Mealey's California Insurance

  • September 14, 2020

    Insurers Respond To Reinsurers' Breach Of Contract Counterclaims

    LOS ANGELES — Insurers on Sept. 10 asserted affirmative defenses to a reinsurer's breach of contract and declaratory relief counterclaims seeking damages of $11.5 million plus prejudgment interest from the insurers in their California federal court dispute over denied reinsurance payments for livery claims, trucking claims and habitability claims (California Capital Insurance Co., et al. v. Maiden Reinsurance North America, Inc., No. 20-1264, C.D. Calif.).

  • September 11, 2020

    Federal Judge Denies Remand Of Homeowners' Breach Of Contract, Bad Faith Suit

    FRESNO, Calif. — A California federal judge on Sept. 8 denied an insured's motion to remand a breach of contract and bad faith suit arising out of fire damages to an insured home after determining that it was not initially clear that the insured's damages exceeded the federal jurisdictional minimum amount of $75,000 (Ramon Sanchez v. AMCO Insurance Co., et al., No. 19-1633, E.D. Calif., 2020 U.S. Dist. LEXIS 163761).

  • September 09, 2020

    Plaintiff Voluntarily Dismisses Class Action Seeking Coverage For Trip Cancellation

    LOS ANGELES — A Los Angeles resident on Aug. 19 filed a notice of voluntary dismissal without prejudice of his class action complaint alleging in a California federal court that an insurance policy specifically covered his trip cancellation due to California’s civil authority orders in response to the novel coronavirus pandemic (Richard Robbins v. Generali Global Assistance, Inc., et al., No. 20-04904, C.D. Calif.).

  • September 04, 2020

    Insurers: COVID-19-Related Business Loss Claims Preempted By Policy Exclusions

    LOS ANGELES — Insurers named as defendants in a breach of contract and bad faith lawsuit stemming from their denial of a lost business coverage claim filed by the operator of a nail salon that was forced to close during the novel coronavirus pandemic on Aug. 28 asked a federal judge in California to dismiss their insured's complaint, arguing that the insured failed to plead any basis for coverage under the terms of the policy he purchased (Thomas Phan v. Nationwide General Insurance Co., et al., No. 20-7616, C.D. Calif.).

  • September 04, 2020

    Panel Affirms Denial Of Reinsurer's Bid To Intervene In Creditor's $3.2M Dispute

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Sept. 2 upheld the denial of a reinsurer's motion to intervene as untimely in a case over a $3.2 million judgment and found that the reinsurer lacked standing to challenge another order disbursing registry funds to a judgment creditor (Odyssey Reinsurance Company v. Richard Keith Nagby, et al. v. Knight Insurance Company Ltd., Nos. 19-55346, 19-55347, 19-55423, 9th Cir., 2020 U.S. App. LEXIS 27976).

  • September 04, 2020

    9th Circuit: Court Erred In Ruling Intellectual Property Exclusion Bars Coverage

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Aug. 19 held that a lower federal court erred in finding that an insurance policy's intellectual property exclusion unambiguously precluded coverage solely based on the allegations that the insured asserted in an underlying lawsuit, reversing and remanding (MyChoice Software, LLC, et al. v. Travelers Casualty Insurance Company of America, No. 19-56030, 9th Cir., 2020 U.S. App. LEXIS 26328).

  • September 02, 2020

    Excess Insurers Oppose Reinsurer's Declaratory Judgment Counterclaim

    SAN FRANCISCO — Two excess insurers on Aug. 25 responded to a reinsurer's declaratory judgment counterclaim in a California federal court, alleging that the reinsurer is estopped and waived from seeking to inspect their claim reporting of an insured's asbestos liabilities (New Hampshire Insurance Company, et al. v. TIG Insurance Company, No. 20-04668, N.D. Calif.).

  • September 02, 2020

    Assignees Failed To Present Any Disputed Issues Of Fact Related To Bad Faith Claim

    LOS ANGELES — A federal judge in California on Aug. 28 granted an auto insurer's motion for summary judgment on a bad faith claim after determining that the assignees to the insured's  policy failed to present any disputed issues of fact related to the bad faith claim (Ricky Ray, et al. v. State Farm Mutual Automobile Insurance Co., et al., No. 19-4922, C.D. Calif., 2020 U.S. Dist. LEXIS 156487).

  • September 02, 2020

    Judge Decides Insurers' Duties For 6 Out Of 15 Construction Defect Cases

    SACRAMENTO, Calif. — Addressing coverage for subcontractors in six out of 15 underlying construction defect cases, a California federal judge on Aug. 31 ruled that an insurer had a duty to defend four of them, a duty to indemnify only three and owed equitable contribution to another insurer for two of them (Interstate Fire & Casualty Insurance Company v. First Specialty Insurance Company, et al., No. 17-1795, E.D. Calif., 2020 U.S. Dist. LEXIS 158229).

  • September 01, 2020

    Judge Refuses To Remand, Grants Insurer's Motion To Dismiss COVID-19 Coverage Suit

    LOS ANGELES — A federal judge in California on Aug. 28 denied a restaurant insured's motion to remand and granted an all-risk insurer's motion to dismiss the insured's lawsuit seeking coverage for its losses arising from the governmental shutdown orders prompted by the novel coronavirus, finding that the insured failed to demonstrated that it incurred "direct physical loss of or damage to property" to trigger the policy's civil authority coverage (10E, LLC v. Travelers Indemnity Co. of Connecticut, et al., No. 20-0441, C.D. Calif., 2020 U.S. Dist. LEXIS 156827).

