Mealey's Emerging Insurance Disputes

  • April 13, 2021

    No Coverage Owed For Alleged Phishing Attack, 9th Circuit Affirms

    PASADENA, Calif.—The Ninth Circuit U.S. Court of Appeals on April 9 affirmed a lower federal court’s ruling in favor of an insurer in Alorica Inc.’s lawsuit seeking coverage for its alleged “security failure” that was caused by a phishing attack by an unknown perpetrator, rejecting the insured’s contention that a letter demanding monetary relief from client Express Scripts constituted a “claim” under its “security & privacy risk response” policy.

  • April 13, 2021

    Kentucky Panel Affirms No Farm Liability Coverage Owed For Crop Fraud Claims  

    FRANKFORT, Ky. — A Kentucky appeals panel on April 9 affirmed a lower court’s summary judgment ruling in favor of a farm liability insurer, finding no error with the lower court’s conclusion that the insureds’ alleged bad acts cannot constitute “accidents” to trigger coverage.

  • April 13, 2021

    Liquidator Amends Complaint In Coverage Suit Arising From $21M Wrongful Acts Claim

    SIOUX FALLS, S.D. — The liquidator of ReliaMax Surety Co. (RSC) on March 23 again amended his complaint seeking a declaratory judgment that coverage exists under a claims-made excess insurance policy above a directors and officers (D&O) policy with regard to a $21 million wrongful acts claim, seeking a $10 million judgment against the insurer minus credits provided for by the underlying judgment plus compensatory and punitive damages to be determined at trial.

  • April 13, 2021

    No Coverage Owed To Executive Officers For Asbestos Injury Claims

    BATON ROUGE, La. — The First Circuit Louisiana Court of Appeal on April 9 affirmed a trial court’s ruling that an insurer has no duty to defend the executive officers of a decedent’s former employer against asbestos personal injury claims because the policy’s co-employee exclusion applies as a bar to coverage for the executive officers who are considered employees of the corporation.

  • April 12, 2021

    Panel:  No Coverage For Intentional Conduct Alleged By Insured’s Former Fiancé

    PASADENA Calif.— The Ninth Circuit U.S. Court of Appeals on April 9 affirmed a lower federal court’s summary judgment in favor of a homeowners insurer in an insured’s breach of contract lawsuit seeking coverage for an underlying action brought by her former fiancé, finding that the underlying allegations are based on only intentional conduct that is barred from coverage.

  • April 12, 2021

    Texas High Court Renders Take-Nothing Judgment On Class Claim Against Insurers

    AUSTIN, Texas — The Texas Supreme Court on April 9 held that homeowners insurers were entitled to summary judgment on class members’ breach of contract claim for nonrenewal of their broad “all risk” insurance policies, reversing and rendering a take-nothing judgment as to the claim.

  • April 09, 2021

    Fiduciary Liability Policy Exclusion Does Not Bar Coverage, Panel Says In Reversal

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on April 8 reversed a lower federal court’s ruling that a fiduciary liability insurance policy’s prior and pending proceeding exclusion precluded coverage for an underlying lawsuit brought against its retirement association insured, reversing and remanding.

  • April 09, 2021

    Home Depot Seeks $50M From Insurers For Losses Arising From 2014 Data Breach

    CINCINNATI — The Home Depot Inc. and Home Depot U.S.A. Inc. on April 8 sued their primary and excess commercial general liability insurers for breach of contract and bad faith in a federal court in Ohio, seeking damages up to the full collective policy limits of $50 million for its losses stemming from a 2014 data breach.

  • April 09, 2021

    Missouri Panel Partly Reverses Ruling In Coverage Suit Over Competitor’s Claims

    KANSAS CITY, Mo. — A Missouri appeals panel on April 6 partly reversed a lower court’s ruling in a commercial general liability insurance coverage dispute arising from an underlying dispute between competitors in the lumber industry, finding that the insureds’ second amended complaint supported claims for bad faith failure to defend and failure to settle.

  • April 08, 2021

    New York Panel:  Excess Insurer Has No Duty To Defend, Indemnify Personal Injury Suit

    NEW YORK — A New York appeals court panel on April 6 reversed a lower court’s ruling that an excess insurer’s policy was primary to the plaintiff insurer’s policy in defending a mutual insured against an underlying personal injury lawsuit, finding that the excess insurer is not bound by a prior judgment.

  • April 08, 2021

    Assault And Battery Exclusion Bars Coverage, Florida Panel Affirms

    MIAMI — A Florida appeals panel on April 7 affirmed a lower court’s ruling that an insurer has no duty to defend or indemnify its insured against an underlying negligence action because it arose out of an assault and battery that occurred on its premises.

