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

Mealey's Emerging Insurance Disputes

April 24, 2025
N.Y. Justice Denies Summary Judgment Motions By NFL, Insurers In Concussion Suit

NEW YORK — A New York justice denied motions for summary judgment filed by the National Football League and insurers in a coverage dispute over underlying lawsuits alleging that the NFL negligently failed to protect former players from brain injuries purportedly caused by concussive head impact, saying that the court cannot determine that coverage has been established as a matter of law.
April 23, 2025
On Remand, Judge Rules For Professional Liability Insurer On Bad Faith Claim

SALT LAKE CITY — On remand from the 10th Circuit U.S. Court of Appeals, a federal judge in Utah granted a professional liability insurer’s motion for summary judgment on the remaining bad faith claim in a coverage dispute arising from a medical malpractice lawsuit.
April 23, 2025
Class Action Alleges Toyota, Progressive Violated Federal Wiretap Act

SHERMAN, Texas — A class action was filed in a Texas federal court alleging Toyota Motor North America Inc., Progressive Casualty Insurance Co. and a provider of data analytics services in the automotive industry violated the Federal Wiretap Act and seeking to hold the defendants responsible for the injuries they inflicted on tens of thousands of class members because of their unauthorized collection and dissemination of private information from Toyota vehicles.
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
Majority Reverses Ruling In Insurer’s Favor In Bad Faith Suit Over Fatal Shooting

ATLANTA — A majority of the 11th Circuit U.S. Court of Appeals on April 18 reversed a lower federal court’s grant of summary judgment in favor of an insurer in a lawsuit alleging that the insurer acted in bad faith when it failed to make a settlement offer in an estate’s lawsuit alleging negligent security against the insured, finding that a jury could reasonably find that the insurer knew or should have known that the insured’s liability was clear.
April 21, 2025
Iowa High Court Reverses, Remands Ruling In Consumer Fraud Coverage Dispute

DES MOINES, Iowa — The Iowa Supreme Court on April 18 held that the record provides the facts needed to demonstrate that consumer fraud alleged against a contractor in an underlying action is not a covered “occurrence” under the contractor’s commercial general liability insurance policy and the purported harm does not include covered “property damage” pursuant to the policy, vacating an appeals court’s ruling, reversing a trial court’s order and remanding for the trial court to enter summary judgment in favor of the insurer.
April 18, 2025
Suquamish Tribe Opposes Insurers’ High Court Petition In Tribal Jurisdiction Dispute

WASHINGTON, D.C. — The Suquamish Tribe in Washington filed an opposition to insurers’ petition for writ of certiorari asking the U.S. Supreme Court to determine “whether a tribal court can exercise jurisdiction over nonmembers of the tribe based on off-reservation conduct,” asking the high court to not disturb the Ninth Circuit U.S. Court of Appeals’ opinion that affirmed a federal court’s finding that a tribal court has subject matter jurisdiction over a COVID-19 coverage suit involving tribal properties on tribal land.
April 17, 2025
9th Circuit Dismisses Claims Against Insurer In Mold Damage Coverage Dispute

SAN FRANCISCO — A panel of the Ninth Circuit U.S. Court of Appeals on April 16 affirmed a lower court’s ruling in a mold and moisture damage coverage dispute finding that a contractor violated the terms of an insurance policy by incurring more than $1 million in repair costs without first seeking consent from an insurer.
April 16, 2025
Denial Of Arbitration In D&O Coverage Dispute Affirmed By 2nd Circuit

NEW YORK — A Second Circuit U.S. Court of Appeals panel on April 15 affirmed the denial of an insurer’s motion to compel a dispute over coverage owed to directors and officers of a bankrupt health care corporation be arbitrated before the London Court of International Arbitration (LCIA), opining that the bankruptcy trustee is not acting as policyholder in the dispute.
April 16, 2025
No E&O Coverage Owed For $262,500 Insured Paid To Hospital, 5th Circuit Affirms

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on April 15 affirmed summary judgment in favor of a managed care organization’s errors and omissions insurer in the insured’s bad faith lawsuit seeking coverage for the $262,500 it paid to a hospital to settle an underlying claim, finding that no coverage exists because the insured paid the underlying claim without the insurer’s prior consent.
April 16, 2025
6th Circuit: No Coverage Owed For Trademark Infringement Suit Against Pharmacy

CINCINNATI — The Sixth Circuit U.S. Court of Appeals affirmed a lower federal court’s summary judgment ruling in favor of insurers in a pharmacist insured’s breach of contract lawsuit seeking coverage for underlying trademark infringement and false advertising claims brought by a subsidiary of Johnson & Johnson, finding that one policy’s professional services exclusion barred coverage and the other policy was not triggered because the underlying lawsuit was not brought by “natural persons.”
April 16, 2025
Georgia Federal Court Dismisses Coverage Dispute Over Wrongful Death Claim

ATLANTA — One day after a commercial general liability insurer filed a notice asking a Georgia federal court to dismiss its lawsuit seeking a declaration that it has no duty to defend or indemnify its tavern operator insured for an underlying wrongful death lawsuit, the court clerk approved the dismissal.
April 16, 2025
Insureds Seek Coverage For 11 Suits Alleging Human Trafficking At Red Roof Hotels

