Justia Insurance Law Opinion Summaries

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This case revolves around a dispute between California Specialty Insulation, Inc. (CSI) and Allied World Surplus Lines Insurance Company (Allied World) over a commercial general liability insurance policy. The policy was issued by Allied World to CSI. The dispute arose when Allied World refused to defend and indemnify CSI against a negligence claim following a construction site accident. The parties disagreed on whether one of the policy’s exclusions for bodily injury liability applied in this situation. The policy excluded coverage for bodily injury to the employees of any “contractor,” but the term “contractor” was not defined in the policy. Allied World argued that the term was unambiguous and the exclusion precluded coverage for the negligence claim, while CSI argued that the term was ambiguous and the exclusion did not apply to the negligence claim.The trial court ruled in favor of CSI, granting its motion for summary judgment and denying Allied World’s. The court found that the term “contractor” in the disputed exclusion was ambiguous and interpreted the term in favor of CSI.The Court of Appeal of the State of California Second Appellate District Division Seven affirmed the trial court's decision. The appellate court agreed with the trial court that the term “contractor” in the disputed exclusion was ambiguous. The court interpreted the term based on CSI’s objectively reasonable expectations and concluded that the exclusion did not apply to the negligence claim in question. Therefore, Allied World was obligated to defend and indemnify CSI against the negligence claim. View "California Specialty Insulation, Inc. v. Allied World Surplus Lines Insurance Co." on Justia Law

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Thermoflex Waukegan, a company that required its hourly workers to use handprints to clock in and out, was sued for allegedly violating the Biometric Information Privacy Act (BIPA) by not obtaining workers' written consent and using a third party to process the data. Thermoflex had multiple insurance policies, including three from Mitsui Sumitomo Insurance, which declined to defend or indemnify Thermoflex, leading to this suit.The district court ruled that an exclusion in the Basic policy made it inapplicable to any claim based on BIPA. The exclusion stated that the insurance did not apply to claims arising out of any access to or disclosure of any person’s or organization’s confidential or personal information. The court found this exclusion straightforward, as BIPA identifies biometric information as confidential.The Excess and Umbrella policy had two parts. Coverage E contained the same exclusions as the Basic policy, and the court agreed with the district court's ruling that it did not apply to claims under BIPA. Coverage U lacked an exclusion relating to nonpublic information. The district court found that none of the three arguably applicable exclusions to Coverage U clearly foreclosed a duty to provide Thermoflex with a defense in the state-court suit.The United States Court of Appeals for the Seventh Circuit affirmed the district court's decision. It agreed with the district court's interpretation of the Basic policy and Coverage E of the Excess and Umbrella policy. It also agreed that the three exclusions to Coverage U did not apply to BIPA. Therefore, it held that Mitsui owed Thermoflex a defense under the Umbrella policy, provided that the limits of another policy that applies to the BIPA claims, plus deductibles, have been exhausted. View "Thermoflex Waukegan, LLC v. Mitsui Sumitomo Insurance USA, Inc." on Justia Law

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The case involves Nancy Anaya-Smith, the next of kin of Michael Brian Smith, who was killed in a single-car accident while he was a passenger in a company vehicle owned by Fixtures & Drywall Company of Oklahoma (FADCO). The vehicle was being driven by Smith's coworker, Duane Clark. Anaya-Smith alleges that Clark's negligence caused the fatal accident. At the time of the accident, FADCO maintained an insurance policy with Federated Mutual Insurance Company (Federated). The policy provided up to $1,000,000 of liability coverage per accident and an additional $6,000,000 of liability coverage per accident under an umbrella policy. However, FADCO had rejected uninsured motorist (UM) coverage for all employees, except for its directors, officers, partners, owners, and their family members.The United States District Court for the Western District of Oklahoma granted summary judgment in favor of Federated, concluding that the vehicle was an uninsured vehicle at the time of the accident because Clark is immune from tort liability under the workers' compensation exclusive remedy provision, and that FADCO's policy providing UM coverage for some individuals who qualify as insureds but rejecting UM coverage for other insureds does not violate Oklahoma law. Anaya-Smith appealed from the summary judgment order.The Supreme Court of the State of Oklahoma answered the first certified question in the affirmative, holding that the vehicle qualifies as an uninsured motor vehicle within the meaning of Oklahoma law. The court answered the second certified question in the negative, concluding that the plain language of Oklahoma law requires a named insured to either elect or reject uninsured/underinsured motorist coverage for all insureds under the policy, treating every insured in the same manner. The court declined to answer the third certified question as the record was undeveloped and the parties did not submit legal arguments pertaining to it. View "Anaya-Smith v. Federated Mutual Insurance Co." on Justia Law