  • April 08, 2021

    Judge Denies Insured’s Motion To Stay Coverage Suit Arising From Worker Injury

    SAN FRANCISCO — A federal judge in California on April 5 denied an insured’s motion to stay primary and excess commercial 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, finding that the two of the three factors in Landis v. North American Co. weigh against a stay.

  • April 07, 2021

    Outback Steakhouse’s Franchisee Appeals No Coverage Ruling In Coronavirus Suit

    SAN FRANCISCO — A franchisee of Outback Steakhouse restaurants in Arizona, Colorado, Nevada, New Mexico and California and its parent and affiliated companies on April 1 filed a notice of appeal in the Ninth Circuit U.S. Court of Appeals challenging a lower court’s finding that they have failed to plausibly allege “direct physical loss of or damage to” their property to trigger coverage under the policy in a coronavirus coverage suit.

  • April 06, 2021

    Judge:  Insurer Has Duty To Defend T-Mobile In Suit Alleging Tower Damaged Building

    SEATTLE — On remand from the Ninth Circuit U.S. Court of Appeals, a federal judge in Washington on April 1 held that an insurer has a duty to defend T-Mobile USA against an underlying lawsuit alleging that a cell phone tower caused property damage, granting T-Mobile’s motion for partial summary judgment as to its breach of contract and declaratory judgment claims, denying both the insured’s and insurer’s motions for summary judgment as to the bad faith claim and deferring ruling on the insurer’s motion for summary judgment as to the New Jersey Consumer Fraud Act claim.

  • April 05, 2021

    Insured’s Efforts To Minimize Conflicts Fail, Insurer Argues To U.S. High Court

    WASHINGTON, D.C. — A life insurer on March 31 argued to the U.S. Supreme Court that an Eighth Circuit U.S. Court of Appeals’ opinion deepened circuit conflicts as to whether class certification is proper when some members benefit from the same conduct that purportedly harms others and whether courts can certify a “fail-safe” class that defines membership by referring to success on the merits, contending that an insured’s “efforts to minimize both conflicts fail.”

  • April 05, 2021

    Minor League Baseball Teams Reply To Opposition Of Appeal In COVID-19 Coverage Suit

    SAN FRANCISCO — Small businesses that own and operate Minor League Baseball (MiLB) teams on March 31 reinforced their argument asking the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court’s dismissal of their breach of contract and declaratory judgment lawsuit seeking business interruption coverage for their losses arising from the coronavirus pandemic.

  • April 05, 2021

    Convention Center Owner Asks Panel To Reverse Dismissal Of COVID-19 Coverage Suit

    CHICAGO — The owner of a hotel, restaurant and convention center in a March 16 brief asks the Seventh Circuit U.S. Court of Appeals to reverse a lower federal court’s dismissal of its breach of contract and declaratory judgment lawsuit against its “all-risk” insurer, arguing that a reasonable person in its position would believe that its policy covers business income loss if it was ordered by the Illinois governor “to close its doors and suspend operations to prevent the spread of a deadly virus.”

  • April 05, 2021

    Pennsylvania Judge: Dentist’s Loss Of Use Of Property Was ‘Direct’ And ‘Physical’

    PITTSBURGH — A Pennsylvania judge held on March 22 that, at the very least, it is reasonable to interpret the phrase “direct physical loss of . . . property” to encompass the loss of use of a dental practice’s property due to the spread of the coronavirus “absent any actual damage to property,” finding that the insured has reasonably demonstrated a right to coverage under its insurance policy’s business income, extra expense and civil authority provisions.

  • April 02, 2021

    Judge: Business Income Provision Does Not Apply To Losses Arising From COVID-19

    CHICAGO — A federal judge in Illinois on March 31 granted an insurer’s motion to dismiss without prejudice a hospitality support agency’s putative class action alleging the insurer wrongfully denied coverage for its losses caused by the government-ordered shutdowns prompted by the coronavirus pandemic, finding that no coverage exists under the policy’s business income, extra expense and civil authority provisions.

  • April 02, 2021

    Federal Judge Rules For Insurer In Employment Practices Liability Coverage Dispute

    SPRINGFIELD, Ill. — A federal judge on March 30 granted an insurer’s motion for summary judgment in its lawsuit disputing coverage for an underlying Fair Labor Standards Act collective action, rejecting the insured’s argument that consent forms signed by two physicians to opt into the conditionally certified collective action are new and distinct claims that were first made during the 2016 policy period.