Mealey's Emerging Insurance Disputes

  • May 14, 2021

    Panel Reverses Dismissal Of Negligent Procurement Claims Against Broker, Agent

    ATLANTA — The 11th Circuit U.S. Court of Appeals on May 13 reversed a lower federal court’s dismissal of a property management company’s negligent procurement of insurance claims against a broker and an agent and remanded with instructions for the lower court to permit the company at least one opportunity to amend its third-party complaint to assert additional facts relevant to the remaining claims.

  • May 14, 2021

    Panel: Dishonest Entrustment Exclusion Bars Coverage For Jewelry Stolen In Mob Scheme

    NEW YORK — A New York appeals panel on May 13 held that an insurance policy’s dishonest entrustment exclusion bars coverage for a jeweler insured’s loss arising from $2.09 million in jewelry stolen by a mobster in prison, affirming a lower court’s grant of the insurer’s motion for summary judgment in the insured’s breach of contract lawsuit.

  • May 14, 2021

    Magistrate Stays Discovery On Insurer’s Duty To Indemnify Senior Living Facility

    WILMINGTON, N.C. — A federal magistrate judge in North Carolina on May 5 granted in part an insurer’s motion to stay discovery in its declaratory judgment lawsuit pending resolution of an underlying class action alleging that a senior living facility and its owners breached their contractual duties to provide adequate staffing and personal care and knowingly failed to comply with staffing and personal care obligations, staying discovery on the indemnification issue and allowing discovery to proceed on “coverage” issues and certain counterclaims.

  • May 14, 2021

    Judge: Ralph Lauren Fails To Allege Physical Loss, Damage In COVID-19 Coverage Suit

    NEWARK, N.J. — A federal judge in New Jersey on May 12 denied Ralph Lauren Corp.’s motion for partial judgment on the pleadings and granted its insurer’s cross-motion for judgment on the pleadings in a coverage lawsuit arising from the coronavirus pandemic, finding that the insured’s pleadings fail to include any specific allegations as to physical loss or damage to its covered or surrounding properties.

  • May 13, 2021

    Judge Denies Insurer’s Motion For Summary Judgment As To T-Mobile’s NJCFA Claim

    SEATTLE — A federal judge in Washington on May 11 denied an insurer’s motion for summary judgment as to T-Mobile USA’s New Jersey Consumer Fraud Act (CFA) claim in a coverage dispute over an underlying lawsuit alleging that a cell phone tower caused property damage, finding that the CFA claim is based on the insurer’s purported deliberate concealment of material facts as to coverage.

  • May 12, 2021

    Panel:  No Defense Owed  For Unfair Practices Class Action Against Fitness Chain

    CINCINNATI — The Sixth Circuit U.S. Court of Appeals on May 11 affirmed a lower federal court’s ruling that an insurer has no duty to defend the operator of the "Urban Active" chain of fitness clubs against an underlying class action alleging unfair practices, finding that the policy’s contractual-liability exclusion bars directors and officers liability coverage.

  • May 12, 2021

    Judge:  How Can Insurer Be ‘So Certain’ That COVID-19 Was Not On Salon’s Premises?

    EAST ST. LOUIS, Ill. — A federal judge in Illinois on May 10 held that, for now, a hair salon insured has plausibly stated a cause of action that it is entitled to “Communicable Disease Business Income and Extra Expense Coverage” for its losses arising from the governmental shutdown of its business in response to the coronavirus pandemic, denying the insurer’s motion to dismiss the insured’s declaratory judgment lawsuit in its entirety.

  • May 12, 2021

    Policy Requires Insured To ‘Fall Down A Rabbit Hole,’ Judge Says In COVID-19 Suit

    PHILADELPHIA — Denying an insurer’s motion to dismiss a retail furniture insured’s lawsuit seeking coverage for its losses stemming from the forced closure of its business in response to the coronavirus pandemic, a Pennsylvania federal judge on May 7 said the more-than-100-page policy requires “the insured to fall down a rabbit hole and wander through a vast thicket of verbiage that would leave even the most careful reader mystified by the mazes of pages to be pieced together and deciphered in order to determine if there is coverage on the other side.”

  • May 11, 2021

    Amici: Policies Never Intended To Cover Economic Losses Untethered To Physical Damage

    CHICAGO — Amici curiae in support of an insurer on May 5 asked the Seventh Circuit U.S. Court of Appeals to affirm a lower federal court’s dismissal of a restaurant insured’s breach of contract lawsuit seeking coverage for its alleged $977,891 in lost business income arising from its government-ordered shutdown in response to the coronavirus pandemic, arguing that “[i]mposing a new and retroactive extra-contractual risk on insurers would threaten insurer solvency and harm Illinois’ insurance marketplace."

