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Mealey's California Insurance

  • December 12, 2024

    Breach Of Contract, Bad Faith Claims Will Remain In Federal Court, Judge Says

    LOS ANGELES — Breach of contract and bad faith claims against a life insurer will proceed in California federal court because remand to state court is not warranted as complete diversity of citizenship exists, a California federal judge said after determining that the beneficiaries’ negligence claim cannot proceed against the nondiverse life insurer agent who was working in the scope of her employment for the life insurer.

  • December 12, 2024

    Judge: Assignee Lacks Standing To Recover Emotional Distress Damages From Insurer

    CHICAGO — A California federal judge held that an assignee cannot establish standing under California Insurance Code Section 11580(b)(2) to recover her emotional distress damages from an insurer as judgment creditor of her former employer, granting the insurer’s motion to dismiss her lawsuit arising from an underlying discrimination judgment in her favor but allowing the assignee leave to amend one of her claims.

  • December 11, 2024

    No Coverage Owed For Regal Cinemas’ Coronavirus Losses, 9th Circuit Affirms

    PASADENA, Calif.— The Ninth Circuit U.S. Court of Appeals affirmed a lower federal court’s ruling in favor of insurers in Regal Cinemas’ breach of contract lawsuit seeking recovery for its revenue losses arising from the coronavirus pandemic, finding that, pursuant to New York law, Regal Cinemas was not insured for its alleged business losses.

  • December 10, 2024

    Panel: Reservation Court Has Jurisdiction In Tribe’s Coronavirus Coverage Suit

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals held that a tribal court has subject matter jurisdiction over an insurance company in a dispute over the tribe’s claims for business interruption losses at its casino caused by the coronavirus pandemic, affirming a lower federal court on the alterative ground that the insurance policy at issue satisfies Montana’s consensual-relationship exception.

  • December 09, 2024

    California Panel: Abuse Or Molestation Exclusion Bars Coverage For Spa Owner

    LOS ANGELES — A California appeals panel held that a commercial insurance policy’s “abuse or molestation” exclusion bars coverage for an underlying lawsuit alleging that a spa owner insured sexually assaulted and molested three of its customers during massage sessions, affirming a lower court’s summary judgment ruling in favor of the insurer in the insured’s breach of contract lawsuit.

  • December 05, 2024

    Doctor Entitled To Almost $98K In Attorney Fees For Success On Disability Claim

    SAN FRANCISCO — A pediatrician who successfully prevailed on her claim for long-term disability (LTD) benefits based on her high risk of exposure to the COVID-19 virus is entitled to $97,965 in attorney fees and $625 in costs because the pediatrician succeeded on the merits of her disability claim and the disability insurer presented no special circumstances that would warrant against an award, a California federal judge said in granting the pediatrician’s motion for attorney fees and costs.

  • December 03, 2024

    Panel Affirms Dismissal Of Amber Heard’s Counterclaims In Defamation Coverage Suit

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeal affirmed a lower federal court’s dismissal of Amber Heard’s breach of contract and bad faith counterclaims in the insurer’s declaratory judgment lawsuit alleging that it has no duty to defend or indemnify her for a defamation judgment awarded to Johnny Depp.

  • December 03, 2024

    Following John’s Grill, Panel Affirms No Coverage Ruling In COVID-19 Suit

    SAN DIEGO — Reconsidering its earlier holding in favor of a diner insured in light of John's Grill, Inc. v. The Hartford Financial Services Group, Inc., a California appeals panel affirmed a lower court’s judgment in favor of an insurer in the diner’s lawsuit seeking coverage for its business losses arising from the COVID-19 pandemic.

  • December 02, 2024

    Construction Company Alleges Bad Faith Cross-Claim Against CGL Insurer

    SACRAMENTO, Calif. —A construction company insured answered a commercial general liability insurer’s first amended complaint and filed cross-claims for breach of contract and breach of the implied covenant of good faith and fair dealing and seeks equitable contribution as assignee of an excess insurer that funded its $2,250,000 settlement of an underlying construction defects lawsuit.

  • November 25, 2024

    Motion To Set Trial Date Denied Without Prejudice In Long-Running RESPA Suit

    FRESNO, Calif. — In a brief Nov. 22 text-only order, a judge sitting by designation in California federal court denied without prejudice a motion to set a trial date in a long-running Real Estate Settlement Procedures Act (RESPA) class action involving captive reinsurance agreements.

  • November 22, 2024

    Insured Failed To Comply With Policy’s Notice, Warranty Provisions, Judge Says

    SAN DIEGO — No coverage is owed to a hospital company insured under a pollution liability policy for remediation of mold discovered in the insured’s heating, ventilation, and air-conditioning (HVAC) systems because the insured failed to comply with the policy’s warranty and notice provisions, both of which are conditions precedent to coverage, a California federal judge said in granting the insurer’s motion for summary judgment and denying the insured’s motion for summary judgment.

  • November 21, 2024

    Joint Powers Authority Wins Remand Of Coverage Suit Against Reinsurer

    LOS ANGELES — Agreeing with a joint powers authority (JPA) that it “is an arm of the state and therefore is not a citizen of California or any other state” for purposes of diversity jurisdiction, a California federal judge on Nov. 20 granted remand to state court of the JPA’s lawsuit over a reinsurer’s denial of coverage for litigation arising from sexual abuse allegations.

  • November 20, 2024

    Stipulation Approved In Bishop’s Row With Insurers Over Sex Abuse Suit Coverage

    SAN FRANCISCO —  A California federal judge filed a docket-only order granting the parties’ stipulation seeking to reschedule a case management conference in a suit filed by the Roman Catholic Bishop of Oakland, Calif., against numerous insurers and the California Insurance Guarantee Association (CIGA), which the plaintiff believes assumed responsibilities for its now-insolvent insurer, seeking a declaratory judgment stating that the plaintiff is entitled to a defense and indemnity regarding covered claims for the more than 300 suits filed against it related to alleged clergy sexual abuse.

