Mealey's Insurance Pleadings : Mealey's : Legal News & Analysis

Mealey's Insurance Pleadings

July 24, 2023
No Additional Abrupt Collapse Coverage Owed, Insurer Argues To 10th Circuit

DENVER — An insurer and its claims service manager argue to the 10th Circuit U.S. Court of Appeals that a building owner insured is owed no coverage under an insurance policy’s additional abrupt collapse coverage, contending that the insured’s building “did not collapse because its structural capacity was not ‘substantially’ or ‘significantly’ impaired.”
July 24, 2023
Insurer, Insured Stipulate To Dismissal In Classic Car Policy Coverage Dispute

DENVER — An insurer and its insured stipulated to dismissal of claims against each other in a Colorado federal court regarding alleged material misrepresentations the insured made in procuring a classic car insurance policy and the insurer’s denial of coverage for the insured’s allegedly stolen cars.
July 21, 2023
Insurers Urge Ohio High Court To Reverse Ruling In Lead Paint Coverage Suit

COLUMBUS, Ohio — The Ohio Supreme Court should reverse a state appellate court’s ruling that an insured’s obligation to contribute to a lead paint abatement fund constitutes damages under applicable insurance policies because the decision nullifies prior rulings made by the Ohio high court, the insurers maintain in a brief on the merits.
July 20, 2023
Insurer Says No Coverage Owed For Underlying Contamination Suit

SAN ANTONIO — No coverage is owed to an insured for an underlying suit alleging that discharges from the insured’s wastewater disposal well contaminated nearby land because the discharges were not sudden and accidental as required for the policy’s exception to a pollution exclusion to apply, an insurer contends in a complaint filed in Texas federal court.
July 18, 2023
Settlement Notice Issued In Water Damage Coverage Row Involving Insolvent Insurer

MIAMI — An insurer on July 17 provided a Florida court with notice that it served a homeowner with a proposed settlement in the homeowner’s breach of contract suit against the insurer and an insolvent insurer, alleging failure to cover all water-related damages.
July 17, 2023
Receiver Asks Delaware Court to Liquidate Life And Health Reinsurer

WILMINGTON, Del. — As previously signaled, the receiver for Scottish Re (U.S.) Inc. in Rehabilitation (SRUS) on July 14 moved in the Delaware Court of Chancery for entry of a liquidation and injunction order declaring, in part, that the life and health reinsurer “is impaired, insolvent, and in an unsound condition.”
July 17, 2023
Insurers Refute Argument That Wind-Driven Rain Must Be Treated As ‘Separate’ Peril

SEATTLE — Responding to a condominium owners association insured’s appeal in a water damage repairs coverage suit, insurers argued to the Ninth Circuit U.S. Court of Appeals that the Washington Supreme Court’s recent unanimous ruling Hill & Stout, PLLC v. Mut. of Enumclaw Ins. Co. precludes the insured’s argument that wind-driven rain must be treated as a “separate” peril under the policy.
July 17, 2023
Homeowners Association Appeals Ruling For Insurer In Suit Arising From Roof Damage

LOS ANGELES — A condominium homeowners association has appealed a California judge’s grant of summary judgment to its insurer in its breach of contract and bad faith lawsuit arising from storm damage to the roof of a Studio City building that housed 31 luxury condominiums.
July 12, 2023
Insured Appeals Denial Of Leave To Amend Coronavirus Complaint

BALTIMORE — An insured notified a Maryland federal court that it is appealing the court’s denial of its motion for leave to file a second amended complaint to address the standard for physical loss that was provided by the Maryland Supreme Court in answer to a certified question in a coronavirus coverage dispute.
July 11, 2023
Whistleblower Seeks To Vacate Dismissal In FCA Suit Alleging Medicare Fraud

NEW YORK — One day after a New York federal magistrate judge issued an order granting a whistleblower physician permission to do so, the whistleblower moved to reopen a case dismissed by stipulation, asserting that he discovered new evidence in his federal and state false claims act violations suit against his former employer, a New York state health system, for alleged fraudulent billing to Medicare and Medicaid.
July 10, 2023
Black Homeowners Say State Farm’s AI Discriminates Against Them

CHICAGO — State Farm Fire & Casualty Co. trained the artificial intelligence at the heart of its claims processing system with historically biased housing and claims data, making the program much more likely to flag claims by black homeowners and causing delays in repairs and other harms, plaintiffs tell a federal judge in Illinois in opposing dismissal of a class action.
July 05, 2023
Remand Motion In Lawsuit Over Purported Reinsurance Is Withdrawn

HONOLULU — The plaintiff in a dispute over a purported reinsurance policy has withdrawn its remand motion without prejudice, telling a Hawaii federal court that it made the call after “review of the current evidentiary record,” including the defendant’s opposition to remand and “recently filed exhibits” that “assert and contain facts that were uniquely in Defendant’s control.”
July 05, 2023
Judgment On Pleadings Disputed In Row Over Sexual Abuse Case Settlements

SEATTLE — Parties in a case over reimbursement for defense and settlement of suits alleging sexual abuse are disputing a motion for judgment on the pleadings, with an interlocal cooperative and a foreign reinsurer arguing issues including whether a pending bid to add allegations renders the motion moot.
July 03, 2023
Texas High Court Passes On Health Insurance Arbitration Dispute

FORT WORTH, Texas — The Texas Supreme Court declined to weigh in on a dispute over the proper process for evaluating arbitration claims involving health insurers and out-of-network providers.
June 30, 2023
Insurer Says 3rd Circuit Properly Found Faulty Workmanship Is Not Occurrence

