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Mealey's Insurance Bad Faith

  • August 24, 2018

    Insured Awarded $1.3M In Attorney Fees Based On Bench Trial Success

    PORTLAND, Ore. — An Oregon federal judge on Aug. 15 awarded an insured more than $1.3 million in attorney fees after determining that a fee multiplier of 1.5 is appropriate because the insured’s counsel faced a risk of nonpayment in handling the insured’s auto coverage suit (Peggy Foraker v. USAA Casualty Insurance Co., No. 14-87, D. Ore., 2018 U.S. Dist. LEXIS 137786).

  • August 22, 2018

    Breach Of Contract, Bad Faith Claims Stemming From Storm Damage Cannot Stand

    DALLAS — A Texas federal judge on Aug. 15 granted an insurer’s motion for summary judgment after determining that the insureds are estopped from alleging a breach of contract claim based on their participation in an appraisal proceeding and that the insureds failed to prove that the insurer acted in bad faith by delaying the payment of their claim for storm damages to their home (Matthew and Wendy Meisenheimer v. Safeco Insurance Company of Indiana, No. 17-2153, N.D. Texas, 2018 U.S. Dist. LEXIS 138220).

  • August 22, 2018

    Insured’s Bad Faith Claim Arising Out Of Request For Repayment Fails, Judge Says

    BOSTON — An insured’s complaint alleging that an insurer violated fair debt collection practices in handling an auto coverage claim must be dismissed because the insured failed to prove that the insurer’s request for reimbursement of a payment was a debt and failed to show that the insurer acted in bad faith in attempting to recover the payment made to the insured, a Massachusetts federal judge said Aug. 17 (Alex Rodolakis, et al. v. Safety Insurance Co., et al., No. 17-12080, D. Mass., 2018 U.S. Dist. LEXIS 140430).

  • August 20, 2018

    No Coverage Owed For Damage Caused By Wildfire, 10th Circuit Affirms

    DENVER — The 10th Circuit U.S. Court of Appeals on Aug. 17 affirmed a lower federal court’s ruling that an insurer owes no coverage for property damage caused by a wildfire known as the Waldo Canyon Fire, rejecting the insureds’ argument that there were errors in the jury instructions (Paul Macomber, et al. v. American Family Mutual Insurance Group, No. 17-1194, 10th Cir., 2018 U.S. App. LEXIS 22927).

  • August 16, 2018

    Judge Denies New Trial On Contract, Bad Faith Claims Against Insurer

    LOS ANGELES — A California federal judge on Aug. 1 denied a life insurer’s request for a new trial or judgment as a matter of law on breach of contract and bad faith claims and denied its motion to strike a reinsurance underwriter’s testimony (DCD Partners LLC, et al. v. Transamerica Life Insurance Co., et al., No. 15-03238, C.D. Calif., 2018 U.S. Dist. LEXIS 135792).

  • August 15, 2018

    Insureds Failed To Support Claims For Unfair Practices, Texas Insurance Code Violation

    McALLEN, Texas — A Texas federal judge on Aug. 13 dismissed claims alleging violations of the Texas Deceptive Trade Practices Consumer Protection Act (DTPA)  and the Texas Insurance Code (TIC) after determining that the insureds failed to state facts in support of the claims, leaving the claims for breach of contract and bad faith to be decided in a hailstorm coverage dispute (Alfredo Murillo Jr., et al. v. Allstate Vehicle and Property Insurance Co., No. 18-208, S.D. Texas, 2018 U.S. Dist. LEXIS 136946).

  • August 15, 2018

    Insured’s Bad Faith Suit Stayed Pending Appraisal Of Hailstorm Damage Claim

    SHERMAN, Texas — A Texas federal judge on Aug. 13 stayed an insured’s bad faith suit and granted an insurer’s motion to compel appraisal of the insured’s claim for hailstorm damages after determining that the insurer did not waive its right to invoke the policy’s appraisal provision (Rainey Rogers v. Nationwide General Insurance Co., No. 18-213, E.D. Texas, 2018 U.S. Dist. LEXIS 136062).

  • August 14, 2018

    Judge: Ongoing Operations Exclusion Bars Coverage For Insured’s Water Damage

    SEATTLE — An ongoing operations exclusion precludes coverage for water damage caused by an insured, a Washington federal judge ruled Aug. 13, granting summary judgment to an insurer on breach of contract and bad faith claims (Diamond Construction LLC and Bellevue Park Homeowners Association v. Atlantic Casualty Insurance Co., No. 17-1408, W.D. Wash., 2018 U.S. Dist. LEXIS 136335).

  • August 14, 2018

    Federal Magistrate Judge Refuses To Strike Insured’s Bad Faith Expert Report

    LAS VEGAS — A Nevada federal magistrate judge on Aug. 2 denied an insurer’s motion to strike the expert testimony submitted by an insured to refute the opinions offered by the insurer’s bad faith expert in a water damage coverage dispute, but said the insured’s expert can testify at trial only if the insurer’s expert testifies (Robert Danganan v. American Family Mutual Insurance Co., No. 17-2786, D. Nev., 2018 U.S. Dist. LEXIS 129738).

  • August 13, 2018

    Reinsurer Seeks Dismissal From Contract, Fraud Suit Over Disability Benefits

    MONTGOMERY, Ala. — In a case over the denial of benefits under four long-term disability insurance policies, a reinsurer argues in an Aug. 1 motion that an Alabama federal court should dismiss breach of contract, bad faith and fraud claims because it is not a party to the policies (Horace R. Theriot Jr. v. The Northwestern Mutual Life Insurance Co., et al., No. 18-00688, M.D. Ala.).

