Justia Insurance Law Opinion Summaries

Nationwide appealed both the district court's order denying Nationwide's motion in limine and the final judgment entered in favor of plaintiff, as assignee of Gary Gardner & Gary Gardner Builders, Inc. At issue is the preclusive effect of a judgment entered by a federal court exercising diversity jurisdiction on a nonparty to an earlier federal action.The Eleventh Circuit held that when determining the preclusive effect of an earlier judgment rendered by a federal court exercising diversity jurisdiction, federal common law adopts the rules of issue preclusion applied by the State in which the rendering court sits. In this case, the court held that the district court was required to apply Alabama's rules of issue preclusion. Instead, the district court applied a federal rule of issue preclusion and that federal rule is not substantively similar to Alabama's rule on nonparty issue preclusion. Therefore, the court reversed the district court's order denying Nationwide's motion in limine, vacated the final judgment in favor of plaintiff, and remanded for further proceedings. View "Sellers v. Nationwide Mutual Fire Insurance Co." on Justia Law

Gunn brought a putative class action against Continental, which had issued a group long-term care insurance policy to Gunn’s employer, the federal judiciary, in Washington D.C. Gunn alleged that Continental breached its contract, committed torts, and violated consumer protection laws by raising his premiums dramatically. The district court dismissed the case on the pleadings based on Continental’s assertion of a filed-rate defense, relying on the Washington state Insurance Commissioner’s approval of the new, higher premiums for individual insureds in Washington.The Seventh Circuit reversed, noting that choice of law is critical in this case, which involves employees in every state. It is unclear which state’s or states’ law creates Gunn’s causes of action, whether that jurisdiction recognizes an applicable filed-rate defense and within what contours, and which state or states have authority to approve premium rates under the group policy. The court remanded to allow the district court to address those questions. View "Gunn v. Continental Casualty Co." on Justia Law

Meemic Insurance Company filed suit against Louise and Richard Fortson, individually and as conservator of their son, Justin Fortson, alleging that Richard and Louise had fraudulently obtained payment for attendant-care services they did not provide to Justin. In 2009, Justin was injured when he fell from the hood of a motor vehicle, necessitating constant supervision and long-term care. Richard and Louise opted to provide attendant care to Justin in their home on a full-time basis. Justin received benefits under his parents’ no-fault policy with Meemic, and from 2009 until 2014, Louise submitted payment requests to Meemic for the attendant-care services she and her husband provided, asserting that they provided full-time supervision; Meemic routinely paid the benefits. In 2013, Meemic investigated Richard and Louise’s supervision of Justin, and discovered Justin had been periodically jailed for traffic and drug offenses and had spent time at an inpatient substance-abuse rehabilitation facility at times when Richard and Louise stated they were providing full-time supervision. The underlying policy contained an antifraud provision stating that the policy was void if any insured person intentionally concealed or misrepresented any material fact or circumstance relating to the insurance, the application for it, or any claim made under it. Louise and Richard counterclaimed, arguing that Meemic breached the insurance contract by terminating Justin’s benefits and refusing to pay for attendant-care services. Meemic moved for summary judgment, and the trial court initially denied the motion, reasoning that under the innocent-third-party rule, Meemic could not rescind the policy on the basis of fraud to avoid liability for benefits owed to Justin, an innocent third party. Meemic moved for reconsideration of that decision after the Court of Appeals later concluded in Bazzi v. Sentinel Ins. Co., 315 Mich App 763 (2016), the innocent-third-party rule was no longer good law. On reconsideration, the trial court granted summary judgment in favor of Meemic. Louise and Richard appealed. The Court of Appeals reversed, first reasoning that Bazzi did not apply because the fraud in this case did not occur in the procurement of the policy and did not affect the validity of the contract. The court concluded, however, that the policy’s antifraud provision was invalid because it would enable Meemic to avoid the payment of personal protection insurance (PIP) benefits mandated by MCL 500.3105. The Michigan Supreme Court affirmed, holding that contractual provisions like the one asserted by Meemic, in the context of the mandate of the no-fault act, are valid when based on a defense to mandatory coverage provided in the no-fault act itself or on a common-law defense that has not been abrogated by the act. Because Meemic’s fraud defense was grounded on neither the no-fault act nor the common law, it was invalid and unenforceable. Accordingly, the Court of Appeals was affirmed on different grounds, and the case remanded to the trial court for further proceedings. View "Meemic Ins. Co. v. Fortson" on Justia Law

