Justia Insurance Law Opinion Summaries

Articles Posted in US Court of Appeals for the Second Circuit
by
The Second Circuit affirmed the district court's judgment sustaining the final determination of Hartford Life with respect to plaintiff's disability benefits under the terms of the long term disability plan.The court held that California Insurance Code 10110.6(a) applies only to the claims of California residents. It does not apply to plaintiff because he was a New York resident at all relevant times. The court also held that "full and fair review" under the Employee Retirement Income Security Act's (ERISA) claims-procedure regulations does not require the claims administrator to produce documents developed or considered during the appeal from the initial determination while the claim is still under review and before a final benefits determination. Therefore, plaintiff cannot establish that Hartford Life did not provide his claim a full and fair review. In this case, the district court correctly reviewed Hartford Life's determination under the arbitrary-and-capricious standard and correctly concluded that the final determination was reasonable and supported by substantial evidence in the record. View "Mayer v. Ringler Associates Inc. and Af." on Justia Law

by
Utica Insurance issued primary and umbrella coverage in 1973 and 1974 and subsequently paid asbestos losses incurred by the manufacturer (Goulds). Utica had ceded parts of its risk to the reinsurers, Munich and Century, in exchange for a share of the premiums, via facultative certificates, i.e., a reinsurance contract particular to that policy. Munich and Century each paid Utica $5 million for their undisputed one-fifth shares of the umbrella policy; but they refused to pay defense costs in addition to limits when Utica billed them an extra $2,760,534 each. Utica sued; in two suits before different judges of the same court, with inconsistent results.On the issue of whether the reinsurers (Munich and Century) were obligated to reimburse Utica for defense costs in addition to policy limits, the Second Circuit held that the 1973 certificates reinsure defense costs within limits, not in addition. A 2007 settlement agreement with Goulds did not independently require Century or Munich to pay defense costs in addition to limits. View "Utica Mutual Insurance Co. v. Munich Reinsurance America, Inc." on Justia Law

by
Plaintiffs filed suit against several laboratory testing companies, alleging that the companies violated federal and Connecticut law by submitting fraudulent or overstated claims for medical services purportedly provided to plaintiffs' plan members. The district court dismissed the complaint with prejudice after concluding that plaintiffs' claims are time-barred by Connecticut’s three-year statute of limitations applicable to tort claims.The Second Circuit found, under Connecticut law, that plaintiffs' equitable claims, which include their federal claims, are subject to no statute of limitations and are instead governed only by the doctrine of laches. Therefore, the court vacated the district court's decision in part. However, the court nonetheless affirmed the district court's dismissal of the state law claims, and specifically reject plaintiffs' argument that the limitations period applicable to those claims was tolled during the pendency of a prior action between the parties. The court explained that, although plaintiffs note that several sister circuits have tolled limitations periods applicable to compulsory counterclaims as a matter of federal law, the legal claims at issue here are all brought under state law, subject only to state law tolling rules, and provide no relief for plaintiffs. View "Connecticut General Life Insurance Co. v. BioHealth Laboratories, Inc." on Justia Law

by
Plaintiffs enrolled in a Group Variable Universal Life Insurance (GVUL) policy offered by MetLife. During the enrollment process, neither plaintiff indicated that he smoked tobacco, but MetLife nevertheless designated them as tobacco smokers, thus triggering their payment of higher insurance premiums. Plaintiffs filed suit after MetLife refused to refund the amount of overpayments, alleging breach of contract and tort violations under New York law.The Second Circuit affirmed the district court's dismissal of plaintiffs' claims as time-barred under New York's applicable statute of limitations. The court held that the continuing-violation doctrine did not toll the limitations period for the breach of contract claim where the issue in this case rests on a single allegedly unlawful act, namely MetLife's initial designation of both plaintiffs as smokers. The court noted that determining whether the Securities Litigation Uniform Standards Act bar applies here is a fraught and unnecessary endeavor. View "Miller v. Metropolitan Life Insurance Co." on Justia Law

by
The Second Circuit reversed the district court's award of $64 million to Utica. In this case, the jury found that the Fireman's Fund breached its obligations under reinsurance contracts issued to Utica. The court agreed with Fireman's Fund that the reinsurance contracts, by their terms, demonstrate as a matter of law that Fireman's Fund did not owe to Utica the obligations allegedly breached. The court explained that the umbrella policies unambiguously define their attachment point by reference to the underlying limits of liability "as stated in the Schedule[s]." Therefore, where the losses in question did not exceed the limits stated for bodily injury in the Schedules, Fireman's Fund had no obligation under the reinsurance contracts to pay for those losses. The court remanded for further proceedings. View "Utica Mutual Insurance Co. v. Fireman's Fund Inc." on Justia Law

by
The Second Circuit certified a question of insurance law to the New York Court of Appeals: Must a general liability insurance carrier defend an insured in an action alleging discrimination under a failure-to-accommodate theory? View "Brooklyn Center for Psychotherapy, Inc. v. Philadelphia Indemnity Insurance Co." on Justia Law

by
The Second Circuit affirmed the district court's grant of defendant's motion to dismiss after the Court of Appeals answered the certified question. In light of the Court of Appeals' holding that section 230(11)(b) of the New York Public Health Law does not create a private right of action for bad faith and malicious reporting to the Office of Professional Medical Conduct to the New York Court of Appeals, the court held that plaintiff's section 230(11)(b) claim was properly dismissed. View "Haar v. Nationwide Mutual Fire Insurance Co." on Justia Law

by
Atlantic sought a declaratory judgment that the insurance policy it had issued to Coastal was void ab initio or, in the alternative, that there was no coverage for the loss of the barge or damage to an adjacent pier. District Court Judge Wexler passed away prior to issuing his findings of fact and conclusions of law. The case was transferred to Judge Azrack, who, after no party requested the recall of any witness under Federal Rule of Civil Procedure 63, issued findings of fact and conclusions of law in her role as successor judge and entered judgment finding Atlantic liable to Coastal under the terms of the policy.Under Federal Rule of Civil Procedure 52(a)(6), factual findings of successor judges who have certified their familiarity with the record are subject to the "clearly erroneous" standard of review. The Second Circuit also held that, under Federal Rule of Civil Procedure 63, a successor judge is under no independent obligation to recall witnesses unless requested by one of the parties. In this case, the court found no reversible error in Judge Azrack's findings of fact and conclusions of law, including findings that Coastal did not breach its duty of uberrimae fidei, and thus the policy was not void; Atlantic failed to prove that the vessel was unseaworthy; the loss of the vessel was due to a "peril of the sea" and was covered by the policy; Coastal was entitled to damages for contractual payments withheld by its contractor for repairs to a pier; and Coastal proved its damages using only a summary spreadsheet of invoices, as evidence. View "Atlantic Specialty Insurance Co. v. Coastal Environmental Group Inc." on Justia Law

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