Mealey's California Insurance : Mealey's : Legal News & Analysis

Mealey's California Insurance

May 14, 2025
California Panel Reverses, Remands Ruling On Insurer’s Fraudulent Concealment Claim

LOS ANGELES — A California appeals court panel reversed a lower court’s ruling as to a plaintiff insurer’s fraudulent concealment claim against a defendant insurer in a coverage dispute over underlying claims that their mutual insured manufactured defective air respirators and masks that did not protect against inhaling silica, asbestos and mixed dust, remanding for a new trial on the fraudulent concealment claim.
May 14, 2025
Insurer Gets LTD Benefits Case Transferred To Different California Federal Court

SAN FRANCISCO — An Employee Retirement Income Security Act suit in which a claimant who says she has “disabling symptoms” of long COVID is challenging denial of her claim for long-term disability (LTD) and life insurance waiver of premium (LWOP) benefits will be transferred to a different federal court in California after a judge considered “deference owed to Plaintiff’s choice of forum, convenience, and the local interest in the case.”
May 13, 2025
Judge Denies Dismissal Of FCA Suit Alleging Upcoding In Emergency Department

SAN FRANCISCO — A California federal judge dismissed with prejudice only non-California state law claims against a California-based provider of emergency medical services but otherwise denied dismissal in a qui tam suit alleging that the provider and a national medical management company violated the federal False Claims Act (FCA) and similar state laws by fraudulent upcoding when submitting claims for payment to government insurers, finding that the “relator has plausibly alleged that the fraudulent scheme at issue” extends outside the hospital.
May 13, 2025
Deal Reported After Partial Summary Judgment Bids Fail In LTD Row

SANTA ANA, Calif. — Days after a California federal judge denied competing motions for partial summary judgment in a lawsuit asserting bad faith and breach of contract claims over calculation of long-term disability (LTD) benefits, the parties told the court they reached an unspecified settlement.
May 13, 2025
Bad Faith, Breach Of Contract Claims Permitted Against Excess Insurers, Judge Says

SAN FRANCISCO — An insured seeking coverage for the seizure of its crude oil tanker by Iranian military forces is permitted to amend and supplement a counterclaim against its excess insurers to assert claims for breach of contract and bad faith because good cause for the amendment exists based on the excess insurers’ belated production of discovery documents, a California federal judge said in granting the insured’s motion to amend and supplement its counterclaim.
May 13, 2025
After LTD Case Remand To Plan, Parties Dispute Attorney Fee Request

SAN FRANCISCO — Parties in a long-term disability (LTD) benefits case are disputing a $139,650 attorney fee request, with the claimant contending that “a remand for further administrative proceedings is not a trivial success where it is based on a court determination that ERISA rights were violated,” and the defendant arguing in part that no award is warranted under Hummel v. S.E. Rykoff & Co.
May 12, 2025
Judge Denies Motion To Amend Judgment In Suit Arising From Hard Rock Hotel Damages

SANTA ANA, Calif. — A California federal judge denied without prejudice a commercial general liability insurer’s motion to amend a $2,186,359.76 judgment in its favor to include $780,360.12 in prejudgment interest in its equitable contribution and equitable indemnification lawsuit arising from damages to a Hard Rock Hotel location, finding that the motion fails to comply with the meet-and-confer requirements under a civil standing order that was issued to the parties.
May 09, 2025
On De Novo Review, Judge Rules That LTD Claimant Is Physically Disabled

LOS ANGELES — Taking issue with numerous aspects of an insurer’s decision to terminate long-term disability (LTD) benefits, a California federal judge concluded that “[a] preponderance of the evidence shows [that the claimant’s] medical symptoms related to spondylolisthesis, lumbar region status post lumbar fusion, and chronic pain render him disabled under the terms of the Plan.”
May 06, 2025
9th Circuit Denies Insurer’s Petition For Rehearing In Contamination Coverage Suit

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on May 5 denied an insurer’s petition for panel rehearing in an environmental contamination coverage suit, refusing to reconsider its decision that a jury trial is necessary to determine the reasonableness of the defense costs incurred by the insured from the date of the insured’s tender of the underlying complaint through the date of the trial court’s order.
May 06, 2025
Judge Rules On Dismissal Motions In Coverage Suit Over Unlawful Recording Claims

SAN DIEGO — A federal judge in California granted in part and denied in part defendant insurers’ motions to dismiss a cyber liability insurer’s lawsuit seeking equitable contribution and indemnification for an underlying lawsuit alleging their mutual insured intentionally failed to disclose that hidden cameras were installed in operating rooms and recorded patient procedures in an effort to investigate drug theft.
May 05, 2025
Judge: Insurer’s Motion To Amend Judgment Can Be Resolved Without Hearing

SANTA ANA, Calif. — A California federal judge said that a commercial general liability insurer’s motion to amend a $2,186,359.76 judgment in its favor to include $780,360.12 in prejudgment interest is appropriate for resolution without a hearing, vacating a May 2 hearing in the insurer’s equitable contribution and equitable indemnification lawsuit arising from damages to a Hard Rock Hotel location.
May 02, 2025
Magistrate Judge Dismisses Couples’ Suit Over Sale Of Wrong Construction Policy

OAKLAND, Calif. — A California federal magistrate judge granted an insurance company’s motion to dismiss a lawsuit brought against it by a married couple who say the insurer “presented” a policy issued by another insurer that was advertised by a broker as covering their home renovation project, but in fact applied to only new construction and therefore left them uninsured for a $150,000 fire claim, finding that the plaintiffs did not plausibly allege deceptive misconduct by the moving defendant.
April 30, 2025
Residents Sue State-Mandated Insurer ‘Of Last Resort’ Over Los Angeles Wildfires

