Mealey's Emerging Insurance Disputes

  • June 11, 2021

    Directors, Officers Insurer Dismisses Coverage Dispute Over Shareholder Claims

    TOPEKA, Kan. — A insurer on June 3 filed a dismissal with prejudice of its lawsuit disputing directors and officers liability coverage for underlying shareholder claims after the insurer, in response to a federal magistrate judge in Kansas’ order to show cause, indicated that it “waited to effectuate service because the parties were engaged in good faith negotiations.”

  • June 10, 2021

    Invalid Payments Exclusion Bars Coverage For $1.2M Gold Coin Loss, Insurer Says

    AUSTIN, Texas — After the Fifth Circuit U.S. Court of Appeals certified two questions in a coverage dispute over $1.2 million in stolen gold coins to the Texas Supreme Court, an insurer in a June 7 brief argues that an insurance policy’s “invalid payments exclusion” barred coverage for the insured’s loss.

  • June 10, 2021

    Insurer Did Not Undertake Duty To Taxi Cab’s Passengers, 8th Circuit Affirms

    ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on June 7 held that an appellant failed to demonstrate that a taxi cab company’s insurer increased his risk or that the taxi company relied on the insurer's background checks, affirming a lower federal court’s ruling that the insurer did not undertake a duty to the insured’s passengers.

  • June 10, 2021

    Federal Judge Refuses To Dismiss Duke’s Suit Seeking Coverage For Antitrust Claims

    ELIZABETH CITY, N.C. — A federal judge in North Carolina on June 8 denied an excess insurer’s motion to dismiss Duke University’s breach of contract, bad faith and unfair and deceptive trade practices claims in its lawsuit seeking coverage for underlying antitrust claims, finding that a 2020 antitrust class action relates back to a 2015 antitrust class action to trigger coverage.

  • June 09, 2021

    N.J. Court Denies Attorney’s Plea To Reform Professional Liability Insurance Policy

    TRENTON, N.J. — A New Jersey appeals court on June 9 rejected an attorney insured’s contention that a professional liability insurance policy must be reformed because it failed to comply with the requirements of New Jersey Rule of Court 1:21-1B(a)(4), affirming a lower court’s summary judgment ruling in favor of the insurer in a coverage dispute over approximately $800,000 in client funds that were allegedly misappropriated by a paralegal.

  • June 08, 2021

    R.I. Judge: Insured States Civil Authority Coverage Claim In Coronavirus Dispute

    PROVIDENCE, R.I. — A Rhode Island judge on June 4 granted in part and denied in part an insurer’s motion to dismiss a nightclub operator insured’s coronavirus coverage dispute, finding that the insured sufficiently stated a claim for civil authority coverage and that the insurer has failed to satisfy its burden of proving that the virus exclusion applied to bar coverage for the insured’s civil authority coverage claim.

  • June 08, 2021

    Insured Rebuffs Insurer’s Plea To Amend Order Refusing To Dismiss COVID-19 Suit

    MINNEAPOLIS — A barbershop owner insured on June 4 asked a federal judge in Minnesota to deny an insurer’s request to amend a June 2 order that partly denied the insurer’s motion to dismiss the insured’s coronavirus coverage lawsuit, arguing that the insurer fails to establish that this lawsuit is exceptional enough to warrant interlocutory appeal.

  • June 08, 2021

    Panel:  Insurer Has No Duty To Defend, Indemnify Suit Arising From Fatal Shooting

    ATLANTA — The 11th Circuit U.S. Court of Appeals on June 7 affirmed a lower federal court’s ruling that a commercial general liability insurer has no duty to defend or indemnify its apartment complex owner insured against an underlying lawsuit arising from a fatal shooting that occurred at one of its properties, finding that a reasonable reader would not construe the application and insurance policy to cover the property where the shooting occurred.

  • June 07, 2021

    Franchise Owners Appeal Dismissal Of $41M Coronavirus Coverage Dispute

    NEWARK, N.J. — Owners of more than 120 franchise locations under the brands Wendy's, T.G.I. Friday's, Marriott and Hilton filed a notice of appeal in a New Jersey federal court on June 4 indicating they are seeking the Third Circuit U.S. Court of Appeal’s review of the lower court’s dismissal of their breach of contract lawsuit alleging $40,798,390 in damages for their losses resulting from the coronavirus pandemic.

