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

Mealey's Emerging Insurance Disputes

August 14, 2024
Insurer Argues Policy Exclusions Bar Coverage For Fraud Claims Against Insureds

CHICAGO — An insurer filed suit in an Illinois federal court, seeking a declaratory judgment that it has no duty to defend or indemnify its insureds against underlying fraud claims because various exclusions in the investment adviser, professional services and directors and officers liability insurance policy bar coverage.
August 14, 2024
Panel Vacates Ruling In Coverage Suit Over Claim Tinder Misappropriated Idea

NEW YORK — The Second Circuit U.S. Court of Appeals on Aug. 13 vacated a lower federal court’s summary judgment ruling in favor of an insured and remanded for the lower court to determine in the first instance whether a New York statute might affect the timeliness of the insured’s notice of an underlying claim alleging that Tinder Inc. misappropriated a product-development consultant’s idea for a “Super Like” feature on the Tinder dating app without giving him the “promised compensation.”
August 14, 2024
Insured: Insurer Acted In Bad Faith In Denying Claim For Damage Caused By Collapse

PHILADELPHIA — An insured sued its commercial property insurer for breach of contract and bad faith in a Pennsylvania federal court, seeking coverage for damage caused by the partial collapse of the façade of a seven-story residential rental building.
August 14, 2024
Insurers: Virginia’s Public Policy Prohibits Coverage For Sex Trafficking Suit

NORFOLK, Va. — Two insurers filed suit in a Virginia federal court, seeking a declaratory judgment that they have no duty to defend or indemnify their mutual insured for a Jane Doe’s claims that she was trafficked for sex at a hotel that was owned or operated by the insured.
August 13, 2024
Federal Judge Dismisses 1 CGL Insurer From Coverage Suit Over BIPA Violation Claim

CHICAGO — Per the parties’ stipulation, a federal judge in Illinois on Aug. 12 dismissed without prejudice the claims and counterclaims between an insured and one of its commercial general liability insurers in the insured’s lawsuit seeking a declaration as to coverage for an underlying putative class lawsuit alleging that it violated the Illinois Biometric Privacy Act (BIPA) by using biometric time clocks to track employee working hours.
August 12, 2024
Insureds Drop Appeal In Coronavirus Coverage Suit In California

LOS ANGELES — One day after the insureds filed a request to dismiss their appeal of a Los Angeles County Superior Court’s judgment on a jury’s special verdict in favor of a commercial property insurer in a breach of contract coverage lawsuit arising from the coronavirus pandemic, Presiding Justice Gonzalo C. Martinez on Aug. 9 signed the order dismissing the appeal.
August 12, 2024
Marine Insurer, Insured Toss Suit After Judge Says Insured Breached Express Warranty

PHILADELPHIA — A marine insurer and a yacht owner insured filed a joint stipulation asking a Pennsylvania federal court to dismiss with prejudice all claims in the insurer’s lawsuit seeking a declaratory judgment that the insured’s failure to recertify or inspect its fire-suppression equipment rendered its maritime insurance policy void from the beginning approximately one month after a judge granted the insurer’s motion for summary judgment and found that the insured breached the express warranty.
August 12, 2024
Panel: Knowing Violation Of Rights Exclusion Relieves Insurers Of Duty To Defend

BOSTON — A Massachusetts appeals court affirmed a lower court’s judgment in favor of insurers in a coverage dispute arising from underlying trademark infringement and other claims brought against insureds, finding that the policy’s knowing violation of the rights of another relieved the insurers of their duty to defend.
August 12, 2024
Maryland Panel: Contractual Liability Exclusion Bars Professional Liability Coverage

ANNAPOLIS, Md. — The Maryland Appellate Court affirmed a lower court’s summary judgment ruling in favor of a professional liability insurer in a breach of contract lawsuit, finding that the policy’s contractual liability exclusion relieves the insurer from its duty to defend or indemnify against an underlying lawsuit.
August 12, 2024
Judge Rules Against Insurers In Suit Over Aircraft Leased To Russia Airlines

SAN FRANCISCO — A California judge denied insurers’ motion for summary judgment in insureds’ lawsuit seeking coverage for its $127,810,258.48 in losses arising from aircraft that was leased to Russian airlines and not returned following Russia’s invasion of Ukraine, concluding that the insurers have failed to demonstrate that the insureds did not suffer a physical loss under the policy’s aircraft hull coverage.
August 09, 2024
California High Court Reverses Ruling In Insured’s Favor In COVID-19 Coverage Suit

SAN FRANCISCO — The California Supreme Court on Aug. 8 reversed an appeals court’s ruling in favor of a San Francisco restaurant owner insured in a coverage dispute arising from the COVID-19 pandemic, finding that the lower court erred by declining to enforce the specified cause of loss limitation under the policy’s “Limited Fungi, Bacteria or Virus Coverage” endorsement.
August 09, 2024
11th Circuit Affirms $557,500 Judgment In Favor Of Contractor’s Assignee

ATLANTA — The 11th Circuit U.S. Court of Appeals affirmed a lower federal court’s $557,500 summary judgment in favor of a contractor insured’s assignee in his lawsuit seeking coverage for damage that he incurred as a result of the insured’s misconduct.
August 08, 2024
7th Circuit Reverses Ruling In Broker’s Favor In Insurer’s Indemnification Suit

