Justia Insurance Law Opinion Summaries

Trek, a Wisconsin bicycle manufacturer, had agreements with Taiwanese companies. Trek purchases bicycles from Giant, sells them under its own brand name, and purchases bicycle parts from Formula. The purchase orders required Giant and Formula to have Trek named as an additional insured in their products-liability insurance policies with Zurich and Taian, Taiwanese insurers. Those policies agreed to indemnify the insured and its listed vendors, including Trek, for judgments, expenses, and legal costs incurred “worldwide,” allowed the insurer to control the litigation or settlement of a covered claim but did not require it to do so; included a Taiwanese choice of law provision; and required disputes to be resolved by arbitration in Taiwan.Giessler rented Trek bicycle in Texas. The front-wheel detached from the bicycle's frame, Giessler fell, and the resulting injuries rendered him a quadriplegic. Although Giant had manufactured the bicycle and Formula had manufactured the front-wheel release, neither was a party to Giessler’s lawsuit. Trek’s insurer, Lexington, defended Trek and attempted to notify the Taiwanese companies of Giessler’s lawsuit. The case settled. Lexington paid Giessler on Trek’s behalf. Lexington unsuccessfully sought reimbursement from Zurich and Taian then sued them in Wisconsin.The Seventh Circuit affirmed that the district court lacked personal jurisdiction. Lexington failed to demonstrate that either insurer made any purposeful contact with Wisconsin before, during, or after the formation of the insurance contracts. They did not solicit Trek’s business or target the Wisconsin market. They negotiated and drafted these contracts in Taiwan with Taiwanese companies. The insurers may be liable to Trek and included worldwide coverage provisions but that does not establish Wisconsin's jurisdiction. View "Lexington Insurance Co. v. Hotai Insurance Co., Ltd." on Justia Law

In this breach of contract and negligent infliction of emotional distress action the Supreme Court affirmed the appellate court's judgment affirming the trial court's judgment denying Defendant's motion for judgment notwithstanding the verdict, holding that there was sufficient evidence to support the jury's verdict for Plaintiff.This action stemmed from Defendant's handling of Plaintiff's homeowner's insurance claim. The jury returned a verdict for Plaintiff on both counts. Defendant filed a motion for judgment notwithstanding the verdict, renewing its motion for a directed verdict, arguing that the verdict was not supported by sufficient evidence presented during Plaintiff's case-in-chief. The trial court denied the motion. On appeal, Defendant contended that the so-called waiver rule - which provides that a defendant waives the right to appeal the trial court's denial of the defendant's motion for directed verdict at the close of the plaintiff's case by opting to introduce evidence in its own behalf - is inapplicable to civil cases in which a trial court reserves decision on a motion for directed verdict. The Supreme Court disagreed, holding that a court reviewing the sufficiency of the evidence to support a jury's verdict must consider all of the evidence considered by the jury returning the verdict, not just the evidence presented in the plaintiff's case-in-chief. View "Riley v. Travelers Home & Marine Insurance Co." on Justia Law

A hotel housekeeper injured her back while lifting a pile of linens. Her employer challenged her application for benefits based on an examining doctor’s opinion that she was medically stable and that the job injury was no longer the substantial cause of any disability or need for medical treatment. After a hearing, the Alaska Workers’ Compensation Board decided that the woman was medically stable as of the date of the doctor’s opinion and therefore not entitled to further disability payments or to benefits for permanent partial impairment. The Board also denied further medical care after the date of medical stability. The Alaska Workers’ Compensation Appeals Commission affirmed the Board’s decision, and the woman appealed. Because the Board’s selected date of medical stability was not supported by substantial evidence in the record, the Alaska Supreme Court vacated the Commission’s decision and remanded the case to the Commission with instructions to remand the case to the Board for further proceedings. View "Tobar v. Remington Holdings LP" on Justia Law

