Justia Insurance Law Opinion Summaries

Plaintiff, as assignees of its customers against the insurer, appealed the district court's grant of summary judgment for the insurer. Plaintiff alleged that the insurer failed to pay sufficient funds to fulfill its obligations to return damaged vehicles to pre‐accident condition, and engaged in deceptive practices in claims processing. The Second Circuit held that the district court erred in part in granting summary judgment to the insurer on plaintiff's breach of contract claims, because the insurer failed to show its entitlement to judgment for costs relating to labor hours, parts, labor rates, electronic database access, and hazardous waste removal charges, and the absence of genuine disputes of material fact on these issues. The district court erred in granting summary judgment to the insurer on plaintiff's New York General Business Law 349 claims, because there was a question of material fact regarding plaintiff's claim that the insurer engaged in deceptive practices concerning its labor rates payments and that claim was not precluded by N.Y. Ins. Law 2601. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Nick's Garage, Inc. v. Progressive Casualty Insurance Co." on Justia Law

To seek redress for an opioid epidemic, characterized by the Court of Appeal as having placed a financial strain on state and local governments dealing with the epidemic’s health and safety consequences, two California counties sued (the California Action) various pharmaceutical manufacturers and distributors, including the appellants in this matter, Actavis, Inc., Actavis LLC, Actavis Pharma, Inc., Watson Pharmaceuticals, Inc., Watson Laboratories, Inc., and Watson Pharma, Inc. (collectively, “Watson”). The California Action alleged Watson engaged in a “common, sophisticated, and highly deceptive marketing campaign” designed to expand the market and increase sales of opioid products by promoting them for treating long-term chronic, nonacute, and noncancer pain - a purpose for which Watson allegedly knew its opioid products were not suited. The City of Chicago brought a lawsuit in Illinois (the Chicago Action) making essentially the same allegations. The issue presented by this appeal was whether there was insurance coverage for Watson based on the allegations made in the California Action and the Chicago Action. Specifically, the issue was whether the Travelers Property Casualty Company of America (Travelers Insurance) and St. Paul Fire and Marine Insurance Company (St. Paul) owe Watson a duty to defend those lawsuits pursuant to commercial general liability (CGL) insurance policies issued to Watson. Travelers denied Watson’s demand for a defense and brought this lawsuit to obtain a declaration that Travelers had no duty to defend or indemnify. The trial court, following a bench trial based on stipulated facts, found that Travelers had no duty to defend because the injuries alleged were not the result of an accident within the meaning of the insurance policies and the claims alleged fell within a policy exclusion for the insured’s products and for warranties and representations made about those products. The California Court of Appeal concluded Travelers had no duty to defend Watson under the policies and affirmed. View "The Traveler's Property Casualty Company of America v. Actavis, Inc." on Justia Law

Here the Supreme Court answered a certified question from the United States District Court for the District of Massachusetts concerning the priority of coverage of two automobile insurance policies that both covered a single motor vehicle accident. A portion of the loss was covered by a primary insurance policy from an insurance company not a party to this case. The two policies at issue were triggered, according to the language in each policy, after the exhaustion of the primary policy. Each policy stated that it provided “excess” coverage and also contained an “other insurance” clause. In this opinion, the Supreme Court ultimately concluded that both excess policies covered the accident equally, after exhaustion of the underlying primary policy, to the extent of their respective policy limits. View "Great Divide Insurance Co. v. Lexington Insurance Co." on Justia Law

The Supreme Court reversed the judgment of the circuit court entering summary judgment in favor of the Doe Run Resources Corporation in this insurance coverage dispute. Doe Run was sued by several minor plaintiffs allegedly injured by toxic pollution released from Doe Run’s smelting facility in Peru. Doe Run sued St. Paul Fire and Marine Insurance Company, its insurer, for reimbursement of defense costs incurred during the litigation of these claims. St. Paul alleged that coverage was barred under the insurance policy’s pollution exclusion. The circuit court found the pollution exclusion ambiguous and unenforceable. The Supreme Court reversed, holding that the pollution exclusion unambiguously barred coverage and that St. Paul had no duty to defend Doe Run from the lawsuits. View "Doe Run Resources Corp. v. American Guarantee & Liability Insurance" on Justia Law

In this case, we deny relief on a petition for review of an award of benefits made by the Workers' Compensation Appeals Board (WCAB). In 2006, while working at Pearson Ford, Leopoldo Hernandez accidentally slammed the trunk of a car on his left hand and crushed one of his fingers. Although no bones in his hand were broken, he was unable to continue working at Pearson Ford because of continuing pain in his hand and shoulder. Hernandez applied for and received workers' compensation benefits. Pearson Ford's workers' compensation carrier retained the services of a private investigator, who conducted video surveillance of Hernandez following each of the three visits to his doctor in early 2010. Following each visit, Hernandez was observed taking off his sling, using his left hand to get in and out of his truck or a car, using his left hand to steer his truck or car, and on one occasion stopping at a grocery store and using his left hand to carry a bag of groceries. After the investigator witnessed other instances of Hernandez using his allegedly injured left hand, the carrier notified the district attorney, who in turn, commenced its own investigation. In specified circumstances, a worker who engages in criminal fraud in attempting to recover workers' compensation benefits and is convicted of doing so is thereafter barred from recovering benefits growing out of the fraud. However, in given circumstances where, independent of any fraud, a worker is able to establish his or her entitlement to benefits, benefits may be awarded. Here, the WCAB found evidence, independent of a worker's fraud, that he had suffered a compensable injury and was entitled to benefits. In doing so the WCAB relied on the determination of a medical expert. The Court of Appeal found no error in the WCAB's determination the workers' claim was not barred by the eventual misdemeanor conviction for workers' compensation fraud and in the WCAB's adoption of the expert's finding of a permanent disability. The Court denied the petitioner any relief on its petition asking that it vacate the WCAB's award. View "Pearson Ford v. Workers' Comp. Appeals Bd." on Justia Law

