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Preview: LexisNexis® Mealey's™ California Insurance Legal News

LexisNexis® Mealey's™ California Insurance Legal News



Headline California Insurance Legal News from LexisNexis®



 



Panel Remands For Trial On Execution Of Arbitration Clause Under Reinsurance Agreement
SAN FRANCISCO - Vacating a lower court's judgment, the Ninth Circuit U.S. Court of Appeals on Aug. 4 remanded a dispute for a trial on whether a corn and flour tortilla maker executed arbitration agreements under a reinsurance participation agreement (RPA) or a request to bind coverages and services (Arevalo Tortilleria Inc. v. Applied Underwriters Captive Risk Assurance Company Inc., No. 15-56830, 9th Cir., 2017 U.S. App. LEXIS 14399).



9th Circuit: Qui Tam Plaintiffs Cannot Intervene In Criminal Forfeiture Action
SAN FRANCISCO- A Ninth Circuit U.S. Court of Appeals panel on Aug. 10 held that two medical assistants who filed a qui tam lawsuit under the False Claims Act (FCA) against a podiatrist they worked for could not intervene in a criminal forfeiture action brought by the federal government seeking $1.2 million for false billing to Medicare because the employees lacked standing (United States v. Neil A. Van Dyck, et al., No. 16-10160, 9th Cir., 2017 U.S. Dist. LEXIS 14780).



Judge Finds New Evidence Does Not Warrant Reversing Fraud Convictions
SAN FRANCISCO - Newly discovered evidence pertaining to a government witness's embezzlement of more than $40,000 from Wells Fargo while working as a branch manager does not warrant reversal of the convictions of three defendants for their roles in a scheme to fraudulently obtain life insurance for strangers who did not want or need the policies, a federal judge in California ruled July 28, finding that the new evidence was merely impeaching and not sufficient to render the witness's testimony totally incredible (United States v. Benham Halali, et al., No. 14-cr-00627, N.D. Calif., 2017 U.S. Dist. LEXIS 119038).



Interpretation Of Plan's Terms Was Reasonable Based On Extrinsic Evidence
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on July 28 affirmed a district court's ruling that a pension plan had the discretion to decide which level of disability retirement benefits should be paid to a plan participant and that the interpretation of the plan's terms by the plan's board of trustees was reasonable based on the extrinsic evidence (Harold Davis v. Pension Trust Fund for Operating Engineers, et al., No. 15-17212, 9th Cir., 2017 U.S. App. LEXIS 13727).



Plan Will Not Be Prejudiced If Disability Claimant Proceeds Under Pseudonym
OAKLAND, Calif. - A California federal judge on July 26 granted a disability claimant's motion to proceed under a pseudonym after determining that the need for anonymity outweighs prejudice to the defendant and the public's interest in knowing the claimant's identity (John Doe v. Lincoln National Life Insurance Co., No. 17-3963, N.D. Calif., 2017 U.S. Dist. LEXIS 117110).



Disability Plan's Discretionary Authority Provision Is Void Under California Law
SACRAMENTO, Calif. - A de novo standard of review must be applied in a denial of disability benefits suit because the disability plan's discretionary authority provision is not valid under California law, a California federal judge said July 12 in granting the disability claimant's motion for summary judgment (Renee Johnson Monroe v. Metropolitan Life Insurance Co., No. 15-2079, E.D. Calif., 2017 U.S. Dist. LEXIS 109012).



Disability Claimant Awarded Attorney Fees, Costs As The Prevailing Party
LOS ANGELES - A California federal judge on July 24 awarded a disability claimant more than $100,000 in attorney fees and costs because the claimant prevailed on his claim for disability benefits (Avery Armani v. Northwestern Mutual Life Insurance Co., et al., No. 13-7058, C.D. Calif., 2017 U.S. Dist. LEXIS 117203).



Disability Claimant Met Burden Of Proving She Was Disabled Under Plan
SAN FRANCISCO - A California federal judge on July 24 determined that a disability claimant is entitled to long-term disability benefits because the claimant met her burden of proving that she was disabled according to the terms of the plan at issue (Hadar Meiri v. Hartford Life and Accident Insurance Co., No. 16-103, N.D. Calif., 2017 U.S. Dist. LEXIS 115224).



