Mealey's Catastrophic Loss
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March 30, 2022
Judge Partially Denies Insurer’s Motion To Dismiss Provider’s Coronavirus Suit
NEW YORK — A federal judge in New York on March 29 granted in part and denied in part a health care premises pollution liability insurer’s motion to dismiss New York state's largest health care provider and private employer’s lawsuit seeking coverage for its losses arising from the coronavirus pandemic, finding that the policy is ambiguous as to whether the pandemic led to the occurrence of a “facility-borne virus event.”
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March 30, 2022
Federal Judge: Amtrak Failed To Provide Insurer Timely Notice Of Personal Injury Suit
TAMPA, Fla. — Two days after finding that Amtrak has failed to overcome the presumption of prejudice to an insurer due to its untimely notice of an underlying personal injury lawsuit arising from a collision between an Amtrak train and a car, a Florida federal judge on March 28 entered a declaratory judgment that the insurer has no duty to defend or indemnify Amtrack against the underlying lawsuit.
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March 30, 2022
5th Circuit: Medical Clinic’s Alleged Losses During Pandemic Do Not Trigger Coverage
NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on March 29 affirmed a lower federal court’s grant of a commercial property insurer’s motion to dismiss a medical and surgical clinic’s lawsuit seeking to recover its economic losses stemming from the close of its business during the coronavirus pandemic, finding that the insured has failed to allege a covered loss.
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March 28, 2022
Actress, State Farm Stipulate To Dismissal Of Bad Faith Suit Arising From Wildfire
LOS ANGELES — Actress Shannen Doherty and her insurer State Farm General Insurance Co. on March 24 filed a stipulation in a California federal court dismissing with prejudice Doherty’s bad faith lawsuit arising from her property damage caused by the Woolsey Fire in Malibu, Calif., two months after a judge granted the insured’s motion for a new trial after finding that the jury made a mistake in determining that the insurer breached the implied covenant of good faith and fair dealing.
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March 25, 2022
Federal Judge Refuses To Remand Philadelphia Eagles’ COVID-19 Suit Against Insurer
PHILADELPHIA — A federal judge in Pennsylvania on March 24 denied a motion by the owner and operator of the Philadelphia Eagles football organization to remand its lawsuit seeking a declaration as to coverage for its alleged losses arising from the coronavirus pandemic eight days after its property insurer moved to dismiss the lawsuit, rejecting the insured’s argument that remand was warranted so the federal court “can avoid interference in the delicate state regulatory issues involved and give appropriate respect to the important state interests implicated by this action.”
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March 25, 2022
Panel: Grill’s Business Interruption Claim Constituted Economic, Not Physical Loss
CHICAGO — An Illinois appeals panel on March 21 found that an Evanston, Ill., restaurant’s business interruption claim resulting from the coronavirus pandemic closure orders constituted an economic loss and not a “physical loss” to its insured property, affirming a lower court’s finding that coverage was not triggered.
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March 25, 2022
9th Circuit Affirms No Coverage Ruling In Suit Arising From Pandemic
PHOENIX — Citing “numerous published decisions interpreting nearly identical policy language,” the Ninth Circuit U.S. Court of Appeals on March 17 affirmed a lower federal court’s ruling in favor of property insurer in an insured’s lawsuit seeking coverage for its economic losses arising from the coronavirus pandemic.
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March 23, 2022
Business Income Loss Not Tangible, 5th Circuit Says In Coronavirus Coverage Suit
NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on March 22 affirmed a lower federal court’s grant of a businessowners insurer’s motion for judgment on the pleadings in an insureds’ lawsuit seeking coverage for their alleged losses prompted by the coronavirus pandemic, finding that the policy’s coverage for “direct physical loss of or damage to property” does not cover the insureds’ business income losses that were caused by civil authority orders closing nonessential businesses in response to the coronavirus pandemic.
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March 23, 2022
2nd Circuit: Insured Fails To Allege Direct Physical Loss, Damage To Trigger Coverage
NEW YORK — The Second Circuit U.S. Court of Appeals on March 18 affirmed a lower federal court’s ruling in favor of an insurer in a coronavirus coverage lawsuit, finding that the insured alleges only a loss of use of property with respect to its food-service establishments, which does not constitute an “actual physical loss of” property.
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March 23, 2022
Panel Affirms Ruling In CGL Insurer’s Favor In Suit Seeking $100,000 Reimbursement
PHILADELPHIA — The Third Circuit U.S. Court of Appeals on March 21 affirmed a lower federal court’s ruling in favor of a commercial general liability insurer in an insured’s breach of contract and bad faith lawsuit seeking reimbursement of $100,000 it spent repairing storm-damaged modular units, finding that the insurer has no duty to indemnify its insured because no underlying lawsuit was filed against the insured.
