Specialty Lines
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April 26, 2023
Marketing Co. Wants Out Of La. Hurricane Solicitation Suit
A legal marketing company accused of deceptively soliciting Louisiana hurricane victims as clients for a controversial law firm has asked to be dropped from a putative class action, telling a Texas federal judge Tuesday that the suit fails to establish that its work on behalf of McClenny Moseley & Associates caused any real harm.
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April 26, 2023
Co. Settles With 2 Insurers In EEOC Suit Coverage Spat
A senior care facility has settled its claims against two of four defendants in a coverage fight over a U.S. Equal Employment Opportunity Commission lawsuit alleging that the facility allowed employees to be harassed, the facility told a Colorado federal court.
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April 25, 2023
Clover Health To Pay $22M In Investor Suit Over DOJ Probe
Medicare Advantage insurance provider Clover Health Investments Corp. has agreed to a $22 million settlement deal that resolves claims it covered up a U.S. Department of Justice probe as it prepared to go public via a merger with a special-purpose acquisition company.
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April 25, 2023
Insurance Broker Wants Out Of Mushroom Shipping Suit
An insurance broker said it should be dismissed from a mushroom company's Texas federal suit over a weeklong revocation of authorization to operate its shipping truck fleet, allegedly caused by a failure to notify the Department of Transportation of new insurance coverage.
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April 25, 2023
Underwriter Says Lloyd's Must Help In Settlement Payments
Lloyd's of London must contribute to a settlement that an underwriter and an adjuster agreed to pay after the duo was accused of mishandling claims related to a fatal vehicle crash, the pair told a California federal court, saying the payment is a covered loss under its policy.
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April 25, 2023
IRS Seeks To Force Sex Toy Co. To Hand Over Insurance Docs
A sex toy company should be forced to comply with an IRS summons seeking accounting documents, financial statements and other records in the agency's investigation of what it alleges was a captive insurance scheme, the U.S. government told a California federal court.
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April 25, 2023
BCBS Unit Owes Out-Of-Network Payments, Practice Says
A Blue Cross Blue Shield unit owes a surgery practice "hundreds of thousands of dollars" in out-of-network payment awards issued to the practice under the No Surprises Act, the surgery practice told a New York federal court.
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April 24, 2023
Solar Panel Co. Rips Insurer's 'Onerous' Terms As Trial Opens
Canadian Solar Inc.'s counsel told a California federal judge during bench trial opening arguments on Monday that Sussex Insurance and its predecessor imposed "onerous" provisions and wrongfully denied $45 million in solar panel warranty claims while the insurer's counsel said the policies never specifically covered the types of claims at issue.
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April 24, 2023
Minn. Panel Reverses Insurer's Coverage Escape In Injury Suit
A Minnesota appeals court panel overturned on Monday an insurer's win in its dispute over the duty to defend a woman sued by a police officer over injuries he suffered when she dragged him from her car, finding a dispute exists over whether she acted intentionally.
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April 24, 2023
Insurer Tips Cash Value Scale Against Insureds, Court Told
A group of policyholders launched a proposed class action against American Family Mutual Insurance Co., alleging that the insurer "thumbs the scale against its insured" in Illinois and Ohio by using an adjustment when determining the actual cash value of their total-loss vehicles.
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April 24, 2023
9th Circ. Declines Redo On Malicious Prosecution Coverage
The Ninth Circuit declined Monday to rehear its decision last month against a Los Angeles law firm that an insurance company should be reimbursed for its contributions to a malicious prosecution settlement.
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April 24, 2023
Staffing Agency's Clients Not Covered, Insurer Says
A cannabis staffing agency's insurance policy doesn't cover its client's employees, the insurer told a California federal judge in its bid for a pretrial win in its suit seeking to avoid coverage of a wrongful termination suit.
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April 24, 2023
Allstate Tells 4th Circ. To Uphold Win In UIM Coverage Spat
Allstate asked the Fourth Circuit to affirm its win in a suit brought by a South Carolina woman injured in a car accident, arguing state law doesn't support the partial policy ratification under which the woman said she should be able to add $100,000 in underinsured motorist coverage.
