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Headline Catastrophic Loss Legal News from LexisNexis®



 



Flood Claim Barred By Statute Of Limitations, Federal Judge Rules
HOUSTON - A Texas federal judge on Jan. 9 granted a federal flood insurer's motion for summary judgment in an insured's breach of contract lawsuit seeking coverage for flood damage caused by a May 2015 storm in Houston, finding that the lawsuit is untimely (Ali Ekhlassi v. National Lloyds Insurance Co., et al., No. 17-1257, S.D. Texas, 2018 U.S. Dist. LEXIS 3568).



Federal Judge Enforces $30,000 Settlement In Coverage Dispute Over Storm Damage
FLORENCE, S.C. - A South Carolina federal judge on Dec. 21 granted an insurer's motion to enforce a $30,000 mediated settlement agreement in a dispute over coverage for storm and flood damage, noting that the insured will receive a final settlement of $16,090.01 after the parties' attorney fees are paid (Sherye Epps d/b/a Sunshine Shoes, Plaintiff, v. Midvale Indemnity Company, No. 16-2747, D. S.C., 2017 U.S. Dist. LEXIS 210127).



Flood Sublimit Applies To $25M 'Time Element Losses,' Insurer Argues To 6th Circuit
CINCINNATI - An insurer argued to the Sixth Circuit U.S. Court of Appeals that there are "multiple, reinforcing provisions" in an insurance policy that unambiguously make clear that a high hazard flood sublimit applies to all coverage for losses caused by a flood, including an insured's alleged $25 million "time element losses" arising from a Thailand flood (Federal-Mogul Corp. v. Insurance Company of the State of Pennsylvania, Nos. 17-1649 and 17-1716, 6th Cir.).



Texas High Court Refuses To Disturb Ruling In Insurer's Favor In Hailstorm Dispute
AUSTIN, Texas - The Texas Supreme Court on Jan. 5 denied an insured's petition to review a lower court's summary judgment ruling in favor of an insurer in a breach of contract lawsuit arising from a $73,000 appraisal award for the insured's hailstorm damage, according to its orders pronounce list (Floyd Circle Partners LLC v. Republic Lloyds, No. 17-0734, Texas Sup.).



8th Circuit Vacates 'Ambiguous' Appraisal Award, Remands For Clarification
ST. LOUIS - The Eighth Circuit U.S. Court of Appeals on Jan. 5 held that an appraisal award in a hailstorm coverage dispute is ambiguous, vacating the award and remanding for the lower court to resubmit to the appraisal panel (Mark Herll, et al. v. Auto-Owners Insurance Co., No. 16-1889, 8th Cir., 2018 U.S. App. LEXIS 262).



Rulings On Expert Affirmed In $550,000 Verdict Against Insurer For Hail Damage
ATLANTA - The 11th Circuit U.S. Court of Appeals on Jan. 4 upheld a jury award of more than $550,000 for a Georgia apartment complex on its breach of contract claim against an insurer for not paying enough to replace hail-damaged shingles, finding that the trial court did not err or abuse its discretion in any of its Daubert rulings (The Grand Reserve of Columbus, LLC v. Property-Owners Insurance Company, No. 17-10264, 11th Cir., 2018 U.S. App. LEXIS 217).



Georgia Federal Judge Says Insurer Had Reasonable Basis To Dispute Mold Claim
AUGUSTA, Ga. - A Georgia federal judge on Dec. 6 denied an insurer's motion for summary judgment on a breach of contract claim but granted the insurer's motion on a bad faith claim after determining that the insurer had a reasonable basis to deny the insured's claim for coverage of mold and water damages incurred to her home as a result of a hailstorm (Carrie Finch v. Owners Insurance Co., No. 16-169, S.D. Ga., 2017 U.S. Dist. LEXIS 200934).



