Mealey's Emerging Insurance Disputes

  • February 08, 2021

    Insured Restaurant Chain Did Not Suffer Physical Loss As A Result Of Shutdown Orders

    TAMPA, Fla. — No coverage is owed for an insured restaurant chain’s business losses caused by shutdown orders issued by state governors in the wake of the COVID-19 pandemic because the insured did not sustain a physical loss to any of its insured properties, a Florida federal judge said Feb. 4 in granting the insurer’s motion to dismiss.

  • February 05, 2021

    Employee Exclusion Bars Coverage For Wrongful Death Suit, 5th Circuit Affirms

    NEW ORLEANS — Applying Mississippi law, the Fifth Circuit U.S. Court of Appeals on Feb. 4 held that a general liability insurance policy’s “employee exclusion” bars coverage for an underlying wrongful death lawsuit because the decedent was working as an employee and not an independent contractor of the insured at the time of the fatal accident, affirming a lower federal court’s summary judgment ruling in favor of the insurer.

  • February 05, 2021

    No Computer Transfer Fraud Coverage Owed To Metal Manufacturer, 5th Circuit Affirms

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on Feb. 4 affirmed a federal court’s ruling in favor of an insurer, finding that a silicon metal manufacturer insured is not entitled to coverage under a commercial crime insurance policy’s Computer Transfer Fraud provision for its losses arising from cyber fraud.

  • February 05, 2021

    FDIC Asks 11th Circuit To Reverse Court’s Denial Of $3M Statutory Interest

    ATLANTA — The Federal Deposit Insurance Corp. on Jan. 15 asked the 11th Circuit U.S. Court of Appeals to reverse a lower federal court’s judgment in favor of a directors and officers liability insurer in the FDIC’s lawsuit seeking $3 million in statutory prejudgment interest under Official Code of Georgia Annotated Section 7-4-15, challenging the lower court’s finding that its request was untimely.

  • February 05, 2021

    Insured Defends Remand Of Coronavirus Coverage Suit After 3 Removal Attempts

    PHILADELPHIA — A restaurant insured on Jan. 21 asked the Third Circuit U.S. Court of Appeals to reject a business insurer’s appeal seeking to reverse a lower court’s remand of its coverage lawsuit seeking recovery of damages caused by the novel coronavirus and governmental closure orders, arguing that it seeks solely declaratory relief involving novel state law issues related to the entitlement of coverage under policies issued to Pennsylvania business owners.

  • February 04, 2021

    Insurer Reiterates Cross-Appeal Seeking Reversal Of ‘Excessive’ Attorney Fee Award

    SAN FRANCISCO — A commercial general liability insurer on Feb. 2 reiterated its cross-appeal to the Ninth Circuit U.S. Court of Appeals that Yahoo forfeited its claim to $618,380 in attorney fees under Brandt v. Superior Court in their data privacy coverage dispute.

  • February 04, 2021

    Insureds Ask Court To Reconsider Dismissal Of RICO Suit Arising From Maria Damage

    SAN JUAN, Puerto Rico — Resort hotel insureds on Feb. 1 moved a federal court in Puerto Rico to reconsider or hold in abeyance a Jan. 29 judgment that granted their insurer and insurance adjusters’ motions to dismiss their Racketeer Influenced and Corrupt Organizations (RICO) Act lawsuit seeking coverage for Hurricane Maria damage.

  • February 04, 2021

    Insureds Ask 3rd Circuit To Consolidate Appeals Of Dismissals Of Coronavirus Suits

    PHILADELPHIA — A restaurant and tavern operator on Jan. 29 joined a motion with seven other insureds asking the Third Circuit U.S. Court of Appeals to consolidate their appeals of  lower federal courts’ dismissals of their lawsuits seeking coverage for their business interruption losses caused by the novel coronavirus and the subsequent shutdown orders, contending that consolidation will achieve “significant efficiencies” and “facilitate certification" of "the novel and determinative questions of Pennsylvania law” that are discussed in each appeal to the Pennsylvania Supreme Court.

  • February 04, 2021

    Liquidator Moves To Amend Complaint In Coverage Suit Over $21M Wrongful Acts Claim

    SIOUX FALLS, S.D. — Citing recent occurrences and circumstances, the liquidator of ReliaMax Surety Co. (RSC) on Feb. 2 moved to amend his amended 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.

  • February 03, 2021

    Insurer Failed To Show Novel Coronavirus Did Not Cause Direct, Physical Loss

    SANTA ANA, Calif. — A California judge on Jan. 28 overruled an insurer’s demurrer in a complaint seeking coverage for damages sustained as a result of the novel coronavirus after determining that the insurer failed to prove that the insured did not sustain a direct physical loss at its facility.