  • November 20, 2024

    Insurers: Auto Makers Failed To Recall Vehicles With Potential Deadly Defects

    SANTA ANA, Calif.— Automobile and property insurers filed a subrogation lawsuit on behalf of their insureds against automotive manufacturers, telling a California court that the defendants  “purposefully and knowingly failed to recall millions of their defective vehicles” that contained “potentially deadly defects” and, as a result, put “countless lives at risk from 2006 to date” and caused their insureds to suffer property damage including the loss of use of their vehicles.

  • November 19, 2024

    Compelling Arbitration, Judge Says MOU Is ‘Closely Related’ To Reinsurance Contract

    LOS ANGELES — Concluding that a 1984 memorandum of understanding (MOU) is “closely related to the reinsurance contract and not a completely separate agreement,” a California federal judge granted reinsurers’ motion to compel arbitration in a lawsuit over reinsurance billings arising from asbestos bodily injury claims.

  • November 18, 2024

    Insured’s Snow-Damage Suit Remanded To State Court Based On Lack Of Diversity

    RIVERSIDE, Calif. — A California federal judge remanded an insured’s suit to California state court after determining that complete diversity of citizenship does not exist based on the insured’s naming of an insurance agency as a defendant in a second amended complaint, which alleges breach of contract, bad faith and negligence claims based on the property insurer’s denial of coverage for the partial collapse of an insured building’s roof.

  • November 18, 2024

    Judge: CGL Insurer Has No Duty To Indemnify Contractor For Negligent Work Claims

    SAN FRANCISCO — A federal judge in California granted a commercial general liability insurer’s motion for partial summary judgment seeking a declaration that it has no duty to indemnify its contractor insured against an underlying lawsuit alleging the insured performed negligent contractor work, finding there are no triable questions of material fact and coverage is excluded for the damages alleged in the underlying lawsuit.

  • November 14, 2024

    Citing Loper Bright, Farm Seeks U.S. High Court Review Of Crop Insurance Ruling

    WASHINGTON, D.C. — Arguing that Loper Bright Enterprises v. Raimondo should have prevented the Ninth Circuit U.S. Court of Appeals from deferring to a regulatory interpretation of the Federal Crop Insurance Corp. (FCIC), a farm petitioned the U.S. Supreme Court for review of a crop insurance case.

  • November 14, 2024

    California Federal Judge Denies Insurers’ Motion For Summary Judgment In CERCLA Case

    SACRAMENTO, Calif. — A federal judge in California has denied a motion for summary judgment that a group of intervening insurers filed in a dispute over liability for groundwater contamination under the Comprehensive Environmental Response, Compensation, and Liability Act, stating that expert testimony is not required to prove elements of the claim.

  • November 14, 2024

    Calif. Panel: Defense Costs Not Restitutionary Damages In D&O Coverage Dispute

    SAN JOSE, Calif. — A California appeals panel reversed a lower court’s ruling in favor of an excess directors and officers liability insurer in a breach of contract and bad faith lawsuit brought by an insured and its former chief financial officer, rejecting the insurer’s argument that the insured’s claim for underlying defense costs is the substantial equivalent of “restitutionary damages.”

  • November 14, 2024

    Homeowners Insurer’s Request For 2nd Examination Under Oath Not Unreasonable

    LOS ANGELES — A trial court did not err in granting summary judgment to a homeowners insurer on breach of contract and bad faith claims because the insurer did not act unreasonably in requesting a second examination under oath from the insured and the insured breached the duty to cooperate with the insurer as required under the policy, a California appellate court said.

  • November 13, 2024

    Panel: Jury’s Finding Of Defamation Established Willful Act, No Coverage Owed

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Nov. 12 affirmed a lower federal court’s grant of an insurer’s motion to dismiss an insured’s breach of contract and bad faith lawsuit seeking coverage for a $4,941,071 judgment in a defamation action brought by its former employee, finding that the underlying jury's finding of defamation per se established a willful act under California Insurance Code Section 533.

  • November 12, 2024

    Insurers Say Kia, Hyundai Disregarded Dangerous Defects For Years

    SANTA ANA, Calif. — Several insurers filed a complaint in subrogation in California state court accusing the makers of Kia and Hyundai-brand cars of causing insureds harm in violation of California’s unfair competition law (UCL) by failing to report or recall vehicles with dangerous electrical defects, including spontaneously catching fire while deactivated.

  • November 12, 2024

    California Panel Affirms Ruling In Insurer’s Favor In Vicarious Liability Suit

    LOS ANGELES — A California appeals court affirmed a lower court’s summary judgment ruling in favor of a homeowners insurer in an insured’s lawsuit alleging that the insurer was vicariously liable for the negligence of an insurance agent that resulted in the insured’s underinsurance for a fire loss to her Malibu property under a California FAIR Plan Association insurance policy, concluding that the insured failed to present evidence that raises a triable issue as to whether the agent was the defendant insurer’s agent when she assisted the insured in procuring the FAIR Plan policy.

  • November 12, 2024

    Judge Denies Insurer’s Request To Transfer Silica Coverage Suit

    LOS ANGELES — A California federal judge denied an insurer’s motion to transfer an insured’s suit seeking coverage for underlying bodily injury suits arising out of silica dust exposure to Minnesota federal court where a similar suit filed by the insurer is pending because the insured’s California federal suit was filed prior to the insurer’s Minnesota suit.