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April 24, 2023
Fishing Co., Shipbuilder Win $23M In Policy Blank-Space Fight
Various insurers led by Norwegian Hull Club must pay a fishing company and shipbuilder more than $23 million in additional coverage and prejudgment interest over a vessel severely damaged by Hurricane Michael, a Florida federal judge ruled, finding that their $77 million policy escalated coverage up to 25%.
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April 24, 2023
Exclusion Bars Subpoena Expenses Coverage, Judge Says
A drug development company born out of a merger does not have coverage for expenses it advanced to two of its former officers in connection with U.S. Securities and Exchange Commission subpoenas, a California federal court ruled, saying the company hasn't shown that a change-in-control exclusion is inapplicable.
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April 21, 2023
Law360 Reveals Titans Of The Plaintiffs Bar
In the past year, companies like Juul, Capital One and Southern California Edison have settled for millions if not billions of dollars in litigation that was high-profile and often groundbreaking in its impact on the law itself. Such cases and many others — which involved opioids, sexual harassment, kickbacks and data breaches — were led by attorneys whose accomplishments helped them earn recognition as Law360's Titans of the Plaintiffs Bar for 2023.
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April 21, 2023
Excess Insurer Ducks Defense Costs For Ex-Medical Director
A New York federal judge rejected a former medical center director's bid to force an excess insurer to fund defense costs in adversarial bankruptcy proceedings, finding the policyholder was unable to show that a bankruptcy/insolvency exclusion is inapplicable or unlawful.
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April 21, 2023
Oil Trader Sues Liberty Mutual For Contamination Damage
Houston-based oil and gas trader Grey Rock Gathering and Marketing LLC hit Liberty Mutual Insurance Co. with a breach of contract suit on Friday for failing to cover damage related to a contaminated oil shipment.
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April 21, 2023
6th Circ. Reverses Health Care Co.'s Retaliation Coverage Win
The Sixth Circuit on Friday reversed a health care holding company's win in a dispute over coverage for a settlement of several employees' retaliation claims brought under the False Claims Act, saying a Fairfax Financial insurance unit's policy excluded coverage of the claims.
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April 21, 2023
Ozy CEO Can Get Advanced Defense Costs, Court Says
Ozy Media's insurer must advance defense costs to Ozy's CEO but not the media company itself, a California federal court said Thursday, saying there is little evidence supporting rescission of the policy concerning the CEO at this point in litigation.
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April 21, 2023
Firm Says Travelers Owes $1M For Gymnastics Fund Hack
Travelers should have to pay its $1 million policy limit to a law firm claiming it lost $1.6 million when its USA Gymnastics sex abuse settlement fund was hacked, the firm said, telling a Michigan federal court that its policy specifically provides coverage for losses resulting from fraudulent wire transfers.
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April 21, 2023
3rd Circ. OKs IRS Access To Del. Microcaptive Insurance Docs
The IRS can proceed with a summons seeking microcaptive insurance records from Delaware's insurance department after the Third Circuit affirmed on Friday a lower-court ruling finding that federal law requiring the disclosure of the records trumps state law barring their release.
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April 20, 2023
Conn. Suit Claims Conspiracy In 'Point Of Sale' Auto Policies
Two out-of-state insurance companies conspired to sell "point of sale" policies to car buyers at Connecticut dealerships, providing them with only seven days of coverage in violation of the law, according to a federal complaint filed Thursday that alleges an effort to defraud the public.
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April 20, 2023
Insurer Asks To Recall Coverage For USC's $215M Abuse Deal
A University of Southern California excess insurer is seeking reimbursement for funds it contributed to USC's involvement in a $215 million settlement reached after class actions accused a school gynecologist of sexually abusing his patients, arguing USC's prior knowledge of a potential claim voids coverage.
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April 20, 2023
PE Co., Travelers Settle Heparin Suit Coverage Dispute
Private equity firm ACAS LLC and two Travelers units told a Maryland federal court Thursday that they have resolved their dispute over coverage for an underlying wrongful death suit connected to a tainted batch of blood-thinning drug heparin.
Expert Analysis
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Reach Of Ohio Ransomware Ruling Limited To Policy At Hand
While an Ohio appellate court's recent decision allowing the insured's ransomware attack claim to proceed in EMOI Services v. Owners Insurance may seem significant for insurance jurisprudence, it should not have implications beyond policies specifically insuring damage to software, says Jane Warring at Zelle.
