Justia Insurance Law Opinion Summaries

Selective denied coverage of Creation's insurance claim. Creation sued for breach of contract and won. Creation then pursued costs and fees for Selective’s vexatious and unreasonable delay under the Illinois Insurance Code, 215 ILCS 5/155. The Seventh Circuit held that the remedy was unavailable. Creation then sued Selective’s in-house lawyer, the lawyer’s supervisor, and its outside counsel, alleging they tortiously interfered with the contract between Selective and Creation.The Seventh Circuit affirmed the dismissal of the suit. The suits were an attempt at double recovery—one from the principal and one from its agents. The corporate form limits, not doubles, liability. In Illinois, tortious interference requires some sort of interloper and precludes applying the economic loss doctrine to claims for tortious interference. Illinois provides a corporation’s agents with a conditional privilege, rooted in the business judgment rule, from tortious interference suits. When an agent acts in the corporation’s interests, she is protected from liability for interfering in her principal’s contractual affairs. When an agent interferes with a contract, she is presumed to do so for the company’s benefit. Under Illinois law, overcoming the privilege was Creation’s burden to plead, and its failure to do so with more than mere conclusory allegations dooms its suit. View "Creation Supply, Inc. v. Hahn" on Justia Law

In 2014, plaintiffs Roberta and Kevin Haas' stopped car was struck by a car driven by defendant Mark Carter. Plaintiffs brought this negligence action against defendants, Carter's estate and State Farm Mutual Automobile Insurance Company, seeking to recover economic and noneconomic damages. Carter died after plaintiffs filed suit. State Farm was Roberta Haas' insurer, whom she sued for breach of contract, alleging it failed to pay all the personal injury protection benefits that were due. At trial, one of the primary issues was whether Carter’s driving was a cause-in-fact of the injuries that plaintiffs alleged, and the issue on appeal became whether the trial court properly instructed the jury on causation. The jury returned a verdict for defendants. After review, the Oregon Supreme Court determined the trial court did not err in instructing the jury on causation, and affirmed the circuit court's judgment. View "Haas v. Estate of Mark Steven Carter" on Justia Law

Appellants– the former secretary-treasurer and president, respectively, of a District Lodge of the International Association of Machinists – appealed the district court’s denial of their motion for a preliminary injunction. They sued the international union, its president, and its general secretary-treasurer. The controversy concerns the suspensions of Appellants’ and the international union’s imposition of a trusteeship on their District Lodge. Appellants’ first amended complaint alleged one count under Title I and five counts under Title III of the Labor-Management Reporting and Disclosure Act (the “LMRDA”). They sought equitable relief along with compensatory and punitive damages. A month after they filed their first amended complaint, they filed a motion for a preliminary injunction. The district court denied the motion. It held that Appellants had not shown a likelihood of success on the merits. It also held that the other factors did not favor them.   The DC Circuit affirmed. The court held that Appellants’ request under Title III to end the trusteeship is moot. A case becomes moot when a party obtains the relief they sought. Here, the disputed trusteeship has been lifted. Further, the court explained that Appellants seek to invalidate an officer election. It is impossible to reinstate Appellant as secretary-treasurer or allow the District Lodge to elect new members to other positions unless the court invalidates the officer election that just occurred. Thus, the court rejected the Title I claim. View "Ian Scott-Anderman, et al. v. Robert Martinez, et al." on Justia Law

