Justia Insurance Law Opinion Summaries

Defendant Alfa Mutual Insurance Company sought mandamus relief when the Pickens Circuit Court denied its motion to transfer the underlying lawsuit to the Tuscaloosa Circuit Court. In 2016, Richard Holley, a resident of Pickens County, was involved in a motor-vehicle accident in Tuscaloosa County. The other vehicle was driven by David Evans, who was uninsured. Emergency-medical-services personnel treated Holley at the scene and then transported him to DCH Regional Medical Center in Tuscaloosa. Law-enforcement personnel who were based in Tuscaloosa County also responded to the accident. After the accident, Holley received follow-up treatment from three medical providers in Tuscaloosa and one medical provider in Mississippi. The Alabama Supreme Court concluded the trial court exceeded its discretion in denying Alfa's motion for a change of venue based on the interest-of-justice prong of the forum non conveniens statute. Accordingly, the Court granted Alfa's petition for the writ of mandamus and direct the trial court, in the interest of justice, to vacate its order denying the motion to transfer the action to the Tuscaloosa Circuit Court and to enter an order transferring the case from the Pickens Circuit Court to the Tuscaloosa Circuit Court. View "Ex parte Alfa Mutual Insurance Company." on Justia Law

Real parties in interest are insurers that issued excess comprehensive general liability (CGL) policies to Montrose, a manufacturer of the pesticide DDT. Montrose filed suit seeking a declaratory judgment that it may electively stack excess policies. The trial court rejected the elective stacking in favor of horizontal exhaustion, and denied Montrose's motion for summary adjudication, granting the excess insurers' cross-motion for summary adjudication. The Court of Appeal granted the petition for writ of mandate in part and denied in part, holding that the trial court correctly rejected Montrose's elective stacking approach and thus correctly denied Montrose's motion for summary adjudication and granted Continental Insurer's cross motion. The court also held that the record did not support a universal horizontal exhaustion approach. Therefore, the trial court erred in granting the insurers' motion on the issue of duty. View "Montrose Chemical Corp. v. Superior Court" on Justia Law

From 2006-2012 Packerland deceived at least one of its customers about the protein content of its Whey Protein Concentrate. Land O’Lakes purchased Packerland’s protein concentrate for use in making foods for calves and other young animals. Buyers infer protein levels from measuring nitrogen: a seller can add another nitrogen-rich substance to produce higher scores. The Ratajczaks, who owned Packerland, started adding urea to its protein concentrate. in 2006. Land O’Lakes suspected that the concentrate was high in nonprotein nitrogen but could not learn why; the Ratajczaks made excuses that Land O’Lakes accepted. The Ratajczaks sold Packerland in 2012. The new owner kept them as employees; they kept adding urea until the buyer learned what the truth. The Ratajczaks lost their jobs and settled for about $10 million before the buyer filed a complaint. Land O’Lakes stopped buying Packerland’s product and asserted claims of breach of contract, fraud, and violation of the Racketeer Influenced and Corrupt Organizations Act. Packerland’s insurers refused to defend or indemnify it or the Ratajczaks; the Ratajczaks’ personal insurer refused to indemnify them for their settlement with Packerland’s buyer. The district court dismissed Land O’Lakes’s suit and ruled in favor of the insurers. The Seventh Circuit affirmed, rejecting Land O’Lakes’ claim to treble damages under RICO and state-law and the Ratajczaks’ claims that Packerland’s insurers and their own insurers had to defend and indemnify them. View "Land O'Lakes, Inc. v. Ratajczak" on Justia Law

The Mississippi Workers’ Compensation Group Self-Insurer Guaranty Association (“Guaranty Association”) was ordered by the Mississippi Workers’ Compensation Commission (“Commission”) to assess former members of the Mississippi Comp Choice Workers’ Compensation Self-Insurers Fund (“Comp Choice”). In 2010, the Commission found that “a careful evaluation of the remaining assets and outstanding claims unfortunately shows an insufficient amount of Comp Choice assets to cover the projected claim payout.” The Commission ordered an assessment of the former members of Comp Choice for the last four years showing losses. The former members did not pay their assessments, and the Guaranty Association sued. The former members of Comp Choice filed a motion to dismiss, arguing that the Guaranty Association ignored their right of appeal and that the action was not ripe for consideration, was improper, and/or was premature and should be dismissed. The Circuit Court denied Comp Choice’s motion to dismiss, and ultimately ruled against the former members. Finding no reversible error in the judgment, the Mississippi Supreme Court affirmed. View "Scott Penn, Inc. v. Mississippi Workers' Compensation Group Self-Insurer Guaranty Association" on Justia Law

