Mealey's Emerging Insurance Disputes

  • May 28, 2021

    Insured: ‘No Lawful Basis’ For Insurer To Deny Coverage For Looting, Water Damages

    PHILADELPHIA — A Philadelphia property owner on May 24 sued its insurer for breach of contract and bad faith in a Pennsylvania court, seeking more than $200,000 in property damage caused by looting and subsequent water damage.

  • May 27, 2021

    Insurer Says District Court’s Ruling On COVID-19 Losses Must Be Affirmed

    ATLANTA — A district court correctly found that an insured restaurant chain’s claim for loss of business income caused by shutdown orders issued by state governors in the wake of the COVID-19 pandemic is not covered because the decision is clearly supported by the insurance policy’s language and because the policy’s contamination exclusion bars coverage, an insurer says in a May 26 appellee brief filed in the 11th Circuit U.S. Court of Appeals.

  • May 26, 2021

    Judge:  Plaintiff Law Firm Can’t Use Privilege Both Ways In Thalidomide Cases

    PHILADELPHIA — The plaintiff law firm of Hagens Berman in Seattle cannot give privileged material to an expert in support of the firm’s claim of adequate representation and then object to the material being available to adversaries, a Pennsylvania federal judge ruled May 24.

  • May 26, 2021

    Judge Refuses To Vacate Dismissal Of Franchise Owners’ $41M Coronavirus Coverage Suit

    NEWARK, N.J. — A federal judge in New Jersey on May 24 denied a motion to vacate filed by the owners of more than 120 franchise locations under the brands Wendy's, T.G.I. Friday's, Marriott and Hilton, refusing to disturb her dismissal of their breach of contract lawsuit alleging $40,798,390 in damages for their losses resulting from the coronavirus pandemic.

  • May 26, 2021

    Coronavirus Does Not Constitute Pollution Condition, Federal Judge Determines

    MINNEAPOLIS — The virus that causes COVID-19 does not constitute a pollution condition under a premises pollution liability policy, a Minnesota federal judge said May 25 in granting an insurer’s motion to dismiss the insured’s complaint seeking business interruption losses caused by the shutdown of nonessential businesses in the wake of the COVID-19 pandemic.

  • May 25, 2021

    Judge Denies Motion To Reconsider, Clarify In Directors, Officers Coverage Suit

    WILMINGTON, Del. — A federal judge in Delaware on May 17 issued an oral order denying  without prejudice an insured’s motion for reconsideration or clarification of an April 30 ruling in the insured’s lawsuit seeking coverage for an underlying stockholder action alleging that directors and officers breached their fiduciary duties, noting that the motion failed to comply with Rule 7.1.1 of the Local Rules of Civil Practice and Procedure of the U.S. District Court for the District of Delaware.

  • May 25, 2021

    Insurer Asks Delaware High Court To Find No Coverage For Rite Aid Opioid Suits

    WILMINGTON, Del. — An insurer recently asked the Delaware Supreme Court to reverse a lower court’s ruling that there is coverage under a 2015 insurance policy for underlying lawsuits seeking damages for the costs arising out of Rite Aid Corp.’s distribution and its pharmacies’ dispensing of opioids, challenging the lower court’s finding that some of the underlying economic losses sought against the insured by governmental entities “are arguably because of bodily injury” and the governmental entities’ lawsuits and similar opioid actions assert one occurrence.

  • May 25, 2021

    Panel: Fact Issues Exist As To Whether Insurer Sent Reservation Of Rights Letter

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on May 24 affirmed a lower federal court’s summary judgment ruling that a tenant discrimination liability insurance policy does not cover underlying claims but reversed and remanded for a determination of whether the insurer sent a reservation of rights letter in July 2017.

  • May 25, 2021

    Owners Of Custom Men’s Clothing Stores Appeal No Coverage Ruling In COVID-19 Suit

    NEW ORLEANS — Insureds on May 22 filed a notice in a Louisiana federal court indicating that they are appealing an April 23 ruling that granted a businessowners insurer’s motion for judgment on the pleadings in their lawsuit seeking coverage for their alleged losses prompted by the coronavirus pandemic.

  • May 25, 2021

    Kentucky Panel Affirms No Coverage Owed For Personal Injury Suit

    FRANKFORT, Ky. — A Kentucky appeals panel on May 21 affirmed a lower court’s summary judgment ruling in favor of a commercial general liability insurer, finding that the insurer has no duty to defend and indemnify against an underlying personal injury lawsuit brought against a rodeo company insured.

