LOS ANGELES — In a dispute between two insurers over the duty to indemnify a default judgment in a construction defects case against an insured, one insurer argues to a California appeals court in a May 25 brief that the other cannot prevail against it in a direct action because the default judgment is void and not covered (The Insurance Company of the State of Pennsylvania v. American Safety Indemnity Co., No. B283684, Calif. App., 2nd Dist., Div. 8).
LOS ANGELES — Four insurers filed an equitable contribution complaint on June 13 in a California federal court against another insurer for coverage of seven underlying construction defects cases (Travelers Property Casualty Company of America, et al. v. Lexington Insurance Co., No. 18-05232, C.D. Calif.).
SAN FRANCISCO — A disability claimant is entitled to long-term disability (LTD) benefits because the evidence from the claimant’s treating physicians and evidence obtained from the disability insurer’s medical reviewers support a finding that the claimant is disabled under the plan’s any-occupation standard, a California federal judge said June 18 (Sarabjit Sangha v. Cigna Life Insurance Company of New York, No. 17-5158, N.D. Calif., 2018 U.S. Dist. LEXIS 101725).
SAN FRANCISCO — A stay of an insurer’s suit seeking a declaration regarding its duty to defend an insured in an underlying lead exposure suit is not warranted because the insurer’s coverage suit does not present the same issues as the underlying lead exposure suit and the insured will not be prejudiced if the insurer’s suit proceeds, a California federal judge said June 18 in denying the insured’s motion to stay (James River Insurance Co. v. W.A. Rose Construction, et al., No. 18-2030, N.D. Calif., 2018 U.S. Dist. LEXIS 101698).
SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on June 15 remanded a disability benefits dispute to the district court to determine whether the claimant is entitled to equitable relief based on the disability plan’s failure to properly offset the claimant’s disability benefits (Petar Mrkonjic v. Delta Family-Care and Survivorship Plan, et al., Nos. 16-56335, No. 16-56487, 9th Cir., 2018 U.S. App. LEXIS 16162).
SACRAMENTO, Calif. — In two putative class actions over a reinsurance participation agreement (RPA), a California federal magistrate judge on June 14 ordered an insurance agency to produce nonprivileged, responsive information requested by a reinsurer and its affiliates (Shasta Linen Supply Inc. v. Applied Underwriters Inc., et al., Nos. 16-00158 & 16-01211, E.D. Calif., 2018 U.S. Dist. LEXIS 100158).
RIVERSIDE, Calif. — An appeals court panel in California on May 31 vacated a trial court judge’s ruling ordering a woman who pleaded guilty to one count of making a false statement in support of an insurance claim to pay $1,042.17 in restitution to an insurance company, finding that the company did not take into account the costs it incurred as a result of its investigation of the defendant’s claim (People of California v. Alyce J. Williams, No. D072783, Calif. App., 4th Dist., 1st Div., 2018 Cal. App. Unpub. LEXIS 3728).
SAN JOSE, Calif. — A federal judge in California on June 8 denied a general practitioner’s motion for acquittal on charges of health care fraud, finding that the spreadsheets and explanation of benefit (EOB) documents presented by the government constituted sufficient evidence showing that the doctor submitted fraudulent claims to insurance companies (United States v. Vilasini Ganesh, et al., No. 16cr00211, N.D. Calif., 2018 U.S. Dist. LEXIS 97028).
SACRAMENTO, Calif. — A California federal judge on June 4 recommended dismissing a disability claimant’s state law claims because the state law claims are preempted under the Employee Retirement Income Security Act (Jerome Clay v. AT&T Umbrella Benefit Plan No. 3, No. 17-749, E.D. Calif., 2018 U.S. Dist. LEXIS 93784).
LOS ANGELES — In a dispute seeking confirmation of a $82,130.44 arbitration award, a reinsurer argues in a June 4 motion in California federal court that a landscape company’s motion to dismiss is “procedurally and substantively improper” (Applied Underwriters Captive Risk Assurance Company Inc. v. O’Connell Landscape Maintenance Inc., No. 18-00683, C.D. Calif.).
