Newsletter RSS

Mealey's California Insurance

  • July 28, 2025

    On Remand From 9th Circuit, Judge Dismisses FCA Suit Against Drugmakers

    SAN FRANCISCO — On remand from the Ninth Circuit U.S. Court of Appeals and after the U.S. Supreme Court denied certiorari, a California federal judge dismissed without prejudice a qui tam suit accusing pharmaceutical companies of violating the False Claims Act (FCA) and related state laws by artificially inflating drug prices, finding that dismissal “is warranted” because the second amended complaint “lumps” the companies “together in an undifferentiated mass” regarding the alleged fraud.

  • July 25, 2025

    Calif. Judge Grants Commissioner’s Demurrer As To 2 Claims In Pass-Through Row

    LOS ANGELES — Holding that California Insurance Commissioner Ricardo Lara acted within his authority to issue property insurance pass-throughs but determining that exhausting administrative remedies was not necessary for judicial review, a California judge partially sustained and partially overruled Lara’s demurrer in response to a consumer research and advocacy organization’s complaint that accused Lara of issuing two unlawful insurance bulletins that authorize member insurers of the California FAIR Plan to recoup assessments from policyholders.

  • July 25, 2025

    In Advisory Opinion, DOL Tackles ERISA Question Regarding LTD Plan

    WASHINGTON, D.C. — In one of its first advisory opinions issued under President Donald J. Trump, the U.S. Department of Labor (DOL) took the view that the self-funded long-term disability (LTD) plan of a mutual benefit corporation for California firefighters “does not constitute an employee welfare benefit plan within the meaning of” part of the Employee Retirement Income Security Act — with a caveat. 

  • July 24, 2025

    California Court OKs Publishing Ruling Re Rehab Plan For Workers’ Comp Insurer

    SAN FRANCISCO — The First District California Court of Appeal on July 23 granted a request for publication of an initially unpublished opinion upholding a nonconsensual rehabilitation plan for a workers’ compensation insurance carrier; the plan was approved as part of conservation proceedings brought by California’s insurance regulator and includes options to resolve dozens of reinsurance participation agreement (RPA) lawsuits.

  • July 24, 2025

    9th Circuit Finds Insurer Owed No Coverage For Substandard Work Claims

    PASADENA, Calif. — A Ninth Circuit U.S. Court of Appeals panel affirmed a lower court’s finding that a commercial general liability insurer owed no coverage for an underlying action alleging that an electrical contractor’s substandard work led to flooding damage to switchgear, holding that the claim was excluded under the policy.

  • July 22, 2025

    Insurer Appeals Ruling In D&O Coverage Dispute Over Unfair Dilution Claims

    SAN DIEGO — A business and management indemnity insurer on July 21 filed a notice of appeal of a California federal court’s holding that it has a duty to defend and indemnify its insured against an underlying unfair dilution lawsuit because the “dilution claims exception” to the “insured vs. insured” exclusion restores directors and officers liability coverage.

  • July 17, 2025

    Judge Certifies Class In Suit Challenging Homeowners Insurer’s ACV Calculation

    SAN FRANCISCO — A federal judge in California granted plaintiffs’ motion for class certification in their breach of contract, bad faith and unfair competition lawsuit alleging that their homeowners insurer has a common practice of depreciating sales tax when calculating actual cash value (ACV) benefits to insureds.

  • July 17, 2025

    Judge Finds Indemnity Claim For Coverage Of Underlying Flood Claim Must Continue

    OAKLAND, Calif. — A federal judge in California denied a railway company’s motion to dismiss or stay an insurer’s claim for declaratory relief that it did not have a duty to indemnify the railway company in an underlying complaint against it for negligence after the construction of the railway caused property to flood, finding that the railway company provided no reason that the claim regarding the duty to indemnify should be dismissed or stayed, while the insurer’s claim for declaratory relief that it did not have a duty to defend continues.

  • July 15, 2025

    Benefits To Be Reinstated For Claimant In Migraine Disability Lawsuit

    SAN FRANCISCO — On de novo review of the termination of long-term disability (LTD) benefits for an employment law firm partner diagnosed with vestibular migraine and tinnitus, a California federal judge found in favor of the claimant and directed that the benefits be retroactively reinstated.

  • July 15, 2025

    9th Circuit Revives Breach Claim In Disability Row Involving COVID Risk

    SAN FRANCISCO — In an unpublished July 14 memorandum disposition, the Ninth Circuit U.S. Court of Appeals revived a breach of contract claim, but not a bad faith claim, in a suit an oral surgeon filed after unsuccessfully seeking disability benefits on the grounds that his comorbid conditions and inability to access recommended personal protective equipment (PPE) made it necessary to close his practice early in the COVID-19 pandemic.

  • July 15, 2025

    ‘Sheer Number’ Of AI-Faked Cites Noted In Defense Fee Declaration In Disability Case

    SANTA ANA, Calif. — In a July 14 defense fee declaration submitted at the direction of a California federal judge who imposed sanctions on a plaintiffs’ attorney for faked citations attributed to artificial intelligence, a disability insurer’s attorney said, “The sheer number of non-existent cases . . . was exponentially more than we have identified in any other cases discussing AI-generated and/or hallucinated cases.”

  • July 14, 2025

    Judge: Roof Work Excluded From Insurance Policy, Leaving No Duty Defend

    SANTA ANA, Calif. — A California state court judge granted summary judgment to an insurer in a roof construction defect case, agreeing that the work at issue is excluded under terms of the insurance agreement and that the insurer has no duty to defend or indemnify the general contractor.

