Justia Insurance Law Opinion Summaries

Claimant Cynthia Auck appealed the district courtâs order that found Respondent Workforce Safety and Insurance (WSI) acted with substantial justification when it refused to pay her benefits on the death of her husband. By this refusal, Ms. Auck was precluded from seeking attorneyâs fees. The Supreme Court found that the district court did not abuse its discretion in finding for Respondent. The Court affirmed the lower courtâs decision, and dismissed Ms. Auckâs claim for attorneyâs fees.

Appellants appealed an order revoking their pro hac vice admissions in connection with a putative class action suit where the suit alleged that appellants' clients breached supplemental cancer insurance policies that they had issued. At issue was whether the district court erred in revoking appellants' pro hac vice status where the revocation was based on motions appellants filed in response to plaintiffs' request for class certification, chiefly a motion to recuse the district judge based on his comments during an earlier hearing. The court vacated the revocation order and held that, even though the recusal motion had little merit, the district court erred in revoking appellants' pro hac vice admissions where it did not afford them even rudimentary process.

Grubbs Infinity ("Grubbs"), the insured, sued Universal Underwriters of Texas Insurance Company ("Universal") for underpayment of its insurance policy claim after Grubbs suffered hail damage to buildings on its property. At issue was whether the party demanding appraisal had waived its right to insist on the contractual procedure when the parties disagreed, but neither sought appraisal until one had filed suit. The court conditionally granted Universal's petition for writ of mandamus and directed the trial court to grant Universal's motion to compel appraisal where Universal had not waived its appraisal right and where Grubbs failed to demonstrate a showing of prejudice.

Owatonna Clinic-Mayo Health System ("Clinic") sued its insurer, Medical Protective Company ("Medical Protective"), claiming that the company had breached its obligation to defend and indemnify the Clinic in a medical malpractice suit that had resulted in a judgment against it. At issue was whether the district court erred in ruling as a matter of law that the Clinic's notice to Medical Protective, of a potential claim against it, conformed to the insurance policy requirements and whether the Clinic's belief that it was at risk was objectively reasonable. Also at issue was whether the Clinic was entitled to pre-judgment interest. The court affirmed the judgment and held that the Clinic was deemed to have filed a timely notice with Medical Protective where the information that Medical Protective received would obviously alert a reasonable insurer to the likelihood of possible allegations of liability on the Clinic's part. The court also held that Medical Protective's challenge to the district court's finding, that the Clinic's belief that it was at risk was objectively reasonable, was meritless where the quoted policy language set an exceedingly low bar. The court further held that the district court did not err in awarding pre-judgment interest under Minn. Stat. 60A.0811, subd. 2(a) where the statute was unambiguous; and, in the alternative, if the statute was ambiguous, the court construed it against the insurer.

Appellant Mildred Powell filed an insurance claim with respondent Liberty Mutual Fire Insurance Company to cover damage to her house. Liberty Mutual denied the claim, stating that the damage was excluded under the âearth movement exclusionâ in Appellantâs insurance policy. Appellant took Liberty Mutual to the district court. The court eventually granted Liberty Mutualâs motion for partial summary judgment, concluding that the âearth movement exclusionâ of the policy excluded coverage of the damage. Appellant challenged the district courtâs review of the policy, arguing that it was contrary to state law on a similar âearth movement exclusion.â The Supreme Court concluded that Liberty Mutualâs policy was ambiguous held in light of the applicable state law. The Court held that the district court erred in granting the company summary judgment, and reversed its holding. The Court remanded the case for further proceedings.

An insurance policyholder, TD Banknorth Insurance Agency, Inc., appealed from a declaratory judgment awarding to its insurer, Fireman's Fund Insurance Company, all funds in escrow as proceeds from settlement of the policyholder's claims against third parties. The policyholder challenged the allocation of the escrowed funds on the ground that Connecticut's common law "make whole" doctrine entitled it to recover its deductible before its insurer could collect as subrogee. The court held that this issue was undecided under Connecticut law and certified the following question to the Supreme Court of Connecticut: "Are insurance policy deductibles subject to Connecticut's make whole doctrine?"

ConAgra Foods, Inc. ("ConAgra") sued Lexington Insurance, Co. ("Lexington") alleging breach of contract and breach of the implied duty of good faith and fair dealing. ConAgra's claims arose from the alleged 2007 contamination of certain Peter Pan and Great Value peanut butter products that ConAgra manufactured. ConAgra subsequently sought coverage under its insurance policy with Lexington for personal injury claims arising from its contaminated products and Lexington denied coverage. At issue was whether the provision in the insurance policy provided coverage in light of the "lot or batch" provision in the policy. The court held that the "lot or batch" provision was ambiguous where, under one of the two reasonable interpretations, Lexington's duties to defend and indemnify were triggered. The court also held that, because the policy arguably provided coverage to ConAgra, Lexington's duty to defend was thereby triggered when ConAgra satisfied the applicable "retained limit" for a single "occurrence." Accordingly, the court reversed and remanded to ascertain the intent underlying the ambiguous policy language for purposes of determining whether there was ultimate policy coverage.

Claimant filed a claim against Government Insurance Company ("GEICO") for uninsured/underinsured motorist coverage after sustaining serious injuries as a result of a car accident. At issue was whether the coverage provisions of the GEICO policy entitled claimant to underinsured motorist benefits under the policy. The court held that claimant was not entitled to uninsured/underinsured coverage where Exclusion number 4 in the GEICO insurance policy was authorized by section 19-509(f)(1) of the Insurance Article, Maryland Code, 1997, 2006 Repl.Vol., and was applicable to the facts of this case.

Phoenix Insurance Company ("Phoenix") filed a complaint in circuit court rejecting the arbitration award given to appellee when she requested coverage under the underinsured-motorist provisions of her policy with Phoenix after she was injured in a car accident and the other driver's vehicle was underinsured. At issue was whether a provision allowing either party to an insurance contract to demand a trial de novo following arbitration was unenforceable when it appeared in an underinsured-motorist policy. The court held that the provision in appellee's underinsured-motorist policy allowing either party to reject an award over the statutory minimum for liability coverage did not violate public policy and was not unconscionable.

Plaintiff sued defendants, United Healthcare Insurance Company and the American Association of Retired Persons, alleging breach of contract, fraud under the D.C. Consumer Protection Procedures Act, and unjust enrichment when plaintiff had to pay nearly $40,000 in uninsured medical bills. At issue was whether the district court properly dismissed plaintiff's claim under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim when plaintiff tried to recover the uninsured amount by alleging that the contract between plaintiff and defendants was ambiguous. The court held that the district court properly dismissed plaintiff's claim under Rule 12(b)(6) where the contract was not ambiguous when it included sections on what services were and were not covered and included notations limiting coverage that was directly relevant to plaintiff's circumstances.