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Mealey's Emerging Insurance Disputes

  • July 15, 2020

    Dish Network: Exclusion Not Applicable; Insurer Must Defend Copyright Claims

    NEW YORK — Dish Network Corp. in a May 26 brief asks the Second Circuit U.S. Court of Appeals to reverse a lower court ruling because the company’s insurer did not meet its burden of demonstrating that an exclusion to coverage applies and, therefore, it had a duty to defend the company in underlying litigation (Dish Network Corporation, et al. v. Ace American Insurance Company, No. 20-628, 2nd Cir.).

  • July 15, 2020

    Roundup Of Briefs, Complaints Over Coronavirus Coverage

    From an insured’s opposition to an insurer’s motion to certify direct physical loss questions to the Ohio Supreme Court to minor league baseball teams’ same-day voluntary dismissal of their federal court complaint and filing of a state court complaint, Mealey Publications takes a look at the latest pleadings relating to business interruption coverage for COVID-19.

  • July 14, 2020

    COMMENTARY: COVID-19 Business Interruption Coverage – Chief Roadblocks And Potential Paths To Coverage For Commercial Losses In New York

    By Thomas P. Kurland, Dakotah Burns and Stephen P. Younger

  • July 07, 2020

    COMMENTARY: ‘The Show Must Go On:’ Navigating Arbitration In The Wake Of The Covid-19 Outbreak

    By Justin K. Fortescue, Zachery B. Roth and Marianne E. Bradley

  • July 14, 2020

    Insured Refutes Motion To Certify Direct Physical Loss Questions To Ohio High Court

    CINCINNATI — An insured on July 6 responded to an insurer’s motion to certify to the Ohio Supreme Court three questions as to whether the presence of the novel coronavirus constitutes direct physical loss, arguing that the questions “do not involve novel or intricate questions of state law nor do they affect vital state interests” and “are not unique to Ohio policyholders and, in reality, are not even questions of Ohio law in any meaningful sense” (Troy Stacy Enterprises Inc. v.The Cincinnati Insurance Company, No. 20-00312, S.D. Ohio).

  • July 14, 2020

    3 Minor League Baseball Teams File COVID-19 Coverage Suit In Pennsylvania Court

    PHILADELPHIA — Three minor league baseball teams on July 2 sued their insurer in a Pennsylvania court for breach of contract and declaratory relief, seeking business interruption coverage for their “catastrophic financial losses” stemming from the “first-ever cessation of Minor League Baseball” due to the novel coronavirus pandemic and Major League Baseball’s decision that its teams will not satisfy their contractual duties to provide players under contract to their affiliated teams in the Minor League (Nostalgic Partners LLC, et al. v. Philadelphia Indemnity Insurance Co., No. 200700054, Pa. Comm. Pls., Philadelphia Co.).

  • July 14, 2020

    Travelers Disputes Coverage For $2.1B Tax-Refund Scheme Suits Brought By Denmark

    LEXINGTON, Ky. — An agribusiness insurer on July 6 filed a declaratory judgment lawsuit in a federal court in Kentucky, arguing that it owes no coverage for underlying lawsuits in which the Kingdom of Denmark alleges that insureds were involved in a $2.1 billion “fraudulent tax-refund scheme” (Travelers Indemnity Company of America v. Bernard Tew, et al., No. 20-00292, E.D. Ky.).

  • July 14, 2020

    Judge:  Insurer Has Duty To Defend City Against Employee’s Discrimination Claims

    DETROIT — A federal judge in Michigan on July 13 held that an insurer had and has a continuing duty to defend its city insured against an underlying discrimination lawsuit brought by an employee, finding that the underlying action triggers the policy’s Employment Practices Liability coverage and that the “prior and pending” exclusion does not bar coverage (City of Grosse Pointe v. United States Specialty Insurance Company, et al., No. 18-13428, E.D. Mich., Southern Div., 2020 U.S. Dist. LEXIS 122292).

  • July 14, 2020

    Competitor’s Claims Are Covered ‘Advertising Injuries,’ New Jersey Panel Affirms

    TRENTON, N.J. — A New Jersey appeals panel on July 10 affirmed a lower court’s $337,495.73 judgment in favor of an insured in its lawsuit seeking coverage for an underlying copyright infringement lawsuit, finding that the underlying claims are covered “advertising injuries” under the insurance policy and the “intentional acts,” “computer software professional activities” and “prior publication” exclusions do not bar coverage (Superior Integrated Solutions, Inc. v. Mercer Insurance Company of New Jersey, Inc., et al., No. A-1027-18T4, N.J. Super., App. Div., 2020 N.J. Super. Unpub. LEXIS 1370).

  • July 14, 2020

    Insureds Say District Court Erred In Interpreting Intellectual Property Exclusion

    SAN FRANCISCO — Insureds seeking coverage for an underlying libel and trade secrets suit claim in a March 4 reply brief filed in the Ninth Circuit U.S. Court of Appeals that a district court erred in determining that an insurer had no duty to defend based on the policy’s endorsement excluding intellectual property claims (MyChoice Software LLC, et al. v. Travelers Casualty Insurance Company of America, No. 19-56030, 9th Cir.).

  • July 14, 2020

    Magistrate Sua Sponte Denies Insured Leave To Amend In Fireworks Explosion Suit

    KANSAS CITY, Kan.— A federal magistrate judge in Kansas on July 10 sua sponte denied an insured’s motion for leave to amend its amended answer and counterclaim to a commercial general liability insurer’s declaratory judgment claim disputing coverage for an underlying bodily injury lawsuit, finding that the proposed amendment suffers from undue delay and would likely cause the insurer to incur undue prejudice (Everest Indemnity Insurance Company v. Jake's Fireworks, Inc., et al., No. 19-2620, D. Kan., 2020 U.S. Dist. LEXIS 121383).