  • May 24, 2021

    COVID-19 Is Not Biological Agent, Pollution Condition, Florida Federal Judge Says

    MIAMI — No coverage is owed for an insured’s business losses sustained as a result of shutdown orders issued to slow the spread of the COVID-19 virus because the insured failed to show that the virus is a biological agent as defined in the policy’s pollution condition endorsement, a Florida federal judge said May 20 in granting the insurer’s motion to dismiss.

  • May 24, 2021

    Business Loss Claims Properly Denied Under Virus Exclusion, Insurer Argues

    SCRANTON, Pa. — Dismissal of an insured’s claims in an insurance breach of contract and bad faith lawsuit against its insurer for failure to pay business losses stemming from Pennsylvania Gov. Tom Wolf’s business closure order as part of the state’s response to the COVID-19 pandemic is warranted because the insured failed to sufficiently plead any facts that would invoke “a reasonable expectation” of coverage for the claims he has made, the insurer argues in a May 10 motion to dismiss filed in Pennsylvania federal court.

  • May 21, 2021

    Illinois High Court: Defense Owed For Claims Insured Disclosed Fingerprint Data

    SPRINGFIELD, Ill. — The Illinois Supreme Court on May 20 affirmed a lower court’s ruling that an insurer has a duty to defend against class action claims that its insured violated the Biometric Information Privacy Act by disclosing fingerprint data to a third party without consent, further affirming that the policy’s violation of statutes exclusion does not bar coverage.

  • May 21, 2021

    Michigan Panel Partly Reverses Sexual/Physical Abuse Liability Coverage Suit

    DETROIT — A Michigan appeals panel on May 20 held that an underlying lawsuit alleging that a gym insured’s owner installed hidden surveillance cameras in restrooms and changing facilities to record its patrons without their knowledge or consent falls under an insurance policy’s “physical-sexual abuse” exclusion, finding that while the insurer did not have a duty to indemnify the insureds, it did have a duty to defend.

  • May 20, 2021

    Convention Center Owner Tells 7th Circuit Its Policy Interpretation Is Reasonable

    CHICAGO — The owner of a hotel, restaurant and convention center on May 7 reiterated its argument asking 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 seeking coverage for its losses arising from the coronavirus pandemic, arguing that its interpretation of its “all-risk” insurance policy’s business income coverage is reasonable and, therefore, the insurer has failed to establish the “legal insufficiency” of its complaint.

  • May 20, 2021

    Insurer Accuses Art Gallery Of ‘Misdirection’ In Coronavirus Coverage Dispute

    NEW YORK — An insurer in a May 7 appellee brief asserts that New York law is settled on the meaning of “direct physical loss” and that the several pages an art gallery insured “devotes to cites from jurisdictions far and wide is nothing but an exercise in misdirection” and asks the Second Circuit U.S. Court of Appeals to affirm a lower federal court’s dismissal of the insured’s complaint for failing to assert facts establishing “direct physical loss of or physical damage to” its gallery.

  • May 19, 2021

    11th Circuit Raises Jurisdictional Question In Coronavirus Coverage Suit

    ATLANTA — The 11th Circuit U.S. Court of Appeals on May 12 asked the owner of a Florida restaurant and its insurer to address whether the relevant pleadings in a coronavirus coverage lawsuit sufficiently alleged the citizenship of the parties to invoke a Florida federal court’s jurisdiction in the first instance.

  • May 18, 2021

    Roundup Of Latest Briefs Over Coronavirus Coverage

    From amicus curiae briefs filed in the Seventh Circuit U.S. Court of Appeals in support of an insurer to a Ninth Circuit appeal by the owner of two Los Angeles restaurants, Mealey Publications takes a look at the latest pleadings relating to insurance coverage for COVID-19.

  • May 18, 2021

    Federal Magistrate Grants Limited Extension Of Service Deadline In Coverage Dispute

    TOPEKA, Kan. — The same day an insurer responded to an order to show cause, a federal magistrate judge in Kansas on May 17 granted a limited extension of the deadline for an insurer to serve defendants with its lawsuit disputing directors and officers liability coverage for underlying shareholder claims, directing the insurer to file proof of service or waivers of service or voluntarily dismiss its lawsuit by June 7.

  • May 18, 2021

    Majority: Insurer’s Answer Did Not Interrupt Abandonment Period As To Trailer Owner

    NEW ORLEANS — A majority of the Louisiana Supreme Court on May 13 held that an insurer’s filing of an answer to a personal injury lawsuit did not serve to interrupt the abandonment period as to its property owner insured, reversing an appeals court in part and remanding for the lower court to conduct an evidentiary hearing as to the property owner’s exception of prescription.