Justia Insurance Law Opinion Summaries

This case involves a catastrophic wildfire that occurred in 2016 in the Great Smoky Mountains National Park in Eastern Tennessee. The fire spread into Gatlinburg and Sevier County, resulting in the destruction of over 2,500 structures and the death of 14 people. The appellant insurance companies paid claims to policy holders and then filed claims under the Federal Tort Claims Act (FTCA) against the National Park Service (NPS), alleging negligence for failure to follow multiple mandatory fire-management protocols and for the failure to issue mandatory warnings to the public.The government moved to dismiss the case for lack of subject-matter jurisdiction, arguing that it was immune from suit under the discretionary-function exception to the FTCA. The district court granted the motion on all three claims relating to fire-management protocols, but denied the motion on claims relating to the duty to warn. The insurance companies appealed, and the government cross-appealed.The United States Court of Appeals for the Sixth Circuit reversed the district court's order granting the government's motion to dismiss the insurance companies' incident-command claim. The court affirmed the district court's dismissal of the fire-monitoring claim and the Wildland Fire Decision Support System (WFDSS) claim as part of the discretionary fire-suppression decision-making process. The court also affirmed the district court's denial of the government's facial challenge to the insurance companies' duty-to-warn claims, and remanded these claims for further proceedings. View "American Reliable Insurance Co. v. United States" on Justia Law

The case involves the United States of America, et al. ex rel. Michael Angelo and MSP WB, LLC (Relators-Appellants) against Allstate Insurance Company, et al. (Defendants-Appellees). The relators alleged that Allstate Insurance violated the False Claims Act by avoiding its obligations under the Medicare Secondary Payer Act. They claimed that Allstate failed to report or inaccurately reported to the Centers for Medicare & Medicaid Services (CMS) information regarding its beneficiaries, which led to Allstate failing to reimburse Medicare for auto-accident-related medical costs incurred by beneficiaries insured by Allstate.The United States District Court for the Eastern District of Michigan dismissed the case with prejudice, deeming the relators' second amended complaint deficient in numerous respects. The relators then moved for reconsideration, which the district court denied. They also filed a motion to amend or correct under Rule 59(e), asking the district court to amend its judgment to dismiss the case without prejudice to allow them to file another amended complaint. The district court denied the motion on all grounds.The United States Court of Appeals for the Sixth Circuit affirmed the district court's decision. The court found that the relators failed to state a claim for a violation of the False Claims Act. The court noted that the relators did not provide sufficient facts demonstrating that Allstate had an "established duty" to pay money or property owed to the government. The court also found that the relators did not demonstrate Allstate's understanding that its conduct violated its obligations under federal law. Furthermore, the court found that the relators' claim for conspiracy also failed as they did not provide any specific details regarding the alleged plan or an agreement to execute the plan. The court also affirmed the district court's decision to deny the relators leave to amend their complaint again. View "United States ex rel. Angelo v. Allstate Insurance Co." on Justia Law

The case involves Erie Insurance Company and its affiliates (collectively, Erie) and the Maryland Insurance Administration (MIA). In 2021, the MIA initiated two separate administrative investigations into Erie following complaints alleging racial and geographic discrimination. The first investigation broadly examined Erie’s market conduct, while the second focused on the specific allegations in the individual complaints. In 2023, the MIA issued four public determination letters stating that Erie had violated state insurance laws. These letters referenced documents obtained during the market conduct investigation, which had not yet concluded. Erie requested and was granted administrative hearings on all four determination letters.Erie then filed a lawsuit against the MIA and its commissioner in federal district court, alleging due process violations under 42 U.S.C. § 1983 and violations of Maryland state law. Erie sought a declaration that the determination letters were unlawful, an injunction preventing the defendants from disseminating the letters, and a requirement for the defendants to publicly withdraw them. The district court dismissed Erie's complaint, citing the principles of abstention outlined in Younger v. Harris, which generally discourages federal courts from interfering with ongoing state proceedings.The United States Court of Appeals for the Fourth Circuit affirmed the district court's decision. The court found that Erie had an adequate opportunity to raise its constitutional claims in the administrative hearings and subsequent state court review, as required for Younger abstention. The court also rejected Erie's argument that this case fell within an exception to Younger abstention due to extraordinary circumstances or unusual situations. The court concluded that Erie had not demonstrated that the MIA's actions were motivated by bias or that the administrative proceedings would not afford Erie constitutionally adequate process. View "Erie Insurance Exchange v. Maryland Insurance Administration" on Justia Law