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

Niyokia Lee and James Cooper sustained damages in separate, independent automobile accidents caused by negligent city emergency responders. Lee’s accident happened in Harrison County, and Cooper’s happened in Rankin County. The Mississippi Tort Claims Act afforded immunity to the negligent police officer, the fireman, and the governmental entities employing them. Because Lee and Cooper could not recover from the responders or municipalities, both sought recovery under their car insurance policies’ uninsured motorist provisions. Lee and Cooper had the same UM coverage carrier—State Farm Mutual Automobile Insurance Company. And State Farm denied UM coverage to both, citing Mississippi Code Section 83-11-101(1) of Mississippi’s Uninsured Motorist Act. As State Farm saw it, because the officer and fireman enjoyed police and fire protection immunity under the MTCA, neither policyholder was legally entitled to recover from the immune responders or their city employers. State Farm thus denied UM coverage to Lee and Cooper despite the fact that, in 2009, the state legislature had revised Mississippi Code Section 83-11-103(c) of the UM Act by adding a new subsection expanding the definition of “uninsured motor vehicle” to include “[a] motor vehicle owned or operated by a person protected by immunity under the [MTCA.]” The two trial courts considering the UM coverage issue reached opposite results. The Harrison County Circuit Court granted summary judgment in State Farm’s favor and dismissed Lee’s claims against State Farm, finding because the officer was immune, Lee was not "legally entitled to recover" and consequently, was not eligible for UM coverage. The Rankin County Court granted summary judgment in Cooper’s favor, against State Farm, ruling UM coverage did apply because, otherwise, the 2009 amendment to the UM Act, which expanded the definition of “uninsured motor vehicle” to include vehicles operated by persons who are immune under the MTCA, would be "rendered virtually meaningless." The Mississippi Supreme Court consolidating the two cases found that the plain language of the two provisions made it apparent that Lee and Cooper were entitled to UM coverage. It therefore reversed and remanded the decision of the Harrison County Circuit Court, and affirmed and remanded the decision of the Rankin County Circuit Court. View "Lee v. State Farm Mutual Automobile Insurance Company" on Justia Law

Plaintiff appealed the district court’s post-trial dismissal of his case for lack of subject-matter jurisdiction. A jury found that AXA Equitable Life Insurance Company negligently reported false medical information about Plaintiff to an information clearinghouse used by insurance companies, causing him to become uninsurable. Despite the fact that the parties satisfied the requirements for federal diversity jurisdiction, and the fact that both parties litigated the entire case through trial under North Carolina law, the district court decided that Connecticut law applied and found itself deprived of subject-matter jurisdiction by virtue of a Connecticut statute.   The Fourth Circuit found that the district court erred and concluded that choice of law is waivable and was waived here. And even if Connecticut’s law applied, it would not have ousted federal jurisdiction. Further, the court held that the district court also erred by concluding that Connecticut’s CIIPPA divested it of subject-matter jurisdiction despite that statute affecting only choice of law rather than choice of forum. AXA’s alternative argument for affirmance based on the nature of Plaintiff’s s injury and its causation was thoroughly briefed and argued before the court, and the court found it to be without merit. But because AXA’s argument for post-trial relief challenging the number of damages was neither raised nor briefed before this court, the court remanded to the district court to consider that issue in the first instance. View "Malcolm Wiener v. AXA Equitable Life Insurance Company" on Justia Law

Respondent Stephany Connelly was a passenger in a vehicle driven by co-worker Freya Trezona during the course and scope of their employment when Trezona negligently caused the accident, injuring Connelly. Because workers’ compensation benefits did not fully redress Connelly’s injuries, she made a claim for bodily injury and uninsured motorist (UM) benefits with her own insurance carrier and with Trezona’s carrier. Both companies denied the claim, contending Connelly’s sole remedy lay with the South Carolina Workers’ Compensation Act. Connelly filed suit seeking a declaration that both policies provided coverage. The parties agreed the dispute turned on the interpretation of the phrase “legally entitled to recover” found in the UM statute. The trial court ruled in favor of Connelly, and the court of appeals concurred the phrase was legally ambiguous. The South Carolina Supreme Court found the phrase unambiguous: the amount a plaintiff is “legally entitled to recover” under a UM provision of an insurance policy is the amount for which the plaintiff has secured a judgment against the at-fault defendant. Because the Act prevents Connelly from ever becoming “legally entitled to recover” from Trezona under the facts of this case, the Court reversed the trial court. View "Connelly v. Main Street America Group" on Justia Law

