Articles Posted in US Court of Appeals for the Second Circuit

by
The insurer appealed from the district court's judgment in favor of the adjuster. At issue was whether the district court erred in overturning the jury verdict and granting judgment as a matter of law in favor of the adjuster on the basis of insufficiency of the evidence to support the jury's conclusion that the statute of limitations was tolled such that the insurer's claim was timely filed. The Second Circuit certified a question of law to the Connecticut Supreme Court regarding the contours of the doctrine that tolls a limitation period because of a continuing course of conduct. The state court responded that the evidence was not legally sufficient to toll the statute of limitations on this factual record. Accordingly, because the state court's decision resolved the controlling question of Connecticut law, the court affirmed the judgment. View "Evanston Insurance Co. v. William Kramer & Associates, LLC" on Justia Law

by
The Second Circuit affirmed the district court's order denying GEICO and CCC's motions to compel appraisal in a suit brought by a GEICO policyholder. The court held that it had jurisdiction over this appeal because it had appellate jurisdiction over an order denying a motion to compel arbitration and the appraisal process in the policy fell within the meaning of arbitration. The court held that appraisal was not appropriate in this case where the dispute concerned a legal issue about the meaning of Regulation 64, which was incorporated into the policy. Finally, the district court denied CCC's motion to compel appraisal because CCC was not a signatory to the policy and had no other contractual relationship with the policyholder. View "Milligan v. CCC Info Services" on Justia Law

by
The Second Circuit affirmed the district court's dismissal of plaintiffs' amended complaint under Federal Rule of Civil Procedure 12(b)(6). This appeal arose from a multitude of lawsuits filed by Connecticut homeowners whose basements walls were likely constructed with defective concrete manufactured by the now‐defunct J.J. Mottes Company. The court held that the "collapse" provision in the Allstate homeowner's insurance policy in this case did not afford coverage for basement walls that exhibit signs of deterioration but that have not collapsed suddenly, accidentally, and entirely, as required by the policy. Therefore, the horizontal and vertical cracking in plaintiffs' basement walls did not constitute a covered "collapse" under the policy and Allstate did not breach its contract by denying coverage for plaintiffs' claim. View "Valls v. Allstate Insurance Co." on Justia Law

by
After Liberty refused to provide High Point a defense pursuant to the terms of insurance policies providing coverage for advertising injuries, the district court granted High Point's motion for partial summary judgment. The underlying litigation stemmed from Buyer's Direct's claim that High Point's Fuzzy Babba slipper infringed on the Snoozie's design patent. The Second Circuit agreed with the district court that as used in the counterclaims and with the additional context of the discovery demands in the underlying litigation, the term "offering for sale" includes advertising, such that Liberty owes High Point a defense. However, the court held that Liberty's duty to provide a defense did not arise until High Point provided Liberty with discovery demands served in the underlying litigation. Therefore, the district court vacated the award of damages and remanded for the district court to determine the amount of legal fees incurred from that point forward. View "High Point Design, LLC v. LM Insurance Corp." on Justia Law

by
The Second Circuit affirmed the district court's summary judgment dismissal of all claims in the Second Amended Complaint against defendants in an action stemming from construction projects with the U.S. Army Corps of Engineers. The court held that MES's claims failed to articulate any support for its accusations that Safeco breached its contractual obligations or engaged in bad faith or tortious conduct. The court noted that the claim that Safeco acted inappropriately by attending the cure meetings was particularly frivolous. In this case, MES failed to identify any good faith basis, in law or on the basis of the agreements at issue, for its assertion that Safeco had no right to take steps to meet its obligations under the surety bonds. The court sua sponte awarded Safeco double costs. View "M.E.S., Inc. v. Safeco Insurance Co. of America" on Justia Law

by
Utica and Clearwater appealed from the district court's summary judgment orders regarding Clearwater's obligations to Utica under five facultative reinsurance policies. The Second Circuit held that Clearwater's liability was expense-supplemental because its obligations under the reinsurance contracts followed Utica's expense-supplemental obligations under the umbrella policies. The court vacated and remanded for the district court to determine whether this obligation encompasses certain expenses. The court vacated and remanded the cross-appeal because Utica failed to demonstrate its entitlement to a judgment that Clearwater was bound to indemnify Utica according to Utica's settlement with its insured. View "Utica Mutual Insurance Co. v. Clearwater Insurance Co." on Justia Law

by
The Second Circuit affirmed the district court's judgment that Interstate breached its contractual duty to indemnify the Archdiocese under certain excess insurance policies. The Archdiocese appealed from an amended judgment that Interstate's breach did not violate the Connecticut Unfair Insurance Practices Act (CUIPA). At issue were two contract provisions invoked by Interstate to deny coverage for sexual abuse by priests: the exclusion for assault and battery, and the coverage grant for occurrences that unintentionally and unexpectedly result in personal injury. The court held that the Exclusion applied only to a person "acting within the scope of his duties," and that the assailant priests were not acting within the scope of their duties when they committed sexual assault of children. The court held that Interstate was bound to indemnify the Archdiocese for all sums it was obligated to pay arising out of any occurrences or happening during the period of insurance. The court also held that the Archdiocese failed to demonstrate a violation of CUIPA. View "Hartford Roman Catholic Diocesan Corp. v. Interstate Fire & Casualty Co." on Justia Law

by
AEI filed a declaratory judgment action alleging that Lincoln was barred from challenging the validity of a life insurance policy because the two‐year contestability period had lapsed. The district court granted AEI's motion for summary judgment. The Second Circuit held that the contract did not contain a choice-of-law provision and thus New York conflict-of-law rules governed the dispute. The court held that, because those rules instructed the courts to look to the "center of gravity" of the events at issue to determine which state's substantive law applied, and the center of gravity in this case was New York, New York's substantive law applied. In this case, applying New York's substantive incontestability law barred Lincolnʹs challenges to the policy. View "AEI Life, LLC v. Lincoln Benefit Life Co." on Justia Law

by
At issue in this case was whether the record contained sufficient evidence to support the jury's verdict that a continuing course of conduct tolled the statute of limitations, Connecticut General Statutes 52‐577. The Second Circuit certified the following question to the Connecticut Supreme Court: Is the trial evidence legally sufficient to support the jury's finding that the statute of limitations was tolled at least through October 21, 2010, rendering the Insurer's claim timely? View "Evanston Insurance Co. v. William Kramer & Associates, LLC" on Justia Law

by
The Second Circuit held that the district court erred in its interpretation of the contracts under the court's prior precedent and therefore, the court vacated the original judgment and remanded to the district court for reconsideration of the contracts employing standard principles of contract interpretation. The appeal stemmed from a dispute between Century and Global over the extent to which Global was obligated to reinsure Century pursuant to certain reinsurance certificates. The court held that the district court's determination that the contract was unambiguous was premised on an erroneous interpretation of New York state law. The court explained that the district court should construe each reinsurance policy solely in light of its language and, to the extent helpful, specific context. View "Global Reinsurance Corporation of America v. Century Indemnity Co." on Justia Law