NEW HAVEN, Conn. — Insureds properly stated a claim for bad faith against their homeowners insurance provider for its denial of a claim for coverage due to policy exclusions because the insureds have pleaded a series of improper acts by the insurer in the handling of the claim, a federal judge in Connecticut ruled March 20 in denying the insurer’s motion to dismiss (Justyn Cyr, et al. v. CSAA Fire & Casualty Insurance Co., No. 16-085, D. Conn., 2017 U.S. Dist. LEXIS 39387).
LAS VEGAS — An insured’s bad faith claims stemming from an insurer’s conduct that occurred prior to the insured’s filing of a previous lawsuit are precluded, but claims arising from the insurer’s conduct that occurred after the first lawsuit was filed are not precluded, a Nevada federal judge said March 17 (Rosalind Searcy v. Esurance Insurance Co., No. 15-47, D. Nev., 2017 U.S. Dist. LEXIS 38705).
PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on March 21 affirmed a lower federal court’s $6,080,568 judgment in favor of an insured in a breach of contract and bad faith lawsuit against its excess general liability insurer arising from an underlying patent infringement dispute (Teleflex Medical Incorporated v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 14-56366, 9th Cir., 2017 U.S. App. LEXIS 4996).
LOS ANGELES — A California federal judge on March 17 dismissed without prejudice a breach of contract and bad faith lawsuit against a professional liability insurer in a coverage dispute arising from the insured’s alleged breach of a loan agreement (GemCap Lending, LLC v. Scottsdale Indemnity Co., et al., No. 15-09942, C.D. Calif., 2017 U.S. Dist. LEXIS 38931).
NEW HAVEN, Conn. — A federal judge in Connecticut on March 17 dismissed a couple’s claim that their insurer engaged in unfair and deceptive practices in violation of the Connecticut Unfair Insurance Practices Act (CUIPA) and the Connecticut Unfair Trade Practices Act (CUTPA) when denying their claim for concrete decay in their basement, finding that the plaintiffs did not show that the company practiced a pattern of denying similar claims (Kenneth T. Courteau, et al. v. Teachers Insurance Company, No. 16-cv-580, D. Conn., 2017 U.S. Dist. LEXIS 38434).
ANCHORAGE, Alaska — An insurer breached its duty to defend and indemnify an insured for a settlement of underlying claims arising out of a breach of contract dispute on a construction project, an Alaska federal judge ruled March 16; however, the judge held that the insurer did not breach its duty of good faith (KICC-Alcan General, joint venture v. Crum & Forster Specialty Insurance Company Inc., No. 15-00255, D. Ala.; 2017 U.S. Dist. LEXIS 37560).
ATLANTA — A federal district court did not abuse its discretion in denying a third party’s proposed jury instructions in an insurance bad faith lawsuit because the proposed instructions were not necessary “to correctly state the law,” an 11th Circuit U.S. Court of Appeals panel ruled March 17 in affirming (Douglas Stalley v. Allstate Insurance Co., et al., No. 16-14816, 11th Cir., 2017 U.S. App. LEXIS 4734).
ATLANTA — A federal court in Georgia on March 20 entered judgment in favor of an insurer on an insured’s breach of contract and bad faith claims four days after a judge found that the insured’s losses arising from a 2014 hacking incident of its payment-card reloading system did not trigger coverage under the insurance policy’s computer fraud provision (InComm Holdings Inc., et al. v. Great American Insurance Co., No. 15-02671, N.D. Ga., 2017 U.S. Dist. LEXIS 38132).
ROCHESTER, N.Y. — A New York federal judge on March 15 dismissed a claim of breach of implied covenant of good faith and fair dealing in a dispute over who pays for injuries to a construction subcontractor employee (Nazareth College of Rochester, et al. v. Harleysville Preferred Insurance Co., No. 16-6418, W.D. N.Y., 2017 U.S. Dist. LEXIS 37050).
