Justia Insurance Law Opinion Summaries

In this case, Defendant-Appellee Martin Andersson purchased an insurance policy for his vessel from Plaintiff-Appellant Great Lakes Insurance SE. The vessel ran aground off the coast of the Dominican Republic, and Great Lakes brought a declaratory judgment action to determine coverage under the policy. Andersson filed counterclaims for breach of contract and equitable estoppel. Great Lakes' motion for summary judgment was denied, and Andersson was granted partial summary judgment on his breach of contract claim. Great Lakes appealed, claiming the district court erred in refusing to apply the policy's definition of seaworthiness.The United States Court of Appeals for the First Circuit held that under the absolute implied warranty of seaworthiness, the insured vessel must be seaworthy at the policy's inception, and if not, the policy is void. The court affirmed the district court's ruling, stating that Great Lakes' argument that the absolute implied warranty required the vessel to carry up-to-date charts for all geographic areas covered by the policy in order to be considered seaworthy was unsupported by admiralty case law and was unreasonable.Additionally, the court held that Great Lakes' argument that the express terms of the policy required updated paper charts for every location that could be navigated under the entirety of the policy coverage area was unsupported by the express language of the policy itself. The court found no precedent supporting the claim that updated paper charts for every location covered by the policy were required to be onboard the vessel at the inception of the policy. As a result, the Court of Appeals affirmed the district court's decision in favor of Andersson. View "Great Lakes Insurance SE v. Andersson" on Justia Law

In this case, the United States Court of Appeals for the First Circuit had to decide whether rainwater that accumulated on a parapet roof one or more stories above the ground is considered "surface waters" under Massachusetts law for the purposes of the insurance policies in question. This determination was crucial for deciding whether the insureds, Medical Properties Trust, Inc. (MPT) and Steward Health Care System LLC (Steward), were subject to coverage limitations on "Flood" damage in the policies issued by Zurich American Insurance Company (Zurich) and American Guarantee and Liability Insurance Company (AGLIC).The interpretation of "surface waters" posed a novel issue of Massachusetts law that had not been previously addressed by the Massachusetts Supreme Judicial Court (SJC). The court decided to certify the issue to the SJC as the existing case law did not provide a clear answer and the resolution may require policy judgments on applying Massachusetts law to this key insurance coverage issue.The case arose from a situation where Norwood Hospital Facility, a building owned by MPT and leased to Steward, suffered significant damage after severe thunderstorms. Rainwater accumulated on the hospital's roof and a second-floor courtyard, eventually seeping into the hospital's upper floors. Both Zurich and AGLIC, in their initial evaluations, determined that water damage in the hospital's basement was caused by "Flood," and would be subject to the policies' respective coverage limits. However, the insurers later characterized all the water damage, including that from the roof, as "surface water" and subject to the "Flood" coverage limits.The court concluded that whether rainwater pooled on a parapet roof constitutes "surface waters" in the policies' "Flood" definition is determinative of this interlocutory appeal. Therefore, the court certified the issue to the SJC for its consideration. View "Zurich American Insurance Co. v. Medical Properties Trust, Inc." on Justia Law

Brian Smith, a Rhode Island resident, sued Prudential Insurance Company of America for breach of fiduciary duty after the company terminated his long-term disability benefits under an insurance policy. The policy stated a three-year limitations period to file a lawsuit, which began on the date Smith was required to submit proof of his disability, not on the date Prudential allegedly breached the policy by stopping payment. Consequently, by the time Smith filed his lawsuit, the limitations period had expired. Smith appealed to the United States Court of Appeals for the First Circuit after the United States District Court for the District of Rhode Island granted summary judgment in favor of Prudential on the grounds that Smith's lawsuit was filed too late.Smith argued that enforcing the limitations scheme would violate Rhode Island public policy. While the Court of Appeals found compelling reasons to believe that the limitations scheme might indeed contravene Rhode Island public policy, they also recognized that reversing and remanding on that ground would potentially expand Rhode Island law. Consequently, the Court of Appeals decided to certify the public policy question to the Rhode Island Supreme Court. The certified question is whether, in light of specific state laws and Rhode Island public policy, Rhode Island would enforce the limitations scheme in this case to bar Smith's lawsuit against Prudential. View "Smith v. Prudential Insurance Company of America" on Justia Law

The First Circuit reversed the order of the district court dismissing this case at the pleading stage for lack of standing, holding that Malcom Wiener had Article III standing to sue Defendants, MIB Group, Inc. and its executive vice president, based on additional attorney's fees and costs Wiener insured to respond to Defendants' actions in a separate lawsuit.In 2018, Wiener sued AXA Equitable Life Insurance Company, his former life insurance company, for negligence. After the jury returned a verdict in favor of Wiener the district court granted AXA's motion to dismiss for lack of subject matter jurisdiction. The court of appeals reversed the decision granting AXA's motion to dismiss. Meanwhile, Wiener brought this suit against Defendants, alleging that he incurred out-of-pocket loss in the form of attorney's fees and costs and to respond to Defendants' actions in the related lawsuit. The district court dismissed the action, concluding that Wiener lacked Article III standing. The First Circuit reversed, holding that a past, out-of-pocket loss is a basis for Article III standing, and therefore, Wiener had standing to bring this suit. View "Wiener v. MIB Group, Inc." on Justia Law

