Appeals held Feb. 13, reversing and remanding the entry of summary judgment...

Mealey's Insurance - Judge Declines To Apply 'Fraudulent Misjoinder' Standard In Bad Faith Suit

SAN FRANCISCO - Remand of an insurance breach of contract and bad faith lawsuit to state court is necessary because the Ninth Circuit U.S. Courts of Appeals has yet to adopt the "fraudulent misjoinder" standard established by the 11th Circuit, which an insurer argues is the basis for the action's...

Mealey's Insurance - U.S. High Court Refuses To Review Arbitration Dispute Over Sexual Abuse Claims

WASHINGTON, D.C. - The U.S. Supreme Court on Feb. 20 denied an excess insurer's petition for writ of certiorari challenging a California appeals court's denial of its motion to compel arbitration of a coverage dispute with a school district over sexual abuse claims (Safety National Casualty Corp...

Mealey's Insurance - Magistrate Judge Lifts Stay Against Idaho Insurance Guaranty Association

BOISE, Idaho - An Idaho federal magistrate judge on Feb. 16 lifted a stay against the Idaho Insurance Guaranty Association (IIGA) in a trust bank's coverage dispute but declined to lift a stay and grant a preliminary injunction against an insolvent insurer (Idaho Trust Bank v. BancInsure Inc., et...

Mealey's Insurance - Insurer's Liquidator Has No Interest To Land, New York Bankruptcy Judge Says

WHITE PLAINS, N.Y. - Reversionary interests in land parcels are property of a reorganized debtor, and an insurer's liquidator is precluded from interfering with those interests, a New York federal bankruptcy judge ruled Feb. 15, ordering transfer of title to the reorganized debtor (In re: Frontier...

Mealey's Insurance - 6th Circuit: Pharmacist Used Others' Identifications To Further Fraud Scheme

CINCINNATI - A federal judge in Kentucky erred when dismissing a count from an indictment charging a pharmacist with aggravated identity theft, a Sixth Circuit U.S. Court of Appeals panel ruled Feb. 20, finding that the defendant used the identities of a doctor and patient for the purpose of submitting...

Mealey's Insurance - Evidence About Patient Recruiting, Vehicle Purchases Is Relevant, Judge Says

LOUISVILLE, Ky. - Evidence concerning the recruitment of patients to a chiropractic clinic that allegedly fraudulently billed Medicare, as well as information showing that participants in the scheme put down large cash payments for expensive automobiles, is relevant, a federal judge in Kentucky ruled...

Mealey's Insurance - New York Panel: Armored Car Company's Insurer Is Not Liable For Jewelry Loss

NEW YORK - A New York appeals panel on Feb. 20 affirmed a lower court's ruling that an armored car company's insurer has no duty to compensate a freight carrier and its insurer for the loss of a gold jewelry shipment that was transported by its insured (AXA Winterthur Insurance Co. v Transvalue...