Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

March 13, 2023
Panel: Contamination Exclusion Bars Burger Chain’s Coverage For Coronavirus Losses

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on March 10 affirmed dismissal of In-N-Out Burgers’ breach of contract lawsuit against its commercial property insurer, finding that a policy’s contamination exclusion barred coverage for the insured’s losses arising from the coronavirus pandemic.
March 08, 2023
9th Circuit Affirms Dismissal Of Spa Owners’ Coverage Suit Arising From Pandemic

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals affirmed a lower federal court’s dismissal of spa owner insureds’ lawsuit seeking coverage for their losses arising from the coronavirus pandemic, finding that the insureds’ coverage argument is “squarely foreclosed” by its ruling in Mudpie, Inc. v. Travelers Casualty Insurance Co. of America and that the policies’ virus exclusion also bars coverage.
March 08, 2023
Federal Judge Finds 1 Policy Ambiguous In Broadway Owner’s COVID-19 Coverage Suit

NEW YORK — A New York federal judge granted insurers’ motion for judgment on the pleadings as to breach of contract, bad faith and declaratory judgment claims against one insurer but denied their motion and the insured’s motion as to the breach of contract claim against another insurer, finding that the relevant language in the “Entertainment – Property Insurance for the Performing Arts Policy” is ambiguous in a coronavirus coverage lawsuit brought by the owner and operator of five Broadway theaters.
March 08, 2023
Federal Judge Dismisses COVID-19 Coverage Suit Between Real Estate Trust, Insurer

SANTA ANA, Calif. — One day after a real estate trust insured and its insurer filed a stipulation for voluntary dismissal of the insured’s breach of contract and bad faith lawsuit seeking coverage for its business interruption losses arising from the coronavirus pandemic, a federal judge in California on March 7 dismissed the case with prejudice.
March 07, 2023
Judgment Creditors Appeal Denial Of Turnover Of Funds To Satisfy 9/11 Judgment

NEW YORK — Judgment creditors filed a notice of appeal of a New York federal court’s ruling that adopted a magistrate judge’s report and recommendation to not allow the creditors to satisfy their judgments against the Taliban for its role in the Sept. 11, 2001, terrorist attacks with funds from Afghanistan’s central bank that are held at the Federal Reserve Bank of New York.
March 07, 2023
Real Estate Trust, Insurer Voluntarily Dismiss Coronavirus Coverage Dispute

SANTA ANA, Calif. — A real estate trust insured and its insurer on March 6 filed a stipulation for voluntary dismissal with prejudice of the insured’s breach of contract and bad faith lawsuit seeking coverage for its business interruption losses arising from the coronavirus pandemic.
March 06, 2023
Pollution, Contamination Exclusion Must Be Construed In Favor Of Coverage

SANTA ANA, Calif. — A California federal judge denied an insurer’s motion to dismiss breach of contract, bad faith and declaratory judgment claims alleged by an insured seeking coverage for business losses sustained in the wake of the COVID-19 pandemic because the policy’s pollution and contamination exclusion is ambiguous and must be construed in favor of coverage.
March 06, 2023
Texas Federal Magistrate Judge Says Pollution Exclusion Does Not Bar Coverage

HOUSTON — A commercial general liability insurer’s pollution exclusion does not bar coverage for a multidistrict litigation suit alleging that the insured’s sand mining business contributed to the flooding sustained during Hurricane Harvey because the insurer failed to show that the materials and substances discharged by the insured into area waterways qualify as pollutants, irritants or contaminants, a Texas federal magistrate judge said in recommending that insurer’s motion for summary judgment be denied.
March 03, 2023
4th Circuit Finds ‘No Reversible Error’ In Court’s Dismissal Of Coronavirus Coverage Suit

RICHMOND, Va. — Dispensing with oral argument, the Fourth Circuit U.S. Court of Appeals affirmed a lower federal court’s grant of an insurer’s motion to dismiss insureds’ lawsuit seeking coverage for their financial losses arising from the lockdowns in response to the coronavirus pandemic, finding that the facts and legal contentions have been adequately presented before the court and “argument would not aid the decisional process.”
March 03, 2023
Panel: No Coverage Owed For Insureds’ Alleged $5.3M In Losses Arising From COVID-19

CHICAGO — The Seventh Circuit U.S. Court of Appeals on March 2 affirmed a lower federal court’s dismissal of an insured’s declaratory judgment lawsuit seeking commercial insurance coverage for its more than $5.3 million in claimed derivative losses arising from the coronavirus pandemic, finding that it has “repeatedly interpreted similar language in insurance cases seeking compensation for losses related to COVID-19 restrictions, and have consistently held that temporary loss of use or restrictions on use do not constitute ‘physical’ damage or loss.”
March 03, 2023
California High Court Accepts Certified Question In Coronavirus Coverage Dispute

SAN FRANCISCO — The California Supreme Court accepted the Ninth Circuit U.S. Court of Appeals’ certified question to determine whether “the actual or potential presence of the COVID-19 virus on an insured's premises” constitutes “direct physical loss or damage to property” to trigger coverage under an insured’s commercial property insurance policy.
March 01, 2023
Federal Judge Stands By No Bad Faith Ruling In Thunderstorm Coverage Dispute

JASPER, Ala. — A federal judge in Alabama denied an insured’s motion to reconsider the court’s summary judgment ruling in favor of an insurer as to a bad faith claim in the insured’s lawsuit seeking coverage for property damage allegedly caused by a 2019 thunderstorm, reiterating that the insurer, at the very least, had an arguable reason to withhold payment for the insured’s damage to its carriage house.
March 01, 2023
Judge Grants GEICO’s Motion To Strike Jury Demand In COVID Premium Suit

