Justia Insurance Law Opinion Summaries

In 2018, Albert Mione (“Mione”) was in a collision while operating his motorcycle. Mione’s motorcycle was insured by Progressive Insurance, under a policy that did not include UM/UIM coverage. Albert and his wife Lisa jointly owned a car, which was insured by Erie Insurance on a single-vehicle policy that included UM/UIM coverage with stacking. Mione’s adult daughter Angela also lived in the couple’s home, and she too owned a car, which Erie insured on a single-vehicle policy (“Angela’s policy”). Both of the Erie policies contained household vehicle exclusions barring UM/UIM coverage for injuries sustained while operating a household vehicle not listed on the policy under which benefits are sought. The courts below held that the exclusions were valid and enforceable, citing the Pennsylvania Supreme Court’s 1998 decision in Eichelman v. Nationwide Insurance Co., 711 A.2d 1006 (Pa. 1998). The Miones, contended that the lower courts erred in applying Eichelman, arguing that the Supreme Court sub silentio overruled that decision in Gallagher v. GEICO Indemnity Co., 201 A.3d 131 (Pa. 2019). The Supreme Court rejected the Miones’ argument, and affirmed. View "Erie Insurance Exch. v. Mione, et al." on Justia Law

The issue this case presented for the New Jersey Supreme Court's consideration was whether claims brought under the Insurance Fraud Protection Act (IFPA) and the Workers’ Compensation Act (WCA) by plaintiffs Liberty Insurance Corp. and LM Insurance Corp. (Liberty) against defendants Techdan, LLC (Techdan), Exterior Erecting Services, Inc. (Exterior), Daniel Fisher, Robert Dunlap, and Carol Junz were subject to the apportionment procedure of the Comparative Negligence Act (CNA). Liberty issued workers’ compensation policies to Techdan from 2004 to 2007. It alleged defendants misrepresented the relationship between Techdan and Exterior and the ownership structure of the two entities and provided fraudulent payroll records to reduce the premiums for workers’ compensation insurance. Techdan was indicted for second-degree theft by deception, and Dunlap entered a guilty plea to that charge on Techdan’s behalf. The court granted partial summary judgment as to Liberty’s IFPA claim for insurance fraud against Techdan, Exterior, Dunlap, and Fisher; partial summary judgment as to Liberty’s workers’ compensation fraud claim against all defendants; and partial summary judgment as to Liberty’s breach of contract claim against Techdan and Exterior. The court denied summary judgment as to Liberty’s remaining claims. The jury found Techdan liable for $454,660 in compensatory damages and found Exterior liable for $227,330 in compensatory damages, but awarded no compensatory damages against Dunlap, Fisher, or Junz. It awarded punitive damages in the amount of $200,000 against Dunlap, $10,000 against Fisher, and $45,000 against Junz, but awarded no punitive damages against Techdan or Exterior. The trial court determined all defendants should be jointly and severally liable for the $756,990 awarded as compensatory damages. The Appellate Division held the trial court erred when it imposed joint and several liability on defendants rather than directing the jury to allocate percentages of fault to defendants in accordance with N.J.S.A. 2A:15-5.2(a)(2). The Division concluded the trial court’s cumulative errors warranted a new trial, and it remanded for further proceedings. The Supreme Court concurred with the appellate court: the trial court should have charged the jury to allocate percentages of fault and should have molded the judgment based on the jury’s findings; the trial court’s failure to apply the CNA warranted a new trial on remand. The Court did not disturb the first jury’s findings on the issues of liability under the IFPA, the WCA, or Liberty’s common-law claims, or its determination of total compensatory damages. The Court found no plain error in the trial court’s failure to give the jury an ultimate outcome charge. View "Liberty Insurance Corp. v. Techdan, LLC" on Justia Law

