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Mealey's Insurance

  • February 20, 2019

    California Court Remands Default Judgment Dispute For Further Clarification

    SAN FRANCISCO — A California appeals court on Feb. 19 remanded a case involving a default judgment against an insulator’s insurer so that the trial court could explain why it set aside the more than $2 million judgment (Donna O’Balle v. Fireman’s Fund Insurance Co., No. A151530, Calif. App., 1st Dist., Div. 2, 2019 Cal. App. Unpub. LEXIS 1176).

  • February 15, 2019

    Trial Court Did Not Abuse Discretion In Setting Aside Judgments In Asbestos Dispute

    SAN FRANCISCO — The First District California Court of Appeal on Feb. 14 determined that a trial court did not abuse its discretion in setting aside default judgments entered against an insured named as a defendant in asbestos exposure suits because the insurers were diligent in their investigation of the underlying claims after learning of the suits filed against their insured (Robert Ross v. Hartford Insurance Co., et al., No. A154660; Willie Howard v. Hartford Insurance Co., et al., No. A154662; Michael Steinberger v. Hartford Insurance Co., et al., No. A154664; Monroe Amey v. Hartford Insurance Co., et al., No. A154665; Robert Hanson v. Hartford Insurance Co., et al., No. A154668; Joann Valladon v. Hartford Insurance Co., et al., No. A154671, Calif. App., 1st Dist., Div. 4).

  • February 15, 2019

    Insured’s Declaratory Judgment Claim Stands In Environmental Coverage Dispute

    LOS ANGELES — A California federal judge on Feb. 6 refused to dismiss an insured’s declaratory judgment claim in an environmental contamination coverage dispute after determining that the insured has presented an actual controversy warranting the court’s jurisdiction over the claim (Whittaker Corp. v. AIG Specialty Insurance Co., No. 18-8453, C.D. Calif., 2019 U.S. Dist. LEXIS 23744).

  • February 14, 2019

    No Coverage Owed For Mold Found In Attic Insulation, Insurer Says In Complaint

    SALT LAKE CITY — No coverage is owed to an insured for an underlying claim alleging that the insured’s installation of attic insulation caused mold to develop in attics of condominium buildings because the policy’s fungi or bacteria exclusion clearly precludes coverage, the insurer says in a Feb. 7 complaint filed in Utah federal court (Cincinnati Specialty Underwriters Insurance Co. v. Green  Property Solutions LLC, et al., No. 19-100, C.D. Utah).

  • February 14, 2019

    Rapid-American Seeks Summary Judgment On 2 Asbestos Coverage Issues

    NEW YORK — Chapter 11 debtor Rapid-American Corp. and asbestos claimant representatives filed two summary judgment motions Feb. 8 in New York federal bankruptcy court in an adversary action seeking to resolve the two remaining issues in a dispute with insurers over coverage for asbestos liability (Rapid-American Corporation, et al. v. Travelers Casualty and Surety Company, et al., No. 15-01095, S.D. N.Y. Bkcy.).

  • February 13, 2019

    No Coverage Owed For Infestation Of Brown Recluse Spiders, Federal Judge Says

    BIRMINGHAM, Ala. — A homeowners insurer did not breach its contract or act in bad faith in denying a claim for an infestation of brown recluse spiders in an insured home because the policy’s insect and vermin exclusion clearly applies to preclude coverage, an Alabama federal judge said Feb. 11 (Maggie J. Robinson, et al. v. Liberty Mutual Insurance Co., et al., No. 18-1509, N.D. Ala., 2019 U.S. Dist. LEXIS 216270).

  • February 12, 2019

    Coverage Dispute Insurer: Title Policy Does Not Cover Loss Of Value Claim

    ATLANTA — An insurer on Dec. 31 filed a brief in the Georgia Court of Appeals contending that it should set aside a lower court’s judgment in favor of a property owner because loss of value flowing from actual environmental contamination is not covered by a title insurance policy (Old Republic National Title Insurance Company v. RM Kids LLC, No. A19A0971, Ga. App.).

  • February 12, 2019

    Georgia Federal Judge Says Insured’s Expert Witness Is Qualified And Reliable

    AUGUSTA, Ga. — A Georgia federal judge on Feb. 4 denied an insurer’s motion to exclude the expert testimony of an insured’s witness after determining that the expert is qualified to testify on the cause of the water damage at issue and that the expert’s testimony is crucial to the insured on the issue of causation (Carrie Finch, et al. v. Owners Insurance Co., No. 16-169, S.D. Ga., 2019 U.S. Dist. LEXIS 17581).

  • February 12, 2019

    Insured’s Suit Dismissed; No Coverage Dispute Exists, Indiana Federal Judge Says

    NEW ALBANY, Ind. — An Indiana federal judge on Feb. 11 dismissed a suit filed by an insured family trust after determining that there is no coverage dispute because the suit seeks only an advisory opinion from the court as to whether a pollution exclusion precludes coverage for any liability arising out of decking material treated with a form of arsenic  (The Frederick J. Statts and Geneva S. Statts Family Trust, et al. v. State Farm Mutual Automobile Insurance Co., No. 18-130, S.D. Ind.,  2019 U.S. Dist. LEXIS 21570).

  • February 12, 2019

    Insurer Removes Water Damage Coverage Dispute To Florida Federal Court

    MIAMI — In a Feb. 11 notice of removal, an insurer maintains that a Florida federal court has jurisdiction to decide a water damage coverage dispute because the insured’s complaint, seeking more than $80,000 in additional damages, exceeds the federal jurisdictional amount in controversy requirement (Sushi Garage LLC v. Greenwich Insurance Co., No. 19-20548, S.D. Fla.).