'5th Circuit Affirms Denial Of Oil Spill Claim For Not Arm's-Length Transactions
NEW ORLEANS - A federal judge in Louisiana did not err when refusing to review the denial of a man's claim for compensation under the Deepwater Horizon Economic & Property Damages Settlement Agreement, a Fifth Circuit U.S. Court of Appeals panel ruled Jan. 9, finding that a policy in the agreement excludes transactions that are not arm's length transactions as revenue (Claimant ID 100190818 v. BP Exploration & Production Inc., et al, No. 17-30099, 5th Cir.).



5th Circuit Affirms Gas Retailer's $58.4M Award From Settlement Agreement
NEW ORLEANS - A Fifth Circuit U.S. Court of Appeals panel on Dec. 14 affirmed a federal judge in Louisiana's decision to award a gasoline retailer $58.4 million under the Deepwater Horizon Economic and Property Damages Settlement Agreement, finding that the judge did not err when finding that the company was not excluded from the settlement agreement (BP Exploration & Production Inc., et al. v. Claimant ID 100211268, No. 16-31118, 5th Cir.).



Federal Judge Transfers Coverage Suit Over Damage Caused By California Forest Fire
SAN DIEGO - A California federal judge on Jan. 3 granted an insured's motion to transfer venue of an insurer's lawsuit challenging coverage for the insured's structural and smoke-related damage caused by a July 31, 2015, forest fire (Travelers Property Casualty Company of America v. Hume Lake Christian Camps, Inc., No.: 17-1600, S.D, Calif., 2018 U.S. Dist. LEXIS 1186).



New York Justice: Subcontractor Was Proximate Cause Of Throgs Neck Bridge Fire
NEW YORK - A New York justice on Dec. 26 found that a contractor is entitled to coverage as an additional insured under a subcontractor's primary insurance policy because the subcontractor was the proximate cause of a fire on the Throgs Neck Bridge (E.E Cruz & Company, Inc. v. Axis Surplus Insurance Company, et al., No. 152988/2012, N.Y. Sup., New York Co., 2017 N.Y. Misc. LEXIS 5137).



Judge: City Is Not Entitled To Independent Counsel In Sewer Backup Coverage Suit
SANTA ANA, Calif. - A California federal judge on Dec. 18 denied the city of Laguna Beach's motion for partial summary judgment but granted its motion for partial stay in a coverage dispute over damages arising from an April 26, 2016, sewer backup (Tokio Marine Specialty Insurance Company v. Laguna Beach, No. 17-00277, C.D. Calif., 2017 U.S. Dist. LEXIS 212828).



Insured's Suit Against Adjuster In Hurricane Ike Coverage Dispute Is Untimely
GALVESTON, Texas - A Texas federal judge on Dec. 5 found that an insured's breach of contract and negligence lawsuit against an adjuster is time-barred by a two-year statute of limitations, granting the adjuster's motion for summary judgment in Hurricane Ike coverage dispute (Gracie Reese v. Aftermath Public Adjusters, Inc., et al., No. 16-273, S.D. Texas, 2017 U.S. Dist. LEXIS 199527).



Judge Allows Subpoena Of Insurer's Consultants In Windstorm Coverage Dispute
SEATTLE - Finding insufficient support for an insurer's claim that its consultants were engaged in advance of possible insurance fraud litigation, a Washington federal judge on Dec. 5 denied the insurer's motion to quash subpoenas served on them by the plaintiff in a coverage suit related to extreme weather events (Premier Harvest LLC, et al. v. AXIS Surplus Insurance Co., et al., No. 2:17-cv-00784, W.D. Wash., 2017 U.S. Dist. LEXIS 199910).



Judge Stays Class Action Challenging Insurance Practices After Settlement Announced
JEFFERSON CITY, Mo. - A Missouri federal judge in a Nov. 29 text order granted a joint motion to stay a class action alleging that a homeowners insurer committed breach of contract when it unlawfully applied a policy's $1,000 deductible to an actual cash value (ACV) payment in a hailstorm coverage dispute after the parties announced that they reached a settlement (Jean Heckmann v. Liberty Mutual Fire Insurance Co., No. 14-04147, W.D. Mo.).



