Mealey's California Insurance

  • December 08, 2023

    Judge Dismisses Suit After Flight Attendant, Disability Insurer Settle LTD Claim

    SAN FRANCISCO — A California federal judge dismissed a disability benefits suit after the parties settled the dispute over a flight attendant’s entitlement to long-term disability (LTD) benefits.

  • December 07, 2023

    Majority:  Insurance Code Does Not Bar Indemnification For Retaliation Settlement

    LOS ANGELES — Addressing an “important” question of first impression “whose answer will influence enforcement of our employment laws,” a majority of a California appeals court held Dec. 6 that not all California Labor Code Section 1102.5 claims involve necessarily willful conduct and, therefore, a lower court erred in finding that California Insurance Code Section 533 barred indemnification for a $3 million underlying settlement of police officers’ retaliation lawsuit against a California city.

  • December 07, 2023

    Judgment Entered For Disability Claimant; Own-Occupation Benefits Owed

    SANTA ANA, Calif. — A California federal judge issued a judgment in favor of a disability claimant after determining that the claimant is owed long-term disability (LTD) benefits because the claimant met his burden that he remains disabled from performing the duties of his own occupation.

  • December 07, 2023

    Texas Physicians, Hospital CFO Settle FCA Suit Over Illegal Kickbacks For $880,000

    SHERMAN, Texas — The U.S. Department of Justice (DOJ) announced that a hospital’s former chief financial officer (CFO) and several physicians agreed to pay the U.S. government a total of $880,199 to settle a qui tam federal False Claims Act (FCA) suit alleging violations of the Anti-Kickback Statute (AKS) through payment of illegal kickbacks to doctors and medical practices and fraud against government insurers by billing them for medically unnecessary tests.

  • December 04, 2023

    Insured Failed To Timely Report Employee’s Claims, California Panel Affirms

    RIVERSIDE, Calif. — A California appeals panel concluded that a lower court properly sustained an insurer’s demurrer in an insured’s breach of contract and bad faith lawsuit seeking coverage for underlying claims brought by a former employee, determining that the insured failed to timely report any of the employee’s claims to trigger coverage.

  • December 04, 2023

    Questions Of Fact Regarding Cause Of Water Damage Exist, Calif. Federal Judge Says

    LOS ANGELES — An insured’s claims for breach of contract and bad faith can proceed against a homeowners insurer because questions of fact exist as to whether water damage in the insured’s home was caused by wear and tear, an excluded cause of loss, and whether the insurer’s investigation of the claim was reasonable, a California federal judge said in denying the insurer’s motion for summary judgment.

  • November 30, 2023

    Gym Fee Dispute Stemming From COVID-19 Lockdowns Dismissed Without Prejudice

    SAN DIEGO — A California federal judge on Nov. 29 granted the motions of a fitness and health company and its wholly owned subsidiary gym network and a health insurer to dismiss a putative class complaint brought by a gym member alleging breach of the implied duty of good faith and fair dealing, negligent representation and violations of California law in continuing to charge fees for gym memberships during COVID-19 lockdowns when the gyms could not be accessed.

  • November 30, 2023

    Judge Refuses To Reconsider Ruling Allowing Law Firm To Intervene In D&O Dispute

    SAN JOSE, Calif. — A federal judge in California refused to reconsider its Nov. 3 ruling that granted a law firm’s motion to intervene in an insurer’s lawsuit seeking a declaration that a directors and officers employment practices liability and fiduciary liability policy is rescinded because of the insureds’ material misrepresentations, standing by its decision to permit the firm to enforce a charging lien against the proceeds of the policy.

  • November 30, 2023

    Panel Says Request For Examination Under Oath Was Not Made In Bad Faith

    SAN FRANCISCO — The First District California Court of Appeal affirmed a trial court’s ruling in favor of an insurer on an insured’s breach of contract and bad faith claims in a water damage coverage suit after determining that the insurer’s request for an examination under oath (EUO) from the insured is not evidence of bad faith conduct.

  • November 29, 2023

    On Remand, Parties Dispute Expert Exclusion Bids In RESPA Class Lawsuit

    FRESNO, Calif. — Parties in a long-running Real Estate Settlement Procedures Act (RESPA) class action involving captive reinsurance agreements are sparring in California federal court over expert testimony regarding whether the plaintiffs have standing under an economic harm theory.

  • November 27, 2023

    Lloyd’s And U.S. Subsidiary File Trademark Infringement, Defamation Lawsuit

    HOUSTON — Two entities connected with “an insurance and reinsurance market that is the most famous brand in the insurance underwriting field” have filed a suit in Texas federal court asserting claims including defamation and trademark infringement against an individual and a corporation and LLC they say he registered in Texas and California.

  • November 21, 2023

    Suit Claiming Skilled Nursing Facilities Violated FCA Tossed After Parties Settle

    LOS ANGELES — A California federal judge dismissed the government’s claims against six skilled nursing facilities (SNFs), their owner and their management company two days after the U.S. Department of Justice announced that it entered into a $45.6 million consent judgment with the SNFs and related parties in a suit alleging that they violated the federal False Claims Act (FCA) and California False Claims Act in submitting false claims to Medicare by paying kickbacks to physicians in exchange for the physicians referring patients to the SNFs.

  • November 20, 2023

    9th Circuit Finds No Error In Judgment Entered In Favor Of Disability Insurer

    SAN JOSE, Calif. — The Ninth Circuit U.S. Court of Appeals affirmed a district court’s judgment in favor of a disability insurer, rejecting the disability claimant’s argument that the lower court adopted new rationales that were not included in the administrative record in finding that the insurer’s termination of benefits was reasonable based on the evidence.

