Mealey's Emerging Insurance Disputes : Mealey's : Legal News & Analysis

Mealey's Emerging Insurance Disputes

October 25, 2024
4th Circuit Affirms Ruling In Insurer’s Favor In Suit Over Cryptocurrency Loss

RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals on Oct. 24 affirmed a lower federal court’s dismissal of an insured’s breach of contract lawsuit seeking homeowners insurance coverage for his alleged $170,000 cryptocurrency loss, agreeing with the lower court that the insured’s loss of cryptocurrency is not a “direct physical loss” to trigger policy coverage.
October 25, 2024
U.S., Ship Owner File Settlement Notice In Exoneration Suit Over Bridge Collapse

BALTIMORE — The United States and the owner and technical manager of the ship that allided with and destroyed the Francis Scott Key Bridge in Baltimore filed a joint notice on Oct. 24 indicating they have reached a settlement and asked a Maryland federal court to dismiss the United States’ Sept. 18 claim and answer to the ship owner’s petition for exoneration from or limitation of liability for the casualties and damage arising from the bridge collapse.
October 24, 2024
Pennsylvania Court Dismisses MCARE Fund From Professional Liability Coverage Suit

HARRISBURG, Pa. — A Pennsylvania court dismissed Medical Care Availability and Reduction of Error Fund (MCARE Fund) from a petition seeking professional liability coverage for a $1 million settlement of an underlying malpractice lawsuit, concluding that MCARE Fund has no statutory obligation to act as the primary insurer and indemnify and defend the insured.
October 24, 2024
Driver’s Claims For Larger COVID-19 Refunds Properly Dismissed, 9th Circuit Told

SAN FRANCISCO — GEICO in an Oct. 23 appellee brief tells the Ninth Circuit U.S. Court of Appeals that a federal judge properly granted summary judgment on an insured driver’s class action claim against it for violating California’s unfair competition law (UCL) by providing drivers an insufficient rebate on premiums after COVID-19, arguing that its rebate was fair under the relevant policy and state insurance regulations.
October 23, 2024
Substantial Nexus Existed Between Burn Incident, Vehicle Use, Panel Says In Reversal

TRENTON, N.J. — A New Jersey appeals panel on Oct. 23 reversed a lower court’s ruling in favor of an automobile insurer in an insured’s lawsuit seeking personal injury protection (PIP) benefits for her injuries caused when a hot beverage spilled on her when she was sitting in her car at a Dunkin’ Donuts’ drive-through, finding that the insured’s injuries were a “natural and reasonable . . . consequence” of the use of her vehicle and, therefore, a substantial nexus existed between the injury incident and her vehicle use.
October 23, 2024
Connecticut Judge Rules For Insurer In Coverage Suit Over Assault Claims

NEW BRITAIN, Conn. — A Connecticut judge granted a homeowners insurer’s motion for summary judgment in its lawsuit seeking a declaratory judgment that it has no duty to defend or indemnify its insured against underlying assault claims, finding that the insured’s “alleged violent assault” was no “accident” and, therefore, was not an “occurrence” to trigger coverage under her policy.
October 22, 2024
Insurer Says It Owes No Defense, Indemnification For Data Breach Claim, Suit

SEATTLE — A media tech insurer filed suit in a Washington federal court seeking a declaration that it has no duty to defend or indemnify its financial services firm insured against a bank’s indemnification demand for a data breach incident and a related subrogation lawsuit brought by the bank’s insurer.
October 22, 2024
Illinois Panel Partly Reverses Ruling In Coverage Dispute Over Dog Attack

SPRINGFIELD, Ill. — An Illinois appeals panel reversed a lower court’s grant of summary judgment in favor of defendants in a homeowners insurer’s declaratory judgment lawsuit disputing coverage for bodily injury caused by a dog attack, finding that there is a genuine issue of material fact regarding whether the insured misrepresented her ownership of a pit bull.
October 22, 2024
Contamination Exclusion Bars Coverage For COVID-19 Losses, Federal Judge Says

