Mealey's California Insurance

  • October 19, 2020

    Reinsurer’s Parent Companies: Insurers Conflate Ownership Interest With Acting As Agent

    LOS ANGELES — The parent companies of a reinsurer say in their Oct. 16 reply brief that a California federal court should dismiss four insurers’ intentional interference and inducement of breach of contract case with regard to reinsurance billings because the insurers “conflate holding an ownership interest in a company with acting as an agent for that same company” (California Capital Insurance Company, et al. v. Enstar Holdings [US] LLC, et al., No. 20-7806, C.D. Calif.).

  • October 14, 2020

    Contractor Claims Defense Against Arbitration Owed, Says Insurer Breached Contract

    LOS ANGELES — A general contractor claims in an Oct. 9 complaint filed in California federal court that an insurer breached its contract and acted in bad faith by refusing to defend the contractor in an arbitration arising out of a construction defects dispute (Tutor Perini Building Corp. v. First Mercury Insurance Co. et al., No. 20-9329, C.D. Calif.)

  • October 14, 2020

    Insurer Asks 9th Circuit To Reverse ‘Excessive’ Attorney Fee Award In Favor Of Yahoo

    SAN FRANCISCO — In a Sept. 16 cross-appeal filed in the Ninth Circuit U.S. Court of Appeals, a commercial general liability insurer argues that Yahoo forfeited its claim to $618,380 in attorney fees under Brandt v. Superior Court in their data privacy coverage dispute but defends the lower court’s ruling that the policy’s deductible coverage endorsement is enforceable and precludes coverage for additional damages (Yahoo! Inc. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 19-16475, 9th Cir.).

  • October 13, 2020

    Insurers Oppose Dismissal Of Intentional Interference Case Over Reinsurance Billings

    LOS ANGELES — Four insurers argue in their Oct. 9 opposition brief to a California federal court that the parent companies of a reinsurer are “straddling a line” that does not exist under California law in seeking to dismiss their lawsuit alleging intentional interference and inducement of breach of contract with regard to reinsurance billings (California Capital Insurance Company, et al. v. Enstar Holdings [US] LLC, et al., No. 20-7806, C.D. Calif.).

  • October 13, 2020

    Carrier Owes Duty To Defend Against Negligence Claim In Water Damage Dispute

    SANTA ANA, Calif. — A homeowners insurer has a duty to defend its insureds against a negligence claim stemming from the sale of their home and their failure to properly correct the home’s water intrusion issues because there is a possibility of coverage under the policy at issue, a California federal judge said Sept. 18 (Vivian Schwartz, et al. v. Kemper Independence Insurance Co., et al., No. 19-0559, C.D. Calif., 2020 U.S. Dist. LEXIS 187626).

  • October 13, 2020

    Insureds Failed To Provide Evidence Of Physical Damage To Their Home, Panel Says

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Oct. 9 affirmed a district court’s ruling in favor an insurer in a breach of contract and bad faith suit stemming from a wildfire damage claim after determining that the insureds failed to present a genuine dispute of material fact regarding the alleged physical damage to their home (Jensen Shirley, et al. v. Allstate Insurance Co., No. 19-56066, 9th Cir., 2020 U.S. App. LEXIS 32069).

  • October 07, 2020

    Insured Asks 9th Circuit To Reverse No Coverage Ruling For Alleged Phishing Attack

    SAN FRANCISCO — An insured on Sept. 8 asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court's ruling in favor of its insurer in a lawsuit seeking coverage for its alleged "security failure" that was caused by a phishing attack by an unknown perpetrator, contending that a letter demanding monetary relief from one of its clients constituted a "claim" under its "security & privacy risk response" policy (Alorica Inc. v. Starr Surplus Lines Insurance Company, No. 20-55458, 9th Cir.).

  • October 06, 2020

    Reinsurer's Parent Companies: No Liability For Intentional Interference, Inducement

    LOS ANGELES — In seeking dismissal of four insurers' dispute over the mishandling of reinsurance billings, the parent companies of the reinsurer on Oct. 2 argue to a California federal court that it "is blackletter law that agents cannot be liable for intentional interference with contracts or for inducing a principal to breach those contracts" (California Capital Insurance Company, et al. v. Enstar Holdings [US] LLC, et al., No. 20-7806, C.D. Calif.).

  • October 06, 2020

    Federal Judge Dismisses Restaurant's Coronavirus Coverage Suit With Prejudice

    LOS ANGELES — A federal judge in California on Oct. 2 granted an insurer's motion to dismiss a restaurant's coronavirus coverage lawsuit, finding that the insured failed to plausibly assert that it incurred a "physical loss of or damage to" its restaurant and that the policy's virus exclusion further bars all coverage (Mark's Engine Company No. 28 Restaurant, LLC v. The Travelers Indemnity Company of Connecticut, et al., No. 20-04423, C.D. Calif.).

  • October 06, 2020

    Insured Failed To Show How Property Insurer Breached Contract, Acted In Bad Faith

    LOS ANGELES — A California federal judge on Oct. 2 granted summary judgment in favor of a commercial property insurer on breach of contract and bad faith claims after determining that the insured failed to show how the insurer breached its contract in adjusting the insured's fire damage (Carson Cogeneration Company v. Scottsdale Insurance Company, et al., No. 19-10797, C.D. Calif., 2020 U.S. Dist. LEXIS 183283).