Insureds Say Trial Court Did Not Consider All Evidence In Water Damage Suit
LOS ANGELES - Homeowners seeking coverage for water and mold damages to their home argue in a June 16 brief to the Second District California Court of Appeal that a trial court failed to consider the weight of the evidence supporting the insureds' claim when it entered judgment for the insurer (Roger Novack, et al., v. Pacific Specialty Insurance Co., et al., No. B278121, Calif. App., 2nd Dist., Div. 1, 2017 CA App. Ct. Briefs LEXIS 2924).



Federal Judge Denies Untimely Filed Motion In Insurance Bad Faith Suit
SACRAMENTO, Calif. - Denial of an insurer's motion for judgment on the pleadings in an insurance bad faith lawsuit is proper because the insurer filed the motion over a year and a half after the deadline for dispositive motions, a federal judge in California ruled July 24 in denying the motion (Joanne Koegel v. Government Employees Insurance Co., No. 14-0256, E.D. Calif., 2017 U.S. Dist. LEXIS 116322).



Auto Exclusion Bars Claims, Federal Judge Says In Dismissing Assignee's Suit
SAN DIEGO - A California federal judge on July 25 granted an insurer's motion to dismiss an assignee's complaint after determining that the breach of contract and bad faith claims alleged against the insurer could not stand because the insurer had no duty to defend or indemnify its insured in an underlying suit pursuant to the policy's auto exclusion (Zoe Bernstein v. Nautilus Insurance Co., No. 16-2883, S.D. Calif., 2017 U.S. Dist. LEXIS 116343).



Federal Judge Dismisses Disability-Related Coverage Claims As Time-Barred
SAN DIEGO - A California federal judge on Aug. 3 granted an insurer's motion to dismiss claims for breach of contract and fraud in relation to its denial of long-term disability (LTD) benefits for a university employee, finding that all of the employee's claims were untimely (Laurel Davis v. Liberty Life Assurance Company of Boston, No. 3:17-cv-00738, S.D. Calif., 2017 U.S. Dist. LEXIS 122776).



Insured Appeals Ruling In Aviation Insurer's Favor In Bad Faith Dispute
SAN FRANCISCO - An insured has asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court's ruling in favor of an aviation insurer in a coverage dispute arising from damage to one of the insured's tanker aircrafts (Minden Air Corporation v. Starr Indemnity & Liability Co., 16-15712, 9th Cir.).



Panel: CIGA Has Duty To Reimburse For Workers' Comp Excess Coverage
SACRAMENTO, Calif. - The California Insurance Guarantee Association (CIGA) breached its statutory duty to reimburse a joint powers authority for excess workers' compensation coverage owed under an insolvent insurer's policy, a California appeals panel affirmed July 17 (CSAC Excess Insurance Authority v. California Insurance Guarantee Association, No. C081775, Calif. App., 3rd Dist., 2017 Cal. App. Unpub. LEXIS 4854).



Judge Approves Financial Report, Administration Costs In Liquidation Of Insurer
SAN FRANCISCO - In the liquidation proceedings of CastlePoint National Insurance Co., a California trial judge on July 18 approved and ratified a financial report and expenses of administration totaling $7.8 million concerning the insurer's period of conservation (Dave Jones v. CastlePoint National Insurance Co., No. CPF-16-515183, Calif. Super., San Francisco Co.).



Panel: Court Did Not Err In Dismissing Bad Faith Claim In Coverage Dispute
SAN FRANCISCO - A federal district court did not err in granting an insurer's motion for summary judgment on an insured's claim for insurance bad faith because the insured failed to plead any genuine issues of material facts to support the claim, a Ninth Circuit U.S. Court of Appeals panel ruled June 19 in affirming (Jesse Kalberer v. American Family Mutual Insurance Co., No. 14-17220, 9th Cir., 2017 U.S. App. LEXIS 10779).



9th Circuit Panel Upholds Court's Bad Faith Ruling In Auto Coverage Suit
PASADENA, Calif. - A federal district court did not err in denying an insurer's motion for judgment as a matter of law on an insurance bad faith claim because a reasonable jury could have determined that the insurer had a reasonable opportunity to settle the claims against its insured, a Ninth Circuit U.S. Court of Appeals panel ruled June 15 in affirming (Carlos Madrigal, et al. v. Allstate Indemnity Co., Nos. 16-55839 and 16-55863, 9th Cir.).