This case arose from Hurricane Katrina insurance litigation. After the hurricane had destroyed many homes, policyholders and insurance companies began litigating whether the hurricane losses were caused by flood damage or wind damage. The distinction determined whether the insurance companies would pay claims on those polices that did not cover flood damage. This case is before the Court on interlocutory appeal. Safeco Insurance Company (Safeco) and Liberty Mutual Insurance Company individually challenged the circuit court’s reassignment of their respective cases and the appointment of a special master. The Mississippi Supreme Court found no abuse of discretion in reassigning judges, but vacated the order appointing the special master, finding an abuse of the trial court’s discretion. “The order itself acknowledged a blind-billing provision was “unusual.” But the Supreme Court found it was more than that: requiring both parties, one of which is the State of Mississippi, to pay an attorney in Louisiana to act as a judge, allowing either side to meet with him ex parte, and not requiring this special master to mention these meetings or even justify or detail his bill far exceeded the discretionary authority to appoint special masters.” View "Safeco Insurance Company of America v. Mississippi, ex rel. Hood" on Justia Law

Group Health Cooperative (GHO) provided health insurance benefits to Nathaniel (Joel) Coon, who suffered a serious fungal infection and amputation following knee surgery at the Everett Clinic (TEC). The Coon family later settled potential negligence claims against TEC, and GHO initiated this lawsuit seeking reimbursement of its payments from the settlement proceeds. At issue before the Washington Supreme Court was whether genuine issues of material fact remained to preclude summary judgment in favor of GHO regarding whether the settlement constituted full compensation to Coon, and whether GHO suffered prejudice from the Coons’ failure to provide notice prior to finalizing the settlement. The Supreme Court concurred with the Court of Appeals’ conclusion that genuine issues of fact still remained, making summary judgment inappropriate. The matter was remanded for further proceedings. View "Grp. Health Coop. v. Coon" on Justia Law

In this insurance dispute, the First Circuit remanded the case for additional factfinding, holding that where the record was conflicted as to whether there was complete diversity of citizenship when the action was commenced, remand was required.Appellants were two affiliated insureds who owned and operated a commercial bakery in Pittsfield, Massachusetts. Appellee, their insurer, had in effect a commercial business insurance policy covering the bakery. When a pipe erupted in the bakery, causing covered losses, the parties were unable to settle the ensuing insurance claims. Appellants commenced a civil action against Appellee in the United States District Court for the District of Massachusetts, invoking federal diversity jurisdiction and alleging that complete diversity existed between the parties. The magistrate judge ultimately granted Appellee's motion for summary judgment. The First Circuit noted a jurisdictional hurdle and remanded the case, holding that remand was required for the district court to determine whether there was complete diversity between the parties at the time the action was commenced. View "Bearbones, Inc. v. Peerless Indemnity Insurance Co." on Justia Law

In 2013, Rachel Dixon was driving a car owned by her boyfriend, Rene Oriental-Guillermo (“Policyholder”), when she was involved in an accident with a vehicle in which Priscila Jimenez was a passenger, and which was owned by Iris Velazquez, and operated by Alli Licona-Avila. At the time of the accident, Dixon resided with Policyholder, who had purchased a personal automobile insurance policy (“Policy”) for his vehicle through Safe Auto Insurance Company (“Safe Auto”). The Policy contained an unlisted resident driver exclusion (“URDE”), which excluded from coverage any individuals who lived with, but were not related to, the policyholder, and whom the policyholder did not specifically list as an additional driver on the insurance policy. Jimenez and her husband Luis (collectively, “Appellants”) filed a personal injury lawsuit against Dixon, Policyholder, and Licona-Avila. On May 13, 2015, Safe Auto filed a complaint against Dixon, Policyholder, and Appellants, seeking a declaratory judgment regarding the enforceability of the URDE with respect to Dixon. The trial court granted summary judgment in favor of Safe Auto, finding the URDE unambiguous, valid, and enforceable, and concluding that Safe Auto had no duty under the Policy to defend or indemnify Dixon in the underlying personal injury lawsuit. Appellants timely appealed to the Superior Court, arguing: (1) the trial court erred in holding the URDE was valid and enforceable; (2) that the URDE violated the provisions of the Pennsylvania Motor Vehicle Financial Responsibility Law (“MVFRL”); and (3) that the URDE violated public policy. The Superior Court affirmed the order of the trial court in a divided, published opinion. The Pennsylvania Supreme Court concurred the URDE at issue in this case was enforceable, and affirmed the Superior Court. View "Safe Auto v. Oriental-Guillermo" on Justia Law

