Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

November 02, 2023
Louisiana Majority Refuses To Disturb Reversal Of Default Judgment In Ida Dispute

NEW ORLEANS — A majority of the Louisiana Supreme Court denied insureds’ petition for a writ of certiorari in a Hurricane Ida coverage dispute, standing by its reversal and remand of a default judgment awarding the insureds $694,072.63 in outstanding sums purportedly due under a homeowners insurance policy, penalties, attorney fees and general damages.
October 30, 2023
Force Majeure Provision Does Not Excuse Rent Payment, Panel Says In Coronavirus Suit

SANTA ANA, Calif. — A California appeals panel affirmed a lower court’s ruling that an appellant cannot recoup rent payments for periods during which it was prevented from operating its indoor health and fitness facility due to the government orders in response to the coronavirus pandemic, rejecting the appellant’s argument that the commercial lease's force majeure provision excused it from paying rent.
October 26, 2023
Policy’s Business Income Coverage Language Is Ambiguous, Federal Judge Rules

LOS ANGELES — A California federal judge partly denied a commercial property insurer’s motion for summary judgment in a breach of contract lawsuit arising from a now defunct restaurant’s suspension of operations, finding that the policy’s business income coverage language is ambiguous.
October 25, 2023
8th Circuit Refuses To Reconsider Remand Of Coronavirus Coverage Suit

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on Oct. 24 denied an insurer’s petition seeking rehearing or rehearing en banc of its Sept. 11 ruling that reversed and remanded a coronavirus coverage ruling for an Iowa federal court to determine whether federal diversity jurisdiction exists.
October 25, 2023
Panel Remands For Entry Of Take-Nothing Judgment In Hurricane Harvey Coverage Suit

BEAUMONT, Texas — A Texas appeals panel reversed a lower court’s summary judgment ruling in favor of insureds in a coverage lawsuit arising from Hurricane Harvey damage and remanded for the lower court to enter a take-nothing judgment in favor of the insurer.
October 23, 2023
Majority Substitutes Opinion, Denies Panel Rehearing As Moot In Irma Coverage Suit

ATLANTA — A majority of the 11th Circuit U.S. Court of Appeals on its own motion on Oct. 20 vacated a May 31 opinion, substituted a new opinion and denied as moot an insurer’s motion for panel rehearing en banc, standing by its finding that a lower federal court’s order compelling appraisal and staying a Hurricane Irma coverage dispute pending the appraisal is an interlocutory order that is not immediately appealable under Title 28 U.S. Code Section 1292(a)(1), 28 U.S.C. § 1292(a)(1), or under the Federal Arbitration Act.
October 23, 2023
Insureds Seek Dismissal In Hurricane Coverage Row Involving Liquidated Insurer

ST. CROIX, Virgin Islands — Homeowners notified a federal court in the Virgin Islands that because one of the insurer defendants was never served, the case against it should be dismissed in the insureds’ Hurricane Maria coverage suit involving an insurer in liquidation.
October 23, 2023
5th Circuit Affirms Refusal To Remand And Dismissal Of Coronavirus Coverage Suit

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals affirmed a lower federal court’s denial of insureds’ motion to remand a coronavirus coverage dispute and its grant of the commercial property insurer’s motion to dismiss a breach of contract lawsuit seeking coverage for losses arising from the coronavirus pandemic, finding that the insureds failed to plausibly plead that the coronavirus caused direct physical damage to their insured property.
October 23, 2023
Louisiana Panel Affirms Rulings For Insureds In Hurricanes Laura, Delta Dispute

LAKE CHARLES, La. — A Louisiana appeals panel affirmed a lower court’s rulings following a jury verdict in favor of insureds in a coverage dispute arising from Hurricanes Laura and Delta damage, rejecting the insurer’s argument on appeal that the jury's finding that its payments were untimely is not supported by the evidence or testimony.
October 18, 2023
5th Circuit Affirms Court’s Decision To Vacate ‘Void’ Judgment In Coverage Dispute

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on Oct. 17 affirmed a lower federal court’s ruling vacating a prior order dismissing a commercial shopping center owner insured’s breach of contract and bad faith lawsuit arising from Hurricane Ida damage, finding that the federal court lacked diversity jurisdiction.
October 18, 2023
New York Justice Dismisses Counterclaims Against Insurers In COVID-19 Coverage Suit

NEW YORK — A New York justice granted insurers’ motion to dismiss their insurers’ counterclaims in a coronavirus coverage dispute, finding that the case is “factually indistinguishable” from Consolidated Rest. Operations, Inc. v. Westport Ins. Corp. as to “policyholder COVID-19 claims based on a policy covering ‘direct physical loss, damage or destruction to property.’”
October 16, 2023
Maryland Panel: Insurer’s Negligence Claims Against Subcontractors Are Not Barred

ANNAPOLIS, Md. — Reversing a lower court in part, a Maryland appeals panel held Oct. 13 that contractual waivers of subrogation do not bar an all-risk insurer’s claims alleging that tornado damage to an Amazon warehouse was caused by subcontractors’ negligence in designing and building the warehouse because the subcontractors were not intended third-party beneficiaries of the subrogation waiver.
October 13, 2023
Policy’s 2-Year Prescriptive Period Provision Not Applicable To Bad Faith Claim