California Federal Judge Orders Insurer To Prove That Parties Are Completely Diverse
LOS ANGELES - A California federal judge on June 13 ordered an insurer to show cause as to why an insured's breach of contract and bad faith lawsuit should be litigated in federal court and not be dismissed for lack of subject matter jurisdiction (Reseda Medical Clinic, et al. v. Liberty Mutual Ins. Company, et al., No. 17-3686, C.D. Calif., 2017 U.S. Dist. LEXIS 90932).



California Appeals Panel Says Issue Of Fact Exists On Insurer's Denial Of Coverage
SANTA ANA, Calif. - The Fourth District California Court of Appeal on June 19 reversed a summary judgment ruling entered in favor of an insurer after determining that a genuine issue of material fact exists as to whether the insurer's refusal to cover an insured's epidural injections for injuries sustained in an automobile accident was reasonable (Carmen Zubillaga v. Allstate Indemnity Co., No. G052603, Calif. App., 4th Dist., Div. 3, 2017 Cal. App. LEXIS 562).



California Federal Judge Says Bad Faith Claims Are Not Duplicative Of Each Other
SAN DIEGO - A California federal judge on June 9 denied a motion to dismiss a life insurance beneficiary's claims of bad faith alleged against two insurers after determining that the beneficiary alleged sufficient facts in support of the claims (Mehdi Vossoughi v. AIG Property Casualty Company et al., No. 17-0247, S.D. Calif., 2017 U.S. Dist. LEXIS 89206).



California Federal Judge Says No Additional Coverage Owed To Beneficiaries
LOS ANGELES - Beneficiaries of a director of photography who was killed in a helicopter crash while working on the production of a reality television show are not entitled to coverage under an accidental death and dismemberment policy because the insured was not a "participant" on the reality show, a California federal judge said July 7 in granting the insurer's motion for summary judgment on claims for breach of contract and bad faith (Jerie S. Rydstrom, et al. v. Federal Insurance Co., et al., No. 16-2543, 16-2614, C.D. Calif., 2017 U.S. Dist. LEXIS 105473).



California Federal Judge Allows Plaintiff To Amend Complaint In Life Insurance Dispute
SACRAMENTO, Calif. - A California federal judge on July 7 granted a life insurance beneficiary's motion to amend a complaint after determining that the amendment addresses the insurer's challenges to the beneficiary's standing to pursue the claims and the insurer's argument that the claims are time-barred (Yegeniy V. Sidorov, in his individual capacity and as administrator of the estate of Natalya N. Natalya, v. Transamerica Life Insurance Company, et al., No. 17-00002, E.D. Calif., 2017 U.S. Dist. LEXIS 105479).



California Federal Judge Allows Claims To Stand In Life Insurance Rate Case
LOS ANGELES - A California federal judge on July 10 determined that plaintiffs alleging that a life insurer wrongfully increased monthly deduction rates alleged sufficient facts to support their claims for breach of contract and bad faith (EFG Back AG, Cayman Branch, v. Transamerica Life Insurance Co., No. 16-8104, C.D. Calif., 2017 U.S. Dist. LEXIS 109780).



California Federal Judge Denies Motion To Dismiss Counterclaims In Sewage Suit
LOS ANGELES - A California federal judge on June 23 denied a motion to dismiss bad faith counterclaims against an insurer in a coverage dispute arising out of a sewage spill after determining that the counterclaims sufficiently allege facts in support of the claims (Travelers Property Casualty Company of America v. Mountain Movers Engineering Contactors Inc., No. 16-2127, S.D. Calif., 2017 U.S. Dist. LEXIS 97731).



Termination Of Disability Benefits Was Reasonable, 9th Circuit Panel Affirms
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on June 12 affirmed a district court's ruling that the termination of a disability claim was reasonable based on the plan's mental health coverage limitation and the medical evidence considered by the disability insurer (Kathee A. Colman v. American International Group Inc. Group Benefit Plan, et al., No. 15-15903, 9th Cir., 2017 U.S. App. LEXIS 10394).



Claimant Owed Disability Benefits Under Plan's 'Own Occupation' Provision
SAN FRANCISCO - Following a one-day bench trial, a California federal judge on June 13 determined that a disability claimant submitted sufficient evidence showing that he was disabled under a plan's "own occupation" provision but failed to prove that he was disabled under the plan's "any occupation" standard (Robert Bosley v. Metropolitan Life Insurance Co., No. 16-00139, N.D. Calif., 2017 U.S. Dist. LEXIS 90803).