No Homeowners Coverage Owed For Flood Damage, Federal Judge Says
HOUSTON - A Texas federal judge on Nov. 27 granted a homeowners insurer's motion for partial summary judgment in an insured's breach of contract lawsuit seeking coverage for flood damage caused by a May 2015 storm in Houston, finding that the policy excluded flood damage from coverage (Ali Ekhlassi v. National Lloyds Insurance Co., et al., No. 17-1257, S.D. Texas, 2017 U.S. Dist. LEXIS 194467).



Insurer Did Not Act In Bad Faith By Only Paying For A Portion Of Floor Replacement
PHILADELPHIA - A Pennsylvania federal judge on Nov. 15 dismissed a bad faith claim alleged against a homeowners insurer after determining that the insureds failed to prove that the insurer acted unreasonably by paying for only a portion of the insureds' kitchen floor following a flood at the insureds' home (Steven Barnwell et al. v. Liberty Mutual Insurance Co., No. 16-4739, E.D. Pa., 2017 U.S. Dist. LEXIS 188427).



Federal Judge: Flood Did Not Become Excluded Peril Once Sublimits Were Exhausted
SHERMAN, Texas - A Texas federal judge on Nov. 9 granted insureds' motion for partial summary judgment in their breach of contract and bad faith lawsuit arising from storm damage, finding that the insurer remains liable for any damages caused by pure wind and the combination of wind and flood if such damages are proven by the insureds (Hidden Cove Park and Marina, et al. v. Lexington Insurance Co., et al., No. 17-00193, E.D. Texas, 2017 U.S. Dist. LEXIS 186191).



Magistrate Judge Recommends Denial Of Reinsurance Claims In 9/11 Insurance Dispute
NEW YORK - In a dispute over claims stemming from the attacks on Sept. 11, 2001, a New York federal magistrate judge on Nov. 27 recommended that insurers be awarded $221.5 million but that their claims arising out of reinsurance contracts be denied (In re: Terrorist Attacks on September 11, 2001, No. 03-MDL-1570, Continental Casualty Co. v. Al Qaeda Islamic Army, No. 04-5970, S.D. N.Y., 2017 U.S. Dist. LEXIS 196192).



Insurer Must Cover Damage By Wind, Not Construction Defects, Appeals Panel Says
DETROIT - An insurer is responsible to cover damage from wind-driven rain to condominium units but is not responsible for damage caused by construction defects, a Michigan appeals panel held Nov. 16, reversing summary disposition to the insurer (Walters Beach Condominium Association v. Home-Owners Insurance Co., No. 335172, Mich. App., 2017 Mich. App. LEXIS 1810).



3rd Circuit Affirms Ruling In Favor Of Insurer In Superstorm Sandy Dispute
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Nov. 17 affirmed a district court's summary judgment ruling in favor of an insurer in a Superstorm Sandy coverage dispute after determining that the insurer fulfilled the requirements of accord and satisfaction when it sent its insureds a check representing payment for the insureds' losses (Anna Cranmer, et al. v. Harleysville Insurance Co., et al., No. 17-1596, 3rd Cir., 2017 U.S. App. LEXIS 23187).



Judge Enjoins Insureds From Removing Any Property From Storage Unit In Sandy Suit
BROOKLYN, N.Y. - A New York federal judge on Nov. 6 confirmed that an Oct. 23 court-ordered subpoena remains in effect to make a storage space in Brooklyn, N.Y., available to allow the inspection of the contents of several storage units maintained by insureds in a Superstorm Sandy coverage dispute and enjoined the insureds from removing any boxes or property from the storage units absent permission form the court (Robert Toussie v. Allstate Insurance Co., et al., Nos. 14-2705 and 15-5235, E.D. N.Y., 2017 U.S. Dist. LEXIS 183603).



Judge Allows Insured To Amend Petition To Properly Assert Insurer's Citizenship
BATON ROUGE, La. - A Louisiana federal magistrate judge on Nov. 2 allowed an insured to amend her complaint to adequately allege a flood insurer's citizenship in her breach of contract lawsuit arising from flood damage (Sarah Faye Carrier v. Lexington Insurance Co., No. 17-1543, M.D. La., 2017 U.S. Dist. LEXIS 182386).