  • February 11, 2019

    Federal Magistrate Judge Dismisses Fraud, Bad Faith Claims In Water Damage Dispute

    CHICAGO — An Illinois federal magistrate judge on Feb. 7 dismissed claims alleging fraud,  misrepresentation and bad faith against an insurer after determining that the insured, seeking coverage for water damages caused by burst pipes, failed to allege sufficient facts in support of the claims (Propitious LLC, et al. v. Badger Mutual Insurance Co., et al., No. 18-1405, N.D. Ill., 2019 U.S. Dist. LEXIS 19582).

  • February 11, 2019

    Judge Denies Insurer’s Judgment Motion Based On Wrap-Up Exclusion

    OAKLAND, Calif. — Because a subcontractor was not enrolled in a general contractor’s wrap-up policy, a California federal judge on Feb. 7 denied summary judgment to the subcontractor’s insurer on its duty to defend or indemnify the subcontractor against the contractor’s breach of contract claims concerning water damage to a project (Employers Mutual Casualty Co. v. Fast Wrap Reno One LLC, et al., No. 17-03837, N.D. Calif., 2019 U.S. Dist. LEXIS 20298).

  • February 8, 2019

    Pollution Exclusion Bars Coverage For Welding Fume Exposure Suit, Panel Says

    ATLANTA — A pollution exclusion clearly bars coverage for an underlying suit arising out of welding fume exposure because welding fumes clearly qualify as an irritant or contaminant under the exclusion, the 11th Circuit U.S. Court of Appeals said Feb. 8 (Evanston Insurance Co. v. Sandersville Railroad Co., No. 17-14487, 11th Cir., 2019 U.S. App. LEXIS 3906).

  • February 8, 2019

    Panel Majority Affirms Judgment In Coverage Dispute Over Contaminated Heparin

    RICHMOND, Va. — The majority of the Fourth Circuit U.S. Court of Appeal on Feb. 6 determined that a district court did not err in entering judgment in favor of insureds in a dispute over coverage for underlying product liability lawsuits involving contaminated heparin because the policies at issue clearly provided coverage for the underlying suits (Charter Oak Fire Insurance v. American Capital, 17-2015 and 17-2068, 4th Cir., 2019 U.S. App. LEXIS 3687).

  • February 7, 2019

    Arbitration Of Environmental Coverage Dispute Is Appropriate, Judge Says

    NEWARK, N.J. — A New Jersey federal judge on Feb. 6 granted a motion to compel arbitration in an environmental contamination coverage dispute after determining that arbitration is appropriate because the dispute involves international commercial agreements and the policies at issue included a valid arbitration provision (Cornell-Dubilier Electronics, Inc. v. Allianz Versicherungs Ag, et al., No. 18-15947, D. N.J., 2019 U.S. Dist. LEXIS 19045).

  • February 6, 2019

    No Coverage Owed For Claims Arising Out Of Gas Pipeline Explosion

    NEW ORLEANS — An insured contractor working on a Louisiana natural gas pipeline and its insurer have no duty to defend or indemnify a third party for underlying personal injury claims arising out of a pipeline explosion because Louisiana’s Anti-Indemnity Act bars the indemnity and insurance provisions included in the master service agreement (MSA) between the insured and the third party, a Louisiana federal judge said Feb. 5 (Atlantic Specialty Insurance Co., et al. v. Phillips 66 Co., No. 17-9318, E.D. La., 2019 U.S. Dist. LEXIS 18224).

  • February 5, 2019

    Carrier Prejudiced By Late Notice Of Water Damage Claim, Federal Judge Says

    DETROIT — An insurer was materially prejudiced by an insured’s late notice of a claim for water damage caused by burst water pipes because the insurer was not able to view the damage to the home as a result of the homeowner’s decision not to provide notice of the claim until after demolishing and repairing the damage, a Michigan federal judge said Feb 4 in granting the insurer’s motion for summary judgment (Timika Keathley v. Grange Insurance Company of Michigan, No. 15-11888, E.D. Mich., 2019 U.S. Dist. LEXIS 17599).

  • February 4, 2019

    Insurer Is Entitled To Recover More Than $1M From Co-Insurer, Panel Affirms

    NEW YORK — The Second Circuit U.S. Court of Appeals on Feb. 1 affirmed a district court’s ruling that a commercial general liability insurer is entitled to recover more than $1 million from a co-insurer for defending a mutual insured dairy company in underlying milk contamination lawsuits because the co-insurer failed to prove that it was prejudiced by any late notice (Harleysville Worcester Insurance Company v. Wesco Insurance Company, No. 18-1300, 2nd Cir., 2019 U.S. App. LEXIS 3349).

  • February 1, 2019

    Pennsylvania Federal Judge: Insurer Owes Defense For Products-Related Tort Claims

    PHILADELPHIA — An insurer has a duty to defend two construction defect actions because there are sufficient allegations of products-related tort claims such that there may have been an “occurrence,” a Pennsylvania federal judge ruled Jan. 30 (Nautilus Insurance Co. v. 200 Christian Street Partners LLC, et al., Nos. 18-1364 & 18-1545, E.D. Pa., 2019 U.S. Dist. LEXIS 15060).

  • February 1, 2019

    Mississippi High Court Says Voluntary Payment Cannot Be Recovered By Insurer

    JACKSON, Miss. — Answering a certified question from the Fifth Circuit U.S. Court of Appeals, the Mississippi Supreme Court on Jan. 31 determined that Mississippi’s voluntary payment doctrine bars an insurer from recovering a settlement payment made on behalf of an additional insured that the insurer believed was not covered under the policy because the payment was not made under compulsion (Colony Insurance Co. v. First Specialty Insurance Corp., No. 2018-FC-00574, Miss. Sup., 2019 Miss. LEXIS 52).