Excess Insurer Entitled To Recover $5M Settlement Payment, 9th Circuit Affirms
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on July 7 affirmed a lower federal court's finding that a software firm insured's former first-layer excess directors and officers liability insurer is entitled to recover the $5 million it paid to settle an underlying securities action plus prejudgment interest from the insured's latter first-layer excess directors and officers liability insurer (Genesis Insurance Co. v. Magma Design Automation Inc. v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 15-16999, 9th Cir., 2017 U.S. App. LEXIS 12194).



9th Circuit: Dispute Over Phrase 'Direct Supplier' Is Question Of Fact For Jury
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on June 19 found that whether a manufacturer of hard-disk drives provided to a set-top box company was a direct supplier of a satellite television provider is a question of fact to be resolved by a jury, reversing and remanding a lower court's ruling in favor of an insurer in a business interruption coverage dispute arising from the Thailand flood (DirecTV v. Factory Mutual Insurance Co., No. 16-55313, 9th Cir., 2017 U.S. App. LEXIS 10787).



California Panel Affirms No Coverage For Dentist's Claim For Lost Practice Income
SACRAMENTO, Calif. - A California appeals panel on June 13 affirmed a lower court's ruling in favor of an insurer in a dispute over coverage for an individual dentist's claim for lost dental practice income due to a sewage backup (William A. Gilbert v. The Dentists Insurance Company, Inc., No. C075959, Calif. App., 3rd Dist., 2017 Cal. App. Unpub. LEXIS 4041).



Rescission Lawsuit Is Not 'Exceptional' To Justify Abstention, 9th Circuit Rules
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on July 5 found that a lower court's grant of an insured's request for abstention under Colorado River Water Conservation District v. United States, 424 U.S. 800 (1979), was an abuse of its narrow discretion because the insurer's rescission lawsuit is not "exceptional" to warrant disregarding a federal court's obligation to exercise its jurisdiction (Seneca Insurance Co. Inc. v. Strange Land Inc., et al., No. 15-16011, 9th Cir., 2017 U.S. App. LEXIS 11946).



9th Circuit Affirms Ruling In Insurer's Favor In Coverage Dispute Over Theft
SAN FRANCISCO - Finding that an insured's argument on appeal is waived because it never presented it to the lower court, the Ninth Circuit U.S. Court of Appeals on June 26 affirmed a lower federal court's summary judgment ruling in favor of a business owners insurer (Pacific Enterprises LLC v. AMCO Insurance Co., et al., No. 15-16042, 9th Cir., 2017 U.S. App. LEXIS 11319).



Insured Asks 9th Circuit To Find Loss Of Boats Was Due To Theft And Not Scheme
SAN FRANCISCO - A boat business insured has asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court's finding that an insurer did not breach an all-risk policy in bad faith by denying coverage for its theft claim (Pacific Marine Center, Inc. v. Philadelphia Indemnity Insurance Co., No. 17-15897, 9th Cir.).



Federal Judge Dismisses Suit Seeking Rescission Of Products Liability Insurance
SAN FRANCISCO - A federal judge on June 13 dismissed a rescission lawsuit after the primary products liability insurer and the manufacturer of the da Vinci Surgical System announced that they have reached a settlement (Illinois Union Insurance Co., et al. v. Intuitive Surgical Inc., No. 13-04863, N.D. Calif.).



Professional Services Exclusion Bars Coverage For Pipeline Explosion, Panel Says
SAN FRANCISCO - The First District California Court of Appeal on July 11 affirmed a trial court's judgment in favor of an excess insurer after finding that its policy's professional services exclusion bars coverage for underlying claims arising from a deadly pipeline explosion (Energy Insurance Mutual Limited v. Ace American Insurance Co., No. A140656, Calif. App., 1st Dist., Div. 4).



Magistrate Judge Grants Voluntary Dismissal Of FDIC Suit Against Insolvent Insurer
FRESNO, Calif. - A California federal magistrate judge on June 8 granted the voluntary dismissal of a coverage lawsuit between the Federal Deposit Insurance Corp., as assignee of certain claims by a failed bank, and an insolvent insurer's receiver (Thomas T. Hawker, et al. v. John D. Doak, insurance commissioner as receiver for Red Rock Insurance Co. f/k/a BancInsure Inc., No. 12-1261 E.D. Calif., 2017 U.S. Dist. LEXIS 88319).



