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Legal News & Headlines

Issues Of Material Fact In Environmental Dispute Must Proceed To Trial, Judge Says
FORT WAYNE, Ind. - An Indiana federal judge on Oct. 30 determined that insureds who allege that their insurer breached its duty under settlement agreements reached in an environmental contamination dispute are not entitled to judgment in their favor because numerous issues of material fact exist that must proceed to trial (Valley Forge Insurance Co. v. Hartford Iron & Metal Inc., et al., No. 14-6, N.D. Ind., 2019 U.S. Dist. LEXIS 187791).

Appellants Say 7th Circuit Should Reverse Ruling In Contamination Coverage Suit
CHICAGO - The Seventh Circuit U.S. Court of Appeal should reverse a district court's ruling that an insurer owes no coverage for environmental contamination claims asserted by neighbors of an insured property, the neighbors assert in an Oct. 23 reply brief, contending that even if the insured failed to provide timely notice of the claims, the insurer was not prejudiced by the alleged late notice (Carmine Greene, et al. v. Kenneth Will, et al., No. 19-2260, 7th Cir.).

No Coverage Owed Under Pollution Condition Provision, New York Federal Judge Says
NEW YORK - An insurer owes no coverage under a policy's pollution loss coverage provision for underlying lawsuits arising out of a fire at a Texas oil refinery because the policy's pollution loss provision does not apply to the underlying suits; however, the insurer may owe coverage under the policy's professional services coverage provision as a question of fact exists on the type of services the insured provided prior to the refinery fire, a New York federal judge said Oct. 31 (James River Insurance Co. et al., v. Indian Harbor Insurance Co., No.18-767, S.D. N.Y., 2019 U.S. Dist. LEXIS 189286).

Judge: Insurer Owes Insurers Pro Rata Share Of Defense Costs For Nuisance Suit
SPRINGFIELD, Ill. - A federal judge in Illinois on Oct. 25 held that a commercial general liability insurer must pay two other CGL insurers a pro rata share of the costs they incurred defending their hog feeding operations insured against an underlying lawsuit, as well as prejudgment interest from the date the insured retendered the lawsuit to the first insurer (Westfield Insurance Company v. Indemnity Insurance Company of North America, et al., Nos. 16-3298 and 14-3040, C.D. Ill., 2019 U.S. Dist. LEXIS 185978).

Constructive Fraud Claim Against Insurer In Asbestos Suit Cannot Stand, Judge Says
NORFOLK, Va. - A Virginia federal judge on Oct. 29 granted an insurer's motion to dismiss a constructive fraud claim alleged by an insured seeking coverage for underlying asbestos liabilities after determining that the insured failed to allege that the insurer had a common-law duty or an implied contractual duty to disclose the existence of policies that initially could not be located and were later discovered by the insured (Huntington Ingalls Inc. v. Travelers Indemnity Co., No. 18-147, E.D. Va., 2019 U.S. Dist. LEXIS 187698).

Insurers, Montana Plaintiffs' Negligence Dispute Heading To 3rd Circuit Again
WILMINGTON, Del. - A dispute between insurers of former Chapter 11 debtor W.R. Grace & Co. and Montana state court asbestos personal injury claimants will not be settled on appeal to federal district court but instead will be decided by the Third Circuit U.S. Court of Appeals, a Delaware federal magistrate judge says in an Oct. 30 recommendation to forgo mediation (Continental Casualty Co., et al. v. Jeremy B. Carr, et al., No. 1:19-cv-1871, D. Del., 2019 U.S. Dist. LEXIS 188053).

Fraser's Says Bankruptcy Stay Bars Insurer's Claims Against Settling Insurers
TACOMA, Wash. - A Washington federal court should uphold a bankruptcy court's denial of an insurer's bid to vacate a stipulated order barring its contribution claims against other insurers for asbestos claims against Chapter 11 debtor Fraser's Boiler Service Inc., the debtor argues in an Oct. 28 response brief on appeal (National Union Fire Insurance Company of Pittsburgh, PA v. Fraser's Boiler Service, Inc., et al., No. 3:19-cv-5648, W.D. Wash.).

