Mealey's Emerging Insurance Disputes

  • August 12, 2021

    Claims Against Senior Living Facility, Owners Fail To Trigger Coverage, Insurer Says

    RICHMOND, Va. — A professional liability insurer on Aug. 3 asked the Fourth Circuit U.S. Court of Appeals to reverse a federal court’s finding that it has a duty to defend against an underlying class action alleging that a senior living facility and its owners breached their contractual duties to provide adequate staffing and personal care, arguing that the underlying complaint fails to assert damages because of an injury that was “caused by” a professional health care incident to trigger coverage.

  • August 12, 2021

    Judge:  Directors, Officers Liability Insurers Engaged In A ‘Race To The Courthouse’

    WILMINGTON, Del.— A Delaware judge on Aug. 11 denied primary and excess directors and officers liability insurers’ motion to dismiss or, alternatively, stay a publicly traded diversified holding company and its affiliates’ breach of contract and bad faith seeking coverage for underlying putative class action lawsuits alleging that they improperly manipulated the unit price of an oil refiner and marketer of transportation fuels in the lead up to the exercise of a call right, finding that even if the insurers argued their motion under traditional forum non conveniens standards, they cannot prove overwhelming hardship if they are forced to litigate in Delaware.

  • August 12, 2021

    Pennsylvania Majority Partly Reverses Order Coordinating COVID-19 Coverage Suits

    PITTSBURGH — A majority of the Pennsylvania Superior Court on Aug. 10 partly reversed a lower court’s order coordinating coronavirus coverage lawsuits against Erie Insurance Exchange in the Allegheny County Court of Common Pleas, noting that Pennsylvania Rule of Civil Procedure 213.1 limits coordination to “pending” lawsuits.

  • August 11, 2021

    Federal Judge Dismisses Certain Claims In Hurricane Harvey Coverage Dispute

    HOUSTON — A federal judge in Texas on Aug. 5 dismissed insureds’ claims against an insurance agent and  breach of fiduciary claims against an insurance broker in a Hurricane Harvey coverage dispute, allowing their claims for common-law misrepresentation, negligence and violations of the Deceptive Trade Practices Act and Texas Insurance Code against the broker to survive.

  • August 10, 2021

    Insurer’s Actions Constituted Reasonable Notice, 9th Circuit Rules In Reversal 

    SAN FRANCISCO — Following the Nevada Supreme Court’s affirmative answer to a certified question, the Ninth Circuit U.S. Court of Appeals held Aug. 9 that an insurer is entitled to reimbursement of the funds it already spent in defending uncovered claims and a lower federal court improperly denied the insurer’s request for damages under U.S. Code Section 2202, reversing and remanding.

  • August 10, 2021

    Federal Judge Issues Order To Streamline Coronavirus Coverage Suits Against Erie

    ERIE, Pa. — Following the U.S. Judicial Panel on Multidistrict Litigation’s centralization of coronavirus business interruption coverage lawsuits against Erie Insurance Co. in the U.S. District Court for the Western District of Pennsylvania, a federal judge on Aug. 6 issued an order “in an effort to streamline these proceedings while at the same time maintaining and fostering ultimate judicial economy and minimizing the potential unnecessary expenditure of resources by the parties and counsel.”

  • August 10, 2021

    Sexual Misconduct Policy Exclusion Is Not Ambiguous, 7th Circuit Rules In Reversal

    CHICAGO — The Seventh Circuit U.S. Court of Appeals on Aug. 6 reversed a lower federal court’s ruling in favor of school district insureds in a coverage dispute arising from a student’s alleged sexual misconduct, noting that it “will not read the exclusion to the errors-and-omissions coverage to turn the sexual-misconduct clause from occurrence coverage to claims-made coverage.”

  • August 09, 2021

    CGL Insurers: No Coverage For Surfside Collapse Suits Against Engineering Firm

    BALTIMORE — Two commercial general liability insurers on Aug. 4 filed suit in a Maryland federal court disputing coverage for underlying lawsuits brought against their engineering firm insured by victims of the June 24 partial collapse of a Surfside, Fla., condominium high-rise, alleging that numerous policy exclusions preclude coverage for damages arising from the insured’s rendering or failure to render professional services.

  • August 05, 2021

    MDL Plaintiffs Seek To Enjoin State Court Proceedings In Coronavirus Coverage Suit

    CHICAGO — Hospitality industry insured plaintiffs on Aug. 3 moved for an injunction of all pending and future state court class actions in which insureds of Society Insurance Co. seek business interruption protection coverage arising out of the coronavirus pandemic until proceedings in a multidistrict litigation are completed, arguing to a federal court in Illinois that an injunction “is necessary to prevent Society from attempting to conduct a reverse auction with state court class action plaintiffs to the detriment of the Plaintiffs in this MDL.”

  • August 05, 2021

    COVID-19, Shutdown Orders Can Constitute Direct Physical Loss, Damage, Insured Says

    COLUMBUS, Ohio — Arguing that insurers are bound by what their insurance policy says and not what they wish it said, an insured in an Aug. 3 merits brief asks the Ohio Supreme Court to answer yes to a federal court’s certified question asking whether “the general presence in the community, or on surfaces at a premises, of the novel coronavirus known as SARS-CoV-2” constitutes “direct physical loss or damage to property; or does the presence on a premises of a person infected with COVID-19 constitute direct physical loss or damage to property at that premises?”

