Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

March 22, 2023
Magistrate Issues Stay In Hurricane Coverage Suit Against Insolvent Insurer

BATON ROUGE, La. — A Louisiana federal magistrate judge issued a stay in a coverage dispute filed by a homeowner against his insurer after Hurricane Ida caused purported property damage, finding that a stay is required pursuant to the terms of a consent order appointing the Florida Department of Financial Services (DFS) as receiver for the insurer in liquidation and by Louisiana law requiring a six-month stay in proceedings involving an insolvent insurer.
March 22, 2023
Final Dismissal Issued In Wind Damage Suit Against Florida Guaranty Association

PENSACOLA, Fla. — A Florida state court issued a final dismissal order in a homeowners’ suit over wind damage coverage against the Florida Insurance Guaranty Association (FIGA) as statutory receiver for an insolvent insurer after the homeowners filed a notice of voluntary dismissal.
March 21, 2023
Insured Asks 7th Circuit To Rehear No Coverage Ruling In $5.3M COVID-19 Suit

CHICAGO — An insured asked the Seventh Circuit U.S. Court of Appeals to reconsider its March 2 ruling that affirmed a lower federal court’s dismissal of its declaratory judgment lawsuit seeking commercial insurance coverage for its more than $5.3 million in claimed derivative losses arising from the coronavirus pandemic.
March 20, 2023
5th Circuit Vacates Ruling In Insurer’s Favor In Hurricane Harvey Coverage Suit

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on March 17 held that a lower federal court did not properly conduct the required analysis when it excluded expert evidence in a Hurricane Harvey coverage dispute, vacating the lower court’s evidentiary rulings and summary judgment in favor of the insurer and remanding.
March 20, 2023
Louisiana Majority Reinstates No Coverage Ruling In Restaurant’s Coronavirus Suit

NEW ORLEANS — A majority of the Louisiana Supreme Court on March 17 found that the coronavirus did not cause “direct physical loss of or damage to” an insured’s French Quarter restaurant, reversing an appellate court majority’s finding that an insurance policy is ambiguous and capable of more than one reasonable interpretation as to coverage and reinstating a trial court judgment that denied coverage for the insured’s lost business income arising from the pandemic.
March 17, 2023
Judgment Denied In Hurricane Coverage Suit Involving Facebook Donation Request

NEW ORLEANS — A Louisiana federal judge on March 16 denied an insurer’s motions to confirm an appraisal award and for summary judgment in a coverage dispute over hurricane damage at the insured’s nonprofit ranch for teenage boys, finding that award confirmation is denied because the insurance contract identifies the appraisal as nonbinding and that fact issues remain regarding the insured’s purported damage misrepresentation “even assuming” that the reduced donation request on its “Facebook post is competent summary judgment evidence.”
March 16, 2023
Tulane Seeks Coverage For ‘Time Element,’ Other Losses Arising From Coronavirus

NEW ORLEANS — The administrators of the Tulane Educational Fund sued its insurers for a declaratory judgment and bad faith penalties in a Louisiana federal court, seeking coverage for its medical catastrophe expense (MCE) claim and evacuation expenses (EE) resulting from the COVID-19 contagion.
March 16, 2023
Texas High Court Refuses To Review Coverage Dispute Arising From Hailstorm Damage

AUSTIN, Texas — The Texas Supreme Court denied an insurer’s petition seeking review of an appeals court’s reversal of summary judgment in its favor in a condominium community insured’s coverage lawsuit arising from hailstorm property damage.
March 16, 2023
Florida Panel Affirms Ruling In Favor Of Insurer In Hurricane Irma Coverage Suit

MIAMI — A Florida appeals court panel on March 15 affirmed summary judgment in favor of a homeowners insurer in a coverage dispute arising from Hurricane Irma damage, finding that the trial court did not abuse its discretion when it denied the plaintiff assignee’s request for a continuance for further discovery.
March 14, 2023
No Coverage For Salon’s Losses Arising From Coronavirus, N.J. Panel Affirms

TRENTON, N.J. — A New Jersey appeals court panel affirmed dismissal of a hair salon insured’s breach of contract and declaratory judgment lawsuit seeking coverage for its business losses arising from the coronavirus pandemic, finding that the appeals court in Mac Prop. Grp. LLC v. Selective Fire & Cas. Ins. Co. analyzed and rejected a similar coverage argument.
March 13, 2023
Panel: Contamination Exclusion Bars Burger Chain’s Coverage For Coronavirus Losses

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on March 10 affirmed dismissal of In-N-Out Burgers’ breach of contract lawsuit against its commercial property insurer, finding that a policy’s contamination exclusion barred coverage for the insured’s losses arising from the coronavirus pandemic.
March 08, 2023
9th Circuit Affirms Dismissal Of Spa Owners’ Coverage Suit Arising From Pandemic

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals affirmed a lower federal court’s dismissal of spa owner insureds’ lawsuit seeking coverage for their losses arising from the coronavirus pandemic, finding that the insureds’ coverage argument is “squarely foreclosed” by its ruling in Mudpie, Inc. v. Travelers Casualty Insurance Co. of America and that the policies’ virus exclusion also bars coverage.
March 08, 2023
Federal Judge Finds 1 Policy Ambiguous In Broadway Owner’s COVID-19 Coverage Suit

NEW YORK — A New York federal judge granted insurers’ motion for judgment on the pleadings as to breach of contract, bad faith and declaratory judgment claims against one insurer but denied their motion and the insured’s motion as to the breach of contract claim against another insurer, finding that the relevant language in the “Entertainment – Property Insurance for the Performing Arts Policy” is ambiguous in a coronavirus coverage lawsuit brought by the owner and operator of five Broadway theaters.
March 08, 2023
Federal Judge Dismisses COVID-19 Coverage Suit Between Real Estate Trust, Insurer

