Mealey's Insurance

  • November 22, 2017

    Garlock, Safety National Dispute Policy Interpretation In Coverage Lawsuit

    CHARLOTTE, N.C. — A magistrate judge correctly found that an insurance policy does not provide for arbitration in a dispute with former Chapter 11 debtor Garlock Sealing Technologies LLC and affiliates over coverage for asbestos claims, the companies argue in a Nov. 9 response to the insurer’s objections to the magistrate’s ruling in North Carolina federal court (Safety National Casualty Corp. v. Garlock Sealing Technologies LLC, et al., No. 3:17-cv-00458, W.D. N.C.).

  • November 22, 2017

    Insurers Seek Relief From Kaiser Gypsum’s Stay To Pursue Costs In Coverage Row

    CHARLOTTE, N.C. — Insurers of Chapter 11 debtor Kaiser Gypsum Co. sought relief Oct. 24 from the automatic stay in the debtor’s case in North Carolina federal bankruptcy court so they can pursue the repayment of their costs from the debtor’s primary insurer in a 15-year-old coverage action in a California state court (In re Kaiser Gypsum Company, Inc., et al., No. 16-31602, W.D. N.C. Bkcy.).

  • November 21, 2017

    Insurer Owes Trustee $3.5M In Policy Limits, Attorney Fees For Coverage Dispute

    OAKLAND, Calif. — A California federal bankruptcy judge on Nov. 16 entered a judgment of more than $3.5 million against an insurance company in a dispute over the amount of coverage owed to a company’s liquidating trust for asbestos personal injury claims, including attorney fees and a $60,000 penalty for the insurer’s “vexatious and unreasonable conduct” in the case (In re CFB Liquidating Corporation, f/k/a Chicago Fire Brick Co., et al., No. 01-45483, [Barry A. Chatz, as Trustee for the CFB/WFB Liquidating Trust v. Continental Casualty Company, No. 15-4136] N.D. Calif. Bkcy., 2017 Bankr. LEXIS 3938).

  • November 21, 2017

    No Coverage Owed For Underlying Suit Arising Out Of Cleanup Of Lead Paint Dust

    ST. LOUIS — No coverage is afforded for an underlying suit alleging claims related to the cleanup of lead dust after the removal of lead paint from a high school because the policy’s pollution endorsement applies only in limited circumstances and the policy’s lead exclusion clearly bars coverage, a Missouri federal judge said Nov. 20 (Rice Painting Co. Inc. v.  Depositors Insurance Co., No. 15-1064, E.D. Mo., 2017 U.S. Dist. LEXIS 191355).

  • November 21, 2017

    Judge Resolves Motions To Exclude Testimony, Evidence In Reinsurer, Insurer Dispute

    UTICA, N.Y. — In a dispute over a $325 million settlement of asbestos claims, a New York federal judge on Nov. 16 addressed a number of motions filed by an insurer and a reinsurer to preclude expert testimony and certain arguments from trial (Utica Mutual Insurance Co. v. Fireman’s Fund Insurance Co., No. 09-00853, N.D. N.Y., 2017 U.S. Dist. LEXIS 189911).

  • November 21, 2017

    Oklahoma Federal Judge Strikes Affirmative Defenses In Contamination Dispute

    TULSA, Okla. — An Oklahoma federal judge on Nov. 17 granted an insured’s motion to  strike five of its insurer’s affirmative defenses after finding that the individual counts asserted by the insurer are redundant (Explorer Pipeline Co. v. American Guarantee & Liability Insurance Co., No. 17-330, N.D. Okla., 2017 U.S. Dist. LEXIS 190550).

  • November 21, 2017

    No Additional Coverage Owed For Mold Damage, New Jersey Panel Says

    TRENTON, N.J. — An insurer owes no additional coverage to its insureds for mold damages caused by a leaking water pipe in the wall of a shower because the policy at issue clearly limited coverage for mold damage to $10,000 under a mold rider, the Appellate Division of the New Jersey Superior Court said Nov. 15 (Eugene J. Payor, et al. v. New Jersey Manufacturers Insurance Co., No. A-0345-16T2, N.J. Super., App. Div., 2017 N.J. Super. Unpub. LEXIS 2851).

  • November 20, 2017

    Washington Federal Judge Says Questions Of Fact Exist In Water Damages Suit

    SEATTLE — A Washington federal judge on Nov. 16 determined that questions of material fact exist regarding the application of an insurer’s exclusions for deterioration and rot to an insured condominium association’s claim for water intrusion damages that occurred over time to the exterior cladding of two of the association’s buildings (Sunwood Condominium Association v. Travelers Casualty Insurance Company of America, et al., No. 16-1012, W.D. Wash., 2017 U.S. Dist. LEXIS 189892).

  • November 17, 2017

    Known Defects Relieve Insurer Of Duty To Pay For Repairs, Panel Finds

    LOS ANGELES — A homeowner “who is aware, long before a rainstorm occurs and causes damage, of possible leakage” caused by construction defects cannot reasonably expect an insurer to pay for repairs on the theory that rainwater, and not the defects, caused the damage, a California appeals panel affirmed Nov. 14 (Simon Cohen, et al. v. Pacific Specialty Insurance Co., No. B276060, Calif. App., 2nd Dist., Div. 8, 2017 Cal. App. Unpub. LEXIS 7779).

  • November 17, 2017

    Connecticut High Court To Review Rulings In Asbestos, Silica Coverage Dispute

    HARTFORD, Conn. — The Connecticut Supreme Court on Oct. 18 agreed to review a number of issues decided by the Connecticut Appellate Court in an asbestos and silica coverage dispute after a number of the insurers and the insured petitioned the high court for review (R.T. Vanderbilt Co. Inc. v. Hartford Accident & Indemnity Co., et al., Nos. SC 20000, SC20001, SC20003, Conn. Sup., 2017 Conn. LEXIS 320, 2017 Conn. LEXIS 326, 2017 Conn. LEXIS 322).