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D&O Insurance Lessons From The Rise And Fall Of Theranos
After the fall of Theranos and the recent criminal conviction of founder Elizabeth Holmes, startups seeking to protect their directors and officers from exposure to personal liability should consider how eye-popping company valuations and other changes to the startup landscape will affect their D&O policies, say Lilit Asadourian and Kathryn Bayes at Reed Smith.
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Flawed NY Insurance Law Needs Amendments
The New York Comprehensive Insurance Disclosure Act, recently signed by the governor, imposes a multitude of problematic disclosure obligations on defendant-insureds, which the Legislature should — and likely will — seriously consider modifying or eliminating, says Richard Mason at MasonADR.
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Beyond Insurance: Mitigating Cyber Risk In 2022
As insurers move to higher premiums and less coverage for cyberattacks, companies should consider restructuring their risk mitigation strategies for the upcoming year to lessen their reliance on insurance support for data security issues, say professionals at StoneTurn.
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Justices May Hesitate To Review Calif. Fraud Coverage Case
In Adir International v. Starr Indemnity, the policyholders are asking the U.S. Supreme Court to review their challenge of a California law prohibiting insurers from defending insureds in certain consumer protection claims, but the court may not be ready to decide the issue at this time, says Greg Mann at Rivkin Radler.
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NY Case Shows Insurance Possibility For SEC Disgorgements
Directors and officers insurers almost invariably deny coverage for payments described as disgorgements in settlement agreements with the U.S. Securities and Exchange Commission, but the recent decision of New York's highest court in J.P. Morgan v. Vigilant demonstrates how policyholders can negotiate an insurable settlement with the SEC, say Stephen Weisbrod and Tamra Ferguson at Weisbrod Matteis.
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JP Morgan Ruling May Have Broad Insurance Implications
The New York Court of Appeals' recent decision in J.P. Morgan Securities v. Vigilant Insurance — that settlement funds paid to the U.S. Securities and Exchange Commission did not constitute a penalty for insurance purposes — could have far-reaching application in other types of insurance litigation where plaintiffs could be characterized as seeking equitable relief, say Robert Shulman and Cristen Rose at Paley Rothman.
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Insurance Tips For Mitigating DOJ Cyber Initiative Risks
For companies and executives involved in False Claims Act actions alleging cybersecurity failures like those envisioned by the U.S. Department of Justice's new cyber fraud initiative, certain insurance policies could help defray the substantial costs of defense and even settlement liability, say attorneys at Hunton.
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M&A Rulings Provide Guidance On 'Bump-Up' Claim Coverage
As M&A activity continues to surge, several recent federal court decisions can guide companies in structuring their insurance programs and assessing whether so-called bump-up claims arising from particular M&A transactions may be covered, say Robin Cohen and Orrie Levy at Cohen Ziffer.
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BIPA Ruling Should Aid Insurers In Privacy Claims
Massachusetts Bay Insurance v. Impact Fulfillment Services, a recent decision by a North Carolina federal court finding that a Biometric Information Privacy Act claim was precluded under an insurance exclusion, represents a potentially significant win for insurers due to its broadly applicable contract interpretation, say Joshua Polster and Conor Mercadante at Simpson Thacher.
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Insurers Should Honor Astroworld Coverage Obligations
While insurers may be eager to shift blame on Astroworld showrunner Travis Scott for conditions that resulted in 10 deaths and dozens of injuries, arguments suggesting the tragedy shouldn't be covered appear baseless in light of the facts and the law, says Benjamin Massarsky at Miller Friel.
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Ransomware Case Signifies Shift In Cyber Insurers' Stance
The pleadings in a recently settled California federal court case, Boardriders v. Great American Insurance, show that cyber insurers are taking an adversarial approach to ransomware-related claims in the wake of increasing attacks, so policyholders should anticipate new policy language, claim-payment avoidance and more, say Lynda Bennett and Michael Scales at Lowenstein Sandler.
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Cyber Rulings Aren't Helping COVID Biz Interruption Cases
Where policyholders have recently tried to draw comparison between the loss of property use from a COVID-19 shutdown order and the loss of data use from a ransomware attack, they have found courts unsympathetic to these arguments for business interruption insurance coverage, say Jane Warring and Kristian Smith at Zelle.