Justia Insurance Law Opinion Summaries

Guaranteed Rate, Inc., a mortgage lender, purchased two types of insurance policies from ACE American Insurance Company: management liability and professional liability. Guaranteed Rate sought coverage under the policies for an investigation and eventual settlement of claims brought by the federal government under the False Claims Act. ACE denied coverage under both policies. According to ACE, the Professional Liability Policy expressly excluded False Claims Act charges. ACE also contended that the False Claims Act charges arose from Guaranteed Rate’s professional services, which were excluded under the Management Liability Policy. Only the Management Liability Policy was at issue in this appeal. In Guaranteed Rate’s suit against ACE, a Delaware superior court held that the False Claims Act investigation and settlement did not arise out of Guaranteed Rate’s professional services. Instead, it arose out of false certifications made to the government. Thus, the Management Liability Policy covered the loss. To this, the Delaware Supreme Court agreed with the superior court. View "ACE American Insurance Company v. Guaranteed Rate, Inc." on Justia Law

Plaintiff’s son had a rare heart condition. He died at the age of twenty-seven, awaiting a heart transplant, which Rose says that Defendants—who administered her son’s employer-based health benefits program—wrongfully denied. So she sued on behalf of his estate, seeking monetary relief under both Section 502(a)(1)(B) and Section 502(a)(3). The district court dismissed both claims. As to Plaintiff’s (a)(1)(B) claim, the court held that money was not one of the “benefits” that her son was owed “under the terms of his plan.” And, as to her (a)(3) claim, the court held that her requested monetary relief was too similar to money damages and was thus not “equitable.”   The Fourth Circuit affirmed in part and vacated in part. The court explained that the district court correctly held that money was not one of the “benefits” that Plaintiff’s son was “due” “under the terms of his plan.” So it was right to dismiss her (a)(1)(B) claim. But the court explained that it must vacate its complete dismissal of Plaintiff’s (a)(3) claim. The court explained that while the district court correctly noted that compensatory, “make-whole” monetary relief is unavailable under Section 502(a)(3), it did not consider whether Plaintiff plausibly alleged facts that would support relief “typically” available in equity. The court thus remanded for the district court to decide in the first instance whether Plaintiff can properly allege such a theory based on a Defendant’s unjust enrichment, including whether an unjust gain can be followed to “specifically identified funds that remain in Defendant’s possession” or to “traceable items that the defendant purchased with the funds.” View "Jody Rose v. PSA Airlines, Inc." 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

The Estate of Josiah Wheeler and Josiah’s parents, Keith and Rhetta Wheeler (collectively, “the Wheelers”) appealed the district court’s grant of summary judgment in favor of Garrison Property and Casualty Insurance Company (“Garrison”).   The Ninth Circuit explained that because this case involves an issue of first impression under Alaska law, it respectfully asks the Alaska Supreme Court to exercise its discretion to decide the following certified question: Does a total pollution exclusion in a homeowners’ insurance policy exclude coverage of claims arising from carbon monoxide exposure? View "THE ESTATE OF JOSIAH WHEELER, ET AL V. GARRISON PROPERTY AND CASUALTY INSURANCE COMPANY" on Justia Law

After Plaintiff’s home sustained water damage in a hailstorm, he asked his insurer Allstate to cover the loss; consequently, Steamatic was hired to perform water abatement and mold remediation services. Plaintiff claimed that the mold was not remediated properly and that he developed a severe and permanent lung condition as a result. New Mexico does not permit a civil plaintiff to recover duplicate compensatory damages for the same injuries. The collateral source rule presents an exception to the prohibition of double recovery, permitting a plaintiff to recover the same damages from both a defendant and a collateral source. The New Mexico Supreme Court has held that the payor of the prejudgment settlement of a claim qualifies as a collateral source and that the payment does not reduce the same damages the plaintiff may recover from an adjudicated wrongdoer. The issue this case presented for review centered on whether a payment in postjudgment settlement of a claim by an adjudicated wrongdoer qualified as a collateral source. The Court clarified that the collateral source rule had no application to a postjudgment payment made by an adjudicated wrongdoer. Here, the Court held that the payment, which Plaintiff received in a postjudgment settlement with Allstate satisfied a portion of Plaintiff’s damages and extinguished Plaintiff’s right to recover the same damages from Steamatic. The Court explained that the share of damages fully satisfied by Allstate must offset the damages Plaintiff may recover from Steamatic. View "Gonzagowski v. Steamatic of Albuquerque" on Justia Law

In a previous action between these parties, the Delaware Supreme Court addressed whether the exclusive-remedies provision in the workers’ compensation act precluded an injured employee from pursuing recovery from an uninsured motorist policy. After the Court held that the exclusive-remedies provision did not apply, the employer and its workers’ compensation carrier sought a declaratory judgment that they were permitted to assert a lien against any recovery the employee might obtain for injuries already compensated under the workers’ compensation act. The employee and the uninsured motorist insurer contended that any such lien was barred by statute, relying on the Court’s decision in Simendinger v. National Union Fire Insurance Co., 74 A.3d 609 (Del. 2013). The superior court followed that binding precedent as it was required to do and dismissed the declaratory judgment claim. After review however, the Delaware Supreme Court concluded Simendinger was decided in error. The Court therefore reversed the superior court’s decision and held that the workers’ compensation act expressly allowed the employer and its workers’ compensation carrier to assert a subrogation lien against benefits paid to the employee under the employer’s uninsured motorist policy. View "Horizon Services, Inc. v. Henry" on Justia Law