No Evidence Exists For New Trial On $6.25M Judgment Against Reinsurer, Insurer Says
UTICA, N.Y. - An insurer argues in a Nov. 1 opposition brief to a New York federal court that a reinsurer failed to show a "complete absence of evidence" for a $6.25 million jury verdict in a dispute concerning two separate reinsurance certificates and coverage for settlements of asbestos claims (Utica Mutual Insurance Co. v. Century Indemnity Co., No. 13-995, N.D. N.Y.).

11th Circuit Affirms Finding That No Coverage Is Owed For Collapse
ATLANTA - The 11th Circuit U.S. Court of Appeals on Oct. 31 affirmed a district court's ruling that no coverage is owed for a collapse because the collapse provision at issue clearly provides that a collapse must be abrupt for coverage to exist under the policy (The S.O. Beach Corp., et al. v. Great American Insurance Company of New York, No. 18-11967, 11th Cir., 2019 U.S. App. LEXIS 32569).

District Court Had Authority To Consider Insurer's Motion In Asbestos Dispute
CINCINNATI - The Sixth Circuit U.S. Court of Appeals on Oct. 23 reversed and remanded a district court's denial of an insurer's motion to enforce a judgment entered in favor of the insurer in an asbestos coverage dispute that has been pending for almost 14 years after determining that the lower court had the authority to consider the motion and that the motion was not barred by res judicata (Continental Casualty Co., et al. v. Indian Head Industries Inc., No. 18-2152, 6th Cir., 2019 U.S. App. LEXIS 31574).

Insurer's Settlement For Asbestos Liabilities Is Void Under Louisiana Law
NEW ORLEANS - The Fourth District Louisiana Court of Appeal on Oct. 21 reversed a trial court's ruling that a 2013 settlement between an insurer and its insured for underlying asbestos liabilities prohibits third-party plaintiffs from recovering damages from the insurer after determining that the settlement essentially annulled the policies at issue in violation of Louisiana law (Nelcome J. Courville Jr., et al. v. Lamorak Insurance Co., et al., No. 2019-C-0902, La. App., 4th Cir., 2019 La. App. LEXIS 1862).

Insureds Say Appeal Of Allocation Ruling In Asbestos Suit Is Warranted
NEW YORK - An interlocutory appeal of a New York federal judge's pro rata, time-on-the-risk ruling in favor of an insurer is warranted because the ruling is contrary to well-established New York law on the allocation of defense costs, insureds seeking coverage for costs incurred for underlying asbestos and silica bodily injury lawsuits say in an Oct. 24 motion for certification for interlocutory appeal (Danaher Corp. v. Travelers Indemnity Co., et al., No. 10-0121, S.D. N.Y.).

Insured Appeals Ruling In Excess Insurers' Favor In $1.5B Asbestos Coverage Suit
SAN FRANCISCO - An insured recently asked a California appeals court to reverse a lower court's ruling in favor of excess insurers in its lawsuit seeking coverage for settlements paid to underlying claimants who sued the insured for asbestos-related bodily injury, arguing that the lower court misinterpreted the insurance policies' "other insurance" clauses in concluding that horizontal exhaustion applies notwithstanding the attachment points in the excess insurance policies "that envision vertical exhaustion" (SantaFe Braun, Inc. v. Insurance Company of North America, No. A151428, Calif. App., 1st Dist.).

Insurers Appeal Ruling That Libby, Mont., Plaintiffs' Negligence Suits Can Proceed
WILMINGTON, Del. - Insurers of former Chapter 11 debtor W.R. Grace & Co. on Oct. 4 appealed to Delaware federal court a bankruptcy court's finding on remand that the insurers can be sued in state court by asbestos claimants who say their diseases were caused by W.R. Grace's mining operations in Libby, Mont., and by the negligence of the insurers (Continental Casualty Co., et al. v. Jeremy B. Carr, et al., No. 1:19-cv-1871, D. Del.).

Fairbanks Looks To Halt Insurer's Bid To Sidestep Stay To Litigate Coverage Action
ROME, Ga. - A Georgia federal bankruptcy court should not lift the automatic stay in the Chapter 11 case of The Fairbanks Co. to allow an insurance coverage suit to proceed because the bankruptcy case, nearing completion, could easily be derailed by the move, the debtor says in an Oct. 16 objection to an insurer's lift stay motion (In re The Fairbanks Company, No. 18-41768, N.D. Ga. Bkcy.).

