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

Mealey's Emerging Insurance Disputes

July 03, 2025
Delaware Judge: SEC’s Tolling Request Not Securities Claim Under D&O Policy

WILMINGTON, Del. — A Delaware judge denied an insured’s motion for partial summary judgment in its breach of contract lawsuit seeking directors and officers liability coverage for the more than $26 million in costs that it incurred in connection with an underling settlement with the U.S. Securities and Exchange Commission, finding that a tolling request by the SEC is not a securities claim under the policy and, even if it was, the tolling request does not seek redress in response to any corporate act to trigger coverage.
July 02, 2025
Alaska High Court Partly Reverses Ruling In Suit Arising From Lapsed Policy

ANCHORAGE, Alaska — The Alaska Supreme Court affirmed a lower court’s holding that an insurer failed to send a general contractor insured notice of the nonrenewal of its workers’ compensation and employers liability insurance policy pursuant to a statute and, therefore, breached its contract with the insured, but reversed the lower court’s determination of when prejudgment interest began to accrue and remanded for recalculation of the interest.
July 02, 2025
Judge: Potential For Umbrella Coverage For Negligence Suit Over Electrocution

BALTIMORE — A federal judge in Maryland granted a motion by the operator of a commercial grain and farm supply business to dismiss an insurer’s counterclaim seeking reimbursement of underlying defense costs for a negligence lawsuit arising from the electrocution death of one of the insured’s employees, finding that there is a potential for umbrella coverage under a comprehensive agribusiness policy.
July 01, 2025
Judgment Entered For Insurer In Driving Record ‘Misrepresentation’ Dispute

RALEIGH, N.C. — A North Carolina federal judge on June 30 granted a boat insurer’s motion for judgment on the pleadings, construing it as a summary judgment motion in a coverage dispute, finding that the insurer is entitled to summary judgment due to a policy exclusion and is not bound by the terms of the policy due to the insured’s “material misrepresentation” regarding his driving record.
July 01, 2025
CGL Insurer Disputes Coverage For Suits Arising From Music Festival Shooting

SEATTLE — A commercial general liability insurer filed suit in a Washington federal court seeking a declaration that it has no duty to defend or indemnify its insureds against underlying lawsuits alleging that the insureds’ negligence and failure to exercise due care proximately caused the deaths and injuries from a shooting at a music festival.
June 27, 2025
Judge Refuses To Toss Bad Faith Claim In Coverage Suit Over Antitrust Conspiracy MDL

DENVER — A federal judge in Colorado denied a data liability protection insurer’s motion to dismiss a common-law bad faith claim brought by a multifamily housing lessor insured in its lawsuit seeking coverage for an underlying multidistrict litigation alleging that it was involved in an antitrust conspiracy when it used revenue management software to artificially inflate multifamily housing rents above market across the country.
June 27, 2025
Parties Dismiss 1 Insurer In N.C. Coverage Suit Arising From Opioid Epidemic

WINSTON-SALEM, N.C. — Insureds and one insurer filed a joint stipulation asking a North Carolina court to dismiss the claims and counterclaims between them in a coverage dispute arising from the opioid epidemic.
June 27, 2025
California Judge Denies Insured’s Motion For Summary Adjudication As To UCL Claim

LOS ANGELES — A California judge granted an insured’s motion for summary adjudication as to his declaratory relief claim in a lawsuit alleging that the California Fair Plan Association (CFP) issued property insurance policies with fire coverage that is unlawfully restrictive as to smoke damage claims but denied the insured’s motion as to his unfair competition law (UCL) claim, finding that he failed to satisfy his burden to establish standing to bring the UCL claim.
June 27, 2025
Judge Partly Denies Insurer’s Summary Judgment Motion In Trade Secret Dispute

LAS VEGAS — A federal judge in Nevada granted in part and denied in part an insurer’s motion for summary judgment in a software provider’s lawsuit alleging that the insurer and another software provider misappropriated its trade secrets to develop a clone of its flood claims services system application.
June 27, 2025
Professional Liability Policy Exclusion Applies, Louisiana Majority Rules, Reverses

LAKE CHARLES, La. — A Louisiana appeals panel majority held that a professional liability insurance policy’s bodily injury exclusion unambiguously bars coverage for claims brought against a real estate company insured, reversing a lower court’s summary judgment rulings and remanding.
June 26, 2025
Sub-Broker Wins Dismissal From Insureds’ Negligence Suit Over Warehouse Losses

NEW YORK — In a one-paragraph June 25 order stating that the reasons were “set forth on the record today,” a New York federal judge dismissed a defendant said it “acted as a sub-broker” from a suit seeking $41 million in a dispute involving reinsurance and a warehouse in Afghanistan.
June 26, 2025
Missouri Judge Enters $43.8M Judgment Against Law Enforcement Liability Insurers

JEFFERSON CITY, Mo. — A Missouri judge entered a $43.8 million final judgment against law enforcement liability insurers after a jury determined that the insurers acted in bad faith and vexatiously refused/delayed a claim for coverage of a lawsuit brought against the city of Columbia, Mo., by a man who was convicted and incarcerated for robbery and homicide and later discharged from custody.
June 26, 2025
U.S. High Court Denies Cert In Pennsylvania Underwriting Association Dispute

WASHINGTON, D.C. — The U.S. Supreme Court denied a petition for a writ of certiorari filed by the state-created Pennsylvania Professional Liability Joint Underwriting Association (JUA), which provides insurance to health care providers, including those previously insured by insurers in liquidation, seeking review of a Third Circuit U.S. Court of Appeals holding that the JUA does not have constitutional rights to challenge the constitutionality of Pennsylvania laws due to JUA’s nature as a public entity instead of a private one.
June 24, 2025
Judge: D&O Coverage Restored By Dilution Claims Exception To Policy Exclusion

