Justia Insurance Law Opinion Summaries

A car accident occurred during Race Wars 2, an amateur drag racing event organized by Flyin’ Diesel Performance & Offroad, L.L.C. The accident resulted in injuries and deaths among spectators. The injured parties and representatives of the deceased sued Flyin’ Diesel, who turned to their insurer, Kinsale Insurance Company, for legal defense. The dispute centered on whether Kinsale owed a duty to defend Flyin’ Diesel under their commercial general liability insurance policy.The case was first heard in the United States District Court for the Western District of Texas. The district court found the insurance policy ambiguous and ruled that Kinsale owed Flyin’ Diesel a duty to defend. Flyin’ Diesel was granted partial summary judgment, and Kinsale's motion was denied. Kinsale appealed this decision.The case was then reviewed by the United States Court of Appeals for the Fifth Circuit. The appellate court disagreed with the district court's finding of ambiguity in the insurance policy. The court determined that the policy unambiguously excluded the claims made by the injured parties from coverage. Therefore, the court concluded that Kinsale was not obligated to defend Flyin’ Diesel in the lawsuit. The court reversed the district court's partial summary judgment for Flyin’ Diesel and remanded the case with instructions to grant summary judgment to Kinsale. View "Kinsale Ins v. Flyin' Diesel Performance" on Justia Law

In this case, the National Hockey League and associated parties (plaintiffs) sued their insurer, Factory Mutual Insurance Company (defendant), over losses incurred due to the COVID-19 pandemic under a commercial insurance policy. The plaintiffs claimed that their policy covered physical loss or damage to property due to COVID-19 and sought to overturn a lower court order that struck down most of their coverage theories.The Court of Appeal of the State of California, Sixth Appellate District, found that while the plaintiffs had adequately alleged physical loss or damage from the coronavirus, their insurance policy's contamination exclusion unambiguously excluded coverage for losses due to viral contamination. The court concluded that the policy excluded both the physical loss or damage caused by viral contamination and the associated business interruption losses.The plaintiffs had alleged that the virus physically damaged their property by changing the chemical composition of air and altering the molecular structure of physical surfaces. They also claimed that they had to close their hockey arenas, cancel games, limit fan access, and undertake various remedial measures to mitigate the virus's impact. However, under the terms of their insurance policy, the court found that these losses were not covered because they resulted from viral contamination, which was excluded from coverage under their policy. Thus, the court denied the plaintiffs' petition for review. View "San Jose Sharks, LLC v. Super. Ct." on Justia Law

Larry Nassar sexually assaulted hundreds of girls and young women during his involvement with USA Gymnastics (USAG), the non-profit organization which governs the sport in the United States. As a result of Nassar’s abuse, USAG has been sued several times and investigated by Congress and federal and state authorities. USAG sought financial help with its defense from insurers, including Liberty, with which USAG had a claims-made, directors and officers (D&O) liability insurance policy. An insurance-coverage lawsuit in Indiana state court was removed to federal court.The Nassar-related litigation and investigations forced USAG into bankruptcy. The bankruptcy court issued proposed findings and conclusions, including that the Nassar-related claims were timely made and that a wrongful-conduct exclusion applied to only those claims for which Nassar was criminally convicted. The district court agreed.The Seventh Circuit remanded, first holding that it had jurisdiction because the ruling had the “practical effect” of an injunction under 28 U.S.C. 1292(a)(1). USAG’s claims were timely made during the policy period. The wrongful conduct exclusion, which the court found ambiguous as applied to this case, applies to 10 instances of Nassar’s sexual abuse, but not to claims related to his abuse that were not finally adjudicated. A bodily injury exclusion in the policy does not preclude coverage; coverage is proper for various government investigations and other matters. View "USA Gymnastics v. Liberty Insurance Underwriter, Inc." on Justia Law

In 2000 an “incident” occurred on the ice of a professional hockey game in Switzerland between Miller and McKim. McKim was injured. Swiss courts filed criminal charges against Miller. McKim’s insurer and hockey club filed suit against Miller, and two civil judgments were entered against Miller. Miller left Switzerland before the judgments were finalized and informed his hockey team and its insurer (Winterthur) that he no longer had the financial means to defend the litigation. In 2005, a document was submitted to Miller in Michigan from Winterthur that acknowledged its responsibility for the costs of criminal and civil judgments and proceedings pending in Zurich and previous attorneys’ fees. In 2010, McKim’s team and insurer submitted demands for payment to Miller from the Swiss judgment. Miller, claiming reliance, submitted the demands to Winterthur, which declined to pay the judgments in full. Miller brought suit in Michigan, seeking contractual damages and enforcement of the terms of the 2005 document. The district court granted Winterthur’s motion to dismiss for lack of personal jurisdiction. The Sixth Circuit affirmed. Miller had established a basis for personal jurisdiction under Michigan’s long-arm statute, but the requirements of constitutional due process were not met. View "Miller v. AXA Winterthur Ins. Co." on Justia Law