  • August 04, 2021

    Pilot’s Bodily Injury Claim Barred From Coverage, Illinois Panel Rules, Reverses

    SPRINGFIELD, Ill. — An Illinois appeals panel on July 30 held that an underlying claim for bodily injury that a pilot allegedly suffered while piloting an insured’s airplane is excluded under an insurance policy, reversing a lower court’s denial of the insurer’s motion for summary judgment in its declaratory judgment lawsuit disputing coverage for the underlying claim and remanding.

  • August 04, 2021

    Suit Fails To Allege ‘Medical Incident’ To Trigger Professional Liability Coverage

    FAYETTEVILLE, Ark. — A federal judge in Arkansas on Aug. 2 granted a professional liability insurer’s motion for summary judgment in its lawsuit seeking a declaration that it has no duty to defend or indemnify its incarcerated doctor insured against an underlying sexual assault lawsuit, finding that the underlying action fails to assert a “medical incident” that occurred in the context of the insured’s provision of medical services to trigger coverage.

  • August 03, 2021

    Roundup Of Latest Briefs Over Coronavirus Coverage

    From Boscov’s Department Store Inc.’s appeal to the Third Circuit U.S. Court of Appeals to  American Property Casualty Insurance Association’s amicus curiae brief filed in the 11th Circuit U.S. Court of Appeals, Mealey Publications takes a look at the latest pleadings relating to insurance coverage for COVID-19.

  • August 03, 2021

    No Professional Liability Coverage Owed For Ex-Wife’s Invasion Of Privacy Suits

    NASHVILLE, Tenn. — A federal judge in Tennessee on July 21 held that a doctor insured was not acting within the scope of his duties for Vanderbilt University Medica Center when he accessed his ex-wife's medical records without authorization, finding that a professional liability insurer has no duty to defend against the two underlying invasion of privacy state court lawsuits brought by the ex-wife.

  • August 03, 2021

    Delaware Judge Dismisses Coverage Suit Over Appraisal Proceeding Following Merger

    NEW CASTLE, Del. — A Delaware judge on July 30 granted primary and excess directors and officers liability insurers’ motion to dismiss an insured’s breach of contract lawsuit seeking coverage for defense costs and pre- and post-judgment interest incurred from an appraisal proceeding filed by dissenting stockholders following a corporate merger, finding that “an appraisal action is a statutory proceeding that does not seek redress in response to any corporate act” and “even if an appraisal action does arise from or seek redress for a corporate act, that act necessarily is the merger’s effectuation, which did not occur before the Run-Off Date.”

  • August 03, 2021

    Negligence Claim Against Broker In Asbestos Suit Is Time-Barred

    NEW YORK — A New York federal judge on July 27 granted an insurance broker’s motion for summary judgment in a dispute over asbestos coverage after determining that the insured’s negligence claim is time-barred because the claim accrued in 1995, well past the applicable statutes of limitations under either New York or New Jersey law.

  • August 03, 2021

    Parties Stipulate To Dismiss 3rd Insurer From Private Equity Firms’ Coverage Suit

    WILMINGTON, Del. — Private equity firms insureds and one of their insurers on July 30 filed a stipulation seeking to dismiss with prejudice the insurer from the insureds’ lawsuit seeking coverage for their $120 million settlement with the bankruptcy estate of a retail fashion holding company they acquired.

  • August 03, 2021

    Boscov’s Appeals No Coverage Ruling In Bad Faith Suit Arising From Coronavirus

    ALLENTOWN, Pa. — One month after a federal judge in Pennsylvania held that although Boscov's Department Store Inc.’s business has undoubtedly been impacted by the coronavirus pandemic, its “alleged losses bear no causal connection to the physical condition of its properties,” Boscov’s on July 29 filed a notice of appeal to the Third Circuit U.S. Court of Appeals challenging the no coverage ruling in its breach of contract and bad faith lawsuit against its insurer.

  • August 02, 2021

    Judge Denies State Farm’s Motion To Compel Arbitration In False Claims Act Suit

    GULFPORT, Miss. — A federal judge in Mississippi on July 29 denied State Farm Fire and Casualty Co.’s motion to compel arbitration of claims under the False Claims Act (FCA) and stay all proceedings in relators’ 15-year-old qui tam suit accusing the insurer of filing false flood insurance claims after Hurricane Katrina.

  • August 02, 2021

    Florida Judge Allows Insurer To Intervene, Interplead Funds In Condo Collapse Suit

    MIAMI — A Florida judge on July 21 granted an insurer’s motion to intervene for the limited purpose of interpleading its $1,263,400 policy limits in a consolidated class action arising from the June 24 partial collapse of a Surfside, Fla., condominium high-rise, commending the insurer “for promptly recognizing its obligation to honor its insurance agreements with those who have lost property due to this tragic event, and for promptly tendering its policy limits to those victims who have yet to be located.”