SACRAMENTO, Calif. — An all-risk policy’s contamination exclusion bars coverage for losses sustained during the COVID-19 pandemic because a California appellate panel’s determination that a contamination exclusion bars coverage for COVID-19 losses is binding and warrants the same finding in a similar suit filed by insureds in federal court, a California federal judge said Oct. 21 in granting an insurer’s motion for summary judgment.
October 22, 2024
3rd Circuit Dismisses Urban Outfitters’ Appeal In Coronavirus Coverage Suit

PHILADELPHIA — One day after URBN US Retail LLC (Urban Outfitters) and its insurer filed a joint stipulation to dismiss, the Third Circuit U.S. Court of Appeals tossed Urban Outfitters’ appeal of a lower federal court’s dismissal of its coverage lawsuit arising from the coronavirus pandemic.
October 22, 2024
CGL Insurer Appeals Ruling That it Owes Hotel Defense For Sex Trafficking Claims

ATLANTA — A commercial general liability insurer filed a notice indicating that it is asking the 11th Circuit U.S. Court of Appeals to review a Georgia federal judge’s ruling that granted a hotel operator insured’s motion to dismiss its complaint to the extent that its seeks a declaration that it has no duty to defend against an underlying lawsuit alleging that the insured did not uphold its duty of care concerning the safety of its hotel and hotel guests by failing to prevent and respond to evidence of sex trafficking.
October 21, 2024
Insurer, Medical Product Manufacturer Settle Coverage Dispute

CONCORD, N.H. — Attorneys for an insurer and a medical product manufacturer insured notified a New Hampshire federal court that they have settled the insurer’s declaratory judgment lawsuit pertaining to 10 underlying class actions alleging that the insured manufactured and marketed medical devices used to clean positive airway pressure (CPAP) and bi-level positive airway pressure (biPAP) devices that were not safe or effective.
October 21, 2024
Insurer Voluntarily Tosses Suit Disputing Coverage For Fraud Claims Against Insureds

CHICAGO — The same day an insurer voluntarily dismissed its lawsuit seeking a declaration that it has no duty to defend or indemnify its insureds against underlying fraud claims, a federal judge in Illinois dismissed the lawsuit.
October 17, 2024
Federal Judge Dismisses Philadelphia Eagles’ COVID-19 Suit Against Insurer

PHILADELPHIA — A federal judge in Pennsylvania on Oct. 16 dismissed a lawsuit brought by the owner and operator of the Philadelphia Eagles football organization seeking a declaration as to coverage for its alleged losses arising from the coronavirus pandemic, noting that the court is bound by Ungarean v. CAN & Valley Forge Ins. Co. that was recently decided by the Pennsylvania Supreme Court.
October 15, 2024
Exclusion Bars Coverage For Farm Injuries, N.D. High Court Rules In Reversal

BISMARCK, N.D. — The North Dakota Supreme Court found that an insurance policy provides coverage for bodily injuries incurred by farm employees but not when the injury is related to their use of a motor vehicle, reversing a lower court’s finding that the motor vehicle exclusion does not apply to coverage that was added by a farm employer liability endorsement to the policy.
October 15, 2024
Panel: No Professional Liability Coverage Owed For Gender Discrimination Claim

ST. PAUL, Minn. — The Minnesota Court of Appeals on Oct. 14 affirmed a lower court’s summary judgment ruling in favor of a medical professional liability insurer in a plastic surgeon insured’s breach of contract and bad faith lawsuit seeking coverage for a transgender woman’s claims that he discriminated against her based on her sexual orientation when he refused to perform breast augmentation surgery, finding that no coverage was triggered because it is clear that the underlying claims were based on an alleged gender-identity discrimination and not on a medical incident.
October 15, 2024
Judge Tosses Class Action Alleging Insurance Provider Failed To Prevent Data Breach

NEW YORK — One day after a plaintiff filed a notice of voluntary dismissal without prejudice of her class action complaint alleging that a financial organization that offers insurance, retirement and investment services primarily to teachers failed to prevent a May 2023 data breach that resulted in the theft of the personally identifiable information (PII) of its current and former clients, a New York federal judge ordered the case dismissed.
October 15, 2024
Judgment Entered In Favor Of Insured In Coverage Dispute Over Fireworks Explosion

