Mealey's Emerging Insurance Disputes : Mealey's : Legal News & Analysis

Mealey's Emerging Insurance Disputes

July 09, 2024
4th Circuit Review Sought In Suit Challenging Lender’s Charge Of Insurance Premiums

RICHMOND, Va. — A plaintiff in a putative class action challenging a mortgage lender’s charge and collection of the insurance premiums asked the Fourth Circuit U.S. Court of Appeals to review a Maryland federal court’s finding that the lender did not violate the Credit Grantor Closed End Credit Provisions (CLEC) by receiving a commission from a third-party insurer because the CLEC is inapplicable to the lender’s receipt of a commission.
July 08, 2024
Texas Panel Affirms No Coverage Ruling In Restaurants’ Suit Arising From Pandemic

DALLAS — A Texas appeals panel affirmed a lower court’s grant of a commercial property insurer’s motion for summary judgment in two restaurant group insureds’ lawsuit seeking coverage for their business interruption losses arising from the coronavirus pandemic, concluding that the insureds failed to present “more than a scintilla of evidence to create a genuine issue of material fact that COVID-19 caused ‘direct physical loss of or damage to’” to their restaurants.
June 26, 2024
COMMENTARY: Compliance With Ambiguous Notice Requirements: A Familiar Rule “Or” An Outlier?

By Syed S. Ahmad and Yosef Y. Itkin
July 02, 2024
Homeowners Insurer Disputes Coverage For Wire Fraud Suit Brought Against Insured

NEW HAVEN, Conn. — A homeowners insurer filed suit in a Connecticut federal court seeking a declaration that it has no duty to defend and indemnify its insured in an underlying lawsuit alleging that she and an associate provided fraudulent wire instructions and absconded with $1.4 million in closing funds with respect to the purchase of a Lavallette, N.J., property.
July 02, 2024
English Justice Rules For Reinsurers In $41M Row Over Taliban Seizure

LONDON — Agreeing with reinsurers on interpretation of a disputed exclusionary clause, an English justice granted them summary judgment in a dispute over liability for coverage of a warehouse the Taliban seized in Afghanistan in August 2021.
July 01, 2024
Texas High Court Refuses To Review No Coverage Ruling In $16M Fraudulent Invoice Suit

AUSTIN, Texas — The Texas Supreme Court denied an insured’s petition seeking review of a Texas appeals court’s opinion that affirmed a lower court’s summary judgment ruling in favor of primary and excess commercial crime insurers in a coverage dispute arising from $16,423,941.78 in fraudulent invoices, refusing to disturb the appeals court’s finding that coverage was not triggered because the insured’s underlying loss was the result of a dishonest act by the insured’s authorized representative.
June 28, 2024
Pennsylvania Panel Affirms Judgment In Coverage Dispute Arising From Slip And Fall

PHILADELPHIA — A Pennsylvania appellate panel on June 27 affirmed a lower court’s ruling that denied an insurance broker’s motion for judgment notwithstanding the verdict in a coverage dispute arising from an injury from a slip and fall, finding that the record supports a finding that the broker was negligent in its representation of the certificate of insurance.
June 28, 2024
Majority Affirms Dismissal Of Suit Seeking $192M In Losses Arising From Coronavirus

NEW ORLEANS — A majority of a Fifth Circuit U.S. Court of Appeals panel on June 27 affirmed a lower federal court’s ruling in favor of a commercial property insurer in Texas’ largest nonprofit health system’s lawsuit seeking coverage for its $192 million in business interruption losses arising from the coronavirus, but the dissenting judge found that the case is distinct because the insured pleaded tangible alterations to its property.
June 27, 2024
Panel: Personal Liability Excess Insurer Has No Duty To Defend Defamation Suit

CHICAGO — The Seventh Circuit U.S. Court of Appeals affirmed a lower court’s ruling that a personal liability umbrella insurer had no duty to provide defense costs for an underlying defamation lawsuit brought against board members of the College of DuPage, finding that an educator’s legal liability insurance policy covered the underlying loss.
June 26, 2024
CGL Insurer Disputes Coverage For Suit Against U.S. Paralympic Committee

DENVER — A commercial general liability insurer filed suit in a Colorado federal court seeking a declaratory judgment that it has no duty to defend or indemnify the U.S. Olympic and Paralympic Committee (USOPC) for a paralympic swimmer’s lawsuit alleging that a team member sexually assaulted and harassed him and that USOPC failed to warn his parents about the team member or supervise the accused.
June 25, 2024
CGL Coverage Excluded For Personal Injury Suit, 4th Circuit Affirms

RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals affirmed a lower federal court’s summary judgment ruling in favor of a commercial general liability insurer in its declaratory judgment lawsuit disputing coverage for an underlying personal injury lawsuit brought by a contractor hauler against a logging company owner insured, finding that a policy endorsement unambiguously bars coverage.
June 25, 2024
CGL Insurer, Insured Settle And Dismiss Coverage Dispute Over Trade Secret Lawsuit

BOSTON — A commercial general liability insurer and its insured filed stipulations of dismissal after advising a Massachusetts federal court that they have settled their dispute over defense costs for an underlying trade secret lawsuit brought against the insured by its competitor.
June 25, 2024
Nevada Judge Denies Insurers’ Summary Judgment Motion In Coronavirus Coverage Suit