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March 21, 2022
Suit Over Damages From 3 Hurricanes, Tropical Storm Doomed By SFIP Noncompliance
NEW ORLEANS — A federal judge in Louisiana on March 18 dismissed an insured’s bad faith lawsuit seeking flood damage for her property damage caused by Hurricanes Cristobal, Beta and Zeta and Tropical Storm Sally, finding that the insured failed to comply with her Standard Flood Insurance Policy’s “strict” requirements.
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March 21, 2022
Judge Allows Lakers’ Property Damage Claims To Proceed In COVID-19 Coverage Suit
LOS ANGELES — A federal judge in California on March 17 denied an insurer’s motion to dismiss the Los Angeles Lakers’ first amended complaint to the extent that the claims are based on a commercial property insurance policy’s property damage clause, finding that the team has alleged that its “covered properties were physically altered” and that “those alterations caused detrimental economic impact.”
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March 18, 2022
Panel: Filed-Rate Doctrine Bars ‘Kickback Scheme’ Suit Against Flood Insurers, Bank
NEW YORK — The Second Circuit U.S. Court of Appeals on March 15 affirmed a lower federal court’s finding that the filed-rate doctrine bars an attorney’s lawsuit alleging a bank and insurers participated in a “kickback scheme” that resulted in him being overcharged for flood insurance.
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March 17, 2022
Insurer’s Invocation Of Appraisal, Payment Of Award Did Not Cure Bad Faith Claim
LAKELAND, Fla. — A Florida appeals panel on March 16 held that an insurer’s invocation of an appraisal process and its payment of an appraisal award after the expiration of the 60-day cure period on the insured’s civil remedy notice did not cure its alleged bad faith, reversing and remanding a lower court’s summary judgment ruling in favor of the insurer in a lawsuit arising from the insured’s property damage caused by a lightning strike.
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March 17, 2022
Panel: Presence Of Virus, Governor’s Orders Fail To Constitute Direct Physical Loss
ELGIN, Ill. — An Illinois appeals panel on March 15 affirmed a lower court’s ruling in favor of a commercial property insurer in a café owner insured’s declaratory judgment lawsuit arising from the coronavirus pandemic, finding that the partial loss of the insured’s use of its premises was not sufficient to assert a “direct physical loss of or damage to” its property to trigger business interruption or extra expense additional coverage.
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March 16, 2022
No Coverage Due For COVID-19 Losses; Breach Of Contract, Bad Faith Claims Fail
SAN JOSE, Calif. — An insured’s claims for breach of contract and bad faith fail because there was no physical damage to insured property as a result of shutdown orders issued in the wake of the COVID-19 pandemic and because the policy’s microorganism exclusion precludes coverage, a California federal judge said March 14 in granting the insurer’s motion for judgment on the pleadings.
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March 16, 2022
Homeowners Insurer’s Investigation Was Adequate, Conducted In Good Faith
DALLAS — A bad faith claim alleged against a homeowners insurer cannot proceed because the insureds failed to provide evidence supporting their claim that the insurer’s investigation of their claim for damages caused by a tornado was not conducted in good faith, a Texas federal judge said March 9 in granting the insurer’s motion for partial summary judgment.
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March 14, 2022
Condo Collapse Amended Complaint Adds New Defendants As Others Agree To Settle
MIAMI — A Florida judge on March 11 issued orders permitting a third amended class complaint adding new defendants in the consolidated case over the June 2021 partial collapse of the Champlain Towers South Condominium Building (CTS) in Surfside, Fla., and requiring mediation between four of the previously named defendants, the plaintiffs and the receiver; the orders came just three days after claims against three other defendants were stayed pending approval of settlements totaling more than $55 million.
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March 14, 2022
Subsidence Exclusion Bars Coverage For Claims Arising From Landslide, Panel Affirms
SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on March 11 affirmed a lower federal court’s ruling that an insurance policy’s “Subsidence Exclusion” unambiguously precludes any possibility of coverage for underlying claims against a landscaper insured arising from a catastrophic landslide, finding that all of the injuries connected to the underlying complaints “aris[e], in whole or part, out of . . . ‘earth movement.’”
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March 11, 2022
Parties Settle Coverage Suit Over Challenge To McDonald’s Handling Of COVID-19
CHICAGO — McDonald’s Corp. and a commercial general liability insurer on March 10 filed a joint notice of settlement in a breach of contract and declaratory relief lawsuit brought by McDonald’s Corp. and former and current franchise owners seeking coverage for an underlying class action injunction alleging that they are taking inadequate steps to contain COVID-19 in the workplace.