SAN FRANCISCO — A California federal judge granted GEICO’s motion to strike a demand by a certified class of automotive policy holders for a jury trial on the claim that GEICO violated California’s unfair competition law (UCL) by profiting from a premium giveback program initiated during the COVID-19 pandemic, writing that the lead plaintiff “has no . . . right to a jury trial on her UCL claim.”
March 01, 2023
Panel: No Triable Issue That COVID-19 In Hotel Caused Insured’s Alleged Lost Income

SAN DIEGO — A California appeals court panel affirmed a summary judgment ruling in favor of a commercial insurer in a breach of contract and bad faith lawsuit brought by the owner and operator of a 126-room Holiday Inn Express franchise in San Diego, finding that “there is no evidence creating a triable issue that COVID-19 in the hotel caused the claimed lost income.”
March 01, 2023
Judge Refuses To Stay Judgment Denying Turnover Of Funds To Satisfy 9/11 Judgments

NEW YORK — A New York federal judge denied judgment creditors’ motion to stay an earlier ruling that adopted a magistrate judge’s report and recommendation to not allow the creditors to satisfy their judgments against the Taliban for its role in the Sept. 11, 2001, terrorist attacks with funds from Afghanistan’s central bank that are held at the Federal Reserve Bank of New York.
February 27, 2023
Florida Judge: Subrogation Holdback Fund May Be Disbursed From Settlement Fund

MIAMI — A Florida judge signed an agreed order on a receiver’s motion to confirm compliance with an article of a more than $1 billion June 2022 settlement agreement in contemplation of distribution in a consolidated case over the June 2021 partial collapse of the Champlain Towers South (CTS) condominium building in Surfside, Fla., noting that all insurers of the settlement class members “are permanently barred, enjoined and restrained from commencing, continuing or maintaining any” subrogation claims against any of the released parties.
February 23, 2023
New Jersey Panel Affirms Dismissal Of Dry Cleaners’ COVID-19 Coverage Suit

TRENTON, N.J. — A New Jersey appeals court panel on Feb. 22 affirmed dismissal of a dry cleaner insured’s breach of contract and bad faith lawsuit seeking coverage for its alleged business interruption losses arising from the governmental orders in response to the coronavirus pandemic, finding that the lower court properly found that the virus policy exclusion and a “loss of use or loss of market” exclusion barred coverage.
February 22, 2023
Umpire, Insureds’ Appraiser ‘Exceeded Their Powers,’ Hawaii Panel Says In Reversal

HONOLULU — A Hawaii appeals court held that insureds’ appraiser and an umpire “exceeded their powers” by determining what amounts an insurer owed to the insureds rather than appraising the value of the insureds’ wildfire loss, reversing the lower court’s orders that granted the insureds’ motion to confirm appraisal and denied the insurer’s motion to vacate the appraisal awards and remanding for further proceedings.
February 21, 2023
Chocolate Company Appeals Ruling In Coverage Suit Arising From Superstorm Sandy

BROOKLYN, N.Y. — A chocolate company insured filed a notice of appeal challenging a New York federal court’s take-nothing judgment and denial of its renewed motion for judgment as a matter of law and motion for a new trial in a Superstorm Sandy coverage dispute.
February 16, 2023
N.J. Panel Affirms Dismissal Of Rita’s Water Ice Owners’ Coronavirus Coverage Suit

TRENTON, N.J. — A New Jersey appeals panel affirmed a lower court’s grant of an insurer’s motion to dismiss a declaratory judgment lawsuit brought by the owner of three Rita’s Water Ice businesses, finding that the insureds did not incur any damage that rendered their premises inoperable.
February 16, 2023
Virus Exclusion Bars Coverage For Retailers’ COVID-19 Losses, 9th Circuit Affirms

PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Feb. 15 affirmed a lower federal court’s ruling in favor of a property insurer in retailers’ breach of contract and bad faith lawsuit seeking coverage for their losses arising from the coronavirus pandemic, finding that the virus exclusion bars coverage because the insureds have failed to assert “that the efficient cause of their losses was anything other than the spread of COVID-19.”
February 15, 2023
Late Motion To Exclude Expert Allowed But Fails In Insurance Coverage Spat

DALLAS — An insurer in a storm damage coverage suit was allowed to file a late motion but lost its bid to exclude a property owner’s expert when a Texas federal judge found his testimony reliable and helpful; the judge also denied most of its motion for summary judgment.
February 13, 2023
Florida Majority: Public Adjusting Firm’s President Not ‘Disinterested’ Appraiser

TALLAHASSEE, Fla. — A majority of the Florida Supreme Court held that the president of an insured’s public adjusting firm cannot subsequently serve as the insured’s “disinterested” appraiser under the language of an insurance policy, finding that the appraiser cannot be “disinterested” if his firm is to be compensated with a contingency fee for its public adjuster services.
February 13, 2023
Texas High Court Refuses To Disturb Ruling In Agent’s Favor In Harvey Coverage Suit

AUSTIN, Texas — The Texas Supreme Court on Feb. 10 denied an insureds’ motion to reconsider its refusal to review an appeals court’s ruling in favor of an insurance agent in the insureds’ negligence lawsuit seeking to recover their losses caused by Hurricane Harvey.
February 10, 2023
Dismissal Of Madison Square Garden’s Claims In COVID-19 Coverage Suit Affirmed

NEW YORK — A New York appeals court on Feb. 9 affirmed a lower court’s partial dismissal of Madison Square Garden Sports Corp. and related entities’ coverage lawsuit arising from the coronavirus pandemic, finding that the insureds failed to assert physical damage or loss to trigger coverage.