Asbestos Billing Suit Against Reinsurers Dismissed In Deference To New Jersey Suit
CONCORD, N.H. - A New Hampshire federal judge on Oct. 24 dismissed a suit filed by excess insurers against a number of reinsurers that allegedly refused to pay $22 million in reinsurance billings for asbestos and silica claims paid by the insurers after determining that the prior-pending doctrine warrants dismissal as a similar suit was filed prior to the instant suit in New Jersey state court (United States Fire Insurance Co., et al. v. Equitas Insurance Ltd., et al., No. 18-01205, D. N.H., 2019 U.S. Dist. LEXIS 183909).

Ruling Against Insurer Reversed In Dispute Over Asbestos Exclusion Premiums
BROOKLYN, N.Y. - A New York appellate panel on Oct. 23 reversed a trial court's ruling against an insurer in a dispute over insurance premiums after determining that an asbestos exclusion is not ambiguous as to whether an insured's asbestos abatement work is excluded from coverage (Burlington Insurance Co. v. Pinnacle Demolition and Environmental Services Corp., Nos. 2017-03531, 2017-07909, N.Y. Sup., App. Div., 2nd Dept., 2019 N.Y. App. Div. LEXIS 7591).

Reinsurer Seeks New Trial Over $6.25M Judgment In Asbestos Settlements Dispute
UTICA, N.Y. - After a $6.25 million judgment was entered against it in a dispute concerning two separate reinsurance certificates and coverage for settlements of asbestos claims, a reinsurer asks on Oct. 18 that a New York federal court grant judgment as a matter of law on an insurer's breach of contract claims and affirmative defenses and, in the alternative, grant a new trial on the insurer's breach of contract claims and the reinsurer's claim for breach of the duty of utmost good faith (Utica Mutual Insurance Co. v. Century Indemnity Co., No. 13-995, N.D. N.Y.).

Questions Of Fact Exist On Pollution Exclusion Included In Policy
CHARLESTON, W.Va. - A West Virginia federal judge on Oct. 16 denied a motion for summary judgment filed by insurance agents in a dispute over whether the agents negligently procured a commercial general liability with a total pollution exclusion rather than a modified pollution exclusion after determining that questions of fact exist regarding the procurement of the policy (Gemini Insurance Co. v. Sirnaik LLC et al., No. 18-424, S.D. W.Va., 2019 U.S. Dist. LEXIS 178767).

Texas High Court Should Review Pollution Exclusion Ruling, Insured Contends
AUSTIN, Texas - The Texas Supreme Court should grant review of an appeals court's ruling that an insurer owes no duty to defend an insured against underlying allegations arising out of the insured's aerial spraying of a herbicide based on an endorsement to the policy's pollution exclusion because the underlying suit alleges damages that are potentially covered under the policy at issue, the insured argues in an Oct. 11 petition for review (RiceTec Inc. v. StarNet Insurance Co., No. 19-0927, Texas Sup.).

Gas Explosion Coverage Suit Against Lloyd's Of London Remanded
PITTSBURGH - A Pennsylvania federal judge on Oct. 17 remanded an insured's suit seeking coverage for pollution costs and damages caused by a gas well that spewed drilling fluid and fracking materials above the surface of the ground because the defendant insurers failed to prove that all of the underwriters on the Lloyd's of London policy are completely diverse (CNX Gas Co. LLC v. Lloyd's of London, et al., No. 19-699, W.D. Pa.).

Insurers Say No Coverage Owed For Claims Stemming From Gas Explosion
BIRMINGHAM, Ala. - No coverage is owed for underlying claims filed against an insured following a gas pipeline explosion because the policies' professional liability exclusions and pollution exclusions bar coverage for the underlying claims, two insurers assert in a complaint filed Oct. 10 in Alabama federal court (Ohio Security Insurance Co., et al. v. Superior Land Designs, et al., No. 19-1656, N.D. Ala.).

