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Mealey's Insurance

April 06, 2023
6th Circuit Dismisses Church’s Appeal Over Water Damage No-Coverage Ruling

CINCINNATI — The Sixth Circuit U.S. Court of Appeals granted a stipulated motion to dismiss with prejudice filed by parties in an appeal of a federal district court’s finding that an insurer did not breach its contract with a church by failing to provide coverage for water damage stemming from a leaky roof based on the policy’s negligent work exclusion, which bars coverage for the claim.
April 06, 2023
Suit Seeking Coverage For Alleged Negligent Installation Of Sewage Pipeline Stayed

SEATTLE — A Washington federal judge granted a joint motion to stay a coverage dispute arising out of an insured’s alleged negligent installation of a sewage pipeline until the underlying suit filed against the insured by an individual who was injured as a result of contact with raw sewage from the pipeline is resolved.
April 05, 2023
Reinsurer In Asbestos Coverage Liabilities Row Notifies Court Of Liquidation Order

OMAHA, Neb. — Parties in a federal suit in Nebraska against reinsurers over the $157.2 million settlement that National Indemnity Co. (NICO) reached with Montana regarding alleged asbestos exposures have notified the court of developments in two other proceedings, including an order of liquidation entered against a defendant.
April 04, 2023
Judge: Severed Asbestos Indemnity Dispute Timely Removed; Transfer Proper

NEW ORLEANS — An asbestos defendant timely removed a severed third-party action brought against it by an insurer that claims that the company violated a settlement requiring defense and indemnity against asbestos claims, a federal judge in Louisiana said in denying remand and transferring the case to New Jersey, where the settlement was reached.
April 04, 2023
Judge Finds No Personal Jurisdiction In Reinsurer’s Suit Over Asbestos Settlement

CONCORD, N.H. — Ruling that the court lacked personal jurisdiction in a reinsurer’s declaratory judgment suit against National Indemnity Co. (NICO) regarding a settlement with the state of Montana over alleged asbestos exposures, a New Hampshire federal judge granted dismissal and said she found no evidence that the “asserted claim meaningfully implicates any of NICO’s contacts with New Hampshire.”
April 03, 2023
Excess Insurer Sues Whittaker Clark Daniels Inc. Over Asbestos Claims

MORRISTOWN, N.J. — An insurer filed an action in the Morris County, N.J., Superior Court against asbestos-talc defendant Whittaker Clark & Daniels Inc., seeking a declaration regarding rights and obligation stemming from an asbestos-exclusion-containing excess insurance policy issued in the 1980s.
April 03, 2023
All Claims Against Guaranty Association Dismissed In Shipyard Asbestos Exposure Suit

NEW ORLEANS — A Louisiana federal judge on March 31 granted a dismissal motion filed by the Louisiana Insurance Guaranty Association (LIGA) as the alleged statutory obligor for policies issued by Lamorak Insurance Co., a now-insolvent insurer, in a man’s suit for injuries purportedly related to asbestos exposure while he worked at the shipyard, finding that all claims against LIGA are barred by the Longshore and Harbor Workers’ Compensation Act (LHWCA).
March 30, 2023
D.C. Panel: Restaurants Did Not Incur Direct Physical Loss From COVID-19 Shutdown

WASHINGTON, D.C. — The District of Columbia Court of Appeals affirmed a lower court’s denial of insureds’ expedited motion for summary judgment and grant of their all-risk insurer’s cross-motion for summary judgment in a coronavirus coverage dispute, finding that the insureds’ “loss of use” of their properties as a result of D.C. Mayor Muriel Bowser's shutdown orders was not a “direct physical loss” that triggered insurance coverage.
March 30, 2023
Insurer Must Continue To Defend Insured In Underlying Asbestos Bodily Injury Suits

BOSTON — A cost-sharing agreement between a commercial general liability insurer and an insured named as a defendant in numerous underlying asbestos bodily injury lawsuits was a binding and final settlement and requires the insurer to continue participating in the defense of the insured, a Massachusetts federal judge said in granting the insured’s motion for partial judgment on the pleadings.
March 29, 2023
No Coverage Owed For Fuel Oil Spill At Insureds’ Home, N.Y. Justice Says

PORT EDWARD, N.Y. — Insureds’ claims for breach of contract and bad faith alleged against their property insurer cannot proceed because the policy’s pollution exclusion bars coverage for the damages and remediation costs incurred following an oil spill at the insureds’ home, a New York Supreme Court justice determined.
March 29, 2023
Insured Paint Manufacturer Says Review Of Lead Paint Ruling Not Warranted

COLUMBUS, Ohio — An insured paint manufacturer says that an Ohio appellate court correctly found that the insured’s obligation to contribute to a lead paint abatement fund constitutes damages and says that the Ohio Supreme Court should deny review of the ruling because the insurers failed to present any constitutional question or show that the ruling raises a matter of public interest.
March 28, 2023
No Coverage For Contamination Based On Insured’s Misrepresentations, Judge Says

GREAT FALLS, Mont. — A Montana federal judge granted a pollution liability insurer’s motion for summary judgment after determining that coverage under one of the policies at issue in the environmental contamination coverage suit was void from the start based on misrepresentations made by the insured in the policy application.
March 27, 2023
Burger Chain Asks 9th Circuit To Rehear No Coverage Ruling For Coronavirus Losses

