MIAMI — No coverage is owed to an insured salon and medical spa for business losses sustained as a result of shutdown orders issued in the wake of the COVID-19 pandemic because the insured failed to show that it sustained a direct physical loss to its insured property, a Florida federal judge said Dec. 30 in granting the insurers’ motion to dismiss.
PITTSBURGH — A Pennsylvania federal bankruptcy judge on Nov. 23 entered a default order allowing Chapter 11 debtor ON Marine Services Company LLC to establish a qualified settlement fund (QSF) to hold nearly $31 million in insurance settlement proceeds earmarked for an asbestos personal injury trust (In re: ON Marine Services Company, LLC, No. 20-2007, W.D. Pa. Bkcy.).
ST. LOUIS — A Missouri federal judge on Dec. 10 set a July 12 trial date in a long-running coverage dispute over liability for injuries and property damages sustained as the result of the insured’s lead-smelting operations (Zurich American Insurance Co. v. Fluor Corp., et al., No. 16-429, E.D. Mo.).
DETROIT — Despite an insurer’s concerns over the spread of COVID-19 infections and deaths, a Michigan federal judge on Dec. 14 denied extending the discovery deadline in the insurer’s breach of contract dispute against a reinsurer over billings for an insured’s asbestos claims (Amerisure Mutual Insurance Co. v. Transatlantic Reinsurance Co., No. 18-11966, E.D. Mich.).
HARTFORD, Conn. — The Connecticut Appellate Court in an opinion officially released Dec. 15 found that a trial court erred in determining that excess policies implicated in an environmental contamination dispute will never attach based on the failure to exhaust primary policies because the trial court incorrectly determined the per-occurrence limits of the underlying primary policies (Continental Casualty Co., et al. v. Rohr Inc., et al., Nos. AC 41537, AC 41538, AC 42613, Conn. App., 2020 Conn. App. LEXIS 366).
KANSAS CITY, Mo. — An insurer owes no coverage for business losses sustained by a business owner as a result of shutdown orders issued to slow down the spread of the novel coronavirus because the insured suffered no direct physical loss and because the policy’s pollution or contamination exclusion clearly bars coverage, a Missouri federal judge said Dec. 2 (Zwillo V. Corp., et al. v. Lexington Insurance Co., No. 20-339, W.D. Mo., 2020 U.S. Dist. LEXIS 230672).
OAKLAND, Calif. — A California federal judge on Dec. 10 granted an insurer’s motion to dismiss after determining that a policy’s virus exclusion clearly precludes coverage for business losses sustained as a result of shutdown orders issued to slow the spread of the novel coronavirus (HealthNOW Medical Center v. State Farm General Insurance Co., No. 20-4340, N.D. Calif., 2020 U.S. Dist. LEXIS 232626).
DALLAS — An insurer breached its contract and acted in bad faith by refusing to settle an underlying asbestos personal injury suit filed against the insured and by refusing to cover a $17 million verdict entered against the insured following the insurer’s refusal to settle the underlying suit, an insured alleges in a Dec. 9 complaint filed in Texas federal court (Celanese Corp. v. Lamorak Insurance Co., No. 20-3606, N.D. Texas).
TACOMA, Wash. — A trial court erred in dismissing a breach of contract claim filed by insureds seeking coverage for the remediation of methamphetamine damages because a question of fact exists as to whether the contamination was caused by a pollutant, an excluded cause of loss, or vandalism, a covered cause of loss, the Division II Washington Court of Appeals said Dec. 8 (Nathaniel D. Cumming,, et al. v. United Services Automobile Association, et al., No. 52913-1-II, Wash. App., Div. 2, 2020 Wash. App. LEXIS 3227).
WEST PALM BEACH, Fla. — The Fourth District Florida Court of Appeal on Dec. 9 reversed a trial court’s ruling in favor of a property insurer in a water and mold damage coverage dispute after determining that an issue of fact exists as to whether the insureds’ five-day delay in notifying the insurer of the loss was prejudicial to the insurer and in breach of the insureds’ post-loss contractual obligation to provide prompt notice of a loss (Restoration Construction LLC v. SafePoint Insurance Co., No. 4D19-3790, Fla. App., 4th Dist., 2020 Fla. App. LEXIS 17528).
SAN FRANCISCO — Two excess insurers and a reinsurer on Dec. 8 agreed in a California federal court stipulation to settle claims and counterclaims in their dispute over the reinsurer’s alleged responsibility toward a more than $11.6 million confidential buyout agreement regarding an insured’s asbestos liabilities (New Hampshire Insurance Company, et al. v. TIG Insurance Company, No. 20-04668, N.D. Calif.).