COLUMBUS, Ohio — Insured hotel companies sued their general liability insurer in an Ohio federal court for breach of contract and bad faith, alleging that the insurer arbitrarily and capriciously denied coverage for 11 underlying lawsuits alleging that human trafficking occurred at various Red Roof hotels.
April 15, 2025
Stipulation Filed In Fraudulent Transfer Case After Insurer Liquidation Settlement

TOPEKA, Kan. — After being advised that settlement agreements were approved by a Kansas state court, parties in a fraudulent transfer case in Kansas federal court involving the insolvent insurer filed a stipulation of dismissal.
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.”
April 15, 2025
Skechers Seeks Coverage For Injury Claims Caused By Shoes’ Lack Of Slip-Resistance

LOS ANGELES — Skechers USA Inc. sued its commercial liability insurer in a California court for breach of contract, breach of the implied covenant of good faith and fair dealing and unfair competition, alleging that the insurer has a duty to defend it against an underlying action contending that class members were harmed by actual physical accidents caused by the insured’s shoes’ lack of slip-resistance or by the fact that the shoes were unusable.
April 14, 2025
Insured Dismisses 1 Insurer In Coverage Dispute Over Earplug Product Liability Claims

WILMINGTON, Del. — Plaintiffs and one of their liability insurers filed in a Delaware court a stipulation and proposed order of voluntary dismissal with prejudice of all claims between them in a coverage lawsuit arising from an underlying earplug product liability multidistrict litigation that resulted in a $6 billion settlement and millions of dollars in defense costs.
April 14, 2025
Insured Appeals No Coverage Ruling In Dispute Arising From Opioid Epidemic

TAMPA, Fla. — An insured told Florida federal court that it is asking the 11th Circuit U.S. Court of Appeals to review the court’s judgment in favor of insurers in its lawsuit seeking coverage for underlying actions arising from the opioid epidemic, challenging the court’s finding that the insurers have no duty to defend or indemnify because the opioid lawsuits fail to allege damages “for bodily injury” or “because of bodily injury.”
April 14, 2025
Potbelly Sandwich Shop Owner Sues Employment Practices Liability Insurer

SEATTLE — The owner and operator of several Potbelly Sandwich Shops in Washington state sued its employment practices liability insurer in a Washington court, alleging breach of contract and seeking a declaratory judgment that the insurer has a duty to defend and indemnify it against an underlying putative class alleging that it violated the Washington Equal Pay and Opportunities Act by not providing wage and salary information to job applicants in Washington.
April 09, 2025
COMMENTARY: The Ultimate Social Inflation Survival Guide: Containing Rising Claims Costs In A World Rife With Economic Inflation, Litigation Funding, Nuclear Verdicts, And Anti-Corporate Sentiment

By Scott M. Seaman
April 11, 2025
Panel: No E&O Coverage Owed For $13.3M Insurer Paid To Settle Wrongful Death Action

CINCINNATI — The Sixth Circuit U.S. Court of Appeals on April 10 affirmed a lower federal court’s grant of summary judgment in favor of errors and omissions insurers, concluding that the E&O insurers have no duty to provide coverage for the loss a general liability insurer incurred when it paid a $13.3 million judgment in a wrongful death action brought against its motel owner insured.
April 11, 2025
Illinois Genetic Privacy Act Does Not Apply To Life Insurance, Judge Rules

EAST ST. LOUIS, Ill. — The Illinois Genetic Privacy Act (GIPA) “does not apply to the underwriting practices concerning life insurance policies,” an Illinois federal judge found, granting an insurer’s motion to dismiss a putative class claim under GIPA brought against it by a woman who claimed that she was denied a life insurance policy based on information she provided about her family’s medical history.
April 10, 2025
4th Circuit: Insurer Does Not Have To Contribute To $9M Wrongful Death Settlement

RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals reversed a lower federal court’s ruling that a defendant insurer has to contribute $1 million in primary coverage to an underlying $9 million wrongful death settlement and affirmed the lower court’s finding that the defendant insurer’s excess coverage was not triggered, concluding that both coverages were limited to employees of Surry County, N.C., Emergency Services and did not extend to employees of Surry County's 911 call center.
April 10, 2025
Delaware Judge Dismisses 1 Insurer In Coverage Dispute Over Medicaid Fraud Claims

WILMINGTON, Del. — Three days after an insured and one of its insurers filed a stipulation asking a Delaware court to dismiss with prejudice all claims against the insurer in a professional liability coverage dispute arising from a Medicaid fraud investigation, the judge ordered the case against the insurer dismissed.
April 09, 2025
Federal Judge Dismisses CGL Coverage Dispute Arising From Fatal Shooting

NEWNAN, Ga. — Three days after parties filed a stipulation of dismissal, a federal judge in Georgia dismissed a commercial general liability insurer’s declaratory judgment lawsuit challenging coverage for a wrongful death/premises liability lawsuit brought against a Quality Inn & Suites.