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

Mealey's Emerging Insurance Disputes

March 12, 2024
Insurers Tell N.C. High Court To Apply 27-Year-Old Precedent To Coronavirus Dispute

RALEIGH, N.C. — Insurers argued to the North Carolina Supreme Court that it should affirm an appeals court’s reversal of a lower court’s grant of partial summary judgment in favor of restaurant insureds in a COVID-19 coverage dispute, responding to the insured’s appellant argument that the phrase “physical loss or physical damage” includes loss of the physical use of property under the state’s “long-standing principles of insurance contract interpretation.”
March 12, 2024
Judge Administratively Closes Suit Against Insurance Agent After Settlement Announced

HARTFORD, Conn. — The same day parties announced that they reached a settlement “subject to the parties’ negotiation and execution of a mutually acceptable settlement agreement,” a federal judge in Connecticut administratively closed the insurer’s lawsuit alleging that an insurance agent’s failure to include exclusions in an insurance policy resulted in it paying more than $1 million in legal fees and expenses to settle an underlying worker injury lawsuit.
March 11, 2024
English Justice Addresses Broker Disclosure In Light Of Sanctions On Russia

LONDON — A reinsurance placing broker would not contravene a set of United Kingdom sanctions against Russia by providing certain documents requested under an application for third-party disclosure in a case involving insurance and reinsurance for aircraft and engines leased to Russian entities, an English justice concluded.
March 11, 2024
Majority: Court Erred In Denying Insurer’s Motion To Dismiss COVID-19 Coverage Suit

RICHMOND, Va. — A majority of the Fourth Circuit U.S. Court of Appeals on March 8 held that a lower federal court erred when it denied an insurer’s motion to dismiss an insured’s coverage lawsuit arising from the coronavirus pandemic, reversing both the lower court’s order denying the insurer’s motion to dismiss and its class certification order and remanding with instructions to dismiss the lawsuit.
March 08, 2024
Judge Rules For CGL Insurer In Coverage Dispute With Medical Product Manufacturer

CONCORD, N.H. — A federal judge in New Hampshire granted a commercial general liability insurer’s motion for summary judgment in its declaratory judgment lawsuit pertaining to 10 underlying class actions alleging that its insured manufactured and marketed medical devices used to clean positive airway pressure (CPAP) and bi-level positive airway pressure (biPAP) devices that were not safe or effective, finding that the damages alleged in the class actions fail to constitute “damages because of ‘bodily injury’ or ‘property damage’” to trigger coverage.
March 08, 2024
Bump-Up Exclusion Bars D&O Coverage For $90M Settlement, Judge Rules On Remand

ALEXANDRIA, Va. — On remand from the Fourth Circuit U.S. Court of Appeals, a federal judge in Virginia held that a “bump-up” exclusion unambiguously precludes directors and officers liability insurance coverage for the $90 million settlement of two underlying lawsuits arising from a 2015 merger.
March 08, 2024
Missouri Panel: Forum Selection Clause Binds Parties To Litigate Claims Abroad

ST. LOUIS — A Missouri appeals panel held that a trust that was created in a bankruptcy proceeding for the benefit of individuals harmed by major producers of opioid pharmaceutical products failed to satisfy its “heavy burden” of demonstrating that the forum selection clause in the debtors’ insurance policies was unfair or unreasonable, affirming a lower court’s grant of the insurers’ motion to dismiss the trust’s coverage lawsuit because the parties are bound to litigate any disputes arising from the contracts in England or Wales.
March 08, 2024
6th Circuit Vacates, Remands CGL Insurer’s Suit Seeking Equitable Contribution

CINCINNATI — The Sixth Circuit U.S. Court of Appeals vacated a lower federal court’s summary judgment ruling in favor of defendant insurers in a commercial general liability insurer’s lawsuit seeking equitable contribution for the nearly $5 million in costs it paid in defending their mutual insured against an underlying false advertising lawsuit, remanding for further proceedings.
March 08, 2024
2nd Circuit Dismisses Coronavirus Coverage Suit After Appeal Withdrawn

