Mealey's Insurance
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July 18, 2022
District Court Erred In Finding No Coverage Owed For Mold Damage, Insureds Says
ATLANTA — A district court erred in finding that no coverage is owed for mold damage discovered in an insured hotel because nothing in the policy at issue supports the court’s ruling that the mold damage, caused by various construction defects, incepted prior to the applicable policy period and was not caused by an external event for which coverage would be afforded, insureds contend in a June 27 appellant brief filed in the 11th Circuit U.S. Court of Appeals.
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July 18, 2022
Policy’s Mold Exclusion Bars Coverage For Mold Damages, Judge Says
TULSA, Okla. — No coverage is owed to insureds for mold damage in their home because the policy contains a fungus or mold exclusion that clearly precludes coverage for the insureds’ mold damages, an Oklahoma federal judge said July 11 in granting the insurer’s motion for summary judgment on the insureds’ breach of contract claim related to the mold damages and the insureds’ bad faith claim.
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July 18, 2022
Coverage For Insured’s Water Damage Is Limited To $5,000, Magistrate Judge Says
FORT LAUDERDALE, Fla. — A Florida federal magistrate judge on July 15 recommended granting an insurer’s motion for summary judgment and denying the insured’s motion for summary judgment because the policy’s water damage extension clearly limits the insured’s recovery for water damages to $5,000 and no additional coverage is afforded for tear-out costs necessary to access the broken drain line that caused the water damage in the insured’s property.
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July 18, 2022
Montana Asbestos Plaintiffs, Zurich Brief Court On Dismissal, Summary Judgment
GREAT FALLS, Mont. — A federal judge in Montana on July 7 gave W.R. Grace & Co. insurer Zurich Insurance Co. until later in the month to file a reply brief in support of its motion to dismiss claims that it improperly uses retroactive reinsurance to delay asbestos liability claims in an effort to profit off the “float” and gave it until August to respond to a motion for summary judgment in which plaintiffs contend the insurer’s liability is reasonably clear and requires advance payment.
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July 14, 2022
Panel Reverses Dismissal Of Business’s UCL Claim For Denied Coronavirus Coverage
LOS ANGELES — A California appellate panel July 13 reversed a trial court’s grant of an insurer’s demurrer to claims that it violated California’s unfair competition law (UCL) and breached an insurance policy by denying a claim for physical damage from the COVID-19 virus brought by a business forced to shut down during the pandemic, finding that the court improperly ruled based on its “disbelief” of the plaintiffs’ allegations.
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July 13, 2022
Majority Says Policies’ Assignment Was Valid, Coverage Owed For Asbestos Liabilities
MILWAUKEE — The majority of the Wisconsin Court of Appeals on July 8 determined that a trial court erred in finding that the assignment of insurance policies to the insureds’ successor companies for underlying asbestos claims was not valid based on the policies’ anti-assignment provision because under Wisconsin law, anti-assignment provisions are unenforceable if the assignment occurs after the loss for which coverage is sought.
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July 12, 2022
Bad Faith, Financial Elder Abuse Claims In Water Coverage Suit Fail, Judge Says
SAN FRANCISCO — A homeowners insurer did not act unreasonably in handling an insured water damage coverage claim, a California federal judge said July 7 in granting the insurer’s motion for partial summary judgment on bad faith and financial elder abuse claims.
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July 12, 2022
Developer’s Reconsideration Bid In Pollution Exclusion Coverage Suit Denied
COLUMBUS, Ga. — In a June 28 order, a federal judge in Georgia denied a motion for reconsideration filed by a development company and its owner seeking to alter the judge’s grant of summary judgment in favor of their insurer in a declaratory relief action stemming from an underlying sediment runoff lawsuit, ruling that the defendants failed to bring their argument that sediment runoff is not a pollutant under the policy in response to the insurer’s summary judgment motion.
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July 12, 2022
Bifurcation Of Bad Faith Claim In Environmental Suit Is Warranted, Judge Says
GREEN BAY, Wis. — Bifurcation of an insured’s bad faith claim from the insured’s coverage claim in an environmental contamination dispute is warranted because the insurers will be prejudiced if both claims proceed jointly, a Wisconsin federal judge said July 5.
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July 12, 2022
Massachusetts High Court: Attorney Fee Award In Chemical Exposure Suit Not Covered
BOSTON — The Massachusetts Supreme Judicial Court on July 6 reversed a trial court’s finding that an insurer must pay an attorney fee award entered against its insured in a chemical exposure liability suit because attorney fees do not constitute “damages because of ‘bodily injury’” as required by the commercial liability policy at issue.