  • November 14, 2017

    No Coverage Owed For Asbestos Suit, Insurer Asserts In Complaint

    CHICAGO — No coverage is owed for an underlying asbestos personal injury suit filed against an insured because the policies’ pollution exclusion and silica exclusion preclude coverage, the insurers assert in a Nov. 3 complaint filed in Illinois federal court (All America Insurance Co., et al. v. Banner Truck & Trailer Sales Inc., et al., No. 17-1214, S.D. Ill.).

  • November 14, 2017

    Georgia Federal Judge Awards Insured More Than $1.1M For Contamination Costs

    ATLANTA — A Georgia federal judge on Nov. 3 awarded an insured more than $1.1 million for contamination claims arising out of the operation of a battery plant after rejecting the insurer’s argument that the insured failed to meet the policy’s deductible (ACE American Insurance Co. v. Exide Technologies Inc., et al., No. 16-1600, N.D. Ga.).

  • November 10, 2017

    Pollution Exclusion Does Not Bar Coverage For Carbon Monoxide Suits, Insured Argues

    SAN FRANCISCO — An Oregon federal judge erred in granting summary judgment in favor of an insurer in a dispute over coverage for underlying carbon monoxide poisoning suits because the pollution exclusion in the policy at issue does not apply to carbon monoxide as it is not an irritant or contaminant, an insured argues in an Oct. 23 brief to the Ninth Circuit U.S. Court of Appeals (Colony Insurance Co. v. Victory Construction LLC, et al., No. 17-35357, 9th Cir.).

  • November 10, 2017

    Federal Judge: California Law Applies To Claims In Water Damage Coverage Suit

    NEW BERN, N.C. — A North Carolina federal judge on Nov. 9 determined that California law should be applied to a dispute over coverage for water damages because the policy at issue was issued in California and the insured’s principal place of business is in California (Certain Underwriters at Lloyd’s of London v. American Realty Advisors, et al., Nos. 16-940, 17-74, E.D. N.C., 2017 U.S. Dist. LEXIS 185842).

  • November 10, 2017

    Judge: 3 Policy Exclusions Bar Coverage For Damage Caused By Marijuana Operations

    DETROIT — Finding that tenants' use of an insured’s commercial property units to grow marijuana was illegal or at the very least dishonest, a Michigan federal judge on Nov. 8 held that coverage for the insured’s losses arising from this activity is barred by an insurance policy’s illegal/dishonest acts provision, as well as two other policy exclusions (K.V.G. Properties Inc. v. Westfield Insurance Co., No. 16-11561, E.D. Mich., 2017 U.S. Dist. LEXIS 185005).

  • November 8, 2017

    New York Federal Judge Allows Breach Of Contract Claims To Stand Against Insurer

    UTICA, N.Y. — A New York federal judge on Nov. 7 granted an insurer’s motion to dismiss eight claims alleged by an insured seeking coverage for water and mold damages after determining that the insured plausibly alleged that the insurer breached its contract but failed to prove that the insurer’s conduct amounted to any tortious behavior (Edmund G. Sanderson v. First Liberty Insurance Corp., No. 16-644, N.D. N.Y., 2017 U.S. Dist. LEXIS 184468).

  • November 8, 2017

    Federal Judge Says Assertion Of Reservation Of Rights Is Not Affirmative Defense

    MIAMI — A Florida federal judge on Nov. 7 partially granted an insured’s motion to strike its insurer’s affirmative defenses as they pertained to the insurer’s reservation of rights because the assertion of a reservation of rights is not an affirmative defense (Kapow of Boca Raton Inc. et al. v. Aspen Specialty Insurance Co., No. 17-80972, S.D. Fla., 2017 U.S. Dist. LEXIS 184224).

  • November 7, 2017

    At Least 2 Occurrences Contributed To Contamination Of River, N.J. Judge Says

    NEWARK, N.J. — A New Jersey judge on Oct. 16 denied a motion for summary judgment filed by a number of insurers involved in an environmental contamination coverage dispute after determining that at least two occurrences contributed to the contamination of a New Jersey river (Cooper Industries LLC v. Employers Insurance of Wausau et al., No. L-9284-11, N.J. Super., Essex Co., Law Div.).

  • November 7, 2017

    No Coverage For Underlying Suit Arising Out Of Carbon Monoxide Poisoning, Judge Says

    HAMMOND, Ind. — No coverage is owed for an underlying suit seeking damages as a result of the deaths of four family members caused by carbon monoxide poisoning because the underlying claims alleged against the insureds arose out of the insureds’ contract with the homeowner and do not allege an occurrence for which coverage exists, an Indiana federal judge said Oct. 31 (Allstate Insurance Co. v. McColly Realtors Inc. et al., No. 16-142, N.D. Ind., 2017 U.S. Dist. LEXIS 179793). 

  • November 6, 2017

    Fungi, Bacteria Exclusion Does Not Bar Insured’s Defects, Panel Concludes

    ELGIN, Ill. — A fungi and bacteria exclusion does not apply to preclude otherwise covered property damage from construction defects, an Illinois appeals panel affirmed Nov. 2, finding that an insurer had a duty to defend an underlying action (Pekin Insurance Co. v. JB Architecture Group Inc., et al., No. 15-MR-1755, Ill. App., 2nd Dist., 2017 Ill. App. Unpub. LEXIS 2236).