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Mealey's California Insurance

  • February 27, 2019

    Excess Policies Do Not Require Payment Of Separate Self-Insured Retention

    SAN FRANCISCO— An insured does not have to pay a separate self-insured retention before liability attaches to excess policies, and the insured is entitled to be indemnified by the excess insurers for defense costs incurred in underlying asbestos exposure personal injury suits filed against the insured regardless of whether the underlying suits were resolved through dismissal or settlement, the First District California Court of Appeal said Feb. 25 in reversing a trial court’s ruling (Deere & Co. v. Allstate Insurance Co., et al., No. A145170, Calif. App., 1st Dist., Div. 4, 2019 Cal. App. LEXIS 147).

  • February 21, 2019

    School Administrators’ Insurer Owes $2.6M For Settlement Over Molestation Claims

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Feb. 20 affirmed a lower federal court’s ruling that California Government Code Section 825.4 does not bar an insurer’s  claim against another insurer for repayment of $2.6 million of an underlying $15.8 million settlement of underlying negligent supervision claims against a California school district and three of its administrators arising from allegations that a teacher sexually molested three students (Westport Insurance Corporation v. California Casualty Management Company, No. 17-15924, 9th Cir., 2019 U.S. App. LEXIS 4889).

  • February 22, 2019

    California Panel Vacates Woman’s Conviction For Workers’ Compensation Fraud

    LOS ANGELES — A California appeals panel on Feb. 13 vacated a portion of a woman’s conviction for insurance fraud, finding that there was insufficient evidence to show that she submitted a false claim for workers’ compensation benefits (California v. Sharon L. Davis, No. B286377, Calif. App., 2nd Dist., 8th Div., 2019 Cal. App. Unpub. LEXIS 1061)

  • February 20, 2019

    California Court Remands Default Judgment Dispute For Further Clarification

    SAN FRANCISCO — A California appeals court on Feb. 19 remanded a case involving a default judgment against an insulator’s insurer so that the trial court could explain why it set aside the more than $2 million judgment (Donna O’Balle v. Fireman’s Fund Insurance Co., No. A151530, Calif. App., 1st Dist., Div. 2, 2019 Cal. App. Unpub. LEXIS 1176).

  • February 15, 2019

    Trial Court Did Not Abuse Discretion In Setting Aside Judgments In Asbestos Dispute

    SAN FRANCISCO — The First District California Court of Appeal on Feb. 14 determined that a trial court did not abuse its discretion in setting aside default judgments entered against an insured named as a defendant in asbestos exposure suits because the insurers were diligent in their investigation of the underlying claims after learning of the suits filed against their insured (Robert Ross v. Hartford Insurance Co., et al., No. A154660; Willie Howard v. Hartford Insurance Co., et al., No. A154662; Michael Steinberger v. Hartford Insurance Co., et al., No. A154664; Monroe Amey v. Hartford Insurance Co., et al., No. A154665; Robert Hanson v. Hartford Insurance Co., et al., No. A154668; Joann Valladon v. Hartford Insurance Co., et al., No. A154671, Calif. App., 1st Dist., Div. 4).

  • February 15, 2019

    Insured’s Declaratory Judgment Claim Stands In Environmental Coverage Dispute

    LOS ANGELES — A California federal judge on Feb. 6 refused to dismiss an insured’s declaratory judgment claim in an environmental contamination coverage dispute after determining that the insured has presented an actual controversy warranting the court’s jurisdiction over the claim (Whittaker Corp. v. AIG Specialty Insurance Co., No. 18-8453, C.D. Calif., 2019 U.S. Dist. LEXIS 23744).

  • February 14, 2019

    Federal Judge Refuses To Dismiss, Stay Coverage Suit Over False Advertising Claims

    SAN DIEGO — A California federal judge on Feb. 11 concluded that there is no justification to dismiss or stay an insurer’s declaratory judgment lawsuit disputing coverage for two underlying lawsuits arising from claims that its insured published and distributed knowingly false, misleading and/or deceptive statements about a fitness company’s accreditation and injury rates (National Casualty Company v. National Strength and Conditioning Association, No. 18-1292, S.D. Calif., 2019 U.S. Dist. LEXIS 22022).

  • February 14, 2019

    9th Circuit Denies Rehearing In Abuse Of Discretion Disability Benefits Dispute

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Feb. 12 denied a long-term disability (LTD) plan administrator’s motion to reconsider its decision that the plan administrator abused its discretion in denying LTD benefits under the plan’s any-occupation standard because the plan administrator failed to properly consider restrictions placed on the claimant's ability to stand (Jennifer Kott v. Agilent Technologies Inc. Disability Plan, No. 17-16584, 9th Cir., 2019 U.S. App. LEXIS 4235).

  • February 12, 2019

    Policy Coverage For Jewelry Store Shooting Before California Court

    SAN FRANCISCO — Whether a homeowners insurance policy’s personal injury provision covers the discharge of a firearm after a robbery attempt turns on whether the parties’ portrayal of the resulting injuries as willful or accidental and confronts a California appeals court (CSAA Insurance Exchange, et al. v. Oscar Herrera, No. A153429, Calif. App., 1st Dist.).

  • February 12, 2019

    Contempt Proceeding Against Insured Does Not Allege Covered ‘Damages,’ Judge Says

    SAN JOSE, Calif. — A California federal judge on Feb. 7 held that an underlying contempt proceeding against an insured fails to assert a claim for covered "damages" under a general liability insurance policy, further finding that the policy’s intellectual property and unfair competition exclusions also bar coverage (Great American E&S Insurance Company v. Theos Medical Systems, Inc., No. 17-05660, N.D. Calif., 2019 U.S. Dist. LEXIS 21143).

