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Mealey's Insurance

November 01, 2023
Reinsurer Makes Disputed Intervention Bid In Row Between Insurer And Agent

NEW ORLEANS — A captive cell reinsurer seeking to intervene in a dispute between an insurer and a managing general agent (MGA) in Louisiana federal court argues in an Oct. 31 reply brief that it “has satisfied the Fifth Circuit’s four-part test for intervention as a matter of right.”
October 30, 2023
California Appeals Panel Affirms Ruling For Insurer In Water Damage Suit

LOS ANGELES — The Second District California Court of Appeal affirmed a trial court’s summary judgment ruling in favor of an insurer in a bad faith coverage dispute over water damage caused by a sewer line backup after determining that the insured forfeited its argument that coverage is provided for the water damage by not raising the issue in the trial court.
October 30, 2023
Asbestos Exclusion Cannot Be Construed As Bar To Coverage, Judge Says

ROME, Ga. — A Georgia federal judge denied an insurer’s motion to dismiss its insured’s suit seeking a declaration that coverage is owed for an underlying asbestos bodily injury suit after determining that the asbestos exclusion in the insurer’s policies must be construed in favor of the insured because the insured has stated a claim for which relief can be granted as the insured maintains that its talc products do not contain asbestos.
October 27, 2023
Clearing Of Wetlands Was Not Occurrence; No Duty To Indemnify Exists, Judge Says

INDIANAPOLIS — An insurer has no duty to indemnify its insureds for penalties imposed by the Indiana Department of Environmental Management (IDEM) because the insureds’ clearing of a state-regulated wetlands area was not an occurrence as required for coverage to exist under the insureds’ policy, an Indiana federal judge said in granting the insurer’s motion for summary judgment.
October 26, 2023
Parties In Water, Termite Damage Suit Reach Settlement; Judge Dismisses Suit

JACKSONVILLE, Fla. — A Florida federal judge granted a joint stipulation for dismissal of a suit seeking coverage for damages caused by a termite infestation and water intrusion after the insureds and the property insurer reached a settlement during a mediation conference.
October 26, 2023
Dismissal Of Underlying Plaintiff From Insurer’s Suit Is Not Warranted, Judge Says

NEW ORLEANS — A Louisiana federal judge denied an underlying plaintiff’s motion to dismiss it as a defendant from an insurer’s suit seeking a declaration regarding coverage for an underlying environmental contamination suit filed against an insured because the insurer is not named in the underlying suit and resolution of the coverage issues will aid in the resolution of the underlying suit.
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 24, 2023
In Revised Ruling, Illinois Panel Reverses, Finds Insurer Entitled To Subrogation

CHICAGO — An Illinois appellate panel on Oct. 24 reversed a lower court’s grant of summary judgment to an engineering firm in a builders risk insurer’s suit seeking subrogation damages for the flooding of a building under construction, finding that the trial court erred in finding that the insurer does not meet the prerequisites for equitable subrogation because the insurer’s right to subrogate stemmed from the insurance contract.
October 24, 2023
Additional Insured’s Bad Faith Claims Fail In Chemical Exposure Coverage Suit

ROCHESTER, N.Y. — A New York federal judge determined that an additional insured’s claim for breach of the implied duty of good faith and fair dealing arising out of a coverage dispute for an underlying chemical exposure bodily injury suit must be dismissed because it is duplicative of a breach of contract claim. However, the judge said the additional insured is permitted to amend its complaint as it pertains to the breach of good faith and fair dealing claim.
October 23, 2023
Insurer Says Coverage Suit Over Legionnaire’s Disease Should Stay In Federal Court

LOUISVILLE, Ky. — A Kentucky federal court should exercise its discretion and permit an insurer’s declaratory judgment suit to proceed because litigating the issue of coverage in federal court is more judicially efficient than transferring the suit to a state court where the underlying bodily injury suit arising out of an apartment tenant’s contraction of Legionnaire’s disease is pending, the insurer says in its response to a motion to dismiss.
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 19, 2023
Decision To Include Insurance Case In Firefighting Foam MDL Belongs With JPMDL

CHARLESTON, S.C. — A federal judge in South Carolina has denied motions to dismiss the insurance coverage dispute brought by defendant Tyco Fire Products LP related to injuries from the firefighting substance aqueous film forming foam (AFFF) in the multidistrict litigation for AFFF, citing the doctrine of forum non conveniens and South Carolina’s door closing statute. However, the judge also said that although Tyco had directly filed the coverage lawsuit in the MDL, the decision to include it as part of the MDL should be made by the U.S. Judicial Panel on Multidistrict Litigation (JPMDL) and not the transferee court.
October 18, 2023
Mediator Approved For Insurance Disputes In Imerys, Cyprus Mines Bankruptcies

WILMINGTON, Del. — A Delaware federal bankruptcy judge approved a request by insurers of Chapter 11 asbestos talc debtors Imerys Talc America Inc. and Cyprus Mines Corp. to appoint a mediator for insurance issues in ongoing negotiations among the debtors and claimants on a plan of reorganization after extending the mediation through the end of the year.
October 17, 2023
Insurers Say Case Seeking Coverage For AFFF Claims Was Improperly Filed