BISMARCK, N.D.— A federal court in North Dakota entered a judgment in favor of an insured in a homeowners insurer’s declaratory judgment lawsuit disputing coverage for underlying property damage and personal injuries caused by a fireworks explosion after finding that the policy’s misrepresentation provision does not bar coverage because the insured did not willfully conceal or misrepresent any material facts regarding his use and storage of commercial fireworks at his Bismark property.
October 14, 2024
Intervention Denied In Coverage Row Over Yacht Deemed ‘Remnant Of Its Former Self’

SAN JUAN, Puerto Rico — A Puerto Rico federal judge denied intervention in a declaratory judgment suit against an insured by parties whose boats were purportedly harmed by fire that spread from a nearby yacht the judge called a “charred remnant of its former self,” finding that the proposed intervenors failed to establish that their interests “are not adequately represented by the defendant.”
October 14, 2024
Freddie Mac Settles With 2nd Insurer In D&O Coverage Suit Over SEC Subpoena

WASHINGTON, D.C. — Federal Home Loan Mortgage Corp. (Freddie Mac) and a second insurer told a Washington federal court that they have reached a settlement in Freddie Mac’s breach of contract and bad faith lawsuit seeking directors and officers liability coverage for underlying expenses it incurred on behalf of its directors, officers and employees who were subpoenaed by the Securities and Exchange Commission during an investigation and subsequent lawsuit.
October 14, 2024
Insurer Asks 9th Circuit To Reconsider Ruling In Sex Trafficking Coverage Dispute

SAN FRANCISCO — A commercial insurer filed a petition seeking rehearing of the Ninth Circuit U.S. Court of Appeals’ Sept. 25 ruling that affirmed a lower federal court’s dismissal of its declaratory judgment arising from an underlying multidistrict litigation alleging that the insured is liable under Texas’ sex trafficking statutes, challenging the panel’s finding that its duty to defend has not been extinguished because the underlying claims may impose liability on the insured that triggers coverage.
October 14, 2024
Judge Denies Summary Judgment In UCL Suit Over Insurer’s Liability Under Lost Policy

SANTA ANA, Calif. — A California federal judge on Oct. 11 denied an insurer’s motion for summary judgment on a suit brought against it for breach of contract and violation of California’s unfair competition law (UCL) by the successor-in-interest to a school that is being sued for a 1976 sexual assault of a student by a teacher and claims to be an insured under a policy, the physical copies of which neither party possesses.
October 14, 2024
Judge: ‘Multitude Of Issues’ Remain In Coverage Suit Over Fatal Drunk Driving Crash

STAMFORD, Conn. — A Connecticut judge denied an insurance agency’s motion for summary judgment that it had no duty to recommend or procure a liquor liability insurance policy for a mini market that would have covered the risks associated with its unlicensed and illegal sale of hard alcohol, finding there are a “multitude of issues” that preclude summary judgment in favor of the agency in a negligence lawsuit arising from a $24 million wrongful death settlement.
October 14, 2024
Owners Of Aircraft Valued At More Than $222M Sue Insurers In State Court

STAMFORD, Conn. — Claiming breach of contract and bad faith, five entities that own two freighter planes that they allege a Russian cargo airline has refused to return after the invasion of Ukraine have filed a suit in Connecticut state court against more than two dozen “insurers, underwriters, underwriting managers, and insurance subscribers of coverage in the international aviation insurance market.”
October 11, 2024
Private Equity Firms Amend Federal Complaint Against D&O, Cyber Liability Insurer

OMAHA, Neb.— Two private equity firms filed an amended complaint against their directors and officers and cyber liability insurer in a Nebraska federal court, seeking coverage for the alleged $2.8 million they lost when an imposter investor hacked a reserve account (Panorama Point Partners LLC, et al. v. Everest National Insurance Company, No. 24-393, D. Neb.).