Several homeowners hired contractors to repair damage to their homes. The homeowners assigned to the contractors their rights under their insurance policies with State Farm & Casualty Co. State Farm refused to pay. The contractors sued. State Farm moved for summary judgment, arguing the assignments were invalid under Nebraska law. The district court granted the motion.   The Eighth Circuit affirmed. The court explained that the parties disagree on whether the terms are sufficient to create a valid assignment of rights. The court held that without a description of the services to be provided and a definite price, these terms are left “to be determined in the future,” and thus, there is no mutuality of obligation. Although the written language is insufficient to create an enforceable assignment, this conclusion, by itself, does not resolve this case. The contractors argued that their oral arrangements cure any deficiencies that may exist in the written agreements. The court concluded that it cannot conclude that the assignments here are invalid as a matter of law simply because the written “vital terms” were not as definite as they could have been. View "R.A.D. Services LLC v. State Farm Fire & Casualty Co." on Justia Law

Medical Protective Company (“MedPro”) issued Professional Liability policies to Dr. Bradley DeWall and Wound Management Consultants, P.C. (collectively, “WMC”). Coverage Paragraph A insured WMC against “claim[s] for damages . . . based on professional services rendered or which should have been rendered . . . by the insured . . . in the practice of the insured’s profession.” In this coverage action, the parties dispute whether Paragraph A covers a third party’s claim to recover Medicare reimbursements it had to repay because of deficiencies in WMC’s documentation of the professional services it provided. Applying Iowa law, the district court1 ruled, consistent with other courts that have considered the issue, that the third party’s “Medicare recoupment” claim is not “based upon professional services” and, therefore coverage is limited to the $50,000 of defense costs provided in the policies’ separate Medicare Endorsement. WMC appealed this summary judgment ruling, raising numerous issues.   The Eighth Circuit affirmed. The court concluded that MedPro had no duty to defend WMC from Genesis’s Medicare recoupment claim under the policies’ Paragraph A coverage. The court also agreed with the district court that there is no duty to defend the other claims Genesis asserted in its arbitration complaint because those claims are not “based upon professional services rendered . . . in the practice of [WMC’s] profession.” View "Bradley DeWall v. Medical Protective Company" on Justia Law

The Supreme Court affirmed the decision of the trial court granting summary judgment in favor of Insurer in this action brought to determine whether business losses suffered during the COVID-19 pandemic were covered by the relevant policies, holding that Insured's losses were not covered by the two insurance policies at issue.Before the pandemic, Insurer sold two insurance policies to Insured. Insurer later initiated this action seeking a judgment declaring that Insured's business losses incurred during the COVID-19 pandemic were not covered under the policies. The trial court concluded that there was no coverage under either policy. The Supreme Court affirmed, holding that the trial court properly entered summary judgment for Insurer because Insured's losses plainly and unambiguously were not covered by either policy. View "Hartford Fire Insurance Co. v. Moda, LLC" on Justia Law

The Supreme Court affirmed the judgment of the trial court in this dispute over whether a property insurance policy providing coverage for "direct physical loss of or physical damage to" covered property provided coverage for business income losses arising from the suspension of business operations during the COVID-19 pandemic, holding that the trial court correctly granted Defendant's motion for summary judgment.Plaintiffs, who suspended their business operations during the COVID-19 pandemic and consequently lost business income and incurred other expenses, filed claims for losses with Defendants. After Defendants denied the claims Plaintiffs brought this actin seeking a judgment declaring that the relevant insurance policies covered their economic losses under the circumstances. The trial court granted summary judgment for Defendants. The Supreme Court affirmed, holding that because Plaintiffs did not suffer any "direct physical loss" of covered property, there was no genuine issue of material fact as to whether the policies did not cover Plaintiffs' claims. View "Connecticut Dermatology Group, PC v. Twin City Fire Insurance Co." on Justia Law

Life Insurance Company of North America (“LINA”) made multiple determinations that Plaintiff did not qualify for disability benefits under her long-term disability insurance policy and her life insurance policy. Plaintiff sued LINA for breach of contract and bad-faith failure to provide insurance benefits. The district court granted summary judgment for LINA on Plaintiff’s bad-faith claim based on the multiple medical opinions that supported LINA’s determinations. The district court held that, under Alabama law, Plaintiff could not recover mental anguish damages for her breach of contract claim and excluded evidence of such damages. Finally, following a jury verdict in Plaintiff’s favor on the breach of contract claim related to the long-term disability insurance policy, the district court determined that Plaintiff was entitled to simple pre-judgment interest at a rate of 1.5 percent under the policy and simple post-judgment interest at a rate of 0.08 percent pursuant to 28 U.S.C. Section 1961. In determining that the long-term disability insurance policy provided for simple rather than compound interest, the district court struck a document produced by Plaintiff because it was not properly authenticated. On appeal, Plaintiff argued that the district court erred at each of these steps.   The Eleventh Circuit affirmed. The court held that the evidence establishes that LINA had an arguable reason for determining that Plaintiff did not qualify for disability benefits under the disability policy. Further, the court wrote that the Supreme Court of Alabama has made clear that mental anguish damages are unavailable for breach of contract claims related to long-term disability insurance policies. View "Cherri Walker v. Life Insurance Company of North America" on Justia Law