NEW YORK — Four days after a commercial property insurer and a commercial landlord insured stipulated that the insured’s appeal in a coronavirus coverage suit was withdrawn with prejudice, the Second Circuit U.S. Court of Appeal dismissed the appeal.
March 06, 2024
Washington Judge Partly Grants Insurer’s Motion For Clarification In COVID-19 Suit

SEATTLE —Partly granting an insurer’s motion for partial clarification or reconsideration of a Jan. 4 order denying the insurer’s motion to dismiss the University of Washington’s lawsuit seeking coverage for losses allegedly incurred by its medical and athletic properties in the wake of the coronavirus pandemic, a Washington judge held that the university has pleaded facts to trigger its medical centers’ policies’ communicable disease decontamination cost endorsements; its coverage claims under the athletic properties’ policies are not dismissed and its claims for coverage are not limited to the medical center policies’ time element losses due to contamination by communicable disease endorsements.
March 06, 2024
English Justice Denies Summary Judgment As To Coverage Issue In COVID-19 Suit

LONDON — A justice of the High Court of England and Wales denied summary judgment to two restaurant chains on the issue of coverage for their business interruption losses arising from the coronavirus pandemic but granted summary judgment and permission to appeal the policy construction issue.
March 06, 2024
Amicus Curiae Argues In Support Of Drug Distributor In Opioid Coverage Dispute

SAN FRANCISCO — United Policyholders (UP) filed an amicus curiae brief in support of a prescription drug distributor insured asking the Ninth Circuit U.S. Court of Appeals to reconsider its ruling that there is no coverage owed for lawsuits prompted by the opioid epidemic because the underlying claims “describe exclusively deliberate conduct,” arguing that the ruling “deviates from every other court in the United States that has considered whether the allegations against opioid distributors constitute an ‘occurrence’ or ‘accident’ under the terms of insurance policies like those at issue here.”
March 05, 2024
Illinois Panel: No Coverage Owed For Suit Alleging Willful Acts Against Professor

MOUNT VERNON, Ill. — An Illinois appeals court on March 4 held that an underlying lawsuit alleging that a university professor insured’s conduct was “willful, intentional, and retaliatory” does not trigger coverage under a personal umbrella liability insurance policy, affirming a lower court’s summary judgment ruling in favor of the insurer in its declaratory judgment lawsuit.
March 05, 2024
Panel: No Coverage Owed For Claims Arising From Warehouse Collapse Caused By Tornado

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on March 4 affirmed a lower federal court’s summary judgment ruling in favor of an insurer in its lawsuit seeking a declaratory judgment that it had no duty to defend or indemnify its insured against underlying wrongful death and personal injury claims arising from a warehouse collapse that was caused by a tornado, finding that there is no coverage because the insured did not own, rent or occupy the warehouse when it collapsed.
March 05, 2024
Liability Insurer Says 10th Circuit Should Affirm Order Barring Coverage In MDL

DENVER — A liability insurer argued in its answer brief in the 10th Circuit U.S. Court of Appeals that the appellate court should affirm a district court’s ruling that it does not owe a duty to indemnify the appellant health insurer in an underlying multidistrict litigation (MDL) antitrust dispute involving an excess errors and omissions (E&O) policy issued by a now-insolvent insurer.
March 04, 2024
Panel Affirms, Remands To Establish Whether Policy Exclusion Applies Case By Case

FRANKFORT, Ky. — On remand from the Kentucky Supreme Court, a Kentucky appeals panel on March 1 affirmed a lower court’s finding as to an insurer’s duty to defend against underlying lawsuits alleging that the insured violated federal health care laws, remanding for the lower court to conduct an evidentiary hearing to establish on a case-by-case basis whether an exclusion precludes directors and officers and professional liability insurance coverage.
March 04, 2024
Parties Ordered To Refile Stipulation Of Dismissal In Worker Injury Coverage Suit