SAN DIEGO — A federal judge in California on June 23 held that a business and management indemnity insurer has a duty to defend and indemnify its insured against an underlying unfair dilution lawsuit because the “dilution claims exception” to the “insured vs. insured” exclusion restores directors and officers liability coverage, granting the insured’s motion for summary judgment and denying the insurer’s motion for judgment on the pleadings.
June 23, 2025
Judge Denies D&O, Cyber Liability Insurer’s Motion To Dismiss $2.8M Coverage Suit

OMAHA, Neb. — A federal judge in Nebraska on June 20 denied a directors and officers and cyber liability insurer’s motion to dismiss two private equity firms’ amended complaint seeking coverage for the $2.83 million they lost when an imposter investor hacked a reserve account, finding that the policy’s definition of “loss” is ambiguous.
June 23, 2025
Judge Denies Insured’s Motion For Relief From Judgment In COVID-19 Coverage Suit

ELIZABETH CITY, N.C. —A federal judge in North Carolina denied a hotel and restaurant owner insured’s motion for relief from a March 4, 2021, judgment dismissing its breach of contract and bad faith lawsuit arising from the coronavirus pandemic, rejecting the insured’s argument that the North Carolina Supreme Court’s ruling in N. State Deli, LLC v. Cincinnati Ins. Co. constitutes extraordinary circumstances that warrant relief.
June 20, 2025
Florida Majority: No Coverage Owed For Negligence Suit Arising From Shooting Death

MIAMI — A Florida appellate panel majority affirmed a lower court’s grant of summary judgment in favor of a businessowners insurer in its lawsuit seeking a declaratory judgment that it has no duty to defend or indemnify its homeowners association insured against an underlying negligent maintenance and security lawsuit, agreeing with the lower court that the plain and unambiguous policy terms do not provide coverage for the underlying claims arising from a shooting death in the insured’s development.
June 19, 2025
Colorado Panel Partly Reverses Ruling In Insurer’s Favor In COVID-19 Coverage Suit

DENVER — Noting two matters of first impression, a Colorado appellate court on June 18 reversed in part a lower court’s ruling in favor of an insurer in a retirement communities owner’s lawsuit seeking coverage for its losses arising from the coronavirus pandemic after finding that the insured stated a viable claim to recover some of its alleged losses pursuant to the policy’s health care endorsement.
June 18, 2025
N.M. Panel: Policy Term ‘For A Security Breach’ Is Ambiguous; Coverage Triggered

ALBUQUERQUE, N.M. — A New Mexico appeals court affirmed a lower court’s summary judgment ruling that a cyber insurance policy covered an underlying third-party claim seeking payment for invoices that a now insolvent health insurer mistakenly wired to a fraudulent bank account, finding that the policy term “for a security breach” is ambiguous and must be construed in favor of the insured and the “loss of money” policy exclusions do not apply.
June 18, 2025
English Justice Rules That Aircraft Losses Fall Under War Risk Coverage

LONDON — In a 230-page ruling pertaining to six cases filed over aircraft and engine leases affected by the legal and economic fallout of Russia’s February 2022 invasion of Ukraine, an English justice concluded in part that there were losses worth billions of dollars and that war risk (WR) rather than hull all risks (AR) coverage should apply.
June 18, 2025
Insurer Says No Defense Owed To Company For Underlying Hair Relaxer Lawsuits

ATLANTA — A company that purchased certain assets and liabilities of an insured is not entitled to coverage for underlying lawsuits alleging that hair relaxer products manufactured by the insured and others caused cancer diagnoses in individuals because the insurer did not consent to the transfer of any rights under its policies, the insurer says in a complaint filed in Georgia federal court.
June 17, 2025
Illinois Panel Affirms Ruling In Favor Of Professional Liability Insurer

CHICAGO — An Illinois appeals panel on June 16 affirmed a lower court’s summary judgment ruling in favor of a professional liability insurer in its declaratory judgment lawsuit disputing coverage for an underlying negligence action brought against its doctor insured, finding that the insurer owed no indemnity obligation for the underlying settlement because the doctor insured was not “legally obligated to pay” anything under the settlement terms.
June 17, 2025
3rd Circuit Refuses To Reconsider Refusal To Throw Out BSA Reorganization Plan

PHILADELPHIA — The Third Circuit U.S. Court of Appeals denied two sets of abuse claimants’ petitions to rehear the majority’s dismissal of their appeals seeking to reverse a lower federal court’s confirmation order that affirmed the Boy Scouts of America’s third modified fifth amended Chapter 11 reorganization plan, which contemplates the creation of a settlement trust to “assume liability for all Abuse Claims.”
June 17, 2025
CGL Insurer Removes City’s Coverage Suit Over $9.3M Wrongful Conviction Settlement

DURHAM, N.C. — A commercial general liability insurer filed a notice in a North Carolina federal court seeking removal of the city of Concord’s breach of contract and declaratory judgment lawsuit alleging that the insurer has duty to defend, indemnify and contribute to a $9.3 million settlement of an underlying wrongful conviction lawsuit.
June 16, 2025
Auto Insurer Dismissed From Class Action Complaint Alleging Barratry, Conspiracy

HOUSTON — Two days after insureds filed a notice to voluntary dismiss an automobile insurer from their second amended class action complaint alleging claims for barratry and conspiracy by illegally sharing the personal information of car accident victims for solicitation, a federal judge in Texas dismissed the insurer with prejudice.