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In November 2021, David Goyco was struck and injured by an automobile while operating a low-speed electric scooter (LSES). Goyco filed a claim for personal injury protection (PIP) benefits under his personal automobile policy with Progressive Insurance Company. Progressive denied the claim, arguing that Goyco's LSES did not meet the definition of an "automobile" and that Goyco could not be considered a "pedestrian" under the New Jersey Automobile Reparation Reform Act, commonly known as the No-Fault Act. Goyco filed a complaint, asserting that LSES riders should be considered "pedestrians" entitled to PIP benefits under the No-Fault Act. The trial court denied relief to Goyco, and the Appellate Division affirmed.The Supreme Court of New Jersey affirmed the lower courts' decisions. The court held that an LSES rider does not fall within the definition of "pedestrian" for purposes of the No-Fault Act. The court found that Goyco's LSES was a "vehicle" that used a rechargeable electric motor and was therefore "propelled by other than muscular power" and was "designed for use on highways, rails and tracks." The court also rejected Goyco's reliance on a 2019 statute that provides that an LSES should be considered equivalent to a bicycle, stating that the statute was not intended to have any effect on the No-Fault Act. The court concluded that Goyco was not a pedestrian entitled to PIP benefits under Progressive's No-Fault insurance policy. View "Goyco v. Progressive Insurance Company" on Justia Law

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The case involves an employee, Braden Nanez, who was injured in an auto accident while off work and away from his job at a remote fire base camp. His employer, 3 Stonedeggs, Inc., expected employees not to leave the job site and to notify a manager if they did. Nanez did not notify a manager he was leaving camp. The Workers’ Compensation Appeals Board (the Board) determined that under the commercial traveler rule, workers’ compensation coverage applied to Nanez's injuries. The Board found that Nanez’s use of his own car while off work to drive approximately 70 miles away from camp purportedly to obtain cellular service was conduct reasonably expected by his employer to be incident to its requirement that Nanez spend time away from home where cellular service was not adequately provided at the camp.The employer, 3 Stonedeggs, Inc., and its insurer, Technology Insurance Company, Inc., administered by Amtrust North America, petitioned for a writ of review, arguing that the Board acted in excess of its authority and that substantial evidence does not support the Board’s findings. They argued that Nanez was injured during a material deviation from his employment; he left the camp without employer approval on a personal activity that, under the unique circumstances of working at this remote fire camp, was not contemplated by the employer.The Court of Appeal of the State of California Third Appellate District denied the petition, finding that substantial evidence supports the Board’s findings. The court concluded that under the circumstances of Nanez’s age, his having his personal vehicle with him, the structure of his shifts, the remoteness of the camp, and his not being prohibited from using his vehicle during his off hours, it was reasonable for the employer to expect that Nanez would leave camp in his car during his off time as incident to being employed away from home. View "3 Stonedeggs, Inc. v. Workers' Compensation Appeals Board" on Justia Law

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This case involves a three-car consecutive rear-end collision. The plaintiffs, Scott Eastman and his wife, filed a lawsuit against Jillian Peterson and her insurer, State Farm Mutual Automobile Insurance Company, alleging that Peterson was solely liable for the accident because she negligently rear-ended Eastman's vehicle. Peterson and State Farm denied the allegations, contending that Eastman was comparatively at fault for the accident because he impacted the vehicle in front of him prior to being rear-ended by Peterson. They also disputed the severity of Eastman's injuries caused by the accident and argued that a majority of his alleged injuries and damages were due to a pre-existing condition.The case was tried before a jury, which found both Peterson and Eastman comparatively liable for the accident, assigning fifty-percent fault to each. The jury also found that Eastman had been injured in the accident and awarded him damages. Eastman then filed a motion for judgment notwithstanding the verdict (JNOV), arguing that the jury erred as the evidence strongly and overwhelmingly favored a finding of sole liability on the part of Peterson. The trial court granted the JNOV, finding Peterson solely liable for the accident and increasing the damages awarded to Eastman. The court of appeal affirmed the trial court's judgment.The Supreme Court of Louisiana granted certiorari to review the lower courts' judgments. The court found that the trial court erred in granting the JNOV as to both liability and damages. The court noted that there was conflicting, credible testimony as to whether Eastman collided with the vehicle ahead of him prior to being impacted from behind by Peterson. The court also found that the evidence did not so strongly and overwhelmingly favor Eastman that reasonable jurors could not reach different conclusions. Therefore, the court reversed the court of appeal, vacated the judgment of the trial court, and reinstated the jury's verdict. View "EASTMAN VS. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY" on Justia Law

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The case revolves around a dispute between the Texas Windstorm Insurance Association (TWIA) and Stephen Pruski, a policyholder. TWIA is a quasi-governmental body that provides windstorm and hail insurance to property owners in the coastal region of Texas who cannot get this coverage in the regular market due to the risk of catastrophic hurricanes. Pruski filed two claims with TWIA after Hurricane Harvey and a subsequent storm, and TWIA partially accepted and partially denied coverage for both claims. Pruski then filed a lawsuit in Nueces County District Court, seeking damages for TWIA’s alleged improper denial of coverage. The case was assigned to a judge who was not appointed by the Judicial Panel on Multidistrict Litigation (MDL), as required by Texas Insurance Code Section 2210.575(e).The case was initially heard in the Nueces County District Court, where TWIA filed a motion for summary judgment, arguing that the damages for which Pruski sought recovery were not covered by his policy as a matter of law. The district court granted the motion and rendered a final, take-nothing judgment for TWIA. Pruski appealed, arguing that the trial judge was not qualified to render judgment because she had not been appointed by the MDL panel. The court of appeals reversed the district court's judgment, holding that a trial judge who is not appointed by the MDL panel is “without authority to render judgment” in a suit under Chapter 2210.The Supreme Court of Texas disagreed with the court of appeals' interpretation of the statute. The court held that while the requirement for a judge to be appointed by the MDL panel is mandatory, it is not jurisdictional. Therefore, the district court had subject matter jurisdiction over the suit, even though the presiding judge was not appointed by the MDL panel. The Supreme Court of Texas reversed the court of appeals’ judgment and remanded the case to that court for further proceedings. View "TEXAS WINDSTORM INSURANCE ASSOCIATION v. PRUSKI" on Justia Law