  • May 11, 2021

    Los Angeles Restaurant Owner Seeks Reversal Of No Coverage Ruling In COVID-19 Suit

    SAN FRANCISCO — The owner of two Los Angeles restaurants recently asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court’s dismissal of its lawsuit seeking coverage for its business income loss caused by the governmental shutdown orders in response to the coronavirus pandemic, contending that the lower court dismissed its complaint “based on a range of hypothetical policy consequences” that render its interpretation of the policy “unreasonable — even if conceivable.”

  • May 11, 2021

    Gallery: Court Erred In Accepting Insurer’s ‘Self- Serving’ Policy Interpretation

    NEW YORK — A Manhattan-based art gallery tells the Second Circuit U.S. Court of Appeals in an April 2 brief that a lower federal court committed reversible error in its interpretation of an all-risk business owners insurance policy because it permitted the insurer to escape liability even though a reasonable interpretation of the policy requires the insurer to provide coverage for its losses arising from the forced cessation of its operations in response to the coronavirus pandemic.

  • May 11, 2021

    Panel: D&O Policy Ambiguous On Whether Insurer Owes Coverage For Investors’ Claims

    ST. LOUIS — The Eighth Circuit U.S. Court of Appeals held on May 11 that a directors and officers liability policy is ambiguous as to whether an insurer has a duty to defend and indemnify its insured and its chief executive officers against underlying claims brought by investors, reversing a lower federal court’s ruling in favor of the insurer and remanding.

  • May 10, 2021

    Judge Dismisses Excess Insurer From Coverage Dispute Arising From Smart TV Litigation

    LOS ANGELES — A federal judge in California on May 4 granted an excess insurer’s motion to dismiss Vizio Inc.’s lawsuit seeking defense and indemnity for an underlying $17 million settlement and defense costs arising from class claims over the insured’s unauthorized collections of consumers’ television viewing data, dismissing the claims for breach of contract, breach of the implied covenant of good faith and fair dealing, equitable contribution and declaratory judgment with leave to amend.

  • May 10, 2021

    4th Circuit Affirms Ruling In Favor Of Insurer In Mother Church’s Bad Faith Suit

    RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals on May 7 rejected an insurer’s contention that it was injured by a captive insurer’s decision to defend its rivals against two underlying lawsuits, affirming a lower court’s finding that the insured has failed to demonstrate an injury that is fairly traceable to a breach of captive insurance rules.

  • May 07, 2021

    Panel Affirms Ruling In Insurers’ Favor In Coverage Suit Over Wrongful Death Claims

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on May 5 affirmed a federal court’s ruling in favor of a primary and excess insurer in an insured’s breach of contract lawsuit arising from a fatal truck accident involving the insured’s employee.

  • May 07, 2021

    Judge Rules For Insurers In Separate Coverage Suits Arising From Opioid Epidemic

    PADUCAH, Ky. — A federal judge in Kentucky on May 5 granted Westfield National Insurance Co.’s motion for summary judgment in its lawsuit disputing coverage for underlying lawsuits alleging that Quest Pharmaceuticals Inc. improperly distributed opioids the same day he ruled in favor of another insurer in a similar coverage dispute.

  • May 06, 2021

    Prior Acts Exclusion Bars Coverage, Directors & Officers Insurer Tells 11th Circuit

    ATLANTA — Arguing that an insurer’s duty to defend “is not limitless,” a directors and officers liability insurer on April 12 asked the 11th Circuit U.S. Court of Appeals to reverse a lower federal court’s ruling that adopted a magistrate’s recommendation to grant nursing home owner insureds’ motion for summary judgment and deny its 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.

  • May 05, 2021

    Panel Affirms Discovery, Summary Judgment Rulings In Insurance Bad Faith Appeal

    PASADENA, Calif. — A Ninth Circuit U.S. Court of Appeals panel on May 3 ruled that a federal district court did not abuse its discretion in excluding portions of three declarations submitted by a beneficiary in an insurance breach of contract and bad faith lawsuit stemming from insurers’ denial of life insurance benefits and rescission of policies because the declarants lacked the required knowledge of the statements asserted as required.

  • May 05, 2021

    Roundup Of Latest Briefs Over Coronavirus Coverage

    From the owner and operator of the Philadelphia Eagles’ motion to remand its coverage lawsuit to a dental provider’s appeal to the Seventh Circuit U.S. Court of Appeals, Mealey Publications takes a look at the latest pleadings relating to insurance coverage for COVID-19.

  • May 04, 2021

    Panel Grants Insured’s Motion To Consolidate Appeals In COVID-19 Coverage Suits

    ATLANTA — The 11th Circuit U.S. Court of Appeals on April 27 granted an insured’s motion to consolidate for oral argument its appeal of a lower court’s dismissal of its lawsuit seeking coverage for its business losses arising from the coronavirus pandemic with two related appeals, noting that the three cases will be consolidated for merits disposition after briefing has been completed separately in each appeal.