Douglas Ghee, as personal representative of the estate of Billy Fleming, deceased, appealed a circuit court order dismissing his wrongful-death claim against USAble Mutual Insurance Company d/b/a Blue Advantage Administrators of Arkansas ("Blue Advantage"). The Alabama Supreme Court dismissed this appeal as being from a nonfinal order. View "Ghee v. USAble Mutual Insurance Co." on Justia Law

An injured first-party insured who is compelled to sue for underinsured motorist (UIM) benefits and recovers more at trial than the last insurance company offer is entitled to recover his or her attorney fees in an amount subsequently determined by the district court to be reasonable.In this case, Plaintiff was compelled to sue Insurer. The jury returned a verdict higher than the amount of the last offer made by Insurer to settle her UIM claim. The Supreme Court held that Insurer was required to pay Plaintiff’s attorney fees. The court thus reversed the district court order denying fees and remanded the case for further proceedings. View "Mlekush v. Farmers Insurance Exchange" on Justia Law

Assuming that the legislature’s 2013 amendment to N.Y. Workers’ Comp. Law 25-a has a retroactive impact by imposing unfunded costs upon Plaintiffs for policies finalized before the amendment’s effective date, that retroactive impact is constitutionally permissible.Plaintiffs - approximately twenty insurance companies that wrote workers’ compensation insurance policies in New York - commenced this declaratory judgment action in 2013, alleging that the legislature’s amendment to section 25-a operated retroactively to the extent that it imposed unfunded liability upon Plaintiffs and that this retroactive impact was unconstitutional. Supreme Court granted Defendant’s motion to dismiss, concluding that the amendment operated prospectively. The Appellate Division reversed and entered a judgment declaring section 25-a(1-a) unconstitutional as retroactively applied to policies issued before October 1, 2013. The Court of Appeals reversed, holding that, even assuming that the amendment has retroactive impact, this impact is constitutional. View "American Economy Insurance Co. v. State" on Justia Law

Georgia Urology, P.A., and several of its member physicians filed objections to challenge a $124 million attorney fee awarded by the Jefferson Alabama Circuit Court to class counsel as part of the settlement of Johnson v. Caremark Rx, LLC ("the Caremark class action). After the trial court overruled their objections and its judgment approving the settlement became final, the objectors appealed the attorney fee to this Court. Caremark Rx bought MedPartners; MedPartners was the subject of dozens of securities-fraud lawsuits alleging that it had made false statements regarding its financial condition and anticipated future performance. Many of those lawsuits were eventually consolidated into a class action. In 1999, the MedPartners class action was settled for $56 million based on MedPartners' assertions that the negotiated settlement exhausted its available insurance coverage and that it possessed limited other assets it could use to pay a larger award or settlement. Post-settlement, however, it was revealed in unrelated litigation that MedPartners actually held an excess-insurance policy providing unlimited coverage during the period in which the alleged fraud had been committed. In 2003, the Caremark class action was initiated against MedPartners' corporate successor Caremark Rx, and its previous insurer asserting fraud and suppression claims based on the $56 million settlement agreed to in the MedPartners class action. The objectors appealed the fee award to the Alabama Supreme Court, arguing that they had been given insufficient opportunity to object to class counsel's requested attorney fee inasmuch as their objections were due before class counsel's attorney-fee application was filed, and that the attorney fee ultimately awarded was excessive. The Supreme Court vacated the order entered by the trial court awarding class counsel an attorney fee of $124 million. On remand, class counsel may file a new attorney-fee application, including more detailed information regarding the time expended in this case and how that time was spent. The objectors would then be given a reasonable opportunity to review that application and may, if they still have objections to class counsel's new application, file those objections with the trial court. After the trial court considers those objections and enters a new order making an award of attorney fees, any party with a grievance may file a new appeal to the Alabama Supreme Court. View "Walker v. Johnson" on Justia Law

The commercial general liability policy at issue in this case is internally inconsistent and therefore ambiguous, and therefore, the policy is interpreted in favor of the insured.An employer’s commercial general liability policy was amended by an endorsement that included a “Stop Gap - Employers Liability Coverage Endorsement - West Virginia” that expressly provided coverage for bodily injury to employees, as well as an exclusion for statutory deliberate intent claims. At issue was whether coverage existed for a statutory deliberate intent action under the circumstances of this case. Insurer brought this appeal from an order of the circuit court that granted partial summary judgment for Employer/Insured and Employees. The Supreme Court affirmed, holding that ambiguous policy language must be construed in favor of Insured and that the Stop Gap endorsement operated to provide coverage for the deliberate intent claims of Employees against Employer/Insured, and the conflicting exclusion may not be enforced. View "First Mercury Insurance Co., Inc. v. Russell" on Justia Law