FDIC, Insolvent Insurer Seek Joint Dismissal Of Negligence Dispute
LOS ANGELES - Following an appeal that saw a reversal of summary judgment on negligence claims, the Federal Deposit Insurance Corp., as receiver for a failed bank, and an insolvent insurer on May 30 submitted to a California federal court a joint stipulation asking for dismissal of a dispute over directors and officers liability coverage (Federal Deposit Insurance Corp., as receiver for Security Pacific Bank v. BancInsure Inc., No. 12-9882, C.D. Calif.).



Negligent Work Exclusion Precludes Coverage For Damaged Fuel Tank
SAN DIEGO - A California federal judge on June 26 granted a motion for judgment on the pleadings filed by two insurers in a coverage dispute over a damaged fuel tank after determining that the policy's negligent work exclusion precludes coverage for the damage (Terra Nova Gas Station Inc., et al. v. AMCO Insurance Co., No. 16-1565, S.D. Calif., 2017 U.S. Dist. LEXIS 98465).



Panel Denies Rehearing Of Ruling On Joint Reinsurance Association's Duty To Costs
SAN FRANCISCO - Denying a petition for rehearing, a California appeals panel on June 14 upheld its earlier ruling that an insurance industry placement facility and joint reinsurance association is obligated by California Insurance Code Section 2051 to pay the costs to repair an insured's home, less depreciation, even if the amount exceeds the fair market value of her home (California Fair Plan Association v. Marlene Garnes, No. A143190, Calif. App., 1st Dist., Div. 2, 2017 Cal. App. LEXIS 552).



9th Circuit Finds Jury Instructions Were Adequate For Dispute Over Coverage
SAN FRANCISCO - A Ninth Circuit U.S. Court of Appeals panel on June 16 overruled arguments from a general contractor that a jury was not properly instructed about certain exclusions included in a policy obtained from ProBuilders Specialty Insurance Co., finding that the contactor was reading the exclusions too narrowly (ProBuilders Specialty Insurance Company, RRG v. Valley Corp. B., et al., No. 14-17544, 9th Cir., 2017 U.S. App. LEXIS 10716).



Professional Services Exclusion Does Not Bar Coverage, Insured Tells 9th Circuit
SAN FRANCISCO - An insured has asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court's finding that coverage for an underlying qui tam action brought against it under the False Claims Act (FCA) is barred because the claims arose out of its professional services (HotChalk Inc. v. Scottsdale Insurance Co., No. 16-17287, 9th Cir.).



No Coverage For Insured's Deliberate Acts Of Unprotected Sex, 9th Circuit Affirms
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on June 21 affirmed a lower federal court's ruling that a homeowners insurer has no duty to defend its insured against underlying claims of battery, sexual battery, fraud, intentional infliction of emotional distress, negligence and negligent infliction of emotional distress (Travelers Commercial Insurance Co. v. Jennifer A., No. 15-15841, 9th Cir., 2017 U.S. App. LEXIS 10996).



California Panel Affirms No Coverage Due For Damage To Underground Storage Tank
LOS ANGELES - An insured is not entitled to coverage for the collapse of an underground storage tank because an impairment of the tank's structural integrity does not qualify as an actual collapse for which coverage is afforded under the policy, the Second District California Court of Appeal said July 3 (Tustin Field Gas & Food, Inc., v. Mid-Century Insurance Company, No. B268850, Calif. App., 2nd Dist., Div. 2, 2017 Cal. App. LEXIS 602).



Appeals Panel Upholds Ruling Sentencing Man To Jail For Probation Violations
VENTURA, Calif. - A California appeals panel on June 20 affirmed a trial court judge's decision to imprison a man for the remainder of his six-year concurrent prison sentences for insurance fraud and possession of a controlled substance after finding that he violated the terms of his supervised release by failing to regularly report to his probation officer (People v. Chad Tadao Stukey, No. B279666, Calif. App., 2nd Dist., Div. 6, 2017 Calif. App. Unpub. LEXIS 4189).



