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

Mealey's Insurance Pleadings

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Remand Motion In Lawsuit Over Purported Reinsurance Is Withdrawn

HONOLULU — The plaintiff in a dispute over a purported reinsurance policy has withdrawn its remand motion without prejudice, telling a Hawaii federal court that it made the call after “review of the current evidentiary record,” including the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.
June 19, 2023
Professors Call For Review Of Insurer Standing Ruling In Asbestos Bankruptcy Case

WASHINGTON, D.C. — A request for the U.S. Supreme Court to decide whether the primary insurer for asbestos debtors Kaiser Gypsum Co. Inc. and Hanson Permanente Cement Inc. has standing to challenge the debtors’ reorganization plan should be granted “to resolve an entrenched circuit split and restore uniformity to bankruptcy proceedings,” eight law professors say in an amicus curiae brief in support of the insurer.
June 16, 2023
Property Insurer Says Insured Refused To Cooperate With Policy Conditions As Required

PHOENIX — A commercial property insurer contends in a motion for summary judgment filed in Arizona federal court that its insured’s claims for breach of contract and bad faith cannot proceed because the insured breached the policy by failing to cooperate with the insurer’s investigation of the insured’s vandalism and theft claim.
June 15, 2023
Trial Set In Suit Seeking Nonpublic Info On Holding Company’s Captive Reinsurer

WILMINGTON, Del. — A one-day trial in the Delaware Court of Chancery has been set for June 26 in a suit seeking nonpublic information regarding a captive reinsurer, with the parties filing a joint pretrial stipulation and the plaintiff filing a pretrial brief.
June 15, 2023
Third-Party Complaint Is Filed In Suit Involving Reinsurance Commutation

JACKSON, Miss. — Defendants in a lawsuit involving what the plaintiff alleges was “a corporate insurance and risk management program promoted, created, and put in place by Defendants for Domino’s Pizza franchisees” have filed a third-party complaint against Domino’s Pizza LLC and related entities in a Mississippi federal court.
June 14, 2023
Parties Debate Exclusions In D.C. Circuit Appeal Over Condensation Damage Coverage

WASHINGTON, D.C. — A real estate developer and contractor seeking reversal of summary judgment granted to their builders risk insurers in a dispute over coverage for remediation of condensation damage tell the District of Columbia Circuit U.S. Court of Appeals that the insurers’ arguments in opposition were rejected in Blaine Construction Corp. v. Insurance Company of North America and that the evidence of causation provided should have been dispositive under the language of the policies.
June 14, 2023
Vizio Tells 9th Circuit Its 4th Amended Complaint Is ‘More Than Sufficient’

SAN FRANCISCO — Responding to an insurer’s contention that its appeal “merely regurgitates the same failed arguments,” Vizio Inc. tells the Ninth Circuit U.S. Court of Appeals that the allegations in its fourth amended complaint are “more than sufficient” to permit it to proceed past the pleading stage in its lawsuit seeking coverage for an underlying $17 million settlement and defense costs arising from class claims alleging unauthorized collections of consumers’ television viewing data.
June 13, 2023
Relators Raise SuperValu In 8th Circuit Appeal Of Qui Tam Crop Insurance Row

ST. LOUIS — Relators who are asking the Eighth Circuit U.S. Court of Appeals to reverse vacation of judgment in a qui tam crop insurance case now contend that a recent U.S. Supreme Court decision “makes it clear” that a Minnesota federal court’s interpretation of “knowingly” “is not the correct legal standard.”
June 13, 2023
Amici Argue In Favor Of Insurer In High Court Appeal Of Marine Coverage Suit

WASHINGTON, D.C. — Four amici curiae, including the U.S. Chamber of Commerce, filed briefs in support of a maritime insurer’s petition for writ of certiorari that the high court limited to the question: “Under federal admiralty law, can a choice of law clause in a maritime contract be rendered unenforceable if enforcement is contrary to the ‘strong public policy’ of the state whose law is displaced?”
June 13, 2023
Bifurcated Settlement Proposed For 1 Defendant In SEC Suit Over Alleged Fraud

DURHAM, N.C. — The U.S. Securities and Exchange Commission on June 12 asked a North Carolina federal court to approve a bifurcated settlement it negotiated with one of three defendants in a civil suit over a former investment advisory firm’s alleged “series of fraudulent and improper schemes” that defrauded clients of more than $75 million.
June 13, 2023
Partial Production Of Arbitration Record Compelled In Suit Over Defense Costs

DETROIT — With a motion for declaratory judgment pending in a suit over defense costs, a Michigan federal judge has granted a reinsurer’s motion to compel partial, redacted production of a separate arbitration record.