SANTA ANA, Calif. — One day after a real estate trust insured and its insurer filed a stipulation for voluntary dismissal of the insured’s breach of contract and bad faith lawsuit seeking coverage for its business interruption losses arising from the coronavirus pandemic, a federal judge in California on March 7 dismissed the case with prejudice.
March 07, 2023
Judgment Creditors Appeal Denial Of Turnover Of Funds To Satisfy 9/11 Judgment

NEW YORK — Judgment creditors filed a notice of appeal of a New York federal court’s ruling that adopted a magistrate judge’s report and recommendation to not allow the creditors to satisfy their judgments against the Taliban for its role in the Sept. 11, 2001, terrorist attacks with funds from Afghanistan’s central bank that are held at the Federal Reserve Bank of New York.
March 07, 2023
Real Estate Trust, Insurer Voluntarily Dismiss Coronavirus Coverage Dispute

SANTA ANA, Calif. — A real estate trust insured and its insurer on March 6 filed a stipulation for voluntary dismissal with prejudice of the insured’s breach of contract and bad faith lawsuit seeking coverage for its business interruption losses arising from the coronavirus pandemic.
March 06, 2023
Pollution, Contamination Exclusion Must Be Construed In Favor Of Coverage

SANTA ANA, Calif. — A California federal judge denied an insurer’s motion to dismiss breach of contract, bad faith and declaratory judgment claims alleged by an insured seeking coverage for business losses sustained in the wake of the COVID-19 pandemic because the policy’s pollution and contamination exclusion is ambiguous and must be construed in favor of coverage.
March 06, 2023
Texas Federal Magistrate Judge Says Pollution Exclusion Does Not Bar Coverage

HOUSTON — A commercial general liability insurer’s pollution exclusion does not bar coverage for a multidistrict litigation suit alleging that the insured’s sand mining business contributed to the flooding sustained during Hurricane Harvey because the insurer failed to show that the materials and substances discharged by the insured into area waterways qualify as pollutants, irritants or contaminants, a Texas federal magistrate judge said in recommending that insurer’s motion for summary judgment be denied.
March 03, 2023
4th Circuit Finds ‘No Reversible Error’ In Court’s Dismissal Of Coronavirus Coverage Suit

RICHMOND, Va. — Dispensing with oral argument, the Fourth Circuit U.S. Court of Appeals affirmed a lower federal court’s grant of an insurer’s motion to dismiss insureds’ lawsuit seeking coverage for their financial losses arising from the lockdowns in response to the coronavirus pandemic, finding that the facts and legal contentions have been adequately presented before the court and “argument would not aid the decisional process.”
March 03, 2023
Panel: No Coverage Owed For Insureds’ Alleged $5.3M In Losses Arising From COVID-19

CHICAGO — The Seventh Circuit U.S. Court of Appeals on March 2 affirmed a lower federal court’s dismissal of an insured’s declaratory judgment lawsuit seeking commercial insurance coverage for its more than $5.3 million in claimed derivative losses arising from the coronavirus pandemic, finding that it has “repeatedly interpreted similar language in insurance cases seeking compensation for losses related to COVID-19 restrictions, and have consistently held that temporary loss of use or restrictions on use do not constitute ‘physical’ damage or loss.”
March 03, 2023
California High Court Accepts Certified Question In Coronavirus Coverage Dispute

SAN FRANCISCO — The California Supreme Court accepted the Ninth Circuit U.S. Court of Appeals’ certified question to determine whether “the actual or potential presence of the COVID-19 virus on an insured's premises” constitutes “direct physical loss or damage to property” to trigger coverage under an insured’s commercial property insurance policy.
March 01, 2023
Federal Judge Stands By No Bad Faith Ruling In Thunderstorm Coverage Dispute

JASPER, Ala. — A federal judge in Alabama denied an insured’s motion to reconsider the court’s summary judgment ruling in favor of an insurer as to a bad faith claim in the insured’s lawsuit seeking coverage for property damage allegedly caused by a 2019 thunderstorm, reiterating that the insurer, at the very least, had an arguable reason to withhold payment for the insured’s damage to its carriage house.
March 01, 2023
Judge Grants GEICO’s Motion To Strike Jury Demand In COVID Premium Suit

SAN FRANCISCO — A California federal judge granted GEICO’s motion to strike a demand by a certified class of automotive policy holders for a jury trial on the claim that GEICO violated California’s unfair competition law (UCL) by profiting from a premium giveback program initiated during the COVID-19 pandemic, writing that the lead plaintiff “has no . . . right to a jury trial on her UCL claim.”
March 01, 2023
Panel: No Triable Issue That COVID-19 In Hotel Caused Insured’s Alleged Lost Income

SAN DIEGO — A California appeals court panel affirmed a summary judgment ruling in favor of a commercial insurer in a breach of contract and bad faith lawsuit brought by the owner and operator of a 126-room Holiday Inn Express franchise in San Diego, finding that “there is no evidence creating a triable issue that COVID-19 in the hotel caused the claimed lost income.”
March 01, 2023
Judge Refuses To Stay Judgment Denying Turnover Of Funds To Satisfy 9/11 Judgments

NEW YORK — A New York federal judge denied judgment creditors’ motion to stay an earlier ruling that adopted a magistrate judge’s report and recommendation to not allow the creditors to satisfy their judgments against the Taliban for its role in the Sept. 11, 2001, terrorist attacks with funds from Afghanistan’s central bank that are held at the Federal Reserve Bank of New York.