Justia Insurance Law Opinion Summaries

Keith Steffes, Kelly Steffes and Tasha (Rohrbach) Steffes appealed a district court order granting Nodak Mutual Insurance Company’s motion for a new trial. The Steffeses argued the district court abused its discretion in vacating the judgment and granting Nodak’s motion for a new trial. The North Dakota Supreme Court dismissed the appeal because the order granting a new trial was not then reviewable. View "Nodak Mutual Insurance Company v. Steffes, et al." on Justia Law

Javonne Hunt appealed a district court order requiring him to pay $27,501.86 in restitution to Blue Cross Blue Shield (“BCBS”). In 2017, Hunt was playing basketball at the YMCA in Bismarck, North Dakota when he was involved in an altercation with an opposing player. Hunt intentionally struck the opposing player in the jaw causing a bone fracture. Hunt was charged and subsequently found guilty by a jury of aggravated assault. Following his conviction, Hunt agreed to pay as restitution the out-of-pocket medical expenses incurred by the injured individual in the amount of $3,233.07. BCBS provided evidence that it had paid an additional $27,501.86 for the medical treatment of the injured individual under the injured individual’s policy of insurance. The district court applied N.D.C.C. 12.1-32-08(1) in granting restitution to BCBS and ordered Hunt to pay a total of $30,734.93; $3,233.07 for the conceded out-of-pocket costs plus the $27,501.86 claimed by BCBS. Hunt argued BCBS is precluded from recovery of its expenditures in the criminal proceedings because the definition of “victim” under N.D. Const. art. I, section 25 was incompatible with a recovery by a corporation under the criminal restitution statute, N.D.C.C. 12.1-32-08(1). The North Dakota Supreme Court found no reversible error in the district court’s judgment and affirmed the order. View "North Dakota v. Hunt" on Justia Law

The Supreme Court affirmed the decision of the court of appeals affirming the judgment of the circuit court granting summary judgment dismissing Rural Mutual Insurance Company's subrogation claims pursuant to a subrogation waiver, holding that the subrogation waiver was valid and enforceable.Rural Mutual brought this action against Lester Buildings, LLC, Phoenix Insurance Company, Van Wyks, Inc., and West Bend Mutual Insurance Company after a barn collapsed due to strong winds and Rural Mutual paid more than $650,000 to the barn owner, Jim Herman, Inc. (Herman). The circuit court concluded that the claims were barred pursuant to a subrogation waiver contained in Lester Buildings' contract with Herman, Rural Mutual's insured, and further concluded that Wis. Stat. 895.447 did not void that subrogation waiver. The Supreme Court affirmed, holding (1) section 895.447 did not void the subrogation waiver in the contract because the waiver did not limit or eliminate tort liability; and (2) the subrogation waiver was not an unenforceable exculpatory contract contrary to public policy. View "Rural Mutual Insurance Co. v. Lester Buildings, LLC" on Justia Law

Appellants challenged the approval of a global settlement between the receiver for Stanford International Bank and related entities, and various insurance company underwriters, who issued policies providing coverage for fidelity breaches, professional indemnity, directors and officers protection, and excess losses.The Fifth Circuit vacated the district court's order approving the settlement and bar orders, holding that the district court lacked authority to approve the receiver's settlement to the extent it nullified the coinsureds' claims to the policy proceeds without an alternative compensation scheme; released claims the estate did not possess; and barred suits that could not result in judgments against proceeds of the underwriters' policies or other receivership assets. Accordingly, the court remanded for further proceedings. View "SEC v. Stanford International Bank, Ltd." on Justia Law

The First Circuit affirmed the judgment of the district court granting summary judgment for Insured on Insurer's complaint seeking a declaratory judgment that it had no duty to defend Insured against an underlying class action alleging that Insured had engaged in misconduct that resulted in customers receiving higher bills than Insured had represented that they would be, holding that summary judgment was properly granted.The complaint sought class-wide damages for a variety of Maine common law claims and for claims under the federal Rackeeter Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962, 1964; and the Maine Unfair Trade Practices Act, Me. Rev. Stat. Ann. tit. 5, 207. In its complaint, Insurer argued that the complaint in the underlying action failed to allege that Insurer engaged in conduct that qualified as an "occurrence" or that caused any "bodily injury" under the relevant policy. The district court entered judgment for Insured. The First Circuit affirmed, holding that there was no genuine issue of material fact in dispute and that the district court's conclusions were correct as a matter of law. View "Zurich American Insurance Co. v. Electricity Maine, LLC" on Justia Law