Judge: New York Insureds Failed To Submit Timely Proof Of Loss In Flood Dispute
ROCHESTER, N.Y. - A New York federal judge on Oct. 23 granted a federal flood insurer's motion for summary judgment in a flood coverage dispute, finding that the insureds failed to timely submit a signed and sworn proof of loss for all their alleged damages caused by a June 1, 2015, flood (John Scharr, et al. v. Selective Insurance Company of New York, et al., No. 16-06821, W.D. N.Y., 2017 U.S. Dist. LEXIS 175222).



Judge: Negligence Per Se Claim, Attorney Fees Request Are Preempted By NFIA, NFIP
PORTLAND, Ore. - An Oregon federal judge on Oct. 16 granted insurers' motion to dismiss an insured's negligence per se claim and request for attorney fees in a coverage dispute over damage to hotel rooms caused by tidal waters, finding the claims preempted by the National Flood Insurance Act (NFIA) and the National Flood Insurance Program (NFIP) (Surfsand Resort LLC v. Nationwide Mutual Fire Insurance Company, et al., No. 17-00866, D. Ore., 2017 U.S. Dist. LEXIS 171548).



Motion To Alter Is Untimely, Federal Judge Rules In Dispute Over Flood Damage
TUSCALOOSA, Ala. - For the second time in less than one month, an Alabama federal judge on Oct. 11 denied an insured's motion to alter or amend an earlier judgment that found that a federal flood insurer does not owe coverage for the insured's claim for land and relocation damages arising from a heavy rain that caused a local river to flood (Crawford Nixon v. Nationwide Mutual Insurance Co., No. 15-00186, N.D. Ala., 2017 U.S. Dist. LEXIS 167866).



New York Justice: Insurers Not Entitled To 2nd Proof Of Loss In Superstorm Sandy Suit
NEW YORK - A New York justice on Oct.22 denied two insurers' request for an order compelling an insured to provide them with a signed and sworn proof of loss (POL) detailing Superstorm Sandy property damage because the insured has already provided them with a signed and sworn POL (The Howard Hughes Corporation v. Ace American Insurance Co., et al., No. 650308/15, N.Y. Sup., New York Co., 2015 N.Y. Misc. LEXIS 5261).



New York Justice: Fact Issues Remain In Superstorm Sandy Flood Coverage Dispute
NEW YORK - Ruling on an insured's motion for summary judgment, a New York justice on Oct. 10 held that fact issues remain in a Superstorm Sandy excess flood coverage dispute (Great American Insurance Company of New York v. L. Knife & Son Inc., et al., Index No. 157164/13, N.Y. Sup., New York Co., 2017 N.Y. Misc. LEXIS 3888).



Panel Reverses Ruling As To Excess Coverage In Dispute Arising From Forest Fire
WAUSAU, Wis. - A Wisconsin appeals panel on Oct. 11 affirmed a lower court's ruling that a commercial general liability insurance policy's $2 million aggregate limit applied in a coverage dispute over a forest fire that burned thousands of acres of land, but reversed and remanded for a factual determination on the issue of damages relevant to coverage under the logging company's umbrella insurance policy (Secura Insurance v. Lyme St. Croix Forest Company, LLC, et al., No. 2016AP299, Wis. App., Div. 3, 2017 Wisc. App. LEXIS 791).



Florida Panel Reverses Hurricane Wilma Coverage Suit For 2nd Time
MIAMI - After previously reversing a lower court's ruling in favor of a homeowner in a Hurricane Wilma coverage dispute, a Florida appeals panel on Oct. 18 reversed the lower court's ruling on remand in favor of the insurer, finding that a genuine issue of material fact remains regarding whether a letter from the insurer constituted a denial of coverage (Haim Michel Ifergane, Appellant, vs. Citizens Property Insurance Corp., No. 3D16-1142, Fla. App., 3rd Dist., 2017 Fla. App. LEXIS 14745).



