Justia Insurance Law Opinion Summaries

The Supreme Court reversed the judgment of the court of appeals and reinstated the trial court's grant of summary judgment in favor of Owners Insurance Co. on EMOI Services, LLC's claim of breach of contract and bad-faith denial of insurance coverage after a ransomware attack on EMOI's computer-software systems, holding that Owners was not responsible for covering the loss at issue.At issue was whether the businessowners insurance policy issued by Appellant to EMOI covered losses suffered by EMOI when it became the target of a ransomware attack. The trial court granted summary judgment to Owners. The court of appeals reversed, concluding that genuine issues of material fact precluded summary judgment. The Supreme Court reversed, holding that Owners did not breach its contract with EMOI because the pertinent insurance policy did not cover the type of loss EMOI experienced. View "EMOI Services LLC v. Owners Insurance Co." on Justia Law

The Supreme Court answered in the negative a certified question regarding whether a provision in a commercial insurance policy, governed by Ohio law, providing coverage for a "direct 'loss'" to certain property covers a claim based on business shutdowns caused by COVID-19 (Covid), holding that the term "direct loss" did not include Plaintiff's Covid-related loss of the use of its offices for business purposes.Plaintiff, which owned and operated an audiology practice in northeast Ohio, held an all-risk commercial-property insurance policy issued by Defendant. Plaintiff filed suit alleging that Defendant had breached the contract by refusing to provide coverage for its Covid-related claim on the ground that there was no "direct physical loss or damage" to covered property. The federal court granted Defendant's motion for certification. The Supreme Court answered (1) the term "direct 'loss'" requires that there be some loss or damage to covered property that is physical in nature, and any potential exception to this rule did not apply in this case; and (2) therefore, the term "direct 'loss'" did not include Plaintiff's Covid-related loss of the ability to use covered property for business purposes. View "Neuro-Communication Services v. Cincinnati Insurance Co." on Justia Law

The Supreme Court reversed the decision of the court of appeals reversing the judgment of the trial court concluding that Acuity, an insurer, did not owe Masters Pharmaceutical, Inc. a duty to defend it in the several lawsuits brought by cities and counties in three states (the governments) for losses caused by the opioid epidemic, holding that Acuity did not owe Masters a duty to defend.Cities and counties in West Virginia, Michigan, and Nevada brought the underlying lawsuits against Masters, a wholesale distributor of pharmaceutical products, including prescription opioids, alleging that Masters's conduct contributed to the opioid epidemic. Acuity filed an action for a declaratory judgment that it owed no duty to defend or indemnify Masters in the underlying suits. The trial court granted summary judgment for Acuity. The court of appeals reversed. At issue was whether the governments sought damages for their own economic losses and not "damages because of bodily injury." The Supreme Court reversed, holding (1) the governments did not seek "damages because of bodily injury"; and (2) therefore, Acuity did not owe Masters a duty to defend it in the underlying suits. View "Acuity v. Masters Pharmaceuticals, Inc." on Justia Law

The Supreme Court affirmed the decision of the court of appeals reversing the judgment of the trial court ruling that an umbrella insurance policy between Motorists Mutual Insurance Company (Motorists)and Owens-Brockway Glass container, Inc. (Owens) did not apply to claims made against Ironics, Inc. by Owens, holding that the court of appeals did not err.Owens asserted claims against Ironics for, among other claims, breach of contract. Ironics asked its insurer, Motorists, to defend and indemnify it against Owens's claims under a commercial general-liability policy and a commercial umbrella policy with Motorists. The trial court concluded that neither policy covered Owens's claims and granted summary judgment for Motorists. The court of appeals reversed in part, holding that Ironics was entitled to coverage under the umbrella policy. The Supreme Court affirmed, holding that Owens's claims arose out of an accident that resulted in "property damage" under Ironic's umbrella policy with Motorists and that none of the policy's exclusions applied. View "Motorists Mutual Insurance Co. v. Ironics, Inc." on Justia Law

The Supreme Court held that a provision found in just about every commercial and personal-property insurance policy issued in Ohio that bars coverage for damage caused by "water that backs up or overflows from a sewer" includes damage caused by sewage carried into an insured property by a backup or overflow event.Sewage from the local sewer system backed up into the Bank Nightclub, a bar that was insured at the time by United Specialty Insurance Company. The bar subsequently hired Cleantech to clean up the site and submitted a claim to its insurer. United Specialty denied the claim, citing an exclusion in the bar's policy for damage caused by water that backs up or overflows from a sewer. The bar assigned AKC any claims it might have against United Specialty, and AKC then brought this breach of contract claim. The trial court granted summary judgment in favor of United Specialty. The court of appeals reversed. The Supreme Court reversed, holding that the water-backup exclusion in the policy included damage caused by the sewage. View "AKC, Inc. v. United Specialty Insurance Co." on Justia Law