  • August 13, 2018

    Insured’s Complaint In Bad Faith Suit Found To Be Timely, Not Prejudicial

    SACRAMENTO, Calif. — A federal judge in California on Aug. 6 ruled that insureds timely filed their breach of contract and bad faith lawsuit against their insurer and that the insurer failed to show “beyond doubt” that their claims were barred by the statute of limitations (Daniel Foster, et al. v. Liberty Mutual Fire Insurance Co., No. 18-0485, E.D. Calif., 2018 U.S. Dist. LEXIS 133897).

  • August 13, 2018

    Federal Judge Denies Insurer’s Motion, Says Breach Of Contract Proceeds

    SAN DIEGO — Claims for breach of contract and bad faith arising out of an insurer’s denial of coverage for an underlying wrongful eviction suit will proceed, a California federal judge said July 26 after determining that the insurer failed to prove that the underlying suit is excluded by any of the applicable policy exclusions (Black Mountain Center L.P., et al., v. Fidelity and Deposit Company of Maryland, No. 17-1776, S.D. Calif., 2018 U.S. Dist. LEXIS 125496

  • August 13, 2018

    Alleged Non-Cooperation Of Insured Cannot Be Asserted As Affirmative Defense

    DENVER — An insured’s alleged non-cooperation in the adjustment of an auto claim cannot be asserted as an affirmative defense by an insurer during trial on the insured’s remaining claim for unreasonable delay or denial of benefits in violation of Colorado law, a Colorado federal judge said July 20 in entering a ruling on a number of pending pretrial issues (Wendy L. Peden v. State Farm Mutual Automobile Insurance Co., No. 14-982, D. Colo., 2018 U.S. Dist. LEXIS 121693).

  • August 10, 2018

    Summary Judgment Ruling On Bad Faith Counterclaim Upheld On Appeal

    SEATTLE — A federal district court did not err in granting summary judgment in favor of an insurer on a third-party bad faith counterclaim because the third parties failed to show that any possible bad faith in the handling of their claim resulted in any harm, a Ninth Circuit U.S. Court of Appeals panel ruled July 31 in affirming the lower court’s opinion (State Farm Mutual Automobile Insurance Co. v. Shelbie Frounfelter, et al., No. 17-35313, 9th Cir., 2018 U.S. App. LEXIS 21204).

  • August 10, 2018

    Judge Administratively Closes Tornado Coverage Suit After Settlement Reached

    OKLAHOMA CITY — An Oklahoma federal judge on Aug. 8 ordered a coverage dispute over property damage caused by a tornado administratively closed after the parties announced that they reached a settlement (Charles A. Shadid LLC v. Aspen Specialty Insurance Co., No. 15-595, W.D. Okla.).

  • August 10, 2018

    Policy’s Special Provisions Typewritten Terms Prevail To Bar Wind, Flood Coverage

    BEAUFORT, S.C. — A South Carolina federal judge on Aug. 7 ruled that a commercial inland marine insurance policy should be interpreted according to its typewritten Special Provisions section, which excludes coverage for wind, hail and flood damage, granting the insurer’s motion for summary judgment in a breach of contract and bad faith suit arising from three golf courses damaged by Hurricane Matthew (Greenwood Communities and Resorts, Inc. v. Selective Insurance Company of America, No. 16-3995, D. S.C., 2018 U.S. Dist. LEXIS 132270).

  • August 9, 2018

    Motion In Limine To Exclude Testimony In Bad Faith Dispute Denied

    DENVER — A federal magistrate judge in Colorado on Aug. 7 ruled that expert testimony in an insurance breach of contract and bad faith lawsuit will not be excluded because an insurer’s challenge as to the reliability of the expert’s opinion is overly broad and the testimony is relevant to the insurer’s defenses that its investigation of the insured’s underinsured motorist (UIM) claim that it acted reasonably in handling the claim (Christopher Meek v. Allstate Fire and Casualty Insurance Co., No. 17-0606, D. Colo., 2018 U.S. Dist. LEXIS 132154).

  • August 8, 2018

    Life Insurer Seeks Extension On Motion To Dismiss Schedule In Class Action

    NEW YORK — A life insurer wrote to a New York federal court on Aug. 6 requesting an extension of the motion to dismiss briefing schedule in a class action alleging breach of policies by the unlawful increase of the premium costs to recoup costs associated with the acquisition (Derek Fan, et al. v. Phoenix Life Insurance Co., et al., No. 18-01288, S.D. N.Y.).

  • August 7, 2018

    Bad Faith, Punitive Damages Claims Survive Dismissal In Contamination Coverage Suit

    FRESNO, Calif. — Claims for bad faith and punitive damages alleged against an insurer in an environmental contamination coverage suit can move forward, a California federal judge said Aug. 1 after determining that the insured has sufficiently alleged facts in support of the claims (City of Fresno v. Tokio Marine Specialty Insurance Co., No. 18-504, E.D. Calif., 2018 U.S. Dist. LEXIS 129224).

  • August 6, 2018

    Disputed Issue Of Fact Exists As To Whether Insured Was Agent Of Organization

    DENVER — A disputed issue of material fact precludes summary judgment regarding an auto insurer’s liability to an organization for which an insured allegedly worked, a Colorado federal judge said July 23 in denying the insurer’s motion for summary judgment (Sarah Drobek v. Government Employees Insurance Co., et. al., No. 16-2512, D. Colo., 2018 U.S. Dist. LEXIS 122112).