  • June 07, 2021

    Insurers Say No Coverage Owed For Suit Arising Out Of Listeria Contamination

    AUSTIN, Texas — No coverage is afforded for an underlying shareholder derivative lawsuit filed against an insured ice cream product manufacturer and its directors and officers following a Listeria outbreak because the underlying suit is not a suit seeking damages for bodily injury caused by an occurrence as required by the policies, the insurers say in a June 3 complaint filed in Texas federal court.

  • June 07, 2021

    ‘Resident Relative’ Exclusion Bars Coverage For Wrongful Death Suit, Panel Affirms

    BATON ROUGE, La. — A Louisiana appeals panel on June 4 found that there is no genuine issue of material fact regarding whether a homeowners insurer established that a child meets the definition of a “resident relative” of the insured premises, affirming a lower court’s ruling that a “resident relative” exclusion bars coverage for an underlying wrongful death lawsuit.

  • June 07, 2021

    Plethora Of Bar, Restaurant Owners, Operators Sue Insurer For Coronavirus Losses

    CHICAGO — Owners and operators of various bars, restaurants and taverns, including the Buffalo Wild Wings franchise, sued their property and casualty insurer in a federal court in Illinois on June 2 for its failure to provide coverage for their lost business income arising from the ongoing coronavirus pandemic and subsequent executive orders issued by Illinois Gov. J.B. Pritzker.

  • June 07, 2021

    Environmental Professional Liability Insurer’s Lawsuit Dismissed For Mootness

    COOKEVILLE, Tenn. — A Tennessee federal judge on June 1 dismissed an environmental professional liability insurer’s lawsuit seeking a declaration that no coverage is owed for an underlying suit filed against the insured after determining that the insurer’s suit is moot based on the dismissal of the underlying lawsuit against the insured.

  • June 04, 2021

    Judge Dismisses Consolidated Class Actions Seeking Coverage For COVID-19 Losses

    SEATTLE — A federal judge in Washington on May 28 granted insurers’ motion to dismiss consolidated class actions of hundreds of western Washington businesses seeking coverage for their lost income stemming from the coronavirus pandemic, finding that COVID-19 does not cause the physical loss or damage to the insureds’ property that is required as a condition precedent to trigger coverage.

  • June 04, 2021

    Florida High Court: Insurer Has Standing To Maintain Legal Malpractice Suit

    TALLAHASSEE, Fla. — Answering a certified question in the affirmative, the Florida Supreme Court on June 3 found that an insurer has standing to maintain a legal malpractice lawsuit against counsel who was hired to represent its insured where the insurer is contractually subrogated to the insured's rights under the policy.

  • June 03, 2021

    Officers’ Misconduct Did Not Occur During Policy Periods, Panel Says, Reverses

    WEST PALM BEACH, Fla. — A Florida appeals panel on June 2 held that a commercial general liability insurer did not have a duty to indemnify police officers against an underlying civil rights violations lawsuit because their misconduct did not occur during the policy periods, reversing a lower court’s summary judgment ruling in favor of the officers.

  • June 03, 2021

    Insurer Undervalued Hurricane Damage Losses, Insureds Allege

    LAKE CHARLES, La. — An insurer acted in bad faith and breached the terms of a homeowners insurance policy by failing to timely tender compensation to its insureds and undervalued the damages sustained for covered losses as a result of losses sustained by Hurricane Laura, the insureds allege in a complaint filed June 1 in Louisiana federal court.

  • June 03, 2021

    Insurer Not Due Credit For Medical Payments Already Paid, Arkansas Panel Affirms

    LITTLE ROCK, Ark. — An Arkansas appeals panel on June 2 affirmed a lower court’s ruling that a commercial general liability insurance policy is ambiguous as to its applicable liability limits and the insurer is not owed a credit for the $5,000 in medical payments that it already paid to the estate of a 3-year-old who died after choking on a hot dog given to him by a day care insured.

  • June 02, 2021

    Roundup Of Latest Briefs Over Coronavirus Coverage

    From a convention center owner’s appeal to the Seventh Circuit U.S. Court of Appeals to an insurer accusing an art gallery of “misdirection,” Mealey Publications takes a look at the latest pleadings relating to insurance coverage for COVID-19.

  • June 02, 2021

    Magistrate Recommends Default Judgment Be Entered Against Insured’s Employee

    FRESNO, Calif. — A federal magistrate judge in California on May 24 recommended that an entry of default judgment be entered against an insured’s employee in an insurer’s lawsuit alleging that the employee misappropriated $263,888 from its insured, finding that all of the factors in Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986), weigh in favor of granting the default judgment and granting the insurer’s request for of $263,888 in damages.