LOS ANGELES — California residents sued the California Fair Plan Association (CFPA) and its largest members in a state court seeking damages for the defendants’ alleged bad faith breach of their property insurance policies following the Los Angeles wildfires in January.
April 29, 2025
Water Damage Loss Dispute Dismissed After Insureds, Insurer Settle

LOS ANGELES — A federal judge in California on April 28 dismissed with prejudice an insured couple’s suit against their homeowners insurer related to their water damage loss in accordance with a stipulation of voluntary dismissal the parties filed after reaching a settlement.
April 29, 2025
Magistrate: Relator Must Provide All Alleged False Claims In FCA Kickback Suit

SAN DIEGO — A California federal magistrate judge granted Abbott Laboratories’ motion to compel discovery into all the alleged false claims it purportedly submitted to the government in a suit alleging Abbott violated the False Claims Act (FCA) and state false claim laws regarding Abbott’s purported kickback scheme to induce hospitals and physicians to use an Abbott cardiac medical device, finding that Abbott is “entitled to know the specific false claims” against it.
April 28, 2025
Panel Says No Additional Coverage Owed For Underlying Carbon Monoxide Suit

SAN FRANCISCO — An insured landlord is not entitled to additional coverage for the settlement of a tenant’s underlying bodily injury suit arising out of carbon monoxide poisoning because the apartment insurance policy’s liability limit applies only to the year in which the occurrence took place, the Ninth Circuit U.S. Court of Appeals said April 25 in affirming a district court’s finding that the stacking of annual policy limits is prohibited by the policy.
April 25, 2025
Oral Argument Set In Challenge To Rehab Plan For Workers’ Comp Insurer

SAN FRANCISCO — Oral argument is scheduled in the First District California Court of Appealin a workers’ compensation insurance carrier’s challenge to a nonconsensual rehabilitation plan that was approved as part of conservation proceedings brought by California’s insurance regulator and includes resolution of dozens of reinsurance participation agreement (RPA) lawsuits.
April 25, 2025
Watchdog Group Seeks To Invalidate Insurance Bulletins Allowing Policy Surcharges

LOS ANGELES — A consumer research and advocacy organization alleges in a California state court lawsuit that California Insurance Commissioner Ricardo Lara exceeded his statutory authority by issuing two unlawful insurance bulletins that authorize member insurers of the California FAIR Plan to recoup assessments from policyholders and seeks a writ of mandate and injunction commanding Lara not to enforce the bulletins.
April 23, 2025
Jury Trial Should Not Be Limited To Defense Costs, Insurer Tells 9th Circuit

SAN FRANCISCO — An insurer filed a petition for panel rehearing in the Ninth Circuit U.S. Court of Appeals, contending that the panel should modify its recent opinion and remand for a jury trial on all of the damages claimed by an insured in an environmental contamination coverage suit rather than remand only for a jury trial to determine the reasonableness of the defense costs incurred by the insured from the date of the insured’s tender of the underlying complaint through the date of the district court’s order.
April 22, 2025
Homeowners Accuse Insurers Of ‘Nefarious Conspiracy’ In Suit Arising From Wildfires

LOS ANGELES — California homeowners affected by the Los Angeles wildfires sued insurers in a California court for violations of the state’s Cartwright Act and unfair competition law (UCL), alleging that the insurers participated in a “nefarious conspiracy to eliminate competition between them, and to intentionally and systematically force Plaintiffs to obtain fire insurance from the state’s insurer of last resort.”
April 21, 2025
Insureds, Insurer File Joint Notice Of Settlement In Water Damage Dispute

LOS ANGELES — Insureds and their insurer notified a California federal court that they have reached a settlement in principle of their dispute over the insureds’ water damage loss.
April 17, 2025
9th Circuit Denies Petition For Panel Rehearing In FCA Medicare Fraud Row

SAN JOSE, Calif. — In a one-page order without providing explanation, the Ninth Circuit U.S. Court of Appeals denied a petition for panel rehearing of its ruling affirming a lower court’s dismissal of a qui tam relator’s suit accusing pharmaceutical companies of violating the False Claims Act (FCA) by overcharging the federal government and states under Medicare and Medicaid.
April 17, 2025
$195,000 Class Deal Gets Final OK In Suit Over Allegedly Fraudulent Policies

SANTA ANA, Calif. — Noting the absence of objections and that “the average class member payment will be $467.77, and the highest payment will be $5,204.40,” a California federal judge granted final approval to a $195,000 class settlement that resolves a suit over allegedly counterfeited insurance policies sold through a captive reinsurance arrangement.
April 16, 2025
Insurers Have No Duty To Defend Based On Silica Exclusions, Judge Says

LOS ANGELES — Insurers of an importer and distributor of quartz stone products have no duty to defend their insured in underlying bodily injury suits stemming from exposure to silica dust from the insured’s quartz products because the policies’ silica exclusion clearly bars coverage for the underlying suits.
April 15, 2025
Bad Faith Suit: CFPA Systematically Failed To Investigate, Pay Wildfire Claims

LOS ANGELES — Plaintiffs sued California Fair Plan Association (CFPA) and its “largest” members for breach of contract and bad faith in a California court, seeking compensation for their losses incurred by the January Los Angeles wildfires and to hold CFPA “accountable for its decade-long, systematic failure to properly investigate and pay wildfire claims.”