The case revolves around a former coal miner, Richard McLain, who developed a serious lung condition after working underground for nearly two decades. McLain filed a claim under the Black Lung Benefits Act, alleging that his years of mine work had left him totally disabled from a pulmonary perspective. His former employer, Old Ben Coal Company, had been liquidated through bankruptcy, so Liberty Mutual Insurance Company, the surety guaranteeing Old Ben’s debts under the Act, contested liability on the coal company’s behalf.The case was initially heard by an administrative law judge (ALJ), who determined that McLain was disabled within the meaning of the Black Lung Benefits Act. The ALJ's decision was based on a thorough review of the medical record and a set of medical findings regarding how to distinguish between lung disorders arising from coal dust and those arising from tobacco smoke. Old Ben appealed the ALJ’s decision to the Benefits Review Board, arguing that the ALJ erroneously treated the 2001 preamble as if it were binding law and made factual findings unsupported by the medical record. The Review Board affirmed the benefits decision in full.The case was then brought before the United States Court of Appeals for the Seventh Circuit. The court affirmed the decision of the Benefits Review Board, emphasizing the broad discretion ALJs enjoy when evaluating competing medical theories, the weight ALJs may properly attribute to the perspective of the Department of Labor on such issues, and the significant deference owed to ALJs’ medical findings and scientific judgments on appeal. The court found no error in the ALJ's application of a regulatory preamble or in the factual findings that were challenged by Old Ben. View "Safeco Insurance/Liberty Mutual Surety v. OWCP" on Justia Law

The case involves M&T Farms, a California general partnership between two farmers, who purchased crop insurance under the Whole-Farm Revenue Protection Pilot Policy (the “WFRP Policy”) from Producers Agriculture Insurance Company (“ProAg”), an insurer approved and reinsured by the Federal Crop Insurance Corporation (FCIC). M&T Farms and a third farmer sell farm commodities through a storefront, B&T Farms, which owns their business name and goodwill and is also a California general partnership. M&T Farms filed a claim seeking the full policy amount, which ProAg denied. The FCIC concluded that the WFRP Policy does not allow a partner who files taxes on a fractional share of farming activity conducted by a partnership to be eligible for WFRP coverage for the fractional share of that farming activity.The United States District Court for the Northern District of California granted summary judgment in favor of the FCIC. M&T Farms challenged the FCIC’s decision that a partnership “holding the business name and good will of [others] (i.e., marketing and selling the commodities produced)” is engaged in “farming activity” under section 3(a)(4) of the WFRP Policy, and that therefore, any entity reporting a fractional share of the partnership’s activity on its tax returns is ineligible for WFRP Policy coverage.The United States Court of Appeals for the Ninth Circuit affirmed the district court’s decision. The court held that the WFRP Policy contained an ambiguity regarding the definition of “farming activity.” The FCIC’s conclusion that a partnership selling its partners’ products and holding their goodwill and business name was engaged in “farming activity” under section 3(a)(4) of the policy had a reasonable basis and was also reasonable as a matter of policy. Because the FCIC’s interpretation of “farming activity” in the WFRP Policy was reasonable, it survived APA arbitrary and capricious review. The court also held that the term “farming activity” in the WFRP policy was genuinely ambiguous, the FCIC’s conclusion had a reasonable basis, and the FCIC’s conclusion was entitled to controlling weight. View "M & T FARMS V. FEDERAL CROP INSURANCE CORPORATION" on Justia Law

James and Levi Garrett, a father and son farming duo in South Dakota, were found guilty by a jury of making false statements in connection with federal crop insurance. The Garretts had participated in a federal crop insurance program, administrated by Crop Risk Services (CRS) and backed by the Risk Management Agency of the United States Department of Agriculture (USDA). They had obtained insurance for sunflower crops in 2018, and James had obtained insurance for a corn crop in 2019. The Garretts were accused of falsely certifying the number of acres of sunflowers and corn they planted in 2018 and 2019 respectively, and subsequently reporting harvest losses to CRS.The case went to trial in October 2022. The jury heard from several witnesses and examined dozens of exhibits. At the conclusion of the trial, James was convicted on two counts of making a false statement in connection with insurance for sunflower and corn crops, and Levi was convicted on one count of making a false statement in connection with insurance for a sunflower crop. The Garretts moved for judgment of acquittal, and in the alternative, a new trial, arguing there was insufficient evidence to support their convictions. The district court denied their motion.The Garretts appealed to the United States Court of Appeals for the Eighth Circuit, challenging the district court’s evidentiary rulings and its denial of their post-trial motions. They argued that the district court erred in admitting certain evidence and excluding others, and that there was insufficient evidence to support their convictions. The Court of Appeals affirmed the judgment of the district court, concluding that the trial record supported the jury verdict and that the district court did not err in its evidentiary rulings or in denying the Garretts' post-trial motions. View "United States v. Garrett" on Justia Law