  • November 20, 2023

    Insurer’s Environmental Coverage Suit Stayed Until Underlying Suit Is Resolved

    SANTA ANA, Calif. — A California state judge denied a demurrer to an insurer’s complaint but granted a motion to stay the insurer’s declaratory judgment suit until after an underlying environmental contamination suit against the successor company to an insured is resolved because resolution of the underlying suit will aid the court in determining whether the insurer’s pollution exclusion applies as a bar to coverage for the underlying suit.

  • November 17, 2023

    No Coverage Owed For Foundation Damage; Bad Faith, Breach Of Contract Claims Fail

    LOS ANGELES — An insured’s claims for breach of contract, bad faith and unfair business practices alleged in a complaint seeking coverage for foundation damage arising out of a burst water pipe cannot proceed because the insurer properly denied coverage under the policy’s foundation damage exclusion, the Second District California Court of Appeal said in affirming a trial court’s decision.

  • November 16, 2023

    DOJ Announces $45.6M Judgment In FCA Suit Against Skilled Nursing Facilities

    WASHINGTON, D.C.  — The U.S. Department of Justice (DOJ) on Nov. 15 announced that six skilled nursing facilities (SNFs), their owner and their management company have entered into a $45.6 million consent judgment to resolve allegations that they violated the federal False Claims Act (FCA) and California False Claims Act in submitting false claims to Medicare by paying kickbacks to physicians in exchange for the physicians referring patients to the SNFs.

  • November 16, 2023

    Policy’s Virus Exclusion Bars Coverage For Coronavirus Losses, 9th Circuit Affirms

    PHOENIX — The Ninth Circuit U.S. Court of Appeals on Nov. 15 held that an insured failed to plausibly allege that anything other than the COVID-19 pandemic is the efficient proximate cause of its losses, affirming a federal court’s dismissal of the insured’s commercial insurance coverage lawsuit.

  • November 16, 2023

    Suit Against Homeowners Insurer Dismissed Following Parties’ Agreement

    SAN FRANCISCO — A California federal judge dismissed a fire damage coverage suit filed by insureds against their homeowners insurer after the parties filed a joint stipulation to dismiss the claim for breach of contract without prejudice and the claims for bad faith and unfair insurance practices with prejudice.

  • November 15, 2023

    Insured’s Breach Of Contract, Bad Faith Suit Dismissed For Failure To Prosecute

    SAN FRANCISCO — A California federal magistrate judge on Nov. 14 dismissed an insured’s breach of contract and bad faith suit against his homeowners insurer based on the insured’s failure to respond to the insurer’s motion for judgment on the pleadings and the insured’s failure to respond to the court’s order to show cause as to why the suit should not be dismissed for failure to prosecute.

  • November 15, 2023

    Amber Heard Asks 9th Circuit To Review Dismissal Of Counterclaims In Coverage Suit

    LOS ANGELES — Amber Heard notified a California federal court that she is asking the Ninth Circuit U.S. Court of Appeals to review the court’s dismissal of her breach of contract and bad faith counterclaims in the insurer’s declaratory judgment lawsuit alleging that it has no duty to defend or indemnify her for a defamation judgment awarded to Johnny Depp.

  • November 14, 2023

    Panel Partly Vacates Ruling In Coverage Suit Arising From Slander Of Title Claims

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Nov. 13 ruled that a lower federal court erred in finding that a claim for slander of title against an insured was not covered under the insurance policy, partly vacating and remanding the lower court’s ruling in a coverage dispute over an underling lawsuit alleging cancellation of deed and quiet title, slander of title and conversion against the insured.

  • November 14, 2023

    New Trial Date Set In Groundwater Contamination Coverage Suit

    RIVERSIDE, Calif. — A California federal judge set an April 2024 trial date in a groundwater contamination coverage suit following the parties’ request to move the trial date, originally scheduled to begin this month.

  • November 13, 2023

    Insured Files Supplemental Authority On Applicability Of Pollution Exclusion

    SAN FRANCISCO — A few days before oral arguments were held in the Ninth Circuit U.S. Court of Appeals in a dispute over the applicability of the pollution exclusion, the insured, seeking coverage for an underlying toxic exposure suit stemming from the cleanup of wildfire debris, filed a notice of supplemental authority, urging the Ninth Circuit to consider a ruling by the Second District California Court of Appeal in support of its argument that the pollution exclusion does not bar coverage for the underlying suit.

  • November 13, 2023

    Reserve Information In COVID-19 Coverage Suit Not Relevant To Bad Faith Claim

    SANTA ANA, Calif. — A California federal magistrate judge denied an insured’s motion to compel documents related to the reserve set by an insurer in response to the insured’s claim for business losses sustained in the wake of the COVID-19 pandemic after determining that the reserve information is not relevant to the insured’s bad faith claim because only a nominal reserve was set by the insurer and no changes were made to the reserve since the coverage claim was filed.

  • November 09, 2023

    Bad Faith Claim In Disability Suit Cannot Proceed, Judge Says

    SAN DIEGO — A bad faith claim alleged against a disability insurer cannot proceed because the insured failed to show that the insurer acted unreasonably and because the insurer showed that a genuine issue of fact existed on the cause of the insured’s disability, a California federal judge said in partly granting the disability insurer’s motion for summary judgment.

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