LAS VEGAS — A Nevada judge denied insurers’ joint motion for partial summary judgment in a coronavirus coverage dispute, finding that the insurers have failed to satisfy their burden of showing that a recent Nevada Supreme Court ruling controls this lawsuit and that the policies at issue expressly extend the scope of coverage afforded for the “Infectious or Contagious Disease” peril.
June 25, 2024
Kentucky Panel: All Claims Arise Out Of Single Abuse Event, Subject To Sublimit

FRANKFORT, Ky. — A Kentucky appeals panel held that all underlying claims, including negligent training, against a child care insured arise out of a single event of abuse or molestation and are, therefore, subject to the $100,000 sublimit, partly reversing a lower court’s ruling.
June 25, 2024
Supermarket Sues Insurer For Bad Faith In Suit Arising From Parking Lot Shooting

ALLEGHENY, Pa. — Giant Eagle Inc. sued an insurer for bad faith, unjust enrichment and equitable contribution/indemnification seeking to recoup the more than $450,000 that it has incurred in defending against a lawsuit alleging that a police officer who was working as an off-duty security guard unlawfully shot a man in a Giant Eagle supermarket parking lot.
June 24, 2024
Panel: Professional Services Exclusion Bars D&O Coverage For Anti-Kickback Settlement

SAN FRANCISCO — A California appeals panel on June 21 held that an insured’s loss resulting from its settlement with the United States of claims that it violated the federal Anti-Kickback Statute is barred by its primary and excess directors and officers liability insurance policies’ professional services exclusion, affirming a lower court’s ruling in favor of the insurers in the insured’s breach of contract lawsuit.
June 24, 2024
Insurer’s Failure To Provide Timely Notice Renders Coverage Denial Ineffective

BROOKLYN, N.Y. — A New York appeals court held that a commercial general liability insurer’s failure to provide a timely notice of its disclaimer of coverage to an insured for an underlying slip-and-fall lawsuit rendered its denial on the basis of the policy’s habitability exclusion and the tenant special conditions endorsement ineffective, finding that the insurer has a duty to defend and indemnify.
June 20, 2024
2nd Circuit Lifts Stay Of Clothing Boutique’s Appeal In COVID-19 Coverage Suit

NEW YORK — The Second Circuit U.S. Court of Appeals lifted the stay of a clothing boutique owner insured’s appeal of a federal district court’s order that denied its motion to alter or amend a judgment dismissing its breach of contract and declaratory judgment lawsuit seeking business interruption and property damage coverage for its losses arising from the COVID-19 pandemic and subsequent shutdown orders.
June 20, 2024
Couple Appeals Tax Court Ruling On Purported Microcaptives To 5th Circuit

NEW ORLEANS — One of three recent U.S. Tax Court rulings for the commissioner of Internal Revenue regarding purported microcaptive arrangements is being appealed to the Fifth Circuit U.S. Court of Appeals.
June 19, 2024
Illinois Panel Says No Coverage Owed For Carbon Monoxide Suits Filed Against Insured

SPRINGFIELD, Ill. — No coverage is owed for underlying personal injury lawsuits stemming from a carbon monoxide leak because the underlying allegations involve the insured’s rendering of professional services, the Fourth District Illinois Appellate Court said June 18 in finding that the policies’ professional services exclusion bars coverage.
June 19, 2024
Federal Judge: Employee’s Suit Alleges ‘Securities Claim’ Under D&O Policy

LOS ANGELES — A federal judge in California partly granted a biopharmaceutical company insured’s motion for judgment on the pleadings in a directors and officers liability coverage dispute, finding that a lawsuit brought by the insured’s former employee asserts a “securities claim” based on the policy’s clear language.
June 19, 2024
Court Dismisses Coverage Suit Over Baltimore Sun Shooting Per Parties’ Stipulation

CHICAGO — One day after the parties filed a stipulation of dismissal, a federal Illinois court dismissed with prejudice a lawsuit brought by Tribune Publishing Co. LLC and The Baltimore Sun Co. LLC seeking coverage for underlying wrongful death and negligence lawsuits arising from a 2018 shooting in which five newspaper employees were killed.
June 18, 2024
Exclusion Bars D&O Coverage For Shareholder Dispute, 2nd Circuit Affirms

NEW YORK — The Second Circuit U.S. Cout of Appeals on June 17 affirmed a lower federal court’s dismissal of an insured’s breach of contract and declaratory judgment lawsuit seeking directors and officers and private company liability insurance for an underlying shareholder dispute, finding that a policy exclusion barred coverage because each claim in the underlying lawsuit arose from an “actual or alleged contractual liability or obligation of” the insured or its officers under shareholder agreements.
June 17, 2024
Settlement Reached In Suit Alleging Insurer Fraudulently Down-Coded Medical Devices

MINNEAPOLIS — The manufacturer and seller of an electrotherapy medical device and its insurer told a Minnesota federal court that they have reached a settlement in principal of the insured’s breach of contract and deceptive trade practices lawsuit alleging the insurer has a “blanket corporate policy” of fraudulently down-coding and short-paying for the insured’s H-Wave medical devices that has resulted $1.3 million in injuries to the insured.
June 17, 2024
Lakers, Insurer Dismiss Coronavirus Coverage Dispute In California Federal Court

LOS ANGELES —The Los Angeles Lakers and its commercial property insurer filed a stipulation asking a California federal court to dismiss with prejudice the insured’s lawsuit arising from its property damage and business interruption claims for losses related to the COVID-19 pandemic.