Mealey's Emerging Insurance Disputes
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.”
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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.”
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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.
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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.
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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.
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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.
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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.”
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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.
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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.
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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.
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January 29, 2021
Washington Senate Bill Addresses Business Interruption Coverage In Wake Of COVID-19
OLYMPIA, Wash. — In response to the “devastating impact” of the novel coronavirus pandemic, Washington senators on Jan. 26 introduced Senate Bill 5351, which would codify the interpretation of “loss” and “damage” in the context of business interruption insurance policies and give insureds additional time to challenge insurers’ denial of their business interruption insurance claims.
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January 29, 2021
District Court Did Not Err In Refusing To Strike Bad Faith Claim, Panel Says
SAN FRANCISCO — A district court did not err in refusing to strike a bad faith counterclaim in an excess insurance lawsuit because the counterclaim is not a retaliatory claim under California’s statute against strategic lawsuits against public participation (anti-SLAPP), the Ninth Circuit U.S. Court of Appeals said Jan. 25 in affirming the district court’s opinion.
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January 28, 2021
Restaurant Alleges Bad Faith In Coverage Suit Arising From COVID-19 Closure Orders
CHICAGO — The owner and operator of an Illinois pancake restaurant on Jan. 24 sued its commercial property insurer in an Illinois federal court for breach of contract and bad faith and sought a declaration that its expected more than $400,000 in business interruption losses in connection with the governmental closure orders arising from the novel coronavirus pandemic are covered under its policies.