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July 11, 2022
Claims For Bad Faith, Unfair Claims Practices Dismissed In Mold Suit
RALEIGH, N.C. — An insured’s claims for bad faith and unfair claims practices in a water and mold damage coverage dispute cannot proceed because the insured failed to show that the homeowners insurer acted in bad faith or committed unfair claims practices in handling the claims, a North Carolina federal judge said July 8 in partially granting the insurer’s motion to dismiss.
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July 10, 2022
Bad Faith, Breach Of Contract Suit Over Water Damage Remanded To State Court
PHOENIX — A breach of contract and bad faith suit filed against a homeowners insurer by insureds who are seeking coverage for water damage must be remanded to Arizona state court because the insurer failed to show that the amount in controversy exceeds the federal jurisdictional minimum of $75,000, an Arizona federal judge said June 30.
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July 01, 2022
Panel Affirms Order Denying Insurers’ Motion To Disqualify Manufacturer’s Counsel
SAN FRANCISCO — A California appeals panel on June 28 held that a lower court properly denied an insurers’ motion to disqualify a pipe manufacturer insured’s attorneys in a product liability coverage dispute, finding that the insurers failed to satisfy their burden to prove a prior attorney-client relationship, a personal relationship or a substantial relationship.
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June 30, 2022
3rd Circuit Adopts Fiduciary Model For Future Claims Reps In Asbestos Bankruptcies
PHILADELPHIA — Over the objections of insurers, the Third Circuit U.S. Court of Appeals on June 30 upheld the appointment of a representative for future asbestos claimants in the Chapter 11 bankruptcy of talc producer Imerys Talc America Inc., saying the bankruptcy court applied “in substance” the fiduciary standard for selecting such representatives that the panel adopted in its opinion.
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June 30, 2022
Pollution Exclusion Bars Coverage For Toxic Exposure Lawsuit, Judge Determines
SAN FRANCISCO — An insurer has no duty to defend its insured against an underlying toxic exposure lawsuit arising from the cleanup of a fire that destroyed a city in California because the policy’s pollution exclusion bars coverage, a California federal judge said June 15 in granting the insurer’s motion for summary judgment.
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June 30, 2022
Insurer Breached Contract By Not Defending Insureds In Environmental Suit
SANTA ANA, Calif. — A California federal judge on June 21 granted summary judgment in favor of insureds in an environmental contamination dispute after determining that the insurer breached its contract by refusing to defend the insureds, refusing to appoint independent counsel and refusing to reimburse the insureds for their defense costs.
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June 30, 2022
Administrator For Asbestos Claims Says Insureds’ Allegations Are Unsupported
SANTA ANA, Calif. — A claims administrator handling the administration of underlying asbestos claims filed against an insured argues in a June 15 motion to dismiss filed in California federal court that the insureds’ declaratory judgment and tortious inference with contract claims must be dismissed because the claims are conclusory and not supported with any facts.
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June 30, 2022
Ohio Panel Reiterates Finding That Environmental Suit Was Properly Dismissed
YOUNGSTOWN, Ohio — An Ohio appellate panel on June 21 denied an insurer’s motion for reconsideration, rejecting the insurer’s contention that the panel incorrectly determined that a trial court did not err in dismissing an insurer’s declaratory judgment suit involving coverage for an environmental contamination claim because the trial court properly found that it did not have personal jurisdiction over the additional insured, which is seeking coverage under the policy.
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June 29, 2022
Developer Appeals Pollution Exclusion Bar Ruling To 11th Circuit
COLUMBUS, Ga. — An insured development company and its owner will appeal a federal judge’s final judgment in a declaratory relief action in which a federal judge ruled that the insurer is entitled to summary judgment and owes no coverage for damages resulting from sediment runoff into a neighboring pond created by the insured’s construction project based on an insurance policy’s pollution exclusion, according to a notice of appeal the defendants’ filed June 24 in Georgia federal court.
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June 27, 2022
N.J. Panel Reverses Ruling In Casino’s Favor In Coronavirus Coverage Dispute
TRENTON, N.J. — A New Jersey appeals panel on June 23 held that a lower court erred in denying insurers’ motion to dismiss an insured’s lawsuit seeking property and business interruption insurance coverage for its alleged loss of income during the closure of its Atlantic City casino in response to COVID-19 pandemic shutdown orders, reversing and remanding for the entry of an order to dismiss the complaint against all insurers.