Florida Panel Reverses Dismissal Of Bad Faith Suit In Hurricane Wilma Dispute
WEST PALM BEACH, Fla. - A Florida appeals panel on Oct. 18 found that a bad faith lawsuit should not have been dismissed because the record undisputedly establishes that an insurer received an insured's civil remedies notice (CRN) in a Hurricane Wilma coverage dispute nearly four years before the insured filed its bad faith suit and responded to the CRN without challenging its service (Evergreen Lakes HOA, Inc. v. Lloyd's Underwriters at London, No. 4D16-2657, Fla. App., 4th Dist., 2017 Fla. App. LEXIS 14833).



Florida High Court Accepts Appeal Of Court's Refusal To Conduct New Appraisal
TALLAHASSEE, Fla. - The Florida Supreme Court on Oct. 20 accepted an appeal of an appellate decision finding that an insured's post-appraisal submission of increased costs with a state insurance guaranty association in a Hurricane Wilma coverage dispute is not a legally sufficient basis to reopen the existing appraisal or conduct a new appraisal (Orlando Noa v. Florida Insurance Guaranty Association, No. SC17-738, Fla. Sup., 2017 Fla. LEXIS 2124).



Federal Judge: No Evidence Insured's Race Prompted Insurer's Coverage Decisions
LITTLE ROCK, Ark. - An Arkansas federal judge on Oct. 27 dismissed with prejudice an insured's 42 U.S. Code Section 1981 claim against his insurer, finding that there was no evidence that the insured's race prompted the insurer's coverage decisions regarding damage caused by two storms (Kasib Tauheed Bilal v. IDS Property & Casualty Insurance Co., No. 16-675, E.D. Ark., 2017 U.S. Dist. LEXIS 178317).



Bad Faith Claim Survives Dismissal In Homeowners Insurance Dispute
OKLAHOMA CITY - Insureds have pleaded minimally sufficient facts to support their insurance bad faith claim against their homeowners insurance provider for its alleged failure to properly investigation their claim and provide coverage under the policy, a federal judge in Oklahoma ruled Oct. 24 in denying the insurer's motion to dismiss the bad faith claim (Daniel E. Lang, et al. v. Farmers Insurance Co. Inc., No. 17-0919, W.D. Okla., 2017 U.S. Dist. LEXIS 175858).



Insurance Adjuster Improperly Joined In Bad Faith Suit, Judge Rules
FORT WORTH, Texas - Remand of an insurance breach of contract and bad faith lawsuit to state court is not necessary because insureds improperly joined an insurance adjuster in an attempt to defeat federal court jurisdiction, a federal judge in Texas ruled Oct. 27 in denying the insureds' motion (Cheryl Fernandez, et al. v. Allstate Texas Lloyds, et al., No. 17-729, N.D. Texas, 2017 U.S. Dist. LEXIS 178273).



Judge Transfers Hurricane Matthew Coverage Dispute To New Federal Venue
MIAMI - A judge in the U.S. District Court for the Southern District of Florida on Oct. 18 granted insurers' alternative motion to transfer a coverage dispute arising from Hurricane Matthew damage, finding that the Middle District of Florida is the proper venue because that is where the insureds' property is located (Flash Restoration LLC v. Rockhill Insurance Company, et al., No. 17-23416, S.D. Fla., 2017 U.S. Dist. LEXIS 173319).



Bad Faith Suit Over Property Insurance Claim Remanded To State Court
OXFORD, Miss. - Remand of an insurance breach of contract and bad faith lawsuit to state court is proper because an insured has shown that the amount in controversy in the action will not exceed statutory limits, a federal judge in Mississippi ruled Oct. 17 in granting the insured's motion to remand (Strawberry Missionary Baptist Church v. Church Mutual Insurance Company Foundation Inc., No. 17-155, N.D. Miss., 2017 U.S. Dist. LEXIS 171545).