CHICAGO — The Seventh Circuit U.S. Court of Appeals reversed a lower federal court’s grant of summary judgment in favor of an insurance broker in an insurer’s lawsuit seeking indemnification for its settlement of an underlying personal injury lawsuit brought against the Tampa Bay Buccaneers by a former player, finding that the insurer was not required to provide the broker a tender of defense as a condition precedent to indemnification for settlements with potential liability.
August 07, 2024
Panel Affirms Ruling In Insurer’s Favor In Bad Faith Suit Prompted By Pandemic

NEW ORLEANS — Bound by its ruling in Baylor Scott & White Holdings v. Factory Mut. Ins. Co., the Fifth Circuit U.S. Court of Appeals on Aug. 6 affirmed a federal court’s summary judgment ruling in favor of an insured in its breach of contract and bad faith lawsuit arising from the COVID-19 pandemic.
August 07, 2024
Panel Affirms Denial Of Insurer’s Motion Seeking Arbitration In $1.6M Coverage Suit

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals affirmed a lower federal court’s denial of an insurer’s motion to compel arbitration in a coverage dispute over a $1.6 million settlement of an underlying personal injury lawsuit brought against a massage therapist.
August 07, 2024
Delaware Judge Dismisses 1 Excess Insurer From D&O Coverage Dispute

WILMINGTON, Del. — A Delaware judge dismissed an excess insurer from an insured’s breach of contract and bad faith lawsuit seeking directors and officers and entity securities liability insurance coverage for an underlying appraisal action.
August 07, 2024
Connecticut Judge: Board Exclusion Bars Coverage For Disability Discrimination Suit

HARTFORD, Conn. — A Connecticut judge granted summary judgment in favor of an insurer in a Connecticut town’s lawsuit seeking coverage for an underlying disability discrimination action brought by a former member of the town’s board of education, finding that the policy board exclusion bars Public Entity Management Liability and Public Entity Employment-Related Practices Liability coverage and the discrimination and employment-related practices exclusions bar the policy’s commercial general liability coverage.
August 06, 2024
No Coverage Owed For Defective Work Claims, Pennsylvania Panel Affirms

PHILADELPHIA — A Pennsylvania Superior Court panel on Aug. 5 found that faulty workmanship claims against an insured are not an occurrence to trigger coverage under its contractors general insurance policy, affirming a lower court’s grant of summary judgment in favor of the insurer on its counterclaim that it has no duty to defend or indemnify.
August 06, 2024
Parties Dispute ‘Insurrection,’ Other Issues In Post-Trial Appeal Of Oil Seizure Row

NEW YORK — A partial summary judgment ruling, judicial notice and a jury instruction on causation are all at issue in a Second Circuit U.S. Court of Appeals case filed by reinsurers who were ordered to pay CITGO Petroleum Corp. more than $72.5 million in a suit stemming from the February 2020 seizure of crude oil at a Venezuelan port and involving a marine cargo reinsurance policy.
August 05, 2024
No Automobile Coverage Owed For HPV Transmission, 8th Circuit Affirms

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on Aug. 2 affirmed a lower federal court’s summary judgment ruling in favor of an automobile insurer in its declaratory judgment lawsuit disputing coverage for an underlying claim that the insured transmitted anogenital human papillomavirus (HPV) through sexual activity in his automobile, concluding that the underlying injuries did not "arise out of the use” of the automobile.
August 05, 2024
Connecticut Judge: No Professional Liability Coverage Owed For Malpractice Suit

DANBURY, Conn. — A Connecticut judge granted a professional liability insurer’s motion for summary judgment in a law firm insured’s breach of contract lawsuit seeking coverage for an underlying legal malpractice action, finding that the insurer has established that there is no genuine issue of material fact regarding the basis of its coverage denial.
August 02, 2024
No E&O Coverage Exists For Trade Secret Judgment, 11th Circuit Affirms

ATLANTA — The 11th Circuit U.S. Court of Appeals on Aug. 1 held that no coverage exists under a “Sponsored Insurance Agents Errors and Omissions Liability” insurance policy for a $552,677.61 judgment for misappropriation of trade secrets, affirming a lower federal court summary judgment in favor of the insurer in a writ of garnishment action seeking to collecting the judgment.
August 01, 2024
Judge: Drug Distributor Failed To Establish Potential Coverage For Opioid Suits

SAN FRANCISCO — A federal judge in California held that a prescription drug distributor insured failed to establish that five insurance policies spanning 1999-2004 have any potential to cover underlying opioid lawsuits because the lawsuits fail to allege an accident that caused the purported bodily injury, denying the insured’s motion for partial summary judgment.
August 01, 2024
Magistrate Grants Continuance For Status Conference In D&O Insurers’ Coverage Row

INDIANAPOLIS — Finding “good cause,” an Indiana federal magistrate judge granted defendant insurers’ motion for a continuance of a status conference in a suit filed against them by an insurer now in rehabilitation, seeking a declaration that specified directors and officers (D&O) policies apply to cover claims in underlying litigation.
July 31, 2024
9th Circuit Reverses Judgment In Insurance Row Over Application Misrepresentation

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals reversed and remanded a district court’s grant of summary judgment to insurers in their insureds’ suit seeking coverage for expenses in defending another suit regarding fraud-based claims, finding that the district court erred in applying Nevada law, rather than Texas law, and that pursuant to Texas law, reversal is required because material facts remain in dispute regarding alleged material misrepresentations in the insureds’ application for policy renewal.