  • February 11, 2019

    Insured Seeks Dismissal Of His Putative Class Suit Against Life Insurer

    FRESNO, Calif. — An insured on Feb. 8 filed a notice to dismiss with prejudice his putative class lawsuit against his life insurer a little more than two weeks after a California federal judge granted the insurer's motion to dismiss his claims for unfair business practices and financial elder abuse (Gerald B. Rhinehart v. Genworth Life and Annuity Insurance Company, No. 18-01391, E.D. Calif.).

  • February 11, 2019

    Judge Denies Insurer’s Judgment Motion Based On Wrap-Up Exclusion

    OAKLAND, Calif. — Because a subcontractor was not enrolled in a general contractor’s wrap-up policy, a California federal judge on Feb. 7 denied summary judgment to the subcontractor’s insurer on its duty to defend or indemnify the subcontractor against the contractor’s breach of contract claims concerning water damage to a project (Employers Mutual Casualty Co. v. Fast Wrap Reno One LLC, et al., No. 17-03837, N.D. Calif., 2019 U.S. Dist. LEXIS 20298).

  • February 6, 2019

    Reinsurer’s Motion To Intervene In Creditor Dispute Is Opposed

    SAN DIEGO — In separate briefs filed Feb. 1, parties oppose a reinsurer’s request to intervene in their California federal court dispute over a $3.2 million judgment (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al., No. 16-3038, S.D. Calif.).

  • February 6, 2019

    Federal Judge Remands LTD Claim To Administrator For Recalculation Of Benefits

    LOS ANGELES — A California federal judge on Feb. 1 remanded a long-term disability (LTD) claim to the plan administrator to recalculate a claimant’s monthly benefits to include the claimant’s  commissions and monthly and quarterly bonuses after determining that the plan is ambiguous as to what constitutes monthly earnings (Remy Renault v. Unum Life Ins. Co. of America, et al., No. 16-7078, C.D. Calif., 2019 U.S. Dist. LEXIS 17622).

  • February 5, 2019

    California Appeals Panel Finds No Error In Juror’s Excuse From Fraud Case

    SAN FRANCISCO — A juror was properly excused from an insurance fraud trial for failing to deliberate, a California appeals panel ruled Jan. 31 in upholding a man’s conviction of two counts of insurance fraud, finding that the presiding judge did not err when relying on the notes and testimony of another juror (People of the State of California v. Adam Scott Ravaglia, No. A149657, Calif. App., 1st Dist., 3rd Div., 2019 Calif. Unpub. LEXIS 798).

  • February 4, 2019

    Insured Must Reimburse Deductibles For Settlement Of Defects Suits, Panel Says

    SAN DIEGO — A commercial general liability insurer showed that its insured must reimburse it $50,000 in deductibles for payments it made in settlement of two construction defects actions, a California appeals panel held Jan. 31 (Lexington Insurance Co. v. Timber Ridge Framing Inc., No. D073412, Calif. App., 4th Dist. Div. 1, 2019 Cal. App. Unpub. LEXIS 802).

  • February 1, 2019

    Town Of Paradise Sues PG&E For Injuries, Damages Caused By California Camp Fire

    OROVILLE, Calif. — The Town of Paradise, Calif., sued PG&E Corp. and its subsidiary in a California court on Jan. 24 seeking liability for damages and injuries that the town incurred in the Nov. 8 “Camp Fire,” contending the defendant’s “long history of failing to adequately fund its public safety, vegetation management, and/or infrastructure maintenance programs” has resulted in wildfires, explosions and other devastating events (Town of Paradise v. PG&E Corp., et al., No. 19-00259, Calif. Super., Butte Co.).

  • January 30, 2019

    Class Certification Denied By Judge In Reinsurance Participation Agreement Cases

    SACRAMENTO, Calif. — A California federal judge on Jan. 29 denied class certification in two putative class actions over a reinsurance participation agreement (RPA) entered into by hundreds of California businesses when they bought a workers’ compensation program (Shasta Linen Supply Inc. v. Applied Underwriters Inc., et al., No. 16-158, Pet Food Express Ltd., et al. v. Applied Underwriters Inc., et al., No. 16-1211, E.D. Calif., 2019 U.S. Dist. LEXIS 14286).

  • January 30, 2019

    Drug-Testing Laboratory Did Not Fraudulently Bill Insurer, Judge Rules

    LOS ANGELES — A trial court judge in California on Jan. 25 awarded summary judgment to a laboratory accused by a woman of violating the California Insurance Fraud Prevention Act (CIFPA) for fraudulently billing her insurer for urine drug tests that were not medically unnecessary, holding that the woman failed to present any evidence showing that the defendant engaged in an unlawful relationship with health care providers to recruit patients and that it intended to defraud insurers (California, ex rel. Alison Tonti v. Living Rebos LLC, et al., No. BC674091, Calif. Super., Los Angeles Co.).

  • January 30, 2019

    Heirs Say Insurer Received Too Big A Cut Of Wrongful Death Settlement

    SAN DIEGO — A trial court improperly apportioned a settlement between heirs and a workers’ compensation insurer without considering which claims the agreement resolved or the employer’s liability, the heirs told a California appeals court on Dec. 26 (Nancy Merris Dufresne, et al. v. Gryphon Aircraft Services LLC, et al., No. E071199, Calif. App., 4th Cir.).