Justia Insurance Law Opinion Summaries

Defendant was a tenant of condominium unit (Unit 1801) when unit’s bathtub overflowed and leaked into the condominium units below, causing damage. Pacific Indemnity Company, which insured Unit 1601, brought an action seeking to recover the amount it had paid to the owners of Unit 1601. As the unit’s subrogee, Pacific sought to recover damages in the amount of $351,159 as well as pre-judgment interest and costs. The district court granted summary judgment in favor of Deming, determining that Pacific’s rights to subrogation were waived based on a clause in the bylaws of the condominium trust that unit owners “shall carry insurance,” and that “all such policies shall contain waivers of subrogation.” The First Circuit reversed, holding (1) the plain language of the condominium’s Bylaws, Master Deed, and Declaration of Trust is that the required waivers of subrogation do not apply to tenants; and (2) even if the Bylaws did require unit owners to purchase insurance that contains waivers of subrogation as to claims against tenants, because Defendant presented no evidence that Unit 1601’s owners actually waived their insurer’s subrogation rights against tenants, Pacific can pursue its claims. View "Pacific Indemnity Co. v. Deming" on Justia Law

Gary Sullivan filed suit against VisionAid, Inc., his former employer and a Massachusetts-based company, in Massachusetts state court alleging that he was terminated as the result of illegal age discrimination. In its defense, VisionAid alleged that it terminated Sullivan because it discovered that he had misappropriated several hundred thousand dollars of corporate funds. VisionAid sought to have its insurer, Mount Vernon Fire Insurance Company, cover not only the defense against the age discrimination claim but also the prosecution of the state-court misappropriation counterclaim. VisionAid then filed the underlying suit for a declaratory judgment, arguing that it was not required to pay for the prosecution of VisionAid’s proposed misappropriation counterclaim. The district court entered judgment in Mt. Vernon’s favor, concluding that, according to the plain language of the policy, Mt. Vernon was not required to fund an affirmative counterclaim. The First Circuit certified three dispositive state law questions to the Massachusetts Supreme Judicial Court regarding when an insurer may owe a duty to its insured to prosecute and fund the insured’s counterclaim for damages. View "Mount Vernon Fire Ins. Co. v. Visionaid, Inc." on Justia Law

Utica Mutual Insurance Company (Utica) insured Herbert H. Landy Insurance Agency (Landy) under a professional liability insurance policy. The policy required Utica to defend Landy in lawsuits arising from Landy’s provision of professional services as an insurance broker and agent. CRES Insurance Services, LLC sued Landy in California state court, alleging negligence and that Landy engaged in unfair business practices. When Landy demanded that Utica defend it in the CRES lawsuit, Utica filed this action in federal district court seeking a declaration that CRES’s negligence claim did not trigger its duty to defend. The district court granted summary judgment to Landy. The First Circuit affirmed, holding (1) CRES’s complaint can be reasonably construed to allege a professional liability claim and is therefore covered by the policy; and (2) Utica failed to meet its burden of establishing that the policy’s exclusion for “unfair competition of any type” applies in this case. View "Utica Mut. Ins. Co. v. Herbert H. Landy Ins. Agency, Inc." on Justia Law

This benefits-denial case related to some charges incurred during M.G.’s stay at a residential/educational mental healthcare facility. Stephanie C., individually and on behalf of M.G., her minor son, brought this action challenging a decision of the claims administrator, Blue Cross Blue Shield of Massachusetts, partially denying her claim for benefits. The district court upheld the partial denial. The First Circuit vacated the district court’s judgment, holding that the district court employed the wrong standard of review when considering the partial denial of benefits, and therefore, the court erred in upholding BCBS’s partial denial of benefits. Remanded. View "Stephanie C. v. Blue Cross Blue Shield of Mass." on Justia Law

Appellant, acting in the capacity as the executor of the estate of Marion Bingham, brought this lawsuit against Supervalu, Inc., alleging that Supervalu acted as an insurer of one of its subsidiaries and violated Mass. Gen. Laws ch. 176D and Mass. Gen. Laws ch. 93A by failing to promptly and equitably resolve prior litigation between the subsidiary and the State. Supervalu removed the action to federal court, arguing that it was not in the business of insurance and was thus not subject to regulation under Chapter 176D. The district court granted summary judgment in favor of Supervalu, ruling that Supervalu was not in the business of insurance. The First Circuit affirmed, holding that the district court did not err in concluding that Supervalu was not in the business of insurance. View "Bingham v. Supervalu, Inc." on Justia Law