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Mealey's Emerging Insurance Disputes

  • July 30, 2021

    Theft Exclusions Bars Professional Liability Coverage, Federal Judge Rules

    WEST PALM BEACH, Fla. — A federal judge in Florida on July 27 held that a professional liability insurer’s theft exclusion bars coverage for an underlying lawsuit alleging negligence, legal malpractice, breach of fiduciary duty and negligent hiring against a law firm insured, concluding that the underlying allegations, although not directly charges of theft, stem from and are dependent on the theft of funds by a fraudster.

  • July 29, 2021

    Judge: Doctrine Of Res Judicata Bars Claims In Human Trafficking Coverage Suit

    PHILADELPHIA — A federal judge in Pennsylvania on July 27 held that an insurer has no duty to defend or indemnify its motel owner insured against a “refashioned” complaint alleging that it was negligent in failing to prevent human sex trafficking from occurring at its property, finding that the doctrine of res judicata precludes coverage.

  • July 29, 2021

    Panel: Port Authority Not Additional Insured, Claims Involved Professional Services

    TRENTON, N.J. —A New Jersey appeals panel on July 28 held that the Port Authority of New York and New Jersey was not an additional insured under a contractor’s comprehensive general liability insurance policy because underlying allegations against it arising from a slip-and-fall injury involved professional services that are barred from coverage.

  • July 29, 2021

    Albany County Justice: COVID-19 Coverage Suit Must Be Transferred To New York County

    ALBANY N.Y. — An Albany County, N.Y., Supreme Court justice on July 26 granted an all-risk commercial insurer’s motion to transfer an insured’s coronavirus coverage lawsuit to New York County, rejecting the insured’s argument that the current venue is proper under the policy’s forum selection clause.

  • July 28, 2021

    Judge Issues Reasons For Earlier Dismissal Of Health Care Provider’s $1.25B Suit

    NEW YORK — Twenty days after issuing a one-page order dismissing Northwell Health Inc.’s breach of contract and bad faith lawsuit seeking $1.25 billion in coverage for its property and business interruption losses and decontamination costs arising out of the coronavirus pandemic, a federal judge in New York on July 27 entered a judgment in favor of two commercial property insurers after finding that Northwell’s arguments for coverage under “a litany of possible provisions” “are unpersuasive.”

  • July 27, 2021

    Indiana Panel: Motorized Land Vehicles Exclusion Bars Coverage For Minor’s Injuries

    INDIANAPOLIS — An Illinois appeals panel on July 26 held that a homeowners insurance policy’s motorized land vehicle exclusion barred coverage for a minor’s bodily injuries arising from the use of the golf cart, affirming a lower court’s summary judgment ruling in favor of the insurer in its lawsuit seeking a declaration that it has no duty to defend or indemnify against the underlying lawsuit.

  • July 27, 2021

    No Bodily Injury Alleged; No Homeowners Coverage Owed, Connecticut Panel Affirms

    HARTFORD, Conn. — A Connecticut appeals panel in a July 27 opinion affirmed a lower court’s ruling that an underlying negligent infliction of emotional distress claim brought against an insured failed to assert that a bodily injury occurred and, therefore, an insurer has no duty to defend or indemnify its insured, noting that mental injuries alone will not trigger coverage.

  • July 26, 2021

    Insurers Ask 5th Circuit To Affirm No Coverage Ruling For Phishing Incident

    NEW ORLEANS — Under a “straightforward application of contract law,” two insurers tell the Fifth Circuit U.S. Court of Appeals in July 23 briefs that funds stolen in a phishing scheme were not owned or controlled by their policyholder, thus negating any duty for them to reimburse the stolen funds amounts that were voluntarily reimbursed by appellant RealPage Inc.

  • July 26, 2021

    Ohio Panel: No Directors, Officers Liability Coverage Owed For Alleged Ponzi Scheme

    CLEVELAND — An Ohio appeals panel on July 22 affirmed a lower court’s ruling that an insurer owes no directors and officers liability coverage for underlying reported and nonreported claims arising from an alleged Ponzi scheme, finding that each underlying lawsuit asserted that the insured and others “participated in a continuous and related pattern and practice of defrauding their employees for a period of over two years.”

  • July 26, 2021

    Judge: Insurers Have No Duty To Defend Mutual Insured Against Wrongful Death Suit

    MINNEAPOLIS — A federal judge in Minnesota on July 21 granted insurers’ motion for summary judgment in their lawsuit disputing coverage for an underlying lawsuit alleging their mutual insured drugged and sexually assaulted a woman who subsequently committed suicide, finding that the underlying allegations described a sexual assault by the insured that was neither “unexpected or unintended.”

