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Mealey's California Insurance

  • December 11, 2019

    Plan Did Not Abuse Discretion In Terminating Disability Benefits, Panel Says

    SAN FRANCISCO — A district court did not err in applying an abuse-of-discretion standard of  review in a disability suit because the plan administrator’s conduct did not rise to the level of requiring a de novo review of the plan’s denial of benefits, the Ninth Circuit U.S. Court of Appeals said Dec. 10 in affirming the lower court’s finding that the plan did not abuse its discretion in terminating the disability claimant’s benefits (Olga Gorbacheva v. Abbott Laboratories Extended Disability Plan, et al., Nos. 18-15400, 18-16178, 9th Cir., 2019 U.S. App. LEXIS 36542).

  • December 04, 2019

    Disability Claimant Met Burden Of Proving He Remained Disabled

    SAN FRANCISCO — A California federal judge on Nov. 27 granted a disability claimant’s motion for judgment on the administrative record after determining that the claimant met his burden of proving that he remained disabled from performing the duties of his sedentary occupation as a project manager (Steven S. Garretson v. Metropolitan Life Insurance Co., No. 17-7052, N.D. Calif., 2019 U.S. Dist. LEXIS 206700).

  • December 04, 2019

    Judge Names California Insurance Commissioner As Insurer’s Conservator

    REDWOOD CITY, Calif. — A California judge on Nov. 4 appointed the state’s insurance commissioner as conservator of California Insurance Co. (CIC) and enjoined all litigation involving the insurer (Insurance Commissioner of the State of California v. California Insurance Co., No. 19CIV06531, Calif. Super., San Mateo Co.).

  • December 03, 2019

    Judge Denies Insurer’s Renewed Motion As To Yahoo’s Bad Faith, Damages Claims

    SAN JOSE, Calif. — A California federal judge on Nov. 25 denied a commercial general liability insurer's renewed motion for judgment as a matter of law on Yahoo! Inc.'s bad faith and bad faith damages claims, finding that the insurer has failed to present any new evidence or new argument since the original motion was denied in May (Yahoo! Inc. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 17-00489, N.D. Calif., 2019 U.S. Dist. LEXIS 204411).

  • November 26, 2019

    Contractor: Builders Risk Insurer Improperly Handled Water, Mold-Related Claim

    SAN FRANCISCO — An additional insured contractor alleges in a Nov. 7 complaint filed in a California federal court that a builders risk insurer breached its policy, acted in bad faith and violated California Business and Professions Code Section 17200 et seq., regarding its claim handling of water and mold-related damage in a construction project (Build Group, Inc. v. Liberty Surplus Insurance Corp., No. 19-07359, N.D. Calif.).

  • November 26, 2019

    Discovery In Disability Suit Is Not Warranted, California Federal Judge Determines

    OAKLAND, Calif. — A California federal judge on Nov. 25 denied a disability claimant’s request to conduct discovery after determining that the claimant failed to prove that additional evidence is necessary to conduct an adequate de novo review (Natalya Vigdorchik v. Liberty Life Assurance Company of Boston, et al., No. 19-3891, N.D. Calif., 2019 U.S. Dist. LEXIS 204512). 

  • November 25, 2019

    Disability Insurer Did Not Breach Contract Or Act In Bad Faith In Denying Benefits

    SACRAMENTO, Calif. — A disability claimant failed to prove that a disability insurer breached its contract or acted in bad faith in denying any-occupation disability benefits, a California federal judge said Nov. 21 in granting summary judgment in favor of the insurer (Loretta Bruce v. Hartford Life & Accident Insurance Co., No. 17-2201, E.D. Calif., 2019 U.S. Dist. LEXIS 202511).

  • November 21, 2019

    Disability Administrator Abused Discretion In Denying LTD Claim, Panel Says

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Nov. 19 remanded a long-term disability (LTD) benefits claim to the plan administrator after determining that the plan administrator abused its discretion in denying benefits based on the one-week waiting period required by the plan (Michael Alves v. Hewlett-Packard Comprehensive Welfare Benefits Plan, et al., No. 18-55819, 9th Cir., 2019 U.S. App. LEXIS 34362).

  • November 19, 2019

    Appellant Challenges Stay Of Suit Seeking Validity Of Insurer’s Subrogation Claim

    SAN FRANCISCO — An appellant recently asked a California appeals court to reverse a lower court’s ruling that stayed his declaratory judgment lawsuit disputing the validity of a professional liability insurer’s subrogation claim against his family trust, arguing that the stay “has no legal basis” (John Berman v. Minnesota Lawyers Mutual Insurance Company, No. A155394, Calif. App., 1st Dist., Div. 3).

  • November 19, 2019

    Failure To File Proof Of Loss Defeats Flood Damage Claim, 9th Circuit Affirms

    PORTLAND, Ore. — The Ninth Circuit U.S. Court of Appeals on Nov. 18 affirmed a lower federal court’s finding that a hotel insured’s failure to file a signed and sworn proof of loss defeats its claim for flood damage (Surfsand Resort LLC v. Nationwide Mutual Fire Insurance Co., et al., No. 18-35607, 9th Cir., 2019 U.S. App. LEXIS 34258).

  • November 18, 2019

    Federal Jurisdiction Does Not Exist; Disability Suit Remanded To State Court

    SAN FRANCISCO — A California federal magistrate judge on Nov. 15 remanded a disability claimant’s suit after determining that diversity of jurisdiction does not exist because a negligence claim asserted against the insurance agency that sold the disability policies to the claimant may not be time-barred under California law (Mark Bennett, D.D.S. v. Ohio National Life Assurance Corp., et al., No. 19-5774, N.D. Calif., 2019 U.S. Dist. LEXIS 198719).