After claimant Danny Arvidson received an award of permanent total disability, insurer Liberty Northwest Insurance Corporation requested a hearing before an administrative law judge (ALJ) to review the award. The ALJ dismissed insurer’s hearing request as time-barred. The question on review before the Oregon Supreme Court was whether that dismissal entitled claimant to attorney fees under ORS 656.382(2), which provided that, if an insurer initiates review of a compensation award and the reviewing body “finds that ... all or part of the compensation awarded ... should not be reduced or disallowed,” the insurer shall pay the claimant’s attorney a “reasonable attorney fee.” The ALJ determined that the statute applied to the dismissal of insurer’s claim and awarded fees to claimant. The Workers’ Compensation Board reached a different conclusion and reversed that decision. The Court of Appeals affirmed without opinion. The Oregon Supreme Court reversed, finding the ALJ correctly determined that his dismissal of insurer’s request for hearing entitled claimant to attorney fees. The board erred in concluding otherwise. View "Arvidson v. Liberty Northwest Ins. Corp." on Justia Law

This matter arose from alleged violations of the Health Care Consumer Billing and Disclosure Protection Act (“Balance Billing Act” or “Act”). The Louisiana Supreme Court granted certiorari review to resolve the question of whether a patient’s claims against a contracted healthcare provider for an alleged violation of La. R.S. 22:1874(A)(1) were delictual in nature. The consolidated lawsuits in this matter were filed by Matthew DePhillips and Earnest Williams, individually and on behalf of putative classes, against Hospital District No. 1 of Tangipahoa Parish d/b/a North Oaks Medical Center/North Oaks Health System (“North Oaks”). In February, 2011, Williams was injured in a motor vehicle accident. He sought emergency medical treatment from North Oaks. At the time of the accident, Williams was insured under an insurance policy administered by Louisiana Health Service & Indemnity Company d/b/a Blue Cross and Blue Shield of Louisiana (“BCBS”). North Oaks is a contracted healthcare provider with BCBS pursuant to a certain Member Provider Agreement (the “MPA”) between North Oaks and BCBS. After Williams’ treatment, North Oaks filed a claim with BCBS, and BCBS paid a discounted rate on the claims as provided by the MPA. Thereafter, North Oaks sought to collect from Williams by filing a medical lien against his liability insurance claim for the full and undiscounted charges. Williams alleged that North Oaks filed this lien despite being a contracted healthcare provider with BCBS and despite its legal and contractual requirements to accept the insurance as payment in full. The trial court denied the exceptions of no right of action for breach of contract and prescription, but granted the North Oaks’ exception of no cause of action for claims arising before the effective date of the Balance Billing Act. The court of appeal granted writs in part, finding DePhillips did not have a right of action to assert a claim for breach of the MPA, as he was neither a party nor a third-party beneficiary to that agreement. The appellate court denied North Oaks’ writ application insofar as it related to the trial court’s denial of its exception of prescription. After review, the Supreme Court determined plaintiff's claims were delictual in nature, subject a one-year prescriptive period. View "DePhillips v. Hospital Service Dist. No. 1 of Tangipahoa Parish d/b/a North Oaks Medical Center et al." on Justia Law

Eghtesad’s pro se complaint claimed that he leased property to Martinez; State Farm issued Martinez a fire and liability insurance policy; Eghtesad was named on the policy as an additional insured; Eghtesad sought coverage for property damage; and State Farm told Eghtesad he was covered only for claims of slander. Eghtesad did not file an opposition to State Farm’s demurrer but asked for 60 days to try to settle and get counsel. The court continued the hearing. On the day his opposition was due, Eghtesad sought a further continuance of 90 days, informing the court that he had been involved in an auto accident. He attached a note from his doctor. The court granted Eghtesad “one final continuance” and set the hearing out for two additional weeks. Three days before the new hearing date, without having filed a response to the demurrer, Eghtesad sought another continuance, again providing a doctor’s note. The court did not grant a further continuance and sustained the demurrer without leave to amend.The court of appeal reversed, finding that Eghtesad should have been given an opportunity to amend his complaint. For an original complaint, regardless of whether the plaintiff has requested leave to amend, a trial court’s denial of leave to amend constitutes an abuse of discretion unless the complaint “shows on its face that it is incapable of amendment.” View "Eghtesad v. State Farm General Insurance Co." on Justia Law