The Plaintiffs, purportedly the assignees of certain private insurers (Medicare Advantage Organizations), brought a putative class action against State Farm to recover payments State Farm allegedly should have made to them as reimbursement for certain medical costs. The district court dismissed the action with prejudice, and imposed sanctions under Federal Rule of Civil Procedure 11 against one of the plaintiffs, MSP. and its attorneys. The Seventh Circuit concluded that the district court erred in dismissing plaintiffs’ case with prejudice, when the problem was a fundamental lack of Article III standing so that the court lacked jurisdiction to decide the case. However, the court acted within its discretion when it denied plaintiffs a third opportunity to cure the defects in their pleadings. The court’s order, in substance, was a jurisdictional dismissal without prejudice with denial of leave to amend dismissal is without prejudice. The district court exceeded the bounds of its discretion when it imposed Rule 11 sanctions on Recovery Claims and its attorneys. View "MAO-MSO Recovery II, LLC v. State Farm Mutual Automobile Insurance Co." on Justia Law

Bad Habit Trucking LLC owned a 1996 Peterbilt truck. Great West Casualty Company insured the truck. Dusty Weinreis, a member of Bad Habit Trucking LLC, took the truck to Butler Machinery Company for service work. The truck was destroyed by fire after the service work was completed but before Weinreis paid for the services. Great West paid Bad Habit Trucking $85,000 for the loss of the truck in accordance with the insurance policy. In November 2017 Butler sued Weinreis in small claims court for the unpaid service work. Weinreis counterclaimed in small claims court for the statutory maximum, $15,000, alleging loss of use of the truck, lost profits, cost to repair and replace the truck, and loss of personal property. Prior to the small claims hearing Butler moved to dismiss the case without prejudice. Weinreis resisted the motion, and a small claims hearing took place in 2018. The court awarded Butler $8,041.57 for the unpaid service work and awarded Weinreis $15,000 for lost profits. Offsetting the recoveries resulted in a net award to Weinreis of $6,958.43. In June 2018 Great West sued Butler in district court for $81,753.32 for the loss of the truck plus interest and costs. Butler moved to dismiss under N.D.R.Civ.P. 12(b)(6), arguing the case was fully decided in small claims court when Weinreis sued Butler for loss of the truck. The district court granted Butler’s motion to dismiss because the issue stemmed from the same transaction or occurrence, and found Great West should have filed a claim for damages in the small claims action. Great West moved to reconsider on the basis that Weinreis was the defendant in the small claims action, not Great West or Bad Habit Trucking. Great West argued privity did not exist between Weinreis in his personal capacity and Great West as the insurance company for Bad Habit Trucking. The district court denied the motion to reconsider. The North Dakota Supreme Court found the district court erred in dismissing Great West's claim, and reversed and remanded for further proceedings. View "Great West Casualty Company v. Butler Machinery Company" on Justia Law

The federal district court for the District of South Carolina certified a question of law to the South Carolina Supreme Court. The Supreme Court was asked to construe section 38-77-350(C) of the South Carolina Code (2015) and determine whether, under the facts presented, an insurance company was required to make a new offer of underinsured motorist (UIM) coverage when an additional named insured is added to an existing policy. In 2012, Wayne Reeves acquired an insurance policy from Progressive Direct Insurance Company (Progressive) covering his motorcycle. When the policy was issued, Wayne declined optional UIM coverage. In 2015, Wayne's wife (Jennifer) and son (Bryan) were added to the policy as "drivers and household residents," because they also drove motorcycles. In 2017, Bryan sold his motorcycle and purchased another motorcycle, a 2016 Harley Davidson, which was added to the policy. At the time, Wayne had Bryan added as named insured to the policy. Progressive did not offer Bryan any optional coverages. Later in 2017, Bryan was involved in an accident while driving his 2016 Harley Davidson. Bryan ultimately made a claim against Progressive to reform the policy to include UIM coverage based on Progressive's failure to offer him the optional coverage. Progressive contended that adding Bryan as a named insured was a change to an existing policy, and as a result, Progressive was not required to offer Bryan UIM coverage. Based on the undisputed facts, the parties filed cross motions for summary judgment. The Supreme Court concluded under South Carolina law, Progressive was not required to make an additional offer of UIM coverage to Bryan. View "Progressive Direct v. Reeves" on Justia Law