In this case concerning civil liability based on insurer conduct affecting chiropractic services, the Supreme Court affirmed the order of the trial court dismissing all claims in this case, relying on and incorporating its reasoning in a companion case, Sykes v. Health Network Solutions, Inc., __ S.E.2d __ (N.C. 2019)(Sykes I), in holding that the decision in Sykes I met the criteria for collateral estoppel.This case was one of two putative class actions alleging that defendant insurers contracted with Health Network Solutions, Inc. (HNS) to provide or restrict insured chiropractic services in violation of state insurance and antitrust laws. Plaintiffs chose to bring this action against insurers separately from their claims against against HNS and its individual owners in Sykes I, but both actions presented essentially the same claims and relied on the same theories. The trial court dismissed Plaintiffs' claims in this case. The Supreme Court affirmed, holding that collateral estoppel barred Plaintiffs from litigating these matters given the Court's resolution of the issues in Sykes I. View "Sykes v. Blue Cross & Blue Shield of North Carolina" on Justia Law

The Eighth Circuit affirmed the district court's judgment in an insurance coverage dispute over the allocation of a $6 million settlement in an underlying product liability action. The court held that the district court did not err in interpreting the Batch Clause Endorsement and its construction of the term "lot." The court rejected Federal's arguments to the contrary and affirmed the district court's ruling that AIG be paid $500,000 by Donaldson and be reimbursed over $2.76 million by Federal. View "National Union Fire Insurance Co. of Pittsburgh v. Federal Insurance Co." on Justia Law

This case involved an appeal brought by Aerocet, Inc., and its surety, the State Insurance Fund, in which they appealed an Idaho Industrial Commission decision involving two worker’s compensation claims brought by George McGivney. The Commission awarded McGivney benefits for injuries he sustained to his left knee while working for both Aerocet and Quest Aircraft (Quest). The Referee consolidated the two cases and issued a recommendation that attributed the vast majority of liability to Quest. The Commission rejected the bulk of the Referee’s recommendations and apportioned liability equally between Aerocet and Quest. Aerocet appealed, alleging the Commission inappropriately consolidated McGivney’s two injury claims. Aerocet also argued the Commission failed to determine McGivney’s disability in excess of impairment from his 2011 accident at Aerocet prior to his 2014 accident at Quest, and that the Commission erred in its application of Brown v. Home Depot, 272 P.3d 577 (2012). Aerocet also contended the Commission’s decision was not supported by substantial and competent evidence. After review, the Idaho Supreme Court affirmed the Commission’s decisions. The matter was remanded back to the Commission to enable it to calculate the amount due Quest’s surety from Aerocet’s surety for any amounts overpaid by Quest’s surety. View "McGivney v. Aerocet, Inc" on Justia Law

Lacko began working for BKD’s predecessor in 1999 and worked until September 2015, when she was Senior Manager in the Audit Department, with an annual salary of $93,250.04. She applied for benefits under the short term disability (STD) plan, claiming gastroparesis, diabetes, rheumatoid arthritis, congestive heart failure, breathing difficulties, anxiety, musculoskeletal impairments, and cognitive difficulties related to the medication needed to manage the other conditions. Although United approved her claims for STD benefits three times, it denied benefits in June 2016 for the period beyond November 22, 2015, concluding there was no change in Lacko’s medical condition when she stopped working or subsequently. United also denied her claim for long term disability benefits. Lacko sued under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001.. The district court granted United summary judgment. The Seventh Circuit reversed. United failed to adequately address a determination that Lacko was entitled to Social Security disability benefits and failed to recognize the significant distinction between her ability to perform unskilled work and the job of Senior Manager. The court noted that the Plan’s requirement of a “change” in a person’s physical or mental capacity in order to qualify for benefits does not by its terms preclude a degenerative condition from qualifying a claimant for benefits and noted United's conflict of interests, having issued the policies and serving as claims review fiduciary. View "Lacko v. United of Omaha Life Insurance Co." on Justia Law

The United States Court of Appeals for the Fourth Circuit certified a question of South Carolina law to the South Carolina Supreme Court. The underlying case was an insurance bad faith action against an insurance company for its failure to defend its insured in a construction defect action. The insured settled the construction defect action and brought a bad faith tort action. When the insurer asserted it acted in good faith in denying coverage, the insured sought to discover the reasons why the insurer denied coverage. According to the insurer, the discovery requests included communications protected by the attorney-client relationship. The federal district court reviewed the parties' respective positions, determined the insured had established a prima facie case of bad faith, and ordered the questioned documents to be submitted to the court for an in camera inspection. The insurer then sought a writ of mandamus from the Fourth Circuit to vacate the district court's order regarding the discovery dispute. In turn, the Fourth Circuit asked the South Carolina Supreme Court whether state law supported the application of the "at issue" exception to attorney-client privilege such that a party may waive the privilege by denying liability in its answer. The South Carolina Supreme Court found that the parties, especially the insured, contended the certified question did not accurately represent the correct posture of the case. In fact, the insured conceded the narrow question presented required an answer in the negative. The Supreme Court agreed, finding “little authority for the untenable proposition that the mere denial of liability in a pleading constitutes a waiver of the attorney-client privilege.” The Court elected to analyze the issue narrowly in the limited context of a bad faith action against an insurer, and felt constrained to answer the certified question as follows: "No, denying liability and/or asserting good faith in the answer does not, standing alone, place the privileged communications 'at issue' in the case." View "Mt. Hawley Insurance Company v. Contravest Construction" on Justia Law