Mealey's Insurance

  • March 27, 2017

    Dismissal Appropriate Based On Insurer’s Withdrawal Of Reservation Of Rights

    PHOENIX — Dismissal of an insurer’s suit seeking a coverage declaration for an underlying state court lawsuit alleging personal injury claims caused by pigeon droppings is appropriate because the insureds entered into an agreement with the underlying plaintiff and the insurer withdrew its reservation of rights, an Arizona federal judge said March 22 in granting the insureds’ motion to dismiss (American Family Mutual Insurance Co. v. Scottsdale Casitas Condominium Association, et al., No. 16-2289, D. Ariz., 2017 U.S. Dist. LEXIS 42343).

  • March 27, 2017

    New York Law Applies In Environmental Dispute, Delaware High Court Says, Reversing

    WILMINGTON, Del. — The Delaware Supreme Court on March 23 determined that the law of New York should be applied in a dispute over the allocation of environmental contamination claims because New York has the most significant relationship with the parties and applying the law of the state in which an environmental cleanup site is located, as proposed by the lower court, would result in an inconsistent application of a policy’s contract language (Chemtura Corp. v. Certain Underwriters at CCLC Lloyd’s, et al., No. 371, 2016, Del. Sup., 2017 Del. LEXIS 127).

  • March 24, 2017

    Maryland Federal Judge Says Temporary Restraining Order Is Not Warranted

    BALTIMORE — A Maryland federal judge on March 22 denied an underlying plaintiff’s motion for a temporary restraining order seeking to ban an insurer and its insured from reaching a settlement for an underlying judgment awarded for personal injuries in a lead paint exposure suit (CX Reinsurance Co. Ltd., v. Benjamin L. Kirson, et al., No. 15-3132, D. Md., 2017 U.S. Dist. LEXIS 41230).

  • March 22, 2017

    Issues Of Fact Exist On Cause Of Collapse And Insured’s Knowledge, Federal Judge Says

    PEORIA, Ill. — Because questions of fact exist regarding the cause of the collapse of a building’s second floor and the insured’s knowledge of the condition of the building, an Illinois federal judge on March 21 denied an insurer’s motion for summary judgment (WAMFAM5 Inc. v. Nova Casualty Insurance Co., No. 15-1195, C.D. Ill., 2017 U.S. Dist. LEXIS 40159).

  • March 22, 2017

    Judge Finds Jurisdiction Lacking In Insolvent Insurer’s Suit Over ACA Payments

    ST. LOUIS — An insolvent insurer’s suit against the government over its handling of the Patient Protection and Affordable Care Act (ACA) risk corridor and how it offset debts properly belongs before the U.S. Court of Federal Claims, a federal judge in Iowa said March 17 in finding that she lacked jurisdiction and entering judgment (Nick Gerhart, et al. v. United States Department of Health and Human Services, et al., No. 16-151, S.D. Iowa, 2017 U.S. Dist. LEXIS 37620).

  • March 21, 2017

    Kaiser Gypsum Seeks Deadline Extension While Insurers Seek Dismissal Of Case

    CHARLOTTE, N.C. — Chapter 11 debtor Kaiser Gypsum Co. on March 7 asked a North Carolina federal bankruptcy court for more time to file a plan of reorganization, two weeks after several insurance companies told the court the case should be dismissed because it was filed in bad faith (In re Kaiser Gypsum Company, Inc., et al., No. 16-31602, W.D. N.C. Bkcy.).

  • March 21, 2017

    New York Federal Judge Orders Appraisal To Be Reopened To Determine Mold Damages

    NEW YORK — A New York federal judge on Feb. 22 ordered an appraisal panel to reopen an appraisal to determine if insureds sustained any covered losses as a result of mold (Simon Zarour, et al. v. Pacific Indemnity Co., No. 15-2663, S.D. N.Y., 2017 U.S. Dist. LEXIS 37328).

  • March 21, 2017

    Carrier Seeks Reformation Of Policy To Include An Intended Pollution Exclusion

    ATLANTA — No coverage is owed for contamination claims arising out of the operation of a battery plant because the underlying claim against the insured did not meet the policy’s deductible and a pollution exclusion, inadvertently left out of the policy through mutual mistake, precludes coverage, an insurer argues in a March 15 motion for summary judgment filed in Georgia federal court (ACE American Insurance Co. v. Exide Technologies Inc., et al., No. 16-1600, N.D. Ga.).

  • March 21, 2017

    California Federal Judge Says Complete Diversity Does Not Exist, Remands Mold Suit

    LOS ANGELES — Because a plaintiff can arguably state a claim against an insurance claims adjuster for intentional infliction of emotional distress, the claims adjuster is not a sham defendant and was not fraudulently joined to defeat federal jurisdiction, a California federal judge said March 17 in remanding the insureds’ suit seeking additional coverage for mold damage to California state court (Health Pro Dental Corp., et al. v. Travelers Property Casualty Company of America, et al., No. 17-637, C.D. Calif., 2017 U.S. Dist. LEXIS 38944).

  • March 20, 2017

    Pollution Exclusion Bars Coverage For Suits Alleging Violations Of Clean Water Act

    CLEVELAND — Because a policy’s pollution exclusion clearly bars coverage for claims arising out of violations of the Clean Water Act, an Ohio federal judge March 16 granted an insurer’s motion for judgment on the pleadings and terminated the insured’s suit against its insurer (JTO Inc. v. The Travelers Indemnity Company of America, No. 16-648, N.D. Ohio, 2017 U.S. Dist. LEXIS 38033).