MIAMI — A Florida federal magistrate judge on March 13 abated a plaintiff’s bad faith claim on the basis that the bad faith claim is premature and cannot be adjudicated until after there has been a determination that the insurer breached its contract of insurance (Southeast Distributors Inc. v. United Specialty Insurance Co., No. 16-24549, S.D. Fla., 2017 U.S. Dist. LEXIS 35453).
PITTSBURGH — An auto insurer properly denied underinsured motorist (UIM) coverage to a policyholder injured while a pedestrian, a Pennsylvania federal magistrate judge ruled March 13, finding that the antique auto policy limited UIM coverage to vehicle occupants in compliance with state law (John Bish, et al. v. American Collectors Insurance Inc., et al., No. 2:16-cv-01434, W.D. Pa., 2017 U.S. Dist. LEXIS 35205).
SAN JOSE, Calif. — A California federal judge on March 14 found that San Francisco Forty Niners Football Co.’s primary commercial general liability insurer has a duty to contribute by equal shares with another insurer to defense costs in an underlying lawsuit against the football team and others (First Mercury Insurance Co. v. Great Divide Insurance Co., No. 16-02114, N.D. Calif., 2017 U.S. Dist. LEXIS 36501).
COLUMBUS, Ohio — Remand of an insurance breach of contract and bad faith lawsuit to state court is not proper because the amount in controversy exceeds the statutory limit, a federal judge in Ohio ruled March 13 (Leslie Wyatt v. New England Mutual Life Insurance Co., et al., No. 17-40, S.D. Ohio, 2017 U.S. Dist. LEXIS 35504).
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).
TAMPA, Fla. — Reconsideration of a federal district court’s ruling to grant an insurer a new trial in an insurance bad faith lawsuit is not warranted because an insured’s reference to another insurer’s claims handling for a bodily injury claim was not relevant and not properly considered by a jury, a federal judge in Florida ruled March 13 in denying the insured’s motion for reconsideration (Joshua Moore v. GEICO General Insurance Co., No. 13-1569, M.D. Fla., 2017 U.S. Dist. LEXIS 35136).
HARRISBURG, Pa. — After finding that a genuine issue of fact exists as to the value of a property destroyed by a fire, a Pennsylvania court on March 10 reversed a portion of a trial court's ruling for an insurer but affirmed a finding that the insurer did not act in bad faith when it denied the insureds certain coverage under the policy (Sabrina Brown v. Everett Cash Mutual Insurance Co., et al., No. 1549 WDA 2015, Pa. Super., 2017 Pa. Super. LEXIS 161).
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).
FRANKFORT, Ky. — A Kentucky appeals panel on March 10 affirmed a lower court’s ruling that threw out an insured’s breach of contract, bad faith, unfair claims practices and misrepresentation claims against its insurer, finding that because the insured failed to make a prima facie showing that it incurred a loss due to employee theft, the use of inventory calculations is not permitted (Khazai Rug Gallery, LLC v. State Auto Property & Casualty Ins. Co., No. 2016-CA-000129-MR, Ky. App., 2017 Ky. App. Unpub. LEXIS 187).
SAN FRANCISCO — A federal district court erred in granting a third party’s motion for summary judgment on her breach of the implied duty to settle claim in an insurance bad faith and breach of contract lawsuit because no reasonable jury could conclude that the insurer “unreasonably failed to accept” the third party’s offer to settle, a Ninth Circuit U.S. Court of Appeals panel ruled March 7 in reversing (Amy J. McDaniel v. Government Employees Insurance Co., No. 14-17203, 9th Cir., 2017 U.S. App. LEXIS 4029).
ATLANTA — Parties in an insurance bad faith lawsuit recently asked the 11th Circuit U.S. Court of Appeals to determine whether a federal district court erred in finding that an insurer acted in bad faith by not accepting the terms of claimants’ time-limited demand letter seeking the policy limits under its insured’s automobile insurance policy in exchange for a limited release of claims against the insured (Jesus Camacho, et al. v. Nationwide Mutual Insurance Co., No. 16-14225, 11th Cir.).