In this appeal, a married couple, both visually impaired, sued Colony Insurance Company to recover for the injuries they suffered when the wife fell down a restaurant's stairs. The couple had previously sued the restaurant and its owner for negligence in a New Hampshire state court, resulting in a default judgment against the defendants.The couple then sought to collect the judgment amount from Colony, the restaurant's insurer, arguing that the insurer was obligated to pay under the restaurant's liability insurance policy. Colony denied the couple's claim, stating that it was not notified of the lawsuit against the restaurant "as soon as practicable," as required by the insurance policy. The couple contended that the insurance policy was compulsory under a City of Manchester ordinance, therefore the insurer could not deny the claim based on a breach of the notice provision in the policy.The District Court granted summary judgment to Colony, ruling that the insured had breached the insurance contract by failing to provide timely notice and that the compulsory insurance doctrine, which generally limits an insurer's defenses against an injured party's claim, did not apply. The couple appealed the decision, but the United States Court of Appeals for the First Circuit affirmed the District Court's ruling.The Appeals Court held that, as a matter of law, the lack of timely notice constituted a breach of the insurance contract, thereby releasing Colony from payment. The court also agreed with the District Court's conclusion that the compulsory insurance doctrine did not apply to the case. The court noted that the doctrine has largely been applied in the context of automobile liability insurance and found no persuasive reason to extend it to this case. View "Jespersen v. Colony Insurance Company" on Justia Law

Appellant, a former employee of the City of La Habra Heights (City), pled no contest to a felony that arose out of the performance of her official duties. Under the terms of Appellant’s plea agreement, the conviction was later reduced to a misdemeanor under Penal Code section 17 and then dismissed under Penal Code section 1203.4. After Respondent California Public Employees’ Retirement System (CalPERS) determined that Appellant forfeited a portion of her retirement benefits as a result of her felony conviction, she filed a petition for writ of administrative mandate. The trial court denied her petition.   The Second Appellate District affirmed. The court concluded the trial court did not err in denying the petition because, consistent with the language and purpose of section 7522.72, Appellant’s retirement benefits were subject to forfeiture upon her no-contest plea to a job-related felony, notwithstanding the subsequent reduction to a misdemeanor and dismissal of the charge. Further, the court explained that Appellant asserts that section 7522.72 is unconstitutional, but she fails to present any cognizable argument or legal authority to support her claim. View "Estrada v. Public Employees' Retirement System" on Justia Law

Plaintiff applied for disability insurance benefits on January 30, 2020, alleging disability since March 1, 2017,due to PTSD, depression, anxiety, insomnia, headaches, and a right knee injury. His application was denied initially and upon reconsideration. A medical expert confirmed that Plaintiff would be markedly limited when interacting with others. The medical expert suggested that Plaintiff’s Residual Function Capacity (RFC) includes “some limitations in terms of his work situation.” Once the Appeals Council denied review of the ALJ’s decision, Plaintiff sought judicial review. The district court affirmed the agency’s denial of benefits. On appeal, Plaintiff only challenged the ALJ’s finding that his mental impairments were not disabling.   The Ninth Circuit affirmed. The panel held that the ALJ did not err in excluding Plaintiff's VA disability rating from her analysis. McCartey v. Massanari, 298 F.3d 1072, 1076 (9th Cir. 2002) (holding that an ALJ is required to address the Veterans Administration disability rating) is no longer good law for claims filed after March 27, 2017. The 2017 regulations removed any requirement for an ALJ to discuss another agency’s rating. The panel held that the ALJ gave specific, clear, and convincing reasons for rejecting Plaintiff's testimony about the severity of his symptoms by enumerating the objective evidence that undermined Plaintiff’s testimony. The panel rejected Plaintiff's contention that the ALJ erred by rejecting the opinions of Plaintiff’s experts. The panel held that substantial evidence supported the ALJ’s conclusion that Plaintiff’s mental impairments did not meet all of the specified medical criteria or equal the severity of a listed impairment. View "JEREMY KITCHEN V. KILOLO KIJAKAZI" on Justia Law

Saloojas, Inc. (“Saloojas”) filed five actions against Aetna Health of California, Inc. (“Aetna”), seeking to recover the difference in cost between its posted cash price for COVID-19 testing and the amount of reimbursement it received from Aetna. Saloojas argues that Section 3202 of the CARES Act requires Aetna to reimburse out-of-network providers like Saloojas for the cash price of diagnostic tests listed on their websites. The district court dismissed this action on the ground that the CARES Act does not provide a private right of action to enforce violations of Section 3202.   The Ninth Circuit affirmed. The panel held that the CARES Act does not provide a private right of action to enforce violations of Section 3202. Saloojas correctly conceded that the CARES Act did not create an express private right of action. The panel held that there is not an implied private right of action for providers to sue insurers. The use of mandatory language requiring reimbursement at the cash price does not demonstrate Congress’s intent to create such a right. The statute does not use “rights-creating language” that places “an unmistakable focus” on the individuals protected as opposed to the party regulated. View "SALOOJAS, INC. V. AETNA HEALTH OF CALIFORNIA, INC." on Justia Law