  • July 13, 2020

    Judge: Insurer Owes No Coverage For Sandy Hook Victims’ Families’ Defamation Suit

    WATERBURY, Conn. — A Connecticut judge on June 5 held that a homeowners insurer has no duty to defend its insured against an underlying lawsuit brought by the family of a child and an educator who were killed at Sandy Hook Elementary School on Dec. 14, 2012, finding that the underlying complaint fails to allege “bodily injury,” “property damage” or an “occurrence” and that the intentional act exclusion bars coverage (USAA General Indemnity Company v. Cory T. Sklanka, No. UWYCV196048057S, Conn. Super., Waterbury Dist., 2020 Conn. Super. LEXIS 648).

  • July 13, 2020

    Federal Judge Remands Professional Liability Coverage Dispute To California Court

    LOS ANGELES — A federal judge in California on June 29 granted an insured’s motion to remand its lawsuit seeking professional liability coverage, rejecting the insurer’s argument that  removal is proper because the insured acted in bad faith by keeping the broker who procured the policy as a defendant to prevent removal to federal court until 28 U.S. Code Section 1446(c)(1)’s one-year removal period expired (Somera Capital Management, LLC v. Twin City Fire Insurance Company, No. 20-4277, C.D Calif., 2020 U.S. Dist. LEXIS 115193).

  • July 13, 2020

    Judge:  Human Trafficking, Wage Claims Fall Outside Professional Liability Coverage

    PHILADELPHIA — A federal judge in Pennsylvania on July 9 granted a professional liability insurer’s motion to dismiss an insured’s breach of contract and bad faith lawsuit, finding that underlying human trafficking and wage violations brought against the insured by a former employee fail to trigger coverage (Carl Hemphill, et al. v. Landmark Insurance Company, No. 19-5260, E.D. Pa., 2020 U.S. Dist. LEXIS 120447).

  • July 13, 2020

    Federal Judge Allows ‘Unlawful’ Prong Of UCL Claim To Proceed Against Insurers

    SACRAMENTO, Calif. — A federal judge in California on July 9 granted insurers’ motion for judgment on the pleadings on the “unfair” and “fraudulent” prongs of the insured’s California unfair competition law (UCL) claim but denied the insurers’ motion as to the “unlawful prong” of the UCL claim and to the extent that they contend that the insured is precluded from seeking equitable remedies in its suit alleging that they wrongfully denied defense and indemnity for an underlying $50 million settlement (Aerojet Rocketdyne, Inc. v. Global Aerospace, Inc., et al., No. 17-01515, E.D. Calif., 2020 U.S. Dist. LEXIS 121802).

  • July 10, 2020

    Policy’s Games Exclusion Is ‘At Best Ambiguous’; Insurer Owes Defense, Judge Says

    NEW HAVEN, Conn. — A federal judge in Connecticut on July 8 held that a commercial general liability insurer has a duty to defend its insured against an underlying negligence lawsuit, rejecting the insurer’s argument that the policy’s “Games Exclusion” bars coverage (Atain Specialty Insurance Co., v. Hank's Dairy Bar Inc., et al., No. 19-1085, D. Conn., 2020 U.S. Dist. LEXIS 119593).

  • July 09, 2020

    Judge: Professional Services Exclusion Bars Coverage For False Lab Report Claims

    ASHLAND, Ky. — A federal judge in Kentucky on July 7 held that a business insurance policy’s professional services exclusion bars coverage for an underlying lawsuit alleging the insured reported false lab results, granting the insurer’s motion for a declaratory judgment that it has no duty to defend or indemnify its insured (State Farm Fire and Casualty Co. v. Compliance Advantage, LLC, et al., No. 19-41, E.D. Ky., 2020 U.S. Dist. LEXIS 118778).

  • July 09, 2020

    Lawyer’s Breach Of Contract, Bad Faith Claims Fail; No Coverage Afforded, Judge Says

    SEATTLE — An insured’s breach of contract and bad faith claims against a professional liability insurer cannot proceed because no coverage is afforded under the professional liability policy for a grievance filed against the insured lawyer by the Washington State Bar Association, a Washington federal judge said July 7 in granting the insurer’s motion for summary judgment (Jenny Cochrane et al., v. American Guarantee & Liability Insurance Co., No. 19-1253, W.D. Wash., 2020 U.S. Dist. LEXIS 119089).

  • July 08, 2020

    Judge Remands Errors And Omissions Liability Coverage Suit Over Malpractice Claims

    LOS ANGELES — A senior federal judge in California on July 6 held that based on an amended negligence claim against an insurance adjuster in a lawsuit seeking errors and omissions liability coverage for an underlying malpractice claim, complete diversity no longer exists and remand is appropriate, finding, however, that the plaintiffs are not entitled to attorney fees because the adjuster was a sham defendant when the insurer initially removed the lawsuit to federal court (James Cook, et al. v. Arch Insurance Co., et al., No. 20-02612, C.D. Calif., 2020 U.S. Dist. LEXIS 118668).

  • July 08, 2020

    Judge Grants Insurer’s Motion For Summary Disposition In COVID-19 Coverage Suit

    LANSING, Mich. — A Michigan judge granted an insurer’s motion for summary disposition during a July 1 hearing broadcasted on the judge’s personal meeting room on YouTube, finding that an insured’s complaint alleging loss of business due to shutdown orders in response to the novel coronavirus contains “no allegations of direct, physical loss of or damage to” its restaurants (Gavrilides Management Company LLC, et al. v. Michigan Insurance Co., No. 20-000258-CB, Mich. Cir., Ingham Co.).