CHARLESTON, S.C. — An insurance company on Oct. 16 filed a brief in South Carolina federal court in which it joins the arguments of other insurance companies that contend an amended complaint by Tyco Fire Products LP that seeks insurance coverage for claims arising from injuries associated with the firefighting agent aqueous film forming foam (AFFF) should be dismissed because of a related case that would require the parties to “devote time and resources to litigating two coverage actions on the same issues at the same time, at risk of inconsistent rulings on the same policies.”
October 17, 2023
3rd Circuit Dismisses Contractor’s, Homeowners’ Appeal In Mold Coverage Case

PHILADELPHIA — The Third Circuit U.S. Court of Appeals has dismissed homeowners’ and their contractor’s appeal of a lower court ruling that the contractor’s insurer owes them no coverage for personal injuries one of the homeowners sustained as a result of a mold infestation caused by the contractor’s negligent workmanship after the parties stipulated to dismissal following mediation.
October 17, 2023
Insureds’ Mold, Water Damage Suit Stayed To Allow Parties To Proceed To Appraisal

ORLANDO, Fla. — A Florida federal magistrate judge stayed a mold and water damage coverage lawsuit filed by insureds against their homeowners insurer to allow the parties to submit the dispute to appraisal.
October 16, 2023
N.J. Federal Judge Affirms Discovery Ruling In Pollution Liability Coverage Suit

NEWARK, N.J. — A New Jersey federal judge affirmed a magistrate judge’s ruling that a pollution liability insurer is not entitled to documents related to communications between the insured and its law firms about an underlying suit filed against the insured because the insurer failed to show that the magistrate judge’s ruling was clearly erroneous or contrary to law.
October 16, 2023
Federal Judge Grants Motion To Voluntarily Dismiss Pipeline Explosion Suit

BIRMINGHAM, Ala. — An Alabama federal judge granted a motion to voluntarily dismiss with prejudice a lawsuit filed by two insurers seeking a declaration that no coverage is owed for a gas pipeline explosion after the insurers notified the court that they reached a settlement with their insureds.
October 13, 2023
High Court Grants Cert For Insurer’s Challenge To Kaiser Gypsum Asbestos Bankruptcy

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 13 granted a petition for certiorari filed by the primary insurer of Chapter 11 asbestos debtors Kaiser Gypsum Co. Inc. and Hanson Permanente Cement Inc. over a Fourth Circuit U.S. Court of Appeals’ ruling that the insurer lacks standing to challenge the debtors’ reorganization plan.
October 12, 2023
Pennsylvania Mediation Privilege Law Is Applied In Indemnification Row

TRENTON, N.J. — Ruling on a motion to compel discovery in a dispute between insurers and reinsurers over indemnification for asbestos bodily injury claims, a New Jersey federal magistrate judge denied it without prejudice as to two categories of documents but partly granted it as to a third category.
October 11, 2023
Insurer: AFFF Defendant’s Coverage Claim Fails For Lack Of Jurisdiction

CHARLESTON, S.C. — Allstate Insurance Co. on Oct. 10 filed a reply brief in South Carolina federal court arguing that Tyco Fire Products LP fails to establish that the court has jurisdiction over Allstate in Tyco’s lawsuit seeking insurance coverage for the multidistrict litigation for claims arising from injuries associated with the firefighting agent aqueous film forming foam (AFFF).
October 10, 2023
Insured Claims Property Insurer Owes Additional Coverage For Water Damage

LOS ANGELES — An insured filed suit in California state court against its property insurer, seeking a declaration that the insurer owes additional coverage to repair a property damaged when water pipes burst in the building and alleging that the insurer breached its contract and acted in bad faith by refusing to release additional fund for repairs.
October 10, 2023
Insured Condo Association Appeals Pollution Exclusion Ruling To 11th Circuit

ATLANTA — An insured filed a notice of appeal to the 11th Circuit U.S. Court of Appeals, seeking review of a Georgia federal judge’s ruling that an insurer owes no coverage for underlying suits filed by residents of a condominium building who claim that they were injured as a result of fumes exhausted from a backup power generator because the policies’ pollution exclusions bar coverage.
October 10, 2023
Insurers Move To Voluntarily Dismiss Gas Pipeline Explosion Coverage Suit

BIRMINGHAM, Ala. — Two insurers seeking a declaration that no coverage is owed for a gas pipeline explosion filed a motion to dismiss their lawsuit with prejudice in Alabama federal court after reaching a settlement with their insureds.
October 09, 2023
Diversity Of Citizenship Does Not Exist In Sewage Backup Coverage Suit

BROOKLYN, N.Y. — A premises environmental liability insurer’s suit seeking a declaration regarding its coverage obligation for an underlying bodily injury suit must be dismissed because complete diversity of citizenship does not exist as the premises environmental liability insurer and the commercial general liability insurer, named as a defendant, are both incorporated in Delaware, a New York federal judge said.