Maryland Panel Affirms Allocation Method Applied In Lead Paint Dispute
ANNAPOLIS, Md. - The Maryland Court of Special Appeals on Oct. 15 affirmed a trial court's finding that a pro rata time-on-the-risk method of allocation applies in a lead paint poisoning coverage suit, but determined that the trial court erred in finding that one of the insurers owes coverage under one of its three policies for the underlying judgment entered against its insured landlords because the third policy was issued after the tenant was diagnosed with an elevated blood-lead level (Daquantay Robinson et al. v. CX Reinsurance Co. Ltd. et al., Md. Spec. App., No. 1888, 2019 Md. App. LEXIS 879).

Pro Rata, Time-On-The- Risk Method Of Allocation Applies To Policies
NEW YORK - In ruling on a number of issues in an asbestos and silica coverage dispute, a New York federal judge on Oct. 10 agreed with one insurer that the pro rata, time-on-the-risk method of allocation should be applied to the insurer's primary policies issued to an insured that was named in hundreds of underlying asbestos and silica bodily injury lawsuits (Danaher Corp. v. Travelers Indemnity Co., et al., No. 10-0121, S.D. N.Y., 2019 U.S. Dist. LEXIS 176524).

Nonsettling Insurers Decry Court's Jurisdiction Finding In Appeals Over Settlements
TACOMA, Wash. - A Washington federal bankruptcy judge did not have jurisdiction to approve two settlements between Chapter 11 debtor Fraser's Boiler Service Inc. and several asbestos liability insurers, nonsettling insurers argue in their Sept. 30 final brief on appeal in federal court (Fraser's Boiler Service, Inc. v. Certain Underwriters at Lloyd's, et al, No. 19-35269, 9th Cir.).

Insurer, Asbestos Plaintiff Brief Washington Court On $4.5M Covenant Judgment
SEATTLE - After two parties to an asbestos action reached a $4.5 million covenant judgment assigning insurance rights to the plaintiffs, those plaintiffs and the insurer have briefed a Washington appeals court on the propriety of that judgment (Robert P. Ulbricht, et al. v. CBS Corp., et al., No. 79490-6, Wash. App., Div. 1).

Fraser's Insurer Says Negative Ruling In Row Over Contribution Claims Was Error
TACOMA, Wash. - A Washington federal bankruptcy court's denial of an insurer's bid to vacate a stipulated order barring its contribution claims against other insurers for asbestos claims against Chapter 11 debtor Fraser's Boiler Service Inc. should be reversed because it goes against the law of the case, the insurer argues in an Oct. 1 opening brief on appeal in federal district court (National Union Fire Insurance Company of Pittsburgh, PA v. Fraser's Boiler Service, Inc., et al., No. 3:19-cv-5648, W.D. Wash.).

Defective Workmanship Does Not Constitute An Occurrence, Judge Says
PHILADELPHIA - A Pennsylvania federal judge on Oct. 15 granted a commercial general liability insurer's motion for summary judgment after determining that the insurer has no duty to defend its insured subcontractor or an alleged additional insured contractor against a claim arising out of water and mold damages caused by the defective installation of air conditioning units by the subcontractor because defective workmanship does not constitute an occurrence under the policy (Utica Mutual Insurance Co. v. Voegele Mechanical Inc, et al., No. 18-3959, E.D. Pa., 2019 U.S. Dist. LEXIS 178038).

Coverage Owed For Collapse Of Breezeway At Insured Building, Judge Says
GREENSBORO, N.C. - A North Carolina federal judge on Oct. 15 granted an insured's motion for summary judgment after determining that the insurer owes the insured coverage for the collapse of a breezeway at a building owned by the insured because the policy specifically states that coverage is afforded for collapse caused by the weight of people (DENC LLC v. Philadelphia Indemnity Insurance Co., No. 18-754, M.D. N.C.).

Connecticut High Court Says Occupational Disease Exclusions Apply To Nonemployees
HARTFORD, Conn. - The Connecticut Supreme Court on Oct. 8 affirmed an appellate court's finding that occupational disease exclusions included in two insurers' policies bar coverage for occupational disease claims arising out of silica and asbestos exposure filed against the insured by both employees and nonemployees who developed asbestos-related diseases while using the insured's talc while working for other employers (R.T. Vanderbilt Co. Inc. v. Hartford Accident & Indemnity Co., et al., Nos. SC 20000, SC20001, SC20003, Conn. Sup., 2019 Conn. LEXIS 266).