PHILADELPHIA — Rehearing of the Third Circuit U.S. Court of Appeals’ ruling in favor of an insurer in a dispute over coverage for damages to natural gas wells caused by the insured’s fracking work is not warranted because the panel correctly found that neither faulty workmanship nor failure to perform a contract in a workmanlike manner can be construed as an occurrence under the policy at issue, an insurer says in response to the insured’s petition for panel rehearing and rehearing en banc.
June 30, 2023
District Court Decision In Mold Coverage Suit Must Be Reversed, Insureds Say

ATLANTA — A district court’s ruling that no coverage is owed for mold damage discovered in an insured hotel should be reversed because the policy at issue provides coverage for losses caused by a construction defect even if the cost to fix the defect is not covered, the insureds say in an appellant reply brief filed in the 11th Circuit U.S. Court of Appeals.
June 30, 2023
Insurer Says No Coverage Owed For Bodily Injury Suit Caused By Rodent Droppings

RALEIGH, N.C. — A commercial general liability insurer asserts in a complaint filed in North Carolina federal court that it has no duty to defend or indemnify its insured for an underlying suit claiming that the insured’s failure to inspect its storage pod for rodent droppings resulted in the underlying plaintiff becoming infected with bacterial meningitis because its policies’ exclusions for communicable disease, fungi and bacteria and mold apply as a bar to coverage.
June 27, 2023
Insurer Seeks Rehearing Of Dismissal Of Its Appeal In Hurricane Irma Dispute

ATLANTA — An insurer filed a petition for rehearing en banc challenging a majority of the 11th Circuit U.S. Court of Appeals’ dismissal of its appeal in a Hurricane Irma coverage dispute for lack of appellate jurisdiction, challenging the majority’s 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 28 U.S. Code Section 1292(a)(1), 28 U.S.C. § 1292(a)(1), or under the Federal Arbitration Act.
June 27, 2023
Insureds Appeal California Court’s Ruling In Insurer’s Favor In COVID-19 Dispute

LOS ANGELES — Insureds filed a notice appealing 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, challenging the jury’s finding that SARS-CoV-2 did not cause any direct physical loss or damage to the insureds’ hotel on or before June 1, 2020.
June 26, 2023
Contractor Challenges Ruling That Exclusion Bars Coverage For Faulty Installation

WEST PALM BEACH, Fla. — A contractor moved for a Florida federal court to reconsider its Feb. 27 ruling that a commercial general liability insurer is entitled to summary judgment on its declaratory judgment claims in a lawsuit stemming from a subcontractor’s alleged faulty installation of cladding and glazing systems in a construction project, challenging the court’s ruling that the policy’s “course-of-construction” exclusion bars coverage.
June 26, 2023
Freddie Mac Sues Insurers, Seeking D&O Coverage For Costs Incurred By SEC Subpoenas

WASHINGTON, D.C. — Federal Home Loan Mortgage Corp. (Freddie Mac), sued its primary and excess directors and officers liability insurers for breach of contract and bad faith in a District of Columbia federal court, seeking coverage for underlying expenses that it incurred on behalf of its directors, officers and employees who were subpoenaed by the Securities Exchange Commission during an investigation and subsequent lawsuit.
June 23, 2023
CGL Insurer Responds To Homeowners’ Petition Seeking Oregon High Court Review

SALEM, Ore. — A commercial general liability insurer responded to homeowners’ petition asking the Oregon Supreme Court to review an appeals court’s ruling that the insurer has no duty to indemnify either the homeowners or its contractor insured for a coverage dispute over faulty work performed in building a home, challenging the homeowners’ contention that the appeals court “erroneously read” Oak Crest Construction Co. v. Austin Mutual Insurance Co. “to require tort liability to find an ‘occurrence’ or ‘accident’” under the policy.
June 23, 2023
Insured Seeks Coverage For $14M In Losses Resulting From ‘COVID-19 Manifestations’

NEW YORK — The holding company for the U.S. interests of the Mandarin Oriental Hotel Group sued its “all risk” commercial insurers in a New York federal court, arguing that the “Special Perils Provision” in an endorsement of the policies provided coverage for its $14 million in business interruption/interference losses caused by infectious or contagious diseases that were “manifested by any person within a 5-mile radius of” its four hotels in Boston, New York, Miami and Washington, D.C.
June 23, 2023
Court Erred In Compelling Arbitration Of $7M Hurricane Ida Suit, 5th Circuit Told

NEW ORLEANS — An insured tells the Fifth Circuit U.S. Court of Appeals in its appellant brief that a Louisiana federal court erred by compelling arbitration of a dispute over its claims for $7 million in damages caused by Hurricane Ida and for bad faith against its foreign and domestic insurers, arguing that its domestic insurers cannot circumvent an anti-arbitration clause under Louisiana law.
June 22, 2023
Wisconsin Majority Affirms Coverage Ruling In Dispute Over Pool Construction

MADISON, Wis. —A majority of the Wisconsin Supreme Court affirmed an appellate panel’s reversal of a trial court’s ruling that there was no insurance coverage as a matter of law for a pool contractor or the company that supplied the shotcrete for a project that was allegedly riddled with leaks, finding that a trier of fact could determine that the water leakage and consequent cracks in the inground pool, as well as the damage to the surrounding soil, constituted property damage that was caused by an occurrence.