  • July 26, 2021

    Imposing New, Retroactive Risk On Insurers Would Threaten Solvency, Amicus Argues

    ATLANTA — American Property Casualty Insurance Association on July 21 filed an amicus curiae brief in support of Certain Underwriters at Lloyd’s London in a coronavirus coverage suit, arguing to the 11th Circuit U.S. Court of Appeals that commercial property insurance policies “do not—and were never intended to—provide coverage for economic losses untethered to physical loss or physical damage.”

  • July 22, 2021

    5th Circuit Reverses, Remands No Coverage Ruling Of Alleged Data Breach

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on July 21 reversed a lower federal court’s finding that a commercial general liability insurer has no duty to defend against an underlying lawsuit seeking to recover damages purportedly caused by a data breach of the insured’s credit card processing system, finding that the underlying alleged injuries trigger coverage under the policy because they arise from violations of customers’ rights to keep their credit card information private.

  • July 21, 2021

    6th Circuit: Court Correctly Affirmed Arbitration Award In Crop Insurance Dispute

    CINCINNATI — The Sixth Circuit U.S. Court of Appeals on July 20 held that a lower federal court properly affirmed an arbitration award to reimburse a crop insurer for its overpayment of an indemnity claim, finding that the arbitrator’s award respected a federal agency’s finding that a crop insurer may reject a claim based on the insured’s poor record-keeping alone and may obtain retroactive reimbursement for the overpaid claim on that basis.

  • July 20, 2021

    Federal Judge Dismisses Health Care Provider’s $1.25B Coronavirus Coverage Suit

    NEW YORK — A federal judge in New York on July 7 granted two commercial property insurers’ motion to dismiss Northwell Health Inc.’s breach of contract and bad faith lawsuit seeking $1.25 billion in coverage for its property and business interruption losses and decontamination costs arising out of the coronavirus pandemic and denied as moot Northwell’s motion for partial summary judgment.

  • July 20, 2021

    Coverage Not Limited To Injury Arising Out Of ‘Advertising Activities,’ Panel Says

    ST. PAUL, Minn. — A Minnesota appeals court held July 19 that a lower court erred in finding that an insured’s coverage was limited to injury arising out of its “advertising activities,” reversing the lower court’s finding that insurers have no duty to defend against underlying counterclaims prompted by the insured’s lawsuit seeking to recover fees from a gun club and remanding for further proceedings.

  • July 20, 2021

    Federal Judge Dismisses Motion Picture Company’s COVID-19 Coverage Suit

    LOS ANGELES — One day after a motion picture company insured and its insurer filed a joint stipulation of dismissal, a federal judge in California on July 16 dismissed without prejudice the insured’s lawsuit 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 coronavirus pandemic.

  • July 19, 2021

    Parties Announce Tentative Settlement Of Coverage Suit Arising From Worker Injury

    SAN FRANCISCO — Primary and excess commercial insurers and their insured on July 16 announced that they reached a tentative settlement of the insurers’ declaratory judgment lawsuit disputing coverage for an underlying lawsuit alleging that the insured failed to use reasonable care in fulfilling its duty to oversee job site safety regarding the hazards associated with construction yard traffic.

  • July 19, 2021

    5th Circuit Dismisses Insureds’ Appeal Of COVID-19 Dispute For Want Of Prosecution

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on July 15 dismissed insureds’ appeal of a Louisiana federal court’s grant of their businessowners insurer’s motion for judgment on the pleadings in their lawsuit seeking coverage for their alleged losses prompted by the coronavirus pandemic, noting that the appellants failed to timely file their brief and record excerpts.

  • July 16, 2021

    Justice:  Policy Terms ‘Utterly Refute’ Breach Of Contract Suit Prompted By COVID-19

    BROOKLYN, N.Y. — A New York justice on July 15 granted an insurer’s motion to dismiss a breach of contract lawsuit seeking coverage for the plaintiff’s alleged business income losses arising from the governmental restrictions in response to the coronavirus pandemic, finding that the policy terms “serve to utterly refute” the breach of contract claims.

  • July 16, 2021

    Negligence Claim Against Broker Is Ripe For Adjudication, Federal Judge Rules  

    WASHINGTON, D.C. — A federal judge in the District of Columbia on July 13 denied an insurance broker’s motion to dismiss an insured’s negligence claim arising from insurers’ denial of coverage for alleged structural damage to the insured’s newly built facility, finding that the insured’s purported harm due to the insurers’ coverage denial renders its claim against the broker as ripe as its claims against the insurer.