Defendant-appellant American Safety Indemnity Company (“ASIC”) challenged a judgment awarding over $1.4 million in compensatory and punitive damages to plaintiff-respondent Pulte Home Corporation (Pulte), who was the general contractor and developer of two residential projects in the San Marcos area. ASIC issued several sequential comprehensive general liability (CGL) insurance policies to three of Pulte's subcontractors, and during 2003 to 2006, it added endorsements to those policies that named Pulte as an additional insured. The projects were completed by 2006. In 2011 and 2013, two groups of residents of the developments sued Pulte for damages in separate construction defect lawsuits. After American Safety declined to provide Pulte with a defense, Pulte filed this action, asserting that the additional insured endorsements afforded it coverage and therefore required ASIC to provide it with defenses on the construction defect issues. After review, the Court of Appeal concluded the trial court was correct in ruling that the language of ASIC’s additional insured endorsements on the underlying insurance policies created ambiguities on the potential for coverage in the construction defect lawsuits, thus requiring it to provide Pulte with a defense to them. Additionally, the Court upheld the court's decision that Pulte was entitled to an award of punitive damages that was proportional, on a one-to-one basis, to the award of compensatory damages in tort. Although the Court affirmed the judgment as to its substantive rulings, the Court of Appeal was required to reverse in part as to the award of $471,313.52 attorney fees: the trial court abused its discretion in implementing an hourly attorney fee arrangement that Pulte did not arrive at until after trial, to replace the previous contingency fee agreement in a manner that Pulte intended would operate to increase its demand. Since the trial court calculated its $500,000 award of punitive damages by appropriately utilizing a one-to-one ratio to the compensatory, the trial court had to recalculate not only the fees award but also to adjust the amount of punitive damages accordingly. View "Pulte Home Corp. v. American Safety Indemnity Co." on Justia Law

The Eighth Circuit reversed the district court's award of damages to plaintiff for injuries that she sustained in a vehicle-related accident. The court held that the district court improperly applied a heightened duty to the sober designated driver for a group of intoxicated passengers. In this case, the findings of fact were insufficient to support apportioning greater fault to the driver based on her duty to exercise reasonable care in driving the vehicle. Accordingly, the court remanded for new findings and conclusions on the allocation of fault. View "Hiltner v. Owners Insurance Co." on Justia Law

Parents Theresa Allocca and Timothy Allen Davison, filed this action in their individual capacities, and Davison also filed as personal representative of the Estate of Timothy "Asti" Davison. Asti was fatally shot while operating a vehicle that an assailant, operating another vehicle, had forced onto a median on an interstate highway. The Parents sought uninsured motorist (UM) benefits based on several automobile insurance policies issued by defendants York Insurance Company of Maine, Allstate Insurance Company, and Horace Mann Teachers Insurance Company. The Superior Court granted summary judgment in favor of the insurers, concluding that neither any of the policies nor Maine’s UM statute provided coverage for the loss associated with Asti’s death. The Maine Supreme Court affirmed: "[a]lthough the conduct of the person who killed Asti was indisputably deliberate and not accidental, there is no evidence in the record that it was foreseeable to Asti himself, and so, based on that approach, his death would be viewed as 'accidental.' ... describing an intentional act, such as an intentional killing, as an 'accident' stretches the plain meaning of that word too far." Without addressing the superior court’s conclusion that the UM coverage in the policies was not applicable because the loss did not arise from the "use" of a motor vehicle, the Supreme Court concluded as a matter of law that Asti’s death was not caused by an "accident." View "Allocca. v. York Insurance Company of Maine" on Justia Law