The Supreme Court reversed the judgment of the court of appeals in the underlying insurance dispute, holding that the insurance policy at issue did not incorporate the payout limits in an underlying service agreement.ExxonMobil Corporation hired Savage Refinery Services to work as an independent contractor at Exxon's Baytown refinery, and the parties memorialized their arrangement with a service agreement. Under the agreement, Savage promised to obtain at least a minimum stated amount of liability insurance for its employees and to name Exxon as an additional insured. Savage ultimately procured five different insurance policies, three of which were underwritten by National Union Fire Insurance Company and Starr Indemnity & Liability Insurance Company. After a workplace accident at the Baytown Refinery two injured employees sought compensation. Plaintiffs settled with Exxon for $24 million. When National Union and Starr denied Exxon coverage under their umbrella policies Exxon sued for breach of contract. The trial court ruled for Exxon. The court of appeals reversed, concluding that Exxon was not insured under National Union's umbrella policy. The Supreme Court reversed, holding that Exxon was an "insured" under National Union's umbrella policy and that the lower court's ruling with respect to Starr's bumbershoot policy was predicated on a similar error. View "ExxonMobil Corp. v. Nat'l Union Fire Insurance Co. of Pittsburgh, PA" on Justia Law

Defendant Alex Herrgott, was driving a four-seat Polaris all-terrain vehicle at night down a gravel road when he “overcorrected” trying to avoid a pothole. The ATV overturned, and Joseph MacNabb, a passenger, was severely injured. Since MacNabb was a state employee in the course and scope of his employment, he received workers’ compensation benefits from the Mississippi State Agencies Self-Insured Workers’ Compensation Trust. The Trust later initiated this litigation in an attempt to recover more than $300,000 in benefits paid for MacNabb’s injury. The circuit court ultimately granted summary judgment to Herrgott because the Trust’s Mississippi Rule of Civil Procedure 30(b)(6) representative could not articulate a legal theory entitling it to recover. The Mississippi Supreme Court found there was sufficient evidence of Herrgott’s negligence for the case to go to trial, and the deposition testimony of a lay witness should not have bound the Trust as to which legal theories it could pursue. The Supreme Court therefore reversed the summary judgment and remanded the case for trial. View "Mississippi State Agencies Self-Insured Workers' Compensation Trust v. Herrgott" on Justia Law

Scanlon went on leave from his job as a Systems Administrator at McKesson. He requested accommodations to return to work; McKesson temporarily granted some, but not all, of them. Scanlon did not return to work but sought long-term disability insurance benefits under a McKesson group policy underwritten, insured, and administered by LINA. To meet the definition of “disabled” under the policy, an employee must be unable to perform the “material duties” of the employee’s regular occupation and earn 80% or more of the employee’s indexed earnings from working in the employee’s regular occupation. LINA denied Scanlon’s request and denied two administrative appeals after Scanlon supplied VA examination reports and letters and two residual functional capacity evaluations. LINA's medical examiners concluded that Scanlon was not entitled to benefitsIn a suit under ERISA, 29 U.S.C. 1132, the district court found that Scanlon, a veteran, suffered from myriad chronic orthopedic and sleep disorders that cause him pain and impact his daily life but found Scanlon ineligible for benefits, concluding Scanlon did not show that he cannot perform the material duties of his job. The Seventh Circuit vacated. The district court clearly erred when it failed to consider Scanlon’s inability to sit at his desk for eight hours a day as required by his occupation and his inability to perform the cognitive requirements of his job during regular work hours and in its treatment of certain medical records Scanlon provided. View "Scanlon v. Life Insurance Co. of North America" on Justia Law

Husband Steven McAnulty was married twice: once to Plaintiff Elizabeth McAnulty, and once to Defendant Melanie McAnulty. Husband's first marriage ended in divorce; the second ended with his death. Husband’s only life-insurance policy (the Policy) named Defendant as the beneficiary. But the Missouri divorce decree between Plaintiff and Husband required Husband to procure and maintain a $100,000 life-insurance policy with Plaintiff listed as sole beneficiary until his maintenance obligation to her was lawfully terminated (which never happened). Plaintiff sued Defendant and the issuer of the Policy, Standard Insurance Company (Standard), claiming unjust enrichment and seeking the imposition on her behalf of a constructive trust on $100,000 of the insurance proceeds. The district court dismissed the complaint for failure to state a claim. Plaintiff appealed. By stipulation of the parties, Standard was dismissed with respect to this appeal. The only question to be resolved was whether Plaintiff stated a claim. Resolving that issue required the Tenth Circuit Court of Appeals to predict whether the Colorado Supreme Court would endorse Illustration 26 in Comment g to § 48 of the Restatement (Third) of Restitution and Unjust Enrichment (Am. L. Inst. 2011) (the Restatement (Third)), which would recognize a cause of action in essentially the same circumstances. Because the Tenth Circuit predicted the Colorado Supreme Court would endorse Illustration 26, the Court held Plaintiff has stated a claim of unjust enrichment, and accordingly reversed the previous dismissal of her case. View "McAnulty v. McAnulty, et al." on Justia Law