Kevin Crook appealed summary judgment entered in favor of Allstate Indemnity Company ("Allstate Indemnity"), Allstate Insurance Company ("Allstate Insurance"), and The Barker Agency (hereinafter collectively referred to as "the defendants"). Crook owns lake-front property in Tuscaloosa County. The property consists of a house, a bathhouse, a garage, a deck, and a boat dock. In 2006, Crook, through The Barker Agency, obtained property insurance on the house and other structures from Allstate Indemnity. Allstate Indemnity issued a policy to Crook ("the policy") and provided uninterrupted insurance coverage of Crook's house from 2006 through 2015. On February 12, 2015, Allstate Indemnity conducted an inspection of the property for underwriting purposes. After the inspection, on February 23, 2015, The Barker Agency sent Crook a letter with the results, finding no "issues that impact [Crook's] current coverage, and you do not need to do anything further. ...our inspection... focused only on identifying certain types of hazards or conditions that might impact your future insurance coverage. It may not have identified some other hazards of conditions on your property." In April 2015, a storm damaged the deck and the boat dock. Ultimately, Crook sued defendants for breach of contract, bad-faith failure to pay a claim, negligent/wanton procurement of insurance, and estoppel, all relating to the policy's coverage of the storm damage. After review, the Alabama Supreme Court found no reversible error in the grant of summary judgment in favor of defendants and affirmed. View "Crook v. Allstate Indemnity Company, et al." on Justia Law

This matter went before the Alabama Supreme Court on consolidated appeals stemming from an action filed by Nancy Hicks for injuries sustained in an automobile accident. Hicks appealed when the trial court denied her motion for a new trial. Allstate Insurance Company ("Allstate") cross-appealed, challenging the trial court's denial of its motion for a partial judgment as a matter of law on the issue of causation of Hicks's injuries. By refusing to allow the jury to consider the mortality table, the trial court hindered the jury's ability to determine the appropriate amount of damages to which Hicks was entitled in a trial in which the only issue was the amount of damages. Because the trial court erroneously determined that the mortality table could not be admitted into evidence, the trial court's denial of Hicks's motion for a new trial was reversed. Because of the Court's holding on this issue, it pretermitted discussion of Hicks's other argument in support of her request for a new trial, namely that the trial court erred by not giving the requested jury instructions on permanent injuries and on the use of mortality tables. Because Allstate did not properly preserve for appellate review its motion for a partial judgment as a matter of law of the issue of causation underlying Hicks's claim, the trial court's denial of that motion was affirmed. The matter was remanded for further proceedings. View "Allstate Insurance Company v. Hicks" on Justia Law

Defendant Navigators Specialty Insurance Company (Navigators) appealed a trial court order denying its special motion to strike under California’s anti-SLAPP statute. Plaintiff Trilogy Plumbing, Inc. (Trilogy) alleged that Navigators, as Trilogy’s insurer, gave instructions with which Trilogy did not agree to attorneys Navigators had retained to defend Trilogy and wrongfully negotiated settlements without Trilogy’s consent. Navigators contended the alleged conduct constituted protected activity under Code of Civil Procedure section 425.17 (e)(2) and, therefore, the trial court erred by denying the anti-SLAPP motion. After review, the Court of Appeal affirmed: the allegations challenged by the anti-SLAPP motion described Navigators’ mishandling of the claims process with regard to 33 different lawsuits involving Trilogy. While the alleged acts were generally connected to litigation, they did not include any written or oral statement or writing made in connection with an issue under consideration or review by a judicial body and therefore did not constitute protected activity under section 425.16. View "Trilogy Plumbing, Inc. v. Navigators Specialty Ins. Co." on Justia Law

Travelers Insurance Co. appealed a district court decision to affirm a final order of the Idaho Department of Insurance in favor of Ultimate Logistics, LLC (“Ultimate”). The Department of Insurance’s final order upheld a hearing officer’s determination that two mechanics working for Ultimate were improperly included in a premium-rate calculation made by Travelers. In its petition for review, Travelers argued the Department of Insurance acted outside the scope of its statutory authority in determining that the mechanics could not be included in the premium-rate calculation. The district court rejected this argument. Finding no reversible error in the district court's order, the Idaho Supreme Court affirmed. View "Travelers Insurance v. Ultimate Logistics, LLC" on Justia Law