PASADENA, Calif. — In-N-Out Burgers filed a petition for panel rehearing and rehearing en banc challenging the Ninth Circuit U.S. Court of Appeals’ March 10 ruling that affirmed a lower court’s dismissal of its breach of contract lawsuit against its commercial property insurer, arguing that the Ninth Circuit should correct or withdraw its ruling and stay the appeal pending the California Supreme Court’s answer to the Ninth Circuit’s certified question in Another Planet Entertainment, LLC v. Vigilant Ins. Co. 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 22, 2023
Coal Producer Must Arbitrate $115M Fire Dispute With Foreign Insurers, Judge Says

ST. LOUIS — A Missouri federal judge on March 21 stayed a coal producer’s lawsuit against its international insurers for reducing the producer’s $115 million claim for mine fires by more than 90% and ordered the parties to arbitration after finding that a state law prohibiting mandatory arbitration clauses in insurance contracts does not reverse-preempt the New York Convention.
March 21, 2023
Stay Altered So Former Officers Of Debtor Nash Can Get Defense Costs Paid

BRIDGEPORT, Conn. — Three former officers and directors of debtor The Nash Engineering Co. were granted relief from the automatic stay by a Connecticut federal bankruptcy judge so one of the company’s insurers can pay their defense costs for claims leveled by the Chapter 7 trustee that they breached their fiduciary duties when negotiating settlements with asbestos insurers.
March 20, 2023
Pollution, Chemical Materials Exclusion Claims Should Proceed, Magistrate Judge Says

WEST PALM BEACH, Fla. — A Florida federal magistrate judge recommended denying a motion to dismiss pertaining to an insurer’s claims seeking declarations that its policy’s exclusions for pollution and nuclear, biological or chemical materials bar coverage for an underlying negligence suit arising out of a fentanyl overdose at an insured inn because the insurer alleges sufficient facts in support of those claims.
March 20, 2023
Insurers Owe Continued Coverage For Underlying Negligence Suit, Judge Says

SEATTLE — A Washington federal judge denied a motion for summary judgment filed by insurers in a suit seeking coverage for an underlying suit filed against the insured over the insured’s alleged negligent installation of a sewage pipeline because under Washington law, the insurers have a continued duty to defend the insured as the underlying allegations are potentially covered under the policies at issue.
March 20, 2023
No Coverage Due For Environmental Contamination Remediation Costs, Panel Says

JERSEY CITY, N.J. — No coverage is owed for environmental contamination remediation costs at a site where a dry-cleaning business was operated because the insureds failed to obtain the insurers’ consent prior to settling an underlying contribution suit arising out of the remediation costs, a panel of the New Jersey Superior Court Appellate Division said.
March 16, 2023
Insurer Properly Denied Coverage For Diesel Fuel Spill Based On Untimely Notice

NEW ORLEANS — An insured’s claims for breach of contract and bad faith in a dispute over coverage for a diesel fuel spill cannot proceed because the insurer did not breach its contract as the insured failed to provide notice of the spill with 21 days as required by the policy at issue, a Louisiana federal judge said in granting the insurer’s motion for summary judgment.
March 16, 2023
Texas Federal Judge Says Benzene Injury Coverage Suit Must Be Remanded

DALLAS — An insured’s suit seeking a declaration as to whether the insured was released by its insurer from paying a policy’s retention limit in connection with underlying benzene claims must be remanded to state court because complete diversity of citizenship does not exist between the insured and insurer, a Texas federal judge said in granting the insured’s motion to remand.
March 16, 2023
Mold Exclusion, Seepage Exclusion Bar Coverage For Water, Mold Damages

AUGUSTA, Ga. — No coverage is owed for mold damage because the water leak that caused the mold growth occurred over time and is barred by the policy’s seepage and leakage exclusion, a Georgia federal judge said in granting a homeowners insurer’s motion for summary judgment on a bad faith breach of contract claim.
March 13, 2023
Insurer Says Pollution Exclusion Bars Underlying Suit Arising Out Of Noxious Odors

ROME, Ga. — No coverage is owed for an underlying suit seeking damages as a result of noxious odors stemming from a poultry farm because the underlying suit does not allege an occurrence as required by the policy and because the policy’s pollution exclusion applies as a bar to coverage, an insurer maintains in a complaint filed in Georgia federal court.
March 13, 2023
Insurer’s Mold, Water Damage Coverage Suit Should Proceed, Magistrate Judge Says

HARRISBURG, Pa. — A Pennsylvania federal magistrate judge recommended denying a motion to dismiss a homeowners insurer’s suit seeking a coverage declaration for water and mold damages after determining that the insureds failed to show that the mortgage company for their home is an indispensable party that should have been joined as a defendant in the insurer’s suit.
March 13, 2023
No Coverage Owed For Underlying Environmental Contamination Suit, Panel Says

TRENTON, N.J. — A panel of the New Jersey Superior Court Appellate Division affirmed a trial court’s ruling that a prior or pending litigation exclusion bars coverage for an environmental contamination lawsuit filed against an insured by the New Jersey Department of Environmental Protection (NJDEP), agreeing with the court’s finding that an administrative consent order issued by the NJDEP more than 30 years ago constitutes a prior claim under the policy at issue.
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.