  • March 20, 2017

    Judge Finds Asbestos Claims Against English Insurer Related To Arbitration Clause

    NEW ORLEANS — A Louisiana federal judge on March 16 found that an English insurer's removal of a former machinist's asbestos-related claims from a state court was appropriate, finding that the dispute could relate to an underlying arbitration agreement contained in an insurance policy (James Edward O'Connor v. Maritime Management Corp., et al., No. 16-16201, E.D. La., 2017 U.S. Dist. LEXIS 37798).

  • March 17, 2017

    Federal Judge Bars Expert Testimony On Some Repair Costs For Insureds’ Damages

    TULSA, Okla. — An Oklahoma federal judge on March 14 excluded testimony from an expert on estimates to repair a master control center (MCC) and electrical costs as a result of insureds’ damages caused by a contractor and subcontractor’s inadequate design and installation of the concrete columns but allowed other estimates to be admitted (Lexington Insurance Co., et al. v. Newbern Fabricating Inc. and Baucom Concrete Construction Inc. & Newbern Fabricating Inc. v. Doveland Engineering Co., No. 14-0610, N.D. Okla.; 2017 U.S. Dist. LEXIS 36133).

  • March 17, 2017

    Garlock Debtors, Insurer Agree To Denial Of Arbitration Request

    CHARLOTTE, N.C. — An insurer cannot pursue arbitration against Chapter 11 debtor Garlock Sealing Technologies LLC and affiliates for a coverage dispute with a third-party manufacturer but can file a late proof of claim against the debtors without prejudice to its arbitration rights, according to a consent order filed March 16 in North Carolina federal bankruptcy court (In re:  Garlock Sealing Technologies, LLC, et al., No. 10-31607, W.D. N.C. Bkcy.).

  • March 16, 2017

    Texas Federal Judge Says Carrier Has A Duty To Indemnify Insured

    HOUSTON — A Texas federal judge on Feb. 27 determined that an insurer has a duty to indemnify its insured for an underlying product liability suit but found no support for the insured’s extracontractual claims and, accordingly, dismissed those claims against the insurer (U.S. Metals Inc. v. Liberty Mutual Group Inc., et al., No. 12-379, S.D. Texas, 2017 U.S. Dist. LEXIS 32507).

  • March 15, 2017

    Claims Barred By Statute Of Limitations, Nevada Federal Judge Determines

    LAS VEGAS — A Nevada federal judge on March 8 determined that insureds seeking coverage for a water damage claim cannot allege claims for bad faith, unfair claims practices and intentional infliction of emotional distress against their insurer because the claims are barred by the applicable statute of limitations (Maxwell B. Williams, et al. v. The Travelers Home and Marine Insurance Co., et al., No. 16-1856, D. Nev., 2017 U.S. Dist. LEXIS 33954).

  • March 15, 2017

    Judge Defines ‘Collapse,’ Finds Insurer Has No Duty To Indemnify Damage

    CHICAGO — A homeowners insurance policy was intended to cover only a peril in which a building loses its character as a building, an Illinois federal judge ruled March 14, in defining “collapse” under the policy and finding that the insurer has no duty to indemnify damage caused by a contractor to the insureds’ home (The Travelers Home and Marine Insurance Co. v. Patrick Walsh and Colleen Walsh, No. 15-3063, N.D. Ill.; 2017 U.S. Dist. LEXIS 35841).

  • March 14, 2017

    Insureds Failed To Prove Bad Faith Claim, Delaware Supreme Court Concludes

    WILMINGTON, Del. — Insureds failed to establish evidence that their insurer did not have a reasonable justification for denying their claim for water damage from a broken toilet to their condominium unit, the Delaware Supreme Court ruled March 13, affirming a directed verdict to the insurer on a bad faith claim (Debra Bennett and William Bennett v. USAA Casualty Insurance Co., No. S10C-02-010, Del. Sup.; 2017 Del. LEXIS 105).

  • March 14, 2017

    Maryland Federal Judge Says Insured’s Claims On Policy Exhaustion Not Timely Filed

    BALTIMORE — A Maryland federal judge on March 10 granted motions for partial summary judgment filed by a number of insurers involved in an asbestos coverage dispute after determining that the insured’s claims regarding the exhaustion of the insurers’ policies were not timely filed (General Insurance Company of America v. The Walter E. Campbell Co. Inc., et al., No. 12-3307, D. Md.; 2017 U.S. Dist. LEXIS 34348).

  • March 13, 2017

    No Support Provided For Affirmative Defenses, Indiana Federal Magistrate Says

    LAFAYETTE, Ind. — An Indiana federal magistrate judge on March 10 granted a motion to strike a number of an insurer’s affirmative defenses in an environmental liability coverage suit after determining that the insurer failed to provide any factual support for the defenses (Landis+Gyr, et al. v. Zurich American Insurance Co., No. 16-82, N.D. Ind., 2017 U.S. Dist. LEXIS 34269).

  • March 13, 2017

    Oregon Federal Judge: Pollution Exclusion Bars Coverage For Carbon Monoxide Suits

    PORTLAND, Ore. — An insurer has no duty to defend or indemnify its insureds for two underlying lawsuits alleging injuries as a result of carbon monoxide released by a pool heater because carbon monoxide is a pollutant and excluded under the policy’s pollution exclusion, an Oregon federal judge said March 9 (Colony Insurance Co. v. Victory Construction LLC, et al., No. 16-457, D. Ore., 2017 U.S. Dist. LEXIS 34368).