  • October 05, 2020

    JPMDL Creates Insurer-Specific MDLs For Ski Pass Coronavirus Coverage Suits

    WASHINGTON, D.C. — The U.S. Judicial Panel on Multidistrict Litigation on Oct. 2 granted parties' request for the creation of defendant-specific MDLs against two insurers in lawsuits seeking coverage for passes for ski resorts that were prematurely closed due to the novel coronavirus, finding that the suits "involve common questions of fact" and that centralization against one insurer in the U.S. Western District of Missouri and the other insurer in the U.S. Northern District of California "will serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation" (In Re: National Ski Pass Insurance Litigation, No. 2955, JPMDL).

  • October 02, 2020

    Outback Steakhouse's Franchisee Sues Insurer For Losses Arising Out Of Coronavirus

    SAN FRANCISCO — The franchisee of Outback Steakhouse restaurants in Arizona, Colorado, Nevada, New Mexico and California and its parent and affiliated companies on Sept. 29 sued an insurer in a California federal court, alleging that an all-risk insurance policy unambiguously provides coverage for its "direct and/or imminent physical loss" and property damage related to the novel coronavirus (Out West Restaurant Group Inc., et al. v.  Affiliated FM Insurance Company, No. 20-06786, N.D. Calif.).

  • October 01, 2020

    Insureds' Breach Of Contract, Bad Faith Claims To Proceed In Contamination Suit

    SANTA ANA, Calif. — A California federal judge on Sept. 30 denied an insurer's motion to dismiss a second amended complaint filed by insureds seeking a coverage declaration for underlying environmental contamination lawsuits because the insureds have proven that the insurer owes a duty to defend and the insureds supported their claims for breach of contract and bad faith (L.A. Terminals, et al. v. United National Insurance Co., No. 19-286, C.D. Calif., 2020 U.S. Dist. LEXIS 180268).

  • September 30, 2020

    Contractor Sues 3 Insurers Over Coverage For Defects In Fire Sprinkler System

    SAN FRANCISCO — A general contractor accuses three insurers in a Sept. 25 complaint filed in a California federal court of breaching their contract and acting in bad faith in denying a defense for claims of alleged damages related to a fire sprinkler system caused by allegedly defective construction (Build Group, Inc. v. Rockhill Insurance Company, et al., No. 20-6728, N.D. Calif.).

  • September 30, 2020

    Motion Picture Production Company Sues Insurer Over Delays Caused By Coronavirus

    LOS ANGELES — A motion picture production company on Sept. 9 filed suit in a California federal court alleging that its insurer refused to extend its “film producers risk” insurance policy when the production of the  movie “Hypnotic” starring Ben Affleck was delayed by risks associated with the novel coronavirus pandemic and instead indicated that the policy would be “renewed” with the addition of an exclusion for losses relating to the coronavirus (Hoosegow [Hypnotic] Productions Inc. v. Chubb National Insurance Company, No. 20-08253, C.D. Calif.).

  • September 29, 2020

    Conservator Timely Filed Suit Within Disability Plan's Limitations Provision

    SANTA ANA, Calif. — A California federal judge on Sept. 21 denied a disability insurer's motion to dismiss a conservator's claims for benefits and equitable relief under the Employee Retirement Income Security Act because tolling of the disability plan's three-year limitations provision did not begin until the conservator of the disability plan participant was appointed (Joyce Poisson v. Aetna Life Insurance Co., No. 20-1030, C.D. Calif., 2020 U.S. Dist. LEXIS 177216).

  • September 29, 2020

    Magistrate Judge Issues Protective Orders In Disputes Between Reinsurer, Insurers

    LOS ANGELES — A California federal magistrate judge on Sept. 28 granted stipulated protective orders in two cases filed by four insurers against a reinsurer and the reinsurer's parent companies over a billings dispute under reinsurance agreements (California Capital Insurance Company, et al. v. Enstar Holdings [US] LLC, et al., No. 20-7806, California Capital Insurance Co., et al. v. Maiden Reinsurance North America, Inc., et al., No. 20-1264, C.D. Calif.).

  • September 25, 2020

    COVID-19 Suit Dismissed Without Prejudice Due To 'Rapidly Evolving Legal Landscape'

    SAN FRANCISCO — A federal magistrate judge in California on Sept. 22 dismissed a waxing salon's lawsuit seeking coverage for its economic losses caused by the state's closure orders to stop the spread of the novel coronavirus, allowing the insured to amend all but two of their claims because of "the rapidly evolving legal landscape involving COVID-19 business interruption coverage" (Franklin EWC, Inc., et al. v. The Hartford Financial Services Group, Inc., et al., No. 20-04434, N.D. Calif., 2020 U.S. Dist. LEXIS 174010).

  • September 25, 2020

    Disability Claimant's Benefits Were Properly Offset, Federal Judge Says

    SACRAMENTO, Calif. — A disability insurer properly offset a claimant's long-term disability (LTD) benefits based on settlement proceeds awarded to the claimant, a California federal judge said Sept. 22, noting that the disability plan at issue clearly permits the offset (Fadi G. Haddad v. SMG Long Term Disability Plan, et al., No. 16-1700, E.D. Calif., 2020 U.S. Dist. LEXIS 173981).

  • September 24, 2020

    Judge Dismisses Dispute Over Coverage For 600 Construction Defect Claims

    FRESNO, Calif. — A federal judge in California on Sept. 22 dismissed a contribution and subrogation lawsuit brought by two insurers against Clarendon National Insurance Co. concerning coverage for 600 underlying construction defect claims and suits because there is a lack of subject matter jurisdiction (United Specialty Insurance Company, et al. v. Clarendon National Insurance Company, No. 19-1715, E.D. Calif., 2020 U.S. Dist. LEXIS 174054).