NEW YORK — A federal judge in New York ordered a subcontractor, a property owner and a construction manager to refile under the correct Federal Rules of Civil Procedure their stipulation of dismissal of the claims between them in the subcontractor’s lawsuit arising from personal injury actions brought by two of its workers.
March 01, 2024
Tribal Court Has Jurisdiction Over Tribe’s Coronavirus Coverage Suit, 9th Circuit Affirms

SEATTLE — The Ninth Circuit U.S. Court of Appeals on Feb. 29 affirmed a lower federal court’s finding that a tribal court has subject matter jurisdiction over a coronavirus coverage suit involving tribal properties on tribal land that the Suquamish Tribe brought against “nonmember, off-reservation” insurers that participate in a program that is tailored to and offered exclusively to tribes.
March 01, 2024
Insurer Owes Defense For Defamation Suit Against Employer, Indiana Panel Affirms

INDIANAPOLIS — The Indiana Court of Appeals held that an insurer has a duty to defend its insured against an underlying defamation, abuse of process, malicious prosecution and intentional infliction of emotional distress lawsuit brought by the insured’s former employee, rejecting the insurer’s contention that the policy’s “knowing violation of rights of another,” “material published with knowledge of falsity” and “criminal acts” exclusions bar coverage.
March 01, 2024
City Seeks Rehearing In Coverage Suit Over Tax Revenue Losses Arising From Pandemic

ST. LOUIS — A Missouri city asked the Eighth Circuit U.S. Court of Appeals to reconsider its ruling that a commercial property insurer owes no coverage for the city’s tax revenue losses due to governmental closure orders in response to the coronavirus pandemic, arguing that the “inartful” policy is not clear and unambiguous.
February 29, 2024
3rd Circuit Denies Drug Manufacturer’s Petition To Rehear D&O Coverage Dispute

PHILADELPHIA — The Third Circuit U.S. Court of Appeals on Feb. 28 denied a pharmaceutical drug manufacturer insured’s petition for panel rehearing and rehearing en banc, refusing to disturb its finding that an excess directors and officers liability insurer has no duty to pay the insured’s settlement and defense costs arising from an underlying shareholder class action alleging that it artificially inflated its stock when it misrepresented the results of a clinical drug study.
February 29, 2024
Indiana Panel Affirms No Coverage Ruling In Purdue’s Suit Arising From Coronavirus

INDIANAPOLIS — An Indiana appeals court on Feb. 28 affirmed a lower court’s ruling in favor of an all-risks commercial insurer in the Trustees of Purdue University’s declaratory judgment lawsuit seeking coverage for its business interruption losses arising from the coronavirus pandemic, finding that Purdue’s claim does not fall under the unambiguous policy coverage for physical property loss or damage.
February 28, 2024
Montana High Court Affirms Ruling In Contractor’s Favor In Its Suit Against Agent

HELENA, Mont. — The Montana Supreme Court on Feb. 27 determined that a lower court did not err in granting summary judgment as to liability in favor of a general contractor in its lawsuit alleging that its insurance agent failed to procure the coverage it requested, affirming a $1,205,518.63 final judgment in favor of the contractor in a coverage dispute arising from underlying negligence, professional negligence and breach of contract claims brought by the developer of a condominium building.
February 28, 2024
Panel Refuses To Rehear Whether CGL Insurer Has Duty To Indemnify Deli Owner

PHILADELPHIA — The Third Circuit U.S. Court of Appeals refused to reconsider its holding that an appellant is precluded from relitigating whether a commercial general liability insurer must indemnify its deli owner insured for liability arising from the appellant’s underlying state court injury lawsuit over a stabbing at the deli, standing by its ruling that affirmed a lower federal court’s grant of the insurer’s motion to dismiss.
February 28, 2024
Texas High Court Partly Vacates Ruling In $220M SEC Fraud Coverage Suit

AUSTIN, Texas — The Texas Supreme Court conditionally granted in part insurers’ request for mandamus relief in an insured’s lawsuit seeking directors and officers liability insurance coverage for an underlying $220 million securities class action settlement, finding that the lower court abused its discretion in concluding that the settlement is binding or admissible in the coverage lawsuit.