In a case involving the denial of coverage for an automobile accident, the Fifth Circuit addressed whether uninsured motorist coverage can be denied simply because the driver, who was the son of the insured, was not listed on the policy? The court answered that question “no.” The other is whether the policy can be voided because the insured committed a material misrepresentation by failing in her application for insurance to name, as required, those of driving age who lived in her household? The court answered that question, “yes.”   The Fifth Circuit affirmed the district court’s ruling granting Viking Insurance’s motion for summary judgment in Plaintiffs’ suit seeking damages for a wrongful denial of benefits. The court concluded that if an insurer declines to exercise the greater power to void a policy, it still retains the lesser power to exercise a contractual right to deny coverage. The court explained that here, a knowing misstatement in the application about the drivers in the household was material if it would have caused Viking either not to issue the policy or to increase the premium. The court accepted that materiality is not affected by the relationship between the false statement and the specific coverage being sought in litigation. It is enough that the falsity was material to the decision of the company to issue the policy at the agreed price. Consequently, Viking could have voided the policy. By not voiding, Viking’s policy remained in effect. Accordingly, Viking had the right to deny Plaintiffs’ claim. View "Bradley v. Viking Insurance" on Justia Law

Plaintiff-appellant Chris LaBarbera hired Richard Knight dba Knight Construction (Knight) to remodel a house pursuant to a contract that provided Knight would defend and indemnify LaBarbera for all claims arising out of the work. Knight obtained a general liability insurance policy from defendant-respondent Security National Insurance Company (Security National) that covered damages Knight was obligated to pay due to bodily injury to a third party. As relevant here, the policy also covered Knight’s “liability for damages . . . [a]ssumed in a contract or agreement that is an ‘insured contract.’ ” Security National acknowledged the indemnity provision in Knight’s contract with LaBarbera was an “insured contract” within the meaning of the policy. The policy also provided, “If we defend an insured [i.e., Knight] against a suit and an indemnitee of the insured [i.e., LaBarbera] is also named as a party to the suit, we will defend that indemnitee” if certain conditions were met. During the remodeling work, a subcontractor suffered catastrophic injuries, and sued both LaBarbera and Knight. LaBarbera’s liability insurer (plaintiff-appellant Lloyd's of London Underwriters) defended him in that lawsuit, and Security National defended Knight. LaBarbera also tendered his defense to Knight and to Security National, but they either ignored or rejected the tender. After settling the underlying lawsuit for $465,000, LaBarbera and Underwriters sued Knight and Security National, seeking to recover the full $465,000 settlement amount and over $100,000 in expenses and attorney fees incurred defending LaBarbera in that lawsuit. Security National moved for summary judgment on the ground that all claims against it were barred because the undisputed facts established it did not have an obligation to defend or indemnify LaBarbera. The trial court granted the motion and entered judgment in favor of Security National. LaBarbera and Underwriters appealed, but the Court of Appeal affirmed, adopting different reasoning than the trial court. The Court agreed with Security National that the indemnitee defense clause in Knight’s general liability insurance policy did not bestow third party beneficiary rights on the indemnitee, LaBarbera, who benefitted only incidentally from the clause. Because LaBarbera was not a third party beneficiary under Knight’s policy, he was precluded from bringing a direct action against Security National. View "LaBarbera, et al. v. Security Nat. Ins. Co." on Justia Law

This insurance coverage dispute arises from underlying litigation in a single-vehicle accident that led to a lawsuit by J.O. against his employer, Riata Cattle Company, Inc. (“Riata”). J.O. sued Riata in Texas state court, alleging that he suffered bodily injury when Riata’s truck, which he was driving, malfunctioned and crashed due to Riata’s failure to repair and maintain it. J.O. also alleged that Riata committed negligence and gross negligence by failing to provide him with safety equipment, failing to warn him of any dangers, failing to inspect or repair the equipment, and other negligence theories. Riata sought coverage defense from its auto liability insurer, National Liability & Fire Insurance Company (“National Liability”), which is currently defending Riata in the underlying litigation under a reservation of rights letter. National Liability subsequently filed a declaratory judgment action in federal court, seeking a determination that it owes Riata neither a defense nor indemnity under the insurance policy (the “Policy”). National Liability contends it is entitled to a declaratory judgment because the Policy excludes coverage for employees of Riata. Riata seems to concede this argument but contends that the “Form F” endorsement on the Policy compels National Liability to defend and indemnify Riata.The Fifth Circuit affirmed. The court explained that J.O. is an employee of Riata, and according to the applicable Policy, National Liability is excluded from providing insurance coverage to Riata for the underlying litigation. And Form F does not change the employee exclusion in the Policy. View "Ntl L & Fire Ins Co v. Riata Cattle Co" on Justia Law