Apartment Manager, Insurer Debate Punitive Damages Award Coverage In 10th Circuit
LOGAN, Utah - With primary briefing complete and scheduled Oct. 22 oral arguments approaching, the parties in an insurance coverage dispute over punitive damages for a carbon monoxide poisoning incident submitted supplemental briefs at the direction of the 10th Circuit U.S. Court of Appeals addressing the diversity of the parties and suggesting that a party that has known issues on appeal be dismissed from the case (Interstate Fire & Casualty Co., et al. v. Apartment Management Consultants LLC, et al., No. 18-8058, 10th Cir.).

Federal Judge Approves Settlement In Environmental Contamination Suit
SEATTLE - A Washington federal judge on Oct. 1 approved the terms of a proposed settlement between an insured and one of its insurers in an environmental contamination coverage dispute after determining that the terms of the settlement are reasonable (Seattle Times Co. v. National Surety Corp., et al., No 13-1463, W.D. Wash., 2019 U.S. Dist. LEXIS 174642).

Interlocutory Appeal Not Warranted In Environmental Suit, Missouri Judge Says
JOPLIN, Mo. - A Missouri federal judge on Sept. 5 denied an insurer's motion for certification of an order of interlocutory appeal on a choice-of-law determination ruling in an environmental contamination coverage dispute after determining that the insurer failed to prove that the case is an exceptional one that warrants immediate appeal (Butterball LLC v. Great American E&S Insurance Co., No. 18-5074, W.D. Mo., 2019 U.S. Dist. LEXIS 173975).

Insurer Says 5th Circuit Should Affirm Ruling In Contamination Coverage Suit
CHICAGO - The Seventh Circuit U.S. Court of Appeal should affirm a district court's ruling that an insurer owes no coverage for environmental contamination claims asserted by neighbors of an insured property because the insured failed to provide timely notice of the claims, the insurer argues in an Oct. 3 appellee brief (Carmine Greene, et al. v. Kenneth Will, et al., No. 19-2260, 7th Cir.).

No Coverage Due For Water Damage Based On Seepage Exclusion, Judge Says
MACON, Ga. - A Georgia federal judge on Oct. 9 granted a homeowners insurer's motion for summary judgment after determining that no coverage is owed for water damage because the policy clearly excludes coverage for continuous seepage or leakage of water (Kimberly Landrum v. Allstate Insurance Co., No. 18-458, M.D. Ga., 2019 U.S. Dist. LEXIS 175664).

No Coverage Due For Collapse Of Exterior Wall, Appeals Panel Affirms
KANSAS CITY, Mo.- No coverage is owed for the collapse of an exterior brick veneer wall because the collapse was not abrupt and was caused by deterioration of the wall's materials, an excluded cause of loss, the Western District Missouri Court of Appeals said Oct. 8 in affirming a summary judgment ruling in favor of the homeowners insurer (Dominic Messina v. Shelter Insurance Co., No. WD82313, Mo. App., W.D., 2019 Mo. App. LEXIS 1612).

No Coverage Owed For Homeowner's Claim For Cracking, Crumbling Walls
ROCKVILLE, Conn. - A Connecticut state court judge on Sept. 5 granted two insurers' motions for summary judgment in a suit filed by a homeowner seeking coverage for the cracking and deterioration of the home's basement walls after determining that the homeowner's suit is barred by the suit limitation provision in one of the policies and that no coverage is afforded under the second policy's additional coverage for collapse (Sharon A. Giguere v. Great American Insurance Co., et al., No. TTD-CV-176012558-S, Conn. Super., Tolland Dist., 2019 Conn. Super. LEXIS 2483).

No Coverage Owed For 2 Construction Defect Actions, Insurer Argues To 3rd Circuit
PHILADELPHIA - An insurer on Sept. 9 asked the Third Circuit U.S. Court of Appeals to reverse a federal court's ruling that it has a duty to defend two construction defect actions, disputing the finding that there are sufficient allegations of products-related tort claims such that there may have been an "occurrence" (Nautilus Insurance Company v. 200 Christian Street Partners LLC, et al., Nos. 19-1507 and 19-1506, 3rd Cir.).

 
 
The above is not legal advice. That can only come from a qualified attorney who is familiar
with all the facts and circumstances of a particular, specific case and the relevant law.