PASADENA, Calif. — An insurer on June 4 filed a petition asking the Ninth Circuit U.S. Court of Appeals to reconsider its May 21 ruling that found a lower federal court erred in holding that an insurer has no duty to defend or indemnify Office Depot Inc. in an underlying qui tam lawsuit (Office Depot Inc. v. AIG Specialty Insurance Company, No. 17-55125, 9th Cir.).
SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on June 4 affirmed a lower federal court's finding that coverage for an underlying qui tam action brought against an insured under the False Claims Act (FCA) is barred because the underlying lawsuit alleges that the insured’s professional services caused ineligible students and ineligible universities to submit claims for federal financial aid to the U.S. Department of Education (HotChalk Inc. v. Scottsdale Insurance Co., No. 16-17287, 9th Cir., 2018 U.S. App. LEXIS 14884).
SAN FRANCISCO — In answering a question of “exceptional importance” from the Ninth Circuit U.S. Court of Appeals, a majority of the California Supreme Court on June 4 found that third-party claims against an employer for negligent hiring, retention and supervision of its employee qualify as an "occurrence" under the employer's commercial general liability (CGL) policy (Liberty Surplus Insurance Corporation, et al. v. Ledesma and Meyer Construction Company, Inc., et al., No. S236765, Calif. Sup., 2018 Cal. LEXIS 4063).
LOS ANGELES — A California federal judge on May 22 entered judgment in favor of two insurers in an environmental contamination coverage suit after finding that no duty to defend or indemnify an insured exists because an administrative proceeding filed against the insured by the Alabama Department of Environmental Management (ADEM) was not a suit per the terms of the policies at issue (Arrow Electronics Inc. v. Aetna Casualty & Surety Co., et al., No. 17-5247, C.D. Calif., 2018 U.S. Dist. LEXIS 88014).
SAN FRANCISCO — A district court did not abuse its discretion in dismissing a disability claimant’s amended complaint because the prelitigation costs and attorney fees sought by the claimant are not available as equitable relief under the Employee Retirement Income Security Act, the Ninth Circuit U.S. Court of Appeals said May 31 (Larry A. Benson v. Life Insurance Company of North America, No. 17-55253, 9th Cir., 2018 U.S. App. LEXIS 14367).
SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on May 31 reversed a district court’s ruling in favor of a disability insurer after determining that genuine issues of fact exists regarding whether the insurer improperly denied the claim before the amount of time to submit additional materials had expired (Narciso Cuaresma Jr. v. Farmers Group Disability Income Plan, et al., No. 16-16946, 9th Cir., 2018 U.S. App. LEXIS 14368).
SAN DIEGO — A California appeals panel on May 29 affirmed a lower court’s ruling that an insurer has no duty to defend or indemnify its general contractor insured against an underlying lawsuit arising from the unsuccessful development of a 16-home residential subdivision (THV Investments, LLC v. Certain Underwriters at Lloyds of London, et al., No. D073601, Calif. App., 4th Dist., Div. 1, 2018 Cal. App. Unpub. LEXIS 3671).
LOS ANGELES — Based upon a landscape company’s failure to seek an order vacating, modifying or correcting a $82,130.44 arbitration award, a reinsurer argues in a May 23 motion that a California federal court should confirm the award issued in its favor regarding a bad faith claim made against a reinsurance participation agreement (RPA) (Applied Underwriters Captive Risk Assurance Company Inc. v. O’Connell Landscape Maintenance Inc., No. 18-00683, C.D. Calif.).
WASHINGTON, D.C. — The U.S. Supreme Court should deny a disability claimant’s petition for writ of certiorari in a dispute over the offsetting of a claimant’s long-term disability (LTD) benefits to account for Social Security disability income (SSDI) benefits received on behalf of the claimant’s dependents because the plan administrators applied the language of the LTD plan as written, the defendants maintain in a May 25 response brief (Susan Rene Jones v. Merck Sharpe & Dohme Corp., et al., No. 17-1478, U.S. Sup.).
PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on May 21 affirmed a lower federal court’s finding that insureds’ bad faith, breach of contract and negligence claims arising from an alleged theft loss are time-barred (Dean Seymour, et al. v. State Farm General Insurance Company, No. 17-5529, 9th Cir., 2018 U.S. App. LEXIS 13166).