  • July 14, 2025

    9th Circuit Affirms Dismissal Of Driver’s Claim For Larger COVID-19 Refunds

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals affirmed the dismissal of a driver’s class action against her insurer, GEICO, for violating California’s unfair competition law (UCL) by providing drivers an insufficient rebate on premiums after the COVID-19 pandemic, finding that the insurer was protected by the “‘safe harbor’” doctrine as the state insurance commissioner approved its rebate amounts.

  • July 11, 2025

    Contractor’s Insurer Must Defend Developers For Water, Other Damages

    LOS ANGELES — A contractor’s commercial general liability insurer agreed to defend the developers of a residential development as additional insureds, and the homeowners’ subsequent filing of an action alleging that the contractor’s improper installation of concrete flatwork and foundation systems caused water intrusion and other damage to their homes triggered the insurer’s duty to defend, a federal judge in California ruled.

  • July 10, 2025

    Order Vacated, Case Dismissed In LTD Benefits Row Involving COVID Risk

    SAN FRANCISCO — After vacating an August 2024 order and judgment that were in favor of a pediatrician who sought long-term disability (LTD) benefits based on her high risk of exposure to COVID-19, a California federal judge dismissed the case with prejudice pursuant to the parties’ stipulation.

  • July 09, 2025

    California Federal Magistrate Rules Claimant Eligible For 2 Years Of LTD Benefits

    SAN FRANCISCO — In a decision that involved weighing the opinions of numerous doctors, a California federal magistrate judge ruled that a claimant who held a “demanding managerial” role before saying that anxiety, depression and atypical autism made her unable to work is entitled to long-term disability (LTD) benefits “for the two-year mental disorder benefit period” and is eligible to seek attorney fees.

  • July 09, 2025

    Claims Against Long-Term Care Insurer Fail But Insured Permitted To Amend Complaint

    FRESNO, Calif. — A California federal judge granted a long-term care insurer’s motion to dismiss breach of contract, bad faith and financial elder abuse claims without prejudice after determining that the insured failed to specifically show how the long-term care insurer breached its contract when it denied the insured’s claim for benefits under the policy.

  • July 09, 2025

    Auto Insurer Failed To Show Handling Of UIM Claim Was Reasonable, Judge Says

    SAN DIEGO — A California federal judge refused to dismiss an insured’s bad faith claim against an auto insurer after determining that the insurer failed to show that it acted reasonably in handling the insured’s claim for underinsured motorist (UIM) benefits.

  • July 08, 2025

    California Panel Affirms Exclusions Bar Coverage For Subcontractor’s Faulty Work

    LOS ANGELES — Rejecting arguments by a developer and general contractor that a trial court erred by denying them a jury trial and by construing two faulty workmanship exclusions in a subcontractor’s businessowners insurance policy too narrowly, a California appellate court panel affirmed the trial court’s judgment in favor of the insurer in the developer and contractor’s suit to recover more than $1 million in damages and delay costs.

  • July 07, 2025

    Judge Grants Contractors’ Demurrer As To 2 Claims In Hurricane Hilary Coverage Suit

    LOS ANGELES — A California judge granted contractors’ demurrer as to insureds’ negligent and concealment claims in a coverage dispute arising from Hurricane Hilary damage, agreeing with the contractors that because the contractors were hired by the insurer to inspect the insureds’ roof, neither of them owed a duty to the insureds.

  • July 03, 2025

    Judge: Reinsurer Failed To Meet Burden Of Proof In Motion For Partial Judgment

    FORT WORTH, Texas — A Texas federal judge denied a reinsurer’s motion for partial judgment on the pleadings for claims brought by National Transportation Associates Inc. (NTA) concerning a dispute over whether contractual mandates issued by California and other states render a commission payment structure unenforceable; the case is part of broader consolidated litigation among reinsurers and NTA that centers on the reinsurers’ claims of inflated provisional commissions and breach of various agreements.

  • July 03, 2025

    California Federal Judge Sanctions Lawyer For AI-Faked Cites In Disability Case

    SANTA ANA, Calif. — A California federal judge imposed sanctions including a $500 payment on a plaintiff’s attorney who told the court that he “failed to scrutinize and oversee the preparation of” memoranda “filed with erroneous case citations that were invented by AI”; the breach of contract suit over termination of total disability benefits is headed toward a jury trial after the judge last month granted summary judgment for the insurer on a bad faith claim.

  • July 01, 2025

    California Appellate Court Lets Rehab Plan For Workers’ Comp Insurer Stand

    SAN FRANCISCO — In an unpublished opinion, the First District California Court of Appeal upheld a nonconsensual rehabilitation plan for a workers’ compensation insurance carrier; the plan was approved as part of conservation proceedings brought by California’s insurance regulator and includes options to resolve dozens of reinsurance participation agreement (RPA) lawsuits.

  • July 01, 2025

    Insurer Says It Owed No Duty To Defend Water Contamination Suits

    LOS ANGELES — An insurer maintains in opposition to an insured’s motion for judgment on the pleadings that it owed no duty to defend the insured against two water contamination complaints filed by the Los Angeles Regional Water Quality Control Board because the complaints only sought to impose penalties against the insured and did not seek damages as required by the policy.

  • June 30, 2025

    California Insureds Allege Insurers Underinsured Homes Destroyed In Wildfires

    LOS ANGELES — In two separate complaints filed in Los Angeles County Superior Court, insureds whose homes were destroyed in the January wildfires allege that their homeowners insurers underinsured their homes, leaving the homeowners unable to rebuild their destroyed homes.