The First Circuit vacated the judgment of the district court in favor of Philadelphia Indemnity Insurance Company in this action seeking a declaration that BAS Holding Corporation breached a condition of the parties' insurance contract, holding that the district court's findings providing grounds for summary judgment were insupportable.After an arsonist destroyed a building owned by BAS and purportedly insured against loss by Philadelphia, the insurer sought an examination under oath (EUO) of George Carney, BAS's president and owner. Philadelphia then denied coverage on the grounds that BAS refused to provide Carney for an EUO, in violation of its obligations under the relevant insurance policy. Philadelphia then brought this action. The district court granted summary judgment for Philadelphia on the ground that BAS failed to cooperate by refusing to submit to the EUO. The First Circuit vacated the judgment, holding that where the evidence unequivocally showed the BAS never willfully and inexcusably refused to provide Carney for the EUO, and therefore summary judgment was improper. View "Philadelphia Indemnity Insurance Co. v. BAS Holding Corp." on Justia Law

The First Circuit affirmed the judgment of the district court granting United States Liability Insurance Group's (USLI) motion to dismiss this lawsuit brought by Nahant Preservation Trust, Inc. to secure insurance coverage in connection with defense costs and indemnification arising from a state court action brought by Northeastern University, holding that there was no error.Northeastern sued Nahant in state court seeking a declaratory judgment regarding its rights concerning certain land. Nahant, which carried liability insurance through USLI, did not notify USLI of the suit until it wrote to USLI seeking coverage for defense costs. USLI refused to provide coverage on the grounds that Nahant had provided untimely notice of the claim. Thereafter Nahant sued USLI seeking, among other things, a declaratory judgment regarding USLI's duty to defend and indemnify. The First circuit granted USLI's motion to dismiss, concluding that the "exclusion agreement" signed by the parties excluded coverage. The First Circuit affirmed, holding that the district court properly accepted USLI's plausible reading of the exclusion amendment. View "Nahant Preservation Trust, Inc. v. Mount Vernon Fire Insurance Co." on Justia Law

The First Circuit affirmed the order of the district court granting summary judgment in favor of Insurer in this insurance dispute, holding that the failure to give notice according to the terms and conditions of an excess insurance policy forfeits any right to coverage.The President and Fellows of Harvard College purchased a one-year liability insurance policy from a member company of the American International Group, Inc. (AIG) requiring prompt notice of any claim filed against Harvard. Harvard purchased a secondary excess policy from Zurich American Insurance Co. providing that a policyholder give notice of any claims arising under the policy "in the same manner required by the terms and conditions of the [AIG] Policy." In 2014, a student organization sued Harvard for violating Title VI of the Civil Rights Act of 1964. Harvard timely notified AIG of the pending suit but neglected to notify Zurich until after the policy's notification window. Therefore, Zurich denied coverage. Harvard brought this action seeking declaratory relief and damages for breach of contract. The district court granted summary judgment for Zurich. The First Circuit affirmed, holding that there was no basis for overturning the district court's entry of summary judgment. View "President & Fellows of Harvard College v. Zurich American Insurance Co." on Justia Law

The First Circuit affirmed the judgment of the district court granting summary judgment in favor of Triple-S Management Corporation and Triple-S Vida, Inc. (collectively, Triple-S) and dismissing this case brought by Dora Bonner, holding that the district court did not abuse its discretion in denying Bonner's discovery-related motions and did not err in considering the evidence at the summary judgment stage.Bonner brought several claims alleging that Triple-S denied her millions of dollars of proceeds from certain certificates and devised a scheme to defraud her. After denying Bonner's motion to compel discovery and extend the discovery deadline, the district court concluded that Triple-S had established as a matter of law that the persons behind the fraudulent scheme were not related to Triple-S. The First Circuit affirmed, holding that the district court (1) did not abuse its discretion in denying the motion to compel and motion for consideration; and (2) properly granted summary judgment for Triple-S. View "Bonner v. Triple-S Vida, Inc." on Justia Law

The First Circuit affirmed the judgment of the district court granting a motion to compel arbitration in this insurance dispute, holding that the district court correctly granted the motion to compel arbitration brought by the underwriters of Green Enterprises, LLC's insurance policy, all syndicates at Lloyd's of London (Underwriters).After a fire destroyed one of its plants, Green, a Puerto Rican recycling company, filed an insurance claim. Underwriters denied the claim, after which Green brought this lawsuit. Underwriters filed a motion to compel arbitration under an arbitration clause in the parties' contract. The district court granted the motion and dismissed Green's claims without prejudice. The First Circuit affirmed, holding that the district court properly granted the motion to compel. View "Green Enterprises, LLC v. Hiscox Syndicates Limited at Lloyd's of London" on Justia Law

The First Circuit reversed the judgment of the district court ruling that Insured's claim of unfair claim settlement practices in violation of Mass. Gen. Laws ch. 176D and 93A was barred by the choice-of-law provision of the marine insurance policy he purchased from Great Lakes Insurance SE (GLI), holding that the district court erred.Insurer, the insurer of Insured's forty-seven-foot catamaran sailing vessel, brought a declaratory judgment action to determine whether the "constructive total loss" of Insured's vessel was covered under the relevant policy. Insured brought a counterclaim alleging violations of Mass. Gen. Laws ch. 176D, 3(9) and ch. 93A, 9(3A). The district court ruled that pursuant to the policy's choice-of-law provision, New York law barred Insured's Massachusetts counterclaim because New York law does not provide for a chapters 176D and 93A claim. The First Circuit reversed, holding (1) Insured's statutorily-based counterclaim was extra-contractual; (2) the plain language of the choice-of-law provision was not broad enough to unambiguously encompass an extra-contractual claim; and (3) any ambiguity in the policy must be construed in favor of Insured. View "Great Lakes Insurance SE v. Andersson" on Justia Law