  • November 18, 2019

    Insurer Hit With Bad Faith Breach Of Contract Suit Over Failure To Settle

    SAN FRANCISCO — An errors and omissions liability insurer’s failure to settle a consumer class action lawsuit against its insured for violating provisions of the Telephone Consumer Protection Action (TCPA) amounts to a bad faith breach of contract, an assignee argues in a Nov. 5 complaint filed in California federal court (Ignacio Perez v. Indian Harbor Insurance Co., et al., No. 19-7288, N.D. Calif.).

  • November 15, 2019

    Insurer’s Fraud Suit Remanded After Judge Finds No Preemption By ERISA

    SANTA ANA, Calif. — An insurer’s lawsuit accusing a number of substance abuse treatment centers of common-law fraud, violation of California’ unfair competition law (UCL) and other claims can proceed in state court, a federal judge in California ruled Nov. 13, holding that the plaintiff company’s claims are not preempted by the Employee Retirement and Income Security Act (Health Net Life Insurance Co. v. Morningside Recovery LLC, et al., No. 19-cv-1342, C.D. Calif., 2019 U.S. Dist. LEXIS 197937).

  • November 14, 2019

    Breach Of Contract, Bad Faith Claims Against Life Insurer Dismissed

    LOS ANGELES — A California federal judge on Nov. 4 dismissed a breach of contract claim and a bad faith claim against a life insurer because the plaintiffs’ allegations, which arise out of the life insurer’s increase in policy premiums, do not support a claim for breach of contract or for bad faith (Brighton Trustees, et al. v. Transamerica Life Insurance Co., No. 19-4210, C.D. Calif., 2019 U.S. Dist. LEXIS 193359).

  • November 14, 2019

    Panel:  Counsel’s Failure To Raise Youth Factors Argument Was Not Ineffective

    SAN FRANCISCO — A trial attorney’s failure to raise the youth factors argument in two U.S. Supreme Court rulings and one California Supreme Court case following a man’s conviction on two counts of insurance fraud did not constitute ineffective assistance of counsel, a California appeals panel ruled Nov. 13, finding that the contents of the presentence report prepared by the prosecution showed the defendant’s history of failing to comply with probation and post-sentence requirements (People v. Lamont James, Nos. A155627, A157772, Calif. App., 1st Dist., 2nd Div., 2019 Cal. App. Unpub. LEXIS 7507).

  • November 11, 2019

    Admission Of Evidence Of Prior Injury Does Not Warrant Vacating Fraud Verdict

    SANTA ANA, Calif. — A California appeals court panel on Nov. 8 found that while a trial court judge’s decision to admit evidence regarding a 2009 incident in which a police officer injured his right hand while on duty was erroneous, it does not warrant vacating the officer’s conviction for insurance fraud because the error was not prejudicial (People v. Ryan Patrick Natividad, No. G055248, Calif. App., 4th Dist., 3rd Div., 2019 Cal. App. Unpub. LEXIS 7451).

  • November 07, 2019

    Disability Insurer’s Denial Of Benefits Supported By Evidence, Judge Determines

    SAN JOSE, Calif. — A disability claimant failed to prove that he was disabled from his own occupation as a result of sickness or injury according to the plan’s terms, a California federal judge said Nov. 6 after applying a de novo standard of review based on a remand order issued by the Ninth Circuit U.S. Court of Appeals (Robert Gordon v. Metropolitan Insurance Co., No. 10-5399, N.D. Calif., 2019 U.S. Dist. LEXIS 193142).

  • November 05, 2019

    Court Erred In Sustaining Demurrers In Insurance Dispute, Insurer Argues

    SAN JOSE, Calif. — A California court erred in sustaining demurrers without leave to amend in a construction defects insurance lawsuit because the discovery that an insurer’s obligations to a subcontractor arose from fraudulent activity should not result in the general contractor’s insurers avoiding their obligations to their insured “in their entirety,” punishing the subcontractor’s insurer for fulfilling its obligations to it insurer, the subcontractor’s insurer argues in a Sept. 4 appellant brief filed in a California appellate court (The Travelers Indemnity Company of Connecticut v. Navigators Specialty Insurance Co., et al., No. H046784, Calif. App., 6th Dist.).

  • November 05, 2019

    Federal Magistrate Judge Says Disability Plan Did Not Abuse Its Discretion

    SACRAMENTO, Calif. — A California federal magistrate judge on Nov. 1 recommended that judgment be entered in favor of a disability claim because the denial of a claim for an extension of short-term disability (STD) benefits was not an abuse of discretion and is supported by the medical evidence (Jerome Clay v. AT&T Umbrella Benefit Plan No. 3, No. 17-749, E.D. Calif., 2019 U.S. Dist. LEXIS 190308).

  • November 01, 2019

    Court’s Jurisdiction Exists On CIGA’s Case Over WCAB Ruling On Employee’s Injury

    SAN DIEGO — In a case of first impression in California, a state appeals panel on Oct. 30 found, for the purpose of excess insurance, that a trial court has jurisdiction to characterize an employee’s injury under an insolvent insurer’s excess policy differently than what was reflected in a stipulation by the Workers' Compensation Appeals Board (WCAB) (California Insurance Guarantee Association v. San Diego County Schools Risk Management Joint Powers Authority, et al., No. D074360, Calif. App., 4th Dist., Div. 1, 2019 Cal. App. LEXIS 1070).