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In October 2020, Larry Knight's residence was damaged by Hurricane Zeta. He filed an insurance claim with Foremost Insurance Company, which was denied. Knight then sued Foremost, claiming that the company had insured his residence. Over the course of the litigation, Knight amended his complaint six times, eventually adding claims related to a rental property that Foremost admitted to insuring. He also added Karen Bradford and Bradford Agency, LLC as defendants. Foremost moved to strike Knight's latest amended complaint, while Bradford and the Agency moved to quash service of process and to be dismissed from the case, arguing that service on them had been insufficient. The trial court denied these motions.Foremost, Bradford, and the Agency petitioned the Supreme Court of Alabama for a writ of mandamus, arguing that they were entitled to relief. The court agreed, finding that Knight had failed to demonstrate good cause for amending his complaint for a sixth time and that allowing the amendment would result in actual prejudice to Foremost and unduly delay the trial. The court also found that service on Bradford and the Agency was ineffective, as Knight had failed to comply with the service requirements in Rule 4 of the Alabama Rules of Civil Procedure. The court therefore granted the petition and issued the writ, directing the trial court to strike Knight's sixth amended complaint and to grant Bradford and the Agency's motions to quash service of process and to dismiss them from the lawsuit. View "Ex parte Foremost Insurance Company v. Foremost Insurance Company" on Justia Law

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This case involves a dispute between Sentry Insurance and James J. Morgan, who operates a business. Morgan's properties, insured by Sentry, suffered wind and hail damage from a storm. Sentry estimated the damages at $190,768.33 and paid Morgan $61,026.93 after deductions. However, Morgan estimated his loss at $540,426.05 and demanded Sentry pay an additional $349,657.22. When the parties couldn't agree on the loss amount, they turned to an appraisal process outlined in their insurance policy. Both parties appointed an appraiser, but the appraisers couldn't agree on an umpire. Consequently, Sentry filed a petition for the district court to appoint an umpire.The district court dismissed Sentry's petition, ruling that it lacked subject matter jurisdiction because the petition didn't meet the amount-in-controversy requirement for diversity jurisdiction under 28 U.S.C. § 1332. The court reasoned that it couldn't assess the value of the parties' contractual right to have an umpire examine the difference between two appraisers' estimates and determine the loss amount because the appraisers hadn't yet made their estimates.The United States Court of Appeals for the Fifth Circuit reversed the district court's decision. The appellate court disagreed with the district court's narrow interpretation of the right to be protected. It held that in an action seeking the appointment of an umpire for appraisal, the right to be protected is the right to continue with the appraisal process, and the value of this right is the disputed amount set to be resolved through appraisal. The court found that Sentry's petition established an amount in controversy over $75,000, as Morgan had demanded an additional $349,657.22 under the policy. The case was remanded to the district court to consider Morgan's additional jurisdictional arguments. View "Sentry Insurance v. Morgan" on Justia Law

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The case involves George and Sheila Byers, who filed a lawsuit against their homeowners' insurance provider, USAA General Indemnity Company (USAA), and other defendants. The Byerses alleged that USAA breached their contract and the covenant of good faith and fair dealing in relation to the installation of hardwood flooring at their home. They sought attorneys' fees as damages under the Brandt v. Superior Court (1985) principle, which allows for the recovery of attorney fees when an insurer's tortious conduct compels the insured to hire an attorney to obtain policy benefits.USAA sought to compel the Byerses to produce documents related to their attorney fees, arguing that by seeking Brandt fees, the Byerses had waived their attorney-client privilege regarding these documents. The Byerses objected, arguing that the requests were ambiguous, overbroad, and violated attorney-client privilege. The trial court granted USAA's motion to compel, allowing the Byerses to redact any references they believed reflected attorney work product.The Byerses then petitioned the Court of Appeal of the State of California, First Appellate District, Division Five, challenging the trial court's order. They argued that the trial court had forced them to waive their attorney-client privilege and had abused its discretion by ordering the production of all invoices, fee agreements, and payment history.The appellate court denied the Byerses' petition. It found that by seeking Brandt fees, the Byerses had impliedly waived their attorney-client privilege regarding the attorney fees documents. The court also found no abuse of discretion in the trial court's order allowing the Byerses to redact references they believed reflected attorney work product. The court concluded that USAA had a right to learn about the attorney fees aspect of the Byerses' alleged damages during discovery. View "Byers v. Super. Ct." on Justia Law