NEW YORK — It would be “grossly inequitable” and likely legally improper under New York law to permit an excess insurer’s argument that a de facto merger occurred and that a dissolved construction company’s asbestos liabilities were “secretly and unknowingly” discharged in a parent company’s bankruptcy years earlier, a federal bankruptcy judge in New York said Dec. 4 in reopening the case but denying relief (In re: Eastman Kodak Co., No. 12-bk-10202, S.D. N.Y. Bkcy., 2020 Bankr. LEXIS 3393).
LOS ANGELES — “One of the largest talent agencies in the world” sued its commercial property insurers in a California court on Nov. 13 for breach of contract and bad faith, alleging that they are “part of the Chubb group of insurance companies” that “has adopted a universal practice of denying coverage for all business interruption claims associated with SARS-CoV-2, Covid-19, and subsequent events” (United Talent Agency, LLC v. Vigilant Insurance Company, et al., No. 20STCV43745, Calif. Super., Los Angeles Co.).
PHILADELPHIA — A federal judge in Pennsylvania said on Dec. 7 that although he sympathizes with a dentist insured, he cannot ignore that the insured purchased a commercial property insurance policy that does not cover the losses it incurred as a result of the novel coronavirus (Kessler Dental Associates, P.C. v. The Dentists Insurance Company, No. 20-03376, E.D. Pa., 2020 U.S. Dist. LEXIS 228859).
PRESCOTT, Ariz. — Finding that COVID-19 does not fall under a premises pollution liability insurance policy’s definition of “pollution condition,” a federal judge in Arizona on Dec. 4 granted an insurer’s motion to dismiss with prejudice a destination resort insured’s breach of contract lawsuit seeking coverage for its business loss in connection with the novel coronavirus pandemic and subsequent government response (London Bridge Resort LLC v. Illinois Union Insurance Company, Inc., No. 20-08109, D. Ariz.).
KANSAS CITY, Kan.— A federal judge in Kansas on Dec. 3 granted a property insurer’s motion to dismiss with prejudice a wholesale apparel distributor insured’s putative class action seeking coverage for its losses arising from the novel coronavirus and subsequent stay-at-home orders, finding that the insured fails to allege any direct physical loss or damage or that the orders prohibited access to its property (Promotional Headwear International v. The Cincinnati Insurance Company, No. 20-cv-2211-JAR-GEB, D. Kan.).
LOS ANGELES — An insurer on Nov. 5 asked a California federal court to reopen its lawsuit seeking a declaration that it has no duty under two business owners insurance policies to cover its insured’s claimed business income losses related to the novel coronavirus, arguing that although the court determined in dismissing the insured’s counterclaims that it has no duty to provide coverage for the insured’s alleged losses in connection with its Los Angeles office, the court has not yet resolved the same question regarding the insured’s alleged losses to its New York office (Travelers Casualty Insurance Company of America v. Geragos & Geragos, Nos. 20-3619, C.D. Calif.).
BALTIMORE — A federal judge in Maryland on Dec. 1 denied an insured hotel’s motion for reconsideration after determining that the insured failed to present any new evidence concerning its claim for water damage caused by a windstorm and said that the insurer is entitled to summary judgment because the insured conceded that the covered damages do not exceed the policy’s deductible (Bethany Boardwalk Group LLC v. Everest Security Insurance Company, No. 18-3918, D. Md., 2020 U.S. Dist. LEXIS 225178).
BROOKLYN, N.Y. — A New York appellate panel on Dec. 2 determined that a trial court did not abuse its discretion in denying a motion to compel filed by the insureds in an oil spill contamination suit because the trial court properly found that the requests for documents were overly broad and burdensome (Richard Bennett, et al. v. State Farm Fire and Casualty Co., et al., No. 2019-07857, N.Y. Sup., App. Div., 2nd Dept., 2020 N.Y. App. Div. LEXIS 7413).
RALEIGH, N.C. — A trial court did not err in applying an exposure theory of coverage in a suit seeking coverage for underlying benzene and asbestos personal injury claims because an exposure theory of coverage is consistent with the language in the applicable insurance policies, the North Carolina Court of Appeals said Dec. 1 (Radiator Specialty Co. v. Arrowood Indemnity Co. et al., No. COA19-507, N.C. App., 2020 N.C. App. LEXIS 850).