  • February 03, 2021

    Delaware Judge Rules On Motions In ‘Sprawling’ Coverage Suit Arising From Merger

    WILMINGTON, Del. — A Delaware judge on Feb. 2 granted an insured’s motions for judgment on the pleadings and summary judgment and granted in part and denied in part the insurers’ motions for summary judgment, noting that this “sprawling insurance coverage dispute involves one transaction, two alleged federal securities law violations, three policy towers, seven motions, and a baker’s dozen parties.”

  • February 03, 2021

    Insurer Responds To Ralph Lauren Corp.’s Coverage Suit Over Coronavirus Losses

    NEWARK, N.J. — An insurer on Jan. 29 opposed Ralph Lauren Corp.’s motion for partial judgment on the pleadings and cross-moved for judgment on the pleadings in the insured’s New Jersey federal lawsuit alleging that the novel coronavirus and subsequent stay-at-home orders have caused it to incur direct physical loss and physical damage, arguing that “this litigation boils down to four straightforward questions.”

  • February 03, 2021

    Roundup Of Latest Briefs, Senate Bill Over Coronavirus Coverage

    From an insurer’s cross-motion for judgment on the pleadings challenging Ralph Lauren’s Corp.’s claim for coverage to a restaurant insured’s appeal to the Third Circuit U.S. Court of Appeals, Mealey Publications takes a look at the latest pleadings relating to insurance coverage for COVID-19.

  • February 02, 2021

    Insurer:  Shareholder, Whistleblower Suits Constitute Single Claim, No Coverage Due

    KANSAS CITY, Kan. — An insurer on Feb. 1 filed suit in a federal court in Kansas arguing that underlying shareholder claims and an earlier whistleblower lawsuit questioning the cost of freight shipping services constitute a single “claim” that was not “first made” during the policy period and, therefore, no coverage is owed for the shareholder claims.

  • February 02, 2021

    Insureds Sue Directors And Officers Liability Insurers For Bad Faith In Delaware Court

    WILMINGTON, Del. — A publicly traded diversified holding company and its affiliates on Jan. 30 sued their primary and excess directors and officers liability insurers in the Delaware Superior Court for 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.

  • February 02, 2021

    Judge Allows Joint Insurance Funds’ Breach Of Contract, Bad Faith Claims To Proceed

    NEWARK, N.J. — A federal judge in New Jersey on Jan. 26 denied an insurer’s motion to dismiss breach of contract and bad faith claims brought by joint insurance funds (JIFs) seeking indemnification for $4,051,129 in expenses for defending underlying sexual abuse claims.

  • February 01, 2021

    Restaurant Seeks High Court Review Of Whether Roadwork Damage Caused Covered Loss

    WASHINGTON, D.C. — A Florida insured on Jan. 14 filed a petition for a writ of certiorari in the U.S. Supreme Court, seeking review of whether construction dust and debris constitutes “direct physical loss” to its restaurant to trigger coverage under an “all-risk” insurance policy and whether a court erred in excluding three of its causation experts under Daubert and its progeny, noting that “certain issues presented overlap with the recent proliferation of COVID-19 insurance cases across the country.”

  • February 01, 2021

    Hotel: Insurer Leveraging Pandemic To ‘Wipe Out’ Coverage For Civil Unrest Losses

    CHICAGO — The owner of theWit hotel in Chicago on Jan. 27 sued an “all-risk” insurer in an Illinois court for breach of contract and bad faith, accusing the insurer of leveraging the novel coronavirus pandemic “to wipe out coverage for other catastrophic losses and business closures,” including its $14,826,973 in business interruption loss resulting from the civil unrest events in response to the death of George Floyd.

  • February 01, 2021

    Federal Judge Adopts Report, Rules In Insureds’ Favor In D&O Coverage Dispute

    WEST PALM BEACH, Fla. — A federal judge in Florida on Jan. 27 adopted a magistrate’s recommendation to grant nursing home owner insureds’ motion for summary judgment and deny a directors and officers liability insurer’s cross-motion for summary judgment in a coverage dispute arising from claims that the insureds breached fiduciary and statutory duties and caused physical and monetary injuries to one of their residents, rejecting the insurer’s argument that the professional services exclusion bars coverage.

  • January 29, 2021

    IED Claim In Probate Suit Potentially Covered, Missouri Panel Says In Reversal

    ST. LOUIS — A Missouri appeals panel on Jan. 26 reversed and remanded a lower court’s ruling in favor of an insurer, broker and agent in an insured’s lawsuit seeking coverage for an underlying probate lawsuit, finding that the underlying infliction of emotional distress claim is potentially covered and not barred by the policy’s intentional acts exclusion.