The Supreme Court granted writs of prohibition and mandamus to prevent Cuyahoga County Common Pleas Court Judge John O'Donnell from exercising jurisdiction over a civil action that was transferred from the Lyndhurst Municipal Court but denied the writ of mandamus ordering Lyndhurst Municipal Court Judge Dominic Coletta to dismiss the case upon its return from the common pleas court.Plaintiff filed a complaint against State Farm Mutual Insurance Company in the small claims division of the Lyndhurst Municipal Court. Judge Coletta granted Plaintiff's subsequent motion to transfer the case to Cuyahoga County Court of Common Pleas, where it was assigned to Judge O'Donnell. State Farm filed a motion to return the case to the municipal court, but Judge O'Donnell denied the motion. State Farm then brought this action. The Supreme Court granted a writ of prohibition to prevent Judge O'Donnell from hearing the case in the Cuyahoga County Court of Common Pleas and granted a peremptory writ of mandamus ordering Judge O'Donnell to return the matter to the Lyndhurst Municipal Court, holding the peremptory writ was appropriate. View "State ex rel. State Farm Mutual Insurance Co. v. O'Donnell" on Justia Law

In this insurance dispute, the Supreme Court affirmed the trial court's grant of summary judgment to Insurer, holding that specific language in the insurance policy was sufficient to warn Insured that misstatements as to warranties in her application for the policy rendered the policy void ab initio.Insurer submitted an application to Insured indicating that she was the only member of her household, and the application was incorporated into the policy under the policy's terms. Insured's, sister, however, was living with Insured when the sister struck a pedestrian while driving the car covered under the policy. Insured filed a complaint for declaratory judgment claiming that because of Insured's misstatements, the policy was void ab initio. The trial court agreed and granted summary judgment to Insurer. The Supreme Court affirmed, holding that the misstatement regarding the warranty in the application for the insurance policy rendered the policy void ab initio. View "Nationwide Mutual Fire Insurance Co. v. Pusser" on Justia Law

The Supreme Court accepted a state-law question certified to it by the United States District Court for the Northern District of Ohio, Eastern Division and answered that an insured is not permitted to seek full and complete indemnity under a single policy providing coverage for "those sums" that the insured becomes legally obligated to pay because of property damage that takes place during the policy period when the property damage occurred over multiple policy periods.Insured sued Insurer seeking an order requiring Insurer to pay all defense costs incurred in defending the underlying lawsuit and the amounts Insured paid to settle the action. Insurer filed a counterclaim seeking a declaration that Insured was not entitled to allocate all defense costs and indemnity to a single policy period when multiple policies and corresponding policy periods were triggered. At issue was whether contract language providing coverage for "those sums" should be treated like contract language providing coverage for "all sums." The Supreme Court answered the question of state law as set forth above but cautioned against using the answer as a blanket rule applicable to all policies with "those sums" language. View "Lubrizol Advanced Materials, Inc. v. National Union Fire Insurance Co. of Pittsburgh, Pennsylvania" on Justia Law

The Supreme Court reversed the judgment of the court of appeals in this action determining whether an insurer who settles a personal injury claim with an accident victim has a duty to distribute a portion of the settlement proceeds to the victim's former lawyers pursuant to a charging lien, holding that an action based upon a charging lien is an in rem proceeding against a particular fund and that when a matter is resolved through a settlement, the fund comes into being at the time the settlement is paid and the release is received.A discharged law firm sought to enforce a charging lien against a tortfeasor's insurer for the law firm's representation of the victim injured by the tortfeasor. However, no lawsuit was filed on behalf of the victim against the tortfeasor, and the victim settled with the tortfeasor's insurer after he discharged the law firm. The Supreme Court held that, under the facts of this case, the discharged law firm could not enforce its charging lien against the tortfeasor's insurer, and therefore, the discharged law firm did not have a viable charging-lien claim against the tortfeasor's insurer. View "Kisling, Nestico & Redick, LLC v. Progressive Max Insurance Co." on Justia Law

The Supreme Court answered a certified question from the Unitde States District Court by holding that Ohio Rev. Code 4123.35(O) is not unconstitutional as applied to the tort claims of an enrolled subcontractor’s employee who is injured while working on a self-insured construction project and whose injury is compensable under Ohio’s workers’ compensation laws.Daniel Stolz was injured while working as a concrete finisher for Jostin Construction. Jostin was a subcontractor of Messer Construction Company, the general contractor for the project. Under section 4123.35(O), Messer provided workers’ compensation coverage on the project for employees of subcontractors like Jostin that chose to enroll in Messer’s self-insurance plan. Stolz eventually sued Messer and several subcontractors for negligence. Messer and three enrolled subcontractors argued that they were immune from liability under section 4123.35(O). The Supreme Court concluded that the statute provides immunity to both general contractors and enrolled subcontractors from tort claims brought by employees of other enrolled subcontractors. Stolz later amended his complaint to allege that section 4123.35(O) is unconstitutional. The enrolled subcontractors petitioned the district court to certify a question of state law to the Supreme Court. The Supreme Court answered that section 4123.35(O) does not violate the Ohio Constitution’s right-to-remedy, right-to-jury, or equal-protection provisions. View "Stolz v. J & B Steel Erectors, Inc." on Justia Law