Geico General Insurance Company (Geico) asserted eight claims against Glassco, Inc.: a declaratory judgment claim seeking a declaration that Glassco violated the Repair Act and that Geico had no duty to pay pending claims (count one); a federal racketeering claim (count two); a federal racketeering conspiracy claim (count three); a Florida Deceptive and Unfair Trade Practices Act claim (count four); a Florida racketeering claim (count five); a common law fraud claim (count six); an unjust enrichment claim (count seven); and a Repair Act claim (count eight). The district court denied summary judgment to the extent that Geico alleged that Glassco, Inc. made misrepresentations that amounted to fraud “independent of” Glassco’s violations of the Florida Motor Vehicle Repair Act. Geico tried to convert this nonfinal decision into a final decision by filing an amended complaint that removed the fraud allegations that were independent of the Repair Act violations.   The Eleventh Circuit dismissed the appeal explaining that because the district court denied summary judgment as to these fraud allegations, there is no final decision for Geico to appeal. The court held that it can’t exercise jurisdiction over this appeal simply because the alternative—sending this case back to the district court—may be inconvenient or inefficient. The court wrote that by dismissing this appeal today, it vindicates finality as the historic characteristic of federal appellate procedure, serves the important interests of judicial efficiency, and promotes the sensible policy of avoiding piecemeal appeals. View "Government Employees Insurance Company, et al. v. Jason Wilemon, et al." on Justia Law

The certified a question to the Supreme Court of California in a case where an insured who sued for declaratory judgment that its insurance policy provides coverage for its losses arising from the COVID-19 pandemic. At issue here is whether the policy’s virus exclusion is enforceable and precludes coverage.   The Ninth Circuit certified the following question to the Supreme Court of California: Is the virus exclusion in French Laundry’s insurance policy unenforceable because enforcing it would render illusory a limited virus coverage provision allowing for the possibility of coverage for business losses and extra expenses allegedly caused by the presence and impacts of COVID-19 at an insured’s properties, including the loss of business due to a civil authority closure order? View "FRENCH LAUNDRY PARTNERS, LP, ET AL V. HARTFORD FIRE INSURANCE CO., ET AL" on Justia Law

ResCap Liquidating Trust (“ResCap”) pursued indemnification claims against originator Primary Residential Mortgage, Inc. (“PRMI”), a Nevada corporation. ResCap asserted breach of contract and indemnification claims, seeking to recover a portion of the allowed bankruptcy claims for those holding units in the liquidating trust. The district court concluded that ResCap had established each element of its contractual indemnification claim. The district court awarded ResCap $10.6 million in attorney’s fees, $3.5 million in costs, $2 million in prejudgment interest, and $520,212 in what it termed “post-award prejudgment interest” for the period between entry of judgment and the order awarding attorney’s fees, costs, and prejudgment interest. Defendant appealed.   The Eighth Circuit remanded for a recalculation of postjudgment interest but otherwise affirmed. The court explained that the district court held that, as a matter of Minnesota law governed by Section 549.09, a final judgment was not “finally entered” until its Judgment in a Civil Case resolving attorney’s fees, costs, and interest was entered on April 28, 2021, and therefore Minnesota’s ten percent prejudgment rate applied in the interim period. But Section 1961(a) does not say “final judgment,” it says “money judgment.” The district court, on August 17, 2020, entered a “money judgment.” Thus, the district court erred in applying Minnesota law to calculate interest after August 17, 2020, rather than 28 U.S.C. Section 1961(a). View "ResCap Liquidating Trust v. Primary Residential Mortgage" on Justia Law