WASHINGTON, D.C. — The U.S. Judicial Panel for Multidistrict Litigation on June 1 denied an insolvent insurer and its rehabilitators’ motion to transfer and centralize litigation against them to a Pennsylvania federal court, finding that the insurer and its rehabilitators failed to meet the burden of demonstrating “that the benefits of centralization outweigh the disruption to the pending actions and inconvenience that would be imposed on the parties and witnesses.”
LAS VEGAS — Directors of an insolvent Nevada risk retention group failed to “demonstrate” that the high court had jurisdiction in an insurance commissioner’s breach of fiduciary and gross negligence suit against them, the Nevada Supreme Court ruled June 6, dismissing the directors’ appeal of district court orders denying their motion for attorney fees and the Nevada insurance commissioner’s motion to retax and settle costs.
NEW ORLEANS — Almost two weeks after granting an ex parte joint motion to dismiss with prejudice, a Louisiana federal judge on June 13 issued an order granting plaintiffs’ ex parte motion to dismiss with prejudice against specified defendants in an asbestos liability coverage suit alleging that a man contracted malignant mesothelioma and died due to his inhalation of asbestos fibers.
NEW YORK — The Second Circuit U.S. Court of Appeals on June 16 reversed a district court’s ruling that the full aggregate policy limits do not apply to an insured’s policies that were effective for less than a full year because the policies at issue are ambiguous as to whether the full aggregate limits should apply for underlying asbestos liabilities and must be construed in favor of the insured.
BATON ROUGE, La. — A Louisiana federal magistrate judge on June 13 denied a motion to compel responses to discovery filed by the Louisiana Insurance Guaranty Association (LIGA), the statutory obliger for an insolvent insurer in an asbestos exposure suit filed against the insurer, finding that plaintiffs lack the information requested and that LIGA’s settlement-related request is “premature.”
NEW YORK — In three orders issued June 14, a New York federal bankruptcy judge authorized the joint provisional liquidators (JPLs) of Bermuda insurer and reinsurer PB Life and Annuity Co. Ltd. (PBLA) and other debtors to issue subpoenas directing production of documents to dozens of entities and individuals including debtor investment counterparties and certain non-insider third parties — of which the latter includes Google LLC.
AKRON, Ohio — Liberty HealthShare Inc., its CEOs and directors on June 8 issued a status report to an Ohio federal court in a class action filed by health insurance plan members seeking a declaration that the health plans “were and are illegal contracts” and a ruling that the CEOs or directors were personally liable after Liberty was deemed an insolvent insurer under Virginia Code Annotated Section 38.2-215.
SAN FRANCISCO — Ruling 2-1 that abstention under Younger v. Harris does not apply to insurance conservatorships, members of a Ninth Circuit U.S. Court of Appeals panel on June 10 affirmed a lower court’s dismissal of two suits involving the same state court proceeding under the prior exclusive jurisdiction rule; the majority said it believes that this is “the first case in this Court implicating” that rule “in connection with a 42 U.S.C. § 1983 action.”
NEW YORK — A federal judge in New York on June 6 granted a request by both parties in a declaratory judgment suit over defense and indemnity costs that, in lieu of conducting a bench trial scheduled to start July 25, he will “decide all issues on the papers submitted in the pending motions for summary judgment, inclusive of issues of fact, if any.”
CHICAGO — A federal magistrate judge in a June 7 minute entry directed parties to file settlement position opening statements by Aug. 1 following a pre-settlement conference in a lawsuit alleging that insurance brokers breached their duty of care because they knew or should have known that a multiple employer welfare arrangement (MEWA) was not in compliance with its structural requirements and was not financially sound.
WILMINGTON, Del. — Citing changes in the defendants’ plans, the plaintiffs in a putative class suit alleging fraudulent transfers from an insurance subsidiary that more than 1 million policyholders depend on for long-term care (LTC) insurance disability benefits informed the Delaware Chancery Court in a June 3 letter that they are withdrawing their motion for a preliminary injunction.
CHARLOTTE, N.C. — A North Carolina judge on May 24 granted a law firm’s summary judgment motion in a legal malpractice claim filed against it by the owner of an insolvent insurer, finding that the owner failed to provide evidence that the firm could have changed the result of a trial court’s judgment in an underlying $12,849,193.20 judgment against the owner for breach of fiduciary duty, constructive fraud, constructive fraudulent transfer and unfair and deceptive trade practices.
KANSAS CITY, Kan. — A federal magistrate judge in a May 23 docket entry denied a joint unopposed motion to stay two claims regarding antitrust coverage disputes involving an insolvent insurer and health care insurer, finding that despite the consolidated cases’ “complexity,” they “need to move forward regardless of the outcome of mediation.”
WASHINGTON, D.C — Five days after a U.S. Court of Claims judge issued an order approving an attorney fee request made by counsel for insolvent insurers’ subclass for 5% of the $13,714,723 net recovery related to the settlement of risk-corridor claims, the court on May 31 issued a judgment awarding class counsel $685,736 in attorney fees in a suit seeking a declaratory judgment that the U.S. government owes the insurers millions of dollars under the Patient Protection and Affordable Care Act (ACA) risk-corridor program.
NEW YORK — Parties in a declaratory judgment suit over defense and indemnity costs in a personal injury case on May 24 and 25 each filed opposition to the other’s motion for summary judgment in New York federal court, arguing issues including whether, under New York law, the defendant is required to show prejudice to assert a late notice defense.
NEW ORLEANS — Review of a magistrate judge’s order allowing a purported asbestos product supplier to file a supplemental answer in an asbestos coverage suit is moot because the supplier already responded to a new allegation related to Louisiana Insurance Guaranty Association’s (LIGA) obligations regarding the insolvent insurer, a Louisiana federal judge said May 11 in denying the motion for review.
NEW HAVEN, Conn. — The receiver of an insolvent insurer and a professional liability insurer of a captive manager on May 4 issued a joint status report advising a Connecticut federal court that they had settled a coverage lawsuit filed by the receiver, subject to the approval of the Delaware Chancery Court because the insolvent insurer is in liquidation proceedings there and subject to the Chancery Court’s “oversight.”
NEW ORLEANS — A Louisiana federal judge on May 17 issued two orders granting separate joint motions to dismiss with prejudice against two defendants in an asbestos liability coverage suit alleging that a man contracted malignant mesothelioma and died due to his inhalation of asbestos fibers.
DAYTONA BEACH, Fla. — A Florida appellate court on May 17 granted an insured’s petition for a writ of prohibition challenging a trial court’s refusal to grant a stay in a libel proceeding, finding that a six-month stay provided by Florida law “prohibits continuation” of judicial proceedings where the “insolvent insurer remains obligated to provide a defense.”
RALEIGH, N.C. — A North Carolina federal judge on April 25 denied an insolvent insurer’s motion to stay pending the outcome of the insurer’s consolidation motion in a multidistrict litigation proceeding but granted the North Carolina insurance commissioner’s motion to remand in a suit he filed against the insurer alleging that it seeks to increase its insureds’ premium rates without the commissioner’s approval, finding that the commissioner “is not a citizen for purposes of diversity jurisdiction.”