In 2011, Roppo suffered serious injuries in an auto accident with Block, who was insured by Travelers. Travelers and the attorneys it retained for Block disclosed only the limits of Block’s automobile liability policy; they did not disclose the existence of his additional umbrella policy. Roppo eventually learned of the umbrella policy and then settled the case. She brought a proposed class action, challenging the company’s alleged practice of not disclosing the existence of umbrella policies. The case was removed to federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d). The district court denied Roppo’s motion to remand to state court but allowed her to file a second amended complaint, which added Block’s defense attorneys as defendants. Her third amended complaint added a cause of action under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1962(c). The Seventh Circuit affirmed dismissal with prejudice the complaint’s 11 counts, finding that the district court had jurisdiction and that her complaint did not sufficiently state claims of fraudulent misrepresentation, negligent misrepresentation, and negligence under Illinois law, or violations of the Illinois Insurance Code and the Illinois Consumer Fraud and Deceptive Business Practices Act. View "Roppo v. Travelers Commercial Insurance Co." on Justia Law

An insured sued her auto insurer and one of its adjusters, alleging that the insurer breached the insurance contract and committed tortious bad faith by withholding underinsured motorist benefits and that the adjuster negligently handled her claim for those benefits. The insurer then paid all available underinsured motorist benefits to the insured, including interest. The insured continued her tort claims, alleging additional financial and emotional harm from the delayed benefits payment. The insured proposed a jury instruction addressing the effect of the insurer’s belated payment, but the superior court rejected that instruction. After trial the jury determined that: (1) the insurer had acted in bad faith, but its conduct was not a substantial factor in causing the insured’s asserted harm; and (2) the adjuster had not been negligent. The superior court subsequently ordered the jury to award the insured nominal damages. The jury then awarded the insured $2 in nominal damages and later awarded $450,000 in punitive damages. The superior court awarded the insured prevailing party costs and attorney’s fees against the insurer. The court also awarded the adjuster prevailing party attorney’s fees against the insured. The court rejected the insured’s request that judgment against the insurer be entered nunc pro tunc to the date of the jury verdict so that post-judgment interest on the punitive damages award would start earlier. The insurer appealed the nominal and punitive damages awards and the prevailing party determination. The insured cross-appealed the adjuster’s attorney’s fees award, the jury’s failure to award compensatory damages, the court’s rejection of the insured’s proposed jury instruction, and the court’s refusal to enter judgment effective from the jury verdict date. The Alaska Supreme Court affirmed in all respects save the adjuster’s attorney’s fees award: that was remanded for further proceedings. View "Government Employees Insurance Co. v. Gonzalez" on Justia Law

An employee continued to work for over ten years after a job-related knee injury but had multiple surgeries on her injured knee. Over time, her employer made several permanent partial impairment payments, and she was eventually determined to be permanently and totally disabled because of the work injury. She began to receive Social Security disability at about the same time she was classified as permanently and totally disabled for workers’ compensation. Her employer asked the Alaska Workers’ Compensation Board to allow two offsets to its payment of permanent total disability (PTD) compensation: one related to Social Security disability benefits and one related to the earlier permanent partial impairment (PPI) payments. The Board established a Social Security offset and permitted the employer to deduct the amount of previously paid PPI. The employee appealed to the Alaska Workers’ Compensation Appeals Commission, arguing that the Board had improperly applied one of its regulations in allowing the PPI offset and had incorrectly calculated the amount of the Social Security offset. She also brought a civil suit against the State challenging the validity of the regulation. The State intervened in the Commission appeal; the lawsuit was dismissed. The Commission reversed the Board’s calculation of the Social Security offset and affirmed the Board’s order permitting the PPI offset. The employer appealed the Commission’s Social Security offset decision to the Alaska Supreme Court, and the employee cross- appealed the PPI offset. The Court affirmed that part of the Commission’s decision reversing the Board’s calculation of the Social Security disability offset and reversed that part of the Commission’s decision permitting an offset for permanent partial impairment benefits. The case was remanded back to the Commission for further proceedings. View "Alaska Airlines, Inc. v. Darrow" on Justia Law