LAKE CHARLES, La. — A bad faith claim alleged by insureds against their homeowners insurer can proceed because the policy’s two-year prescriptive period applies only to the insureds’ breach of contract claim, a Louisiana federal judge said after determining that the bad faith claim is subject to a 10-year prescriptive period based on precedent set forth by the Louisiana Supreme Court.
October 13, 2023
Reconsideration Denied In Bid To Substitute Guaranty Association For Insurer

NEW ORLEANS — A Louisiana federal judge denied a request to reconsider an order denying substituting a now-insolvent insurer with the Louisiana Insurance Guaranty Association (LIGA) in a suit seeking coverage for purported damage to a home caused by Hurricane Ida, finding that there are no obligations transferred from an insolvent insurer to LIGA permitting it to “step into the shoes of the insolvent insurer.”
October 10, 2023
California Federal Judge Finds Contractor Cannot Bring Bad Faith Claim

LOS ANGELES — Because there has been no excess judgment in underlying arbitration proceedings stemming from a general contractor’s alleged failure to properly secure a building under construction in advance of a hurricane, the contractor cannot state a claim against a commercial general liability insurer for bad faith, a federal judge in California ruled in granting the insurer’s motion for partial summary judgment on the claim.
October 10, 2023
Citing Mudpie, 9th Circuit Affirms Virus Exclusion Bars Coverage For COVID-19 Losses

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals affirmed a lower federal court’s dismissal of insureds’ lawsuit seeking coverage for their losses arising from the coronavirus pandemic and subsequent governmental orders, finding that, as in Mudpie, Inc. v. Travelers Cas. Ins. Co. of Am., the insureds failed to plausibly assert that “the efficient cause” of their losses was anything other than the spread of the COVID-19 virus throughout California.
October 06, 2023
Panel Affirms Dismissal Of Coverage Suit For Insureds’ Failure To Comply With Rule

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on Oct. 5 affirmed a lower federal court’s dismissal without prejudice of a coverage dispute over the insureds’ claims for tornado and wind and hailstorm damage, finding that the lower court did not abuse its discretion in finding that the insureds failed to comply with a local rule that required the retention of local counsel.
October 06, 2023
Hurricane Coverage Suit Remanded After Guaranty Association Added As Defendant

NEW ORLEANS — A Louisiana federal judge remanded to state court a homeowner’s hurricane coverage suit against his now-insolvent insurer, finding that remand is appropriate because adding the Louisiana Insurance Guaranty Association (LIGA) as a defendant in the amended complaint defeats subject matter jurisdiction.
October 06, 2023
5th Circuit Remands Coverage Suit Over $1M Settlement Of Canceled Music Festival

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on Oct. 5 remanded an insured’s lawsuit seeking coverage for an underlying $1 million class action settlement arising from its refusal to refund ticket sales for the South by Southwest festival that was canceled due to the coronavirus pandemic, finding that it cannot reach the merits of the appeal because the parties have not established diversity of citizenship.
October 05, 2023
Waiver Provision Bars Insurer’s Equitable Subrogation Claim, California Panel Says

LOS ANGELES — A California appeals panel affirmed a lower court’s summary judgment ruling in favor of Southern California Edison Co. (SCE) in an insurer’s equitable subrogation lawsuit alleging that a wildfire that resulted in $25 million in paid claims was the sole result of SCE’s negligence, finding that the subcontract’s waiver provision barred the insurer’s claims.
October 04, 2023
Insurer Asks 8th Circuit To Reconsider Remand Of Coronavirus Coverage Suit

ST. LOUIS — An insurer seeks rehearing or rehearing en banc of the Eighth Circuit U.S. Court of Appeals ruling that reversed and remanded a coronavirus coverage lawsuit for an Iowa federal court to determine whether federal diversity jurisdiction exists, arguing that the panel “expressly rejected the principle of federal law that parties are bound by their concessions of jurisdictional facts.”
October 03, 2023
California Panel Reverses Ruling In Insurers’ Favor In Coronavirus Coverage Suit

LOS ANGELES — A California appeals panel on Oct. 2 reversed and remanded a lower court’s order granting a group of insurers’ motion for judgment on the pleadings in a real estate investment firm’s coronavirus coverage dispute, rejecting the insurers’ argument that the pollution exclusion barred coverage.
October 02, 2023
Federal Judge Rules For Insurer In Landlord’s Coronavirus Coverage Suit

NEW YORK — A federal judge in New York on Sept. 29 granted a commercial property insurer’s motion for summary judgment in a coronavirus coverage suit, noting that the Second Circuit U.S. Court of Appeals has held in 11012 Holdings, Inc. v. Sentinel Ins. Co. that, pursuant to New York law, the unambiguous words “physical loss or damage” “require actual physical loss of or damage to the insured's property.”
September 29, 2023
Federal Judge Remands Hurricane Ida Coverage Dispute For Lack Of Jurisdiction

NEW ORLEANS — A Louisiana federal judge remanded to state court homeowners’ bad faith and breach of contract suit against their now-insolvent insurer, which they allege failed to pay for damages resulting from Hurricane Ida, finding that the court lacks jurisdiction because the homeowners added the Louisiana Insurance Guaranty Association (LIGA) as a defendant in their amended complaint.
September 29, 2023
Negligence, Bad Faith Claims Cannot Proceed Against Homeowners Insurer, Judge Says

DENVER — Negligence and bad faith claims against a homeowners insurer cannot proceed because the insureds failed to show that they specifically requested that a homeowners policy, rather than a dwelling policy, be issued for their primary home in Colorado that was destroyed in a wildfire, a Colorado federal judge said in granting the insurer’s motion to dismiss.