  • August 28, 2020

    Reinsurer's Parent Companies Remove Breach Of Contract Case To Federal Court

    LOS ANGELES — Parent companies of a reinsurance company on Aug. 26 removed to a California federal court a lawsuit brought by four insurers alleging intentional interference with and inducement of a breach of a multiple line excess of loss reinsurance agreement (California Capital Insurance Company, et al. v. Enstar Holdings [US] LLC, et al., No. 20-7806, C.D. Calif.).

  • August 26, 2020

    Insolvent Insurers' Trustee Seeks To Make $49.4M Distribution

    LOS ANGELES — California's insurance commissioner as trustee for three insurance trusts on Aug. 10 asked a California trial court for permission to pay additional sums of $49.4 million to creditors, noting that "repayment of creditors is a key goal of any receivership" (Ricardo Lara v. Mission Insurance Company, et al., No. 572-724, Calif. Super., Los Angeles Co.).

  • August 26, 2020

    Judge Awards Bill Of Costs In Dispute Over Reinsurance Participation Agreement

    SACRAMENTO, Calif. — Almost a year after ruling that an insured failed to demonstrate any economic loss from entering into a reinsurance participation agreement (RPA) and, thus, lacked standing to sue under the California unfair competition law (UCL), a federal judge in California on Aug. 25 awarded costs of $20,396.04 against the insured (Pet Food Express Ltd. v. Applied Underwriters Inc., et al., No. 16-1211, E.D. Calif.).

  • August 25, 2020

    Insured Says Pollution Exclusion Cannot Be Used To Deny Coverage

    SAN DIEGO — A commercial property insurance policy's pollution exclusion and virus or bacteria exclusion do not bar coverage for business interruption and extra expense costs incurred as a result of the COVID-19 stay-at-home orders issued by the state of California, an insured restaurant owner says in an Aug. 20 complaint filed against an insurer in California federal court (JAJ Group Inc., et al. v. Liberty Mutual Insurance Co., No. 20-1620, S.D. Calif.).

  • August 25, 2020

    Disability Insurer Did Not Breach Contract, Act In Bad Faith In Denying Claim

    ANCHORAGE, Alaska — The Ninth Circuit U.S. Court of Appeals on Aug. 24 affirmed a district court's ruling in favor of a disability insurer after determining that the insurer did not breach its contract or act in bad faith because the insurer's denial of benefits was reasonable (Cynthia Cheney v. United States Life Insurance Company in the City of New York, et al., No. 19-15649, 9th Cir., 2020 U.S. App. LEXIS 26856).

  • August 25, 2020

    Insured Seeks Reversal Of Rulings In Construction Defects Coverage Dispute

    SANTA ANA, Calif. — An insured recently asked a California appeals court to reverse two summary judgments rulings in favor of a commercial general liability insurer and an insurance broker, arguing that the insurer failed to present compelling evidence or eliminate triable issues of material fact regarding whether rescission of the policy was warranted in a coverage dispute arising from a construction defects lawsuit (Michael Favreau v. Navigators Insurance Company, et al., Nos. G056718 and G056938, Calif. App., 4th Dist.).

  • August 19, 2020

    Excess Liability Insurer Says Pollution Exclusion Bars Coverage For Oil Spill

    LOS ANGELES — An excess liability insurer filed suit on Aug. 14 in California federal court seeking a declaration that its policy's total pollution exclusion bars coverage for remediation costs incurred as the result of a crude oil spill  (General Star Indemnity Co. v. Petrol Transport Inc., et al., No. 20-7371, C.D. Calif.).

  • August 19, 2020

    JPMDL To Hear Oral Arguments On 2 MDLs Over Coronavirus Insurance Coverage

    WASHINGTON, D.C. — The U.S. Judicial Panel on Multidistrict Litigation issued an order on Aug. 18 indicating that it will hear oral arguments on Sept. 24 on whether to transfer and coordinate lawsuits seeking insurance coverage for passes for ski resorts that were prematurely closed due to the novel coronavirus, further indicating that it will hear oral arguments regarding insurer-specific MDLs in lawsuits seeking business interruption coverage for losses arising from governmental closure orders prompted by the coronavirus pandemic (In Re: National Ski Pass Insurance Litigation, No. 2955, JPMDL, In re:  COVID-19 Business Interruption Insurance Coverage Litigation, No. 2942, JPMDL).

  • August 18, 2020

    Attorney Fees In Disability Administrative Proceeding Not Recoverable Under ERISA

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Aug. 17 affirmed a district court's ruling that attorney fees incurred during an administrative appeal are not recoverable under the Employee Retirement Income Security Act (Juan Castillo v. Metropolitan Life Insurance Co., No. 19-56093, 9th Cir., 2020 U.S. App. LEXIS 25985).

  • August 18, 2020

    9th Circuit Reverses Ruling As To Application Of Faulty Workmanship Exclusion

    PORTLAND, Ore. — The Ninth Circuit U.S. Court of Appeals held Aug. 17 that a federal court erred in finding that a faulty workmanship exclusion does not preclude coverage for an insured's repair costs, finding that an ambiguity in the exclusion warrants reversal and remand (Engineered Structures, Inc. v. Travelers Property Casualty Company, No. 18-35588, 9th Cir., 2020 U.S. App. LEXIS 25994).

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