Excess Insurer Seeks Review By California High Court On Issue Of Policy Exhaustion
LOS ANGELES - In a June 27 petition for review filed in the California Supreme Court, an excess insurer says the high court should accept review of a silica coverage suit because the appellate court failed to address what constitutes proper exhaustion of the primary insurance policy at issue (Truck Insurance Exchange v. Moldex Metric Inc., et al., No. S242845, Calif. Sup., 2017 CA S. Ct. Briefs LEXIS 1064).



Judge Refuses To Substitute Insurer As Defendant In UCL, Coverage Case
SAN DIEGO - A California federal judge on June 16 denied a request filed by a group of development companies to substitute an insurer as a defendant in an action seeking coverage in an underlying construction defects case, finding that the substitution would not advance the litigation and refusing to remand the case (Toll CA, L.P., et al. v. American Safety Indemnity Company, et al., No. 16-cv-1523, S.D. Calif., 2017 U.S. Dist. LEXIS 94107).



Company: Insurer Owes Coverage For Fraudulent Email That Led To Financial Loss
SAN FRANCISCO - A company that was the victim of fraud by way of email has asked the Ninth Circuit U.S. Court of Appeals to reverse a lower court's decision and find that an insurer must provide coverage under the terms of a policy regarding losses by computer fraud (Aqua Star [USA] Corp. v. Travelers Casualty and Surety Company of America, No. 16-35614, 9th Cir.).



Panel: Joint Reinsurance Association Is Required To Pay Costs To Repair Home
SAN FRANCISCO - An insurance industry placement facility and joint reinsurance association is obligated by California Insurance Code Section 2051 to pay the costs to repair an insured's home, less depreciation, even if the amount exceeds the fair market value of her home, a California appeals panel ruled May 26 (California Fair Plan Association v. Marlene Garnes, No. A143190, Calif. App., 1st Dist., Div. 2, 2017 Cal. App. LEXIS 479).



9th Circuit Says Disability Claimant Failed To Provide Objective Medical Findings
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeal on May 11 affirmed a district court's ruling after determining that a long-term disability (LTD) claim was properly denied because the claimant failed to provide any objective medical findings in support of the claim for benefits (Tricia Z. Cooper v. Intel Corporation Long Term Disability Plan, No. 14-35745, 9th Cir., 2017 U.S. App. LEXIS 8380).



California Federal Judge Orders Parties To File Joint Proposed Judgment On Attorney Fees
SAN FRANCISCO - A California federal judge on May 15 ordered a disability claimant and a disability insurer to submit a joint proposed judgment on the claimant's motion for attorney fees after finding that the claimant is not entitled to collect attorney fees for all the tasks completed by the claimant's attorney (Marlon Montoya v. Reliance Standard Life Insurance Co., No. 14-2740, N.D. Calif.; 2017 U.S. Dist. LEXIS 73781).



9th Circuit Panel Says Wrong Standard Of Review Applied In Disability Suit
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on May 11 reversed a district court's ruling in favor of a disability insurer after determining that the district court applied the wrong standard of review pursuant to California law (Talana Orzechowski v. The Boeing Company Non-Union Long-Term Disability Plan, et al., No. 14-55919, 9th Cir., 2017 U.S. App. LEXIS 8348).



California Federal Judge: Disability Insurer Failed To Properly Weigh All Evidence
SAN JOSE, Calif. - A California federal judge on June 5 reversed a disability insurer's termination of long-term disability (LTD) benefits after determining that the insurer failed to properly consider the reports of the claimant's treating physicians when it found that the claimant was not disabled from the duties of her regular occupation (Lisa Gallegos v. The Prudential Insurance Company of America, No. 16-1268, N.D. Calif., 2017 U.S. Dist. LEXIS 86123).



9th Circuit Affirms Ruling That Disability Claimant Waived Right To Contest Denial
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on May 22 affirmed a district court's finding that a disability claimant waived his rights to contest the termination of his disability benefits because the claimant signed a waiver of all rights, including his rights to contest the termination of his disability claim, as part of a settlement with his former employer for wrongful termination claims (Thomas A. Gonda v. The Permanente Medical Group Inc., et al., No. 15-16484, 9th Cir., 2017 U.S. App. LEXIS 8888).



California Federal Judge Says Evidence Supports Finding That Claimant Is Disabled
SAN FRANCISCO - A California federal judge on May 24 granted a disability claimant's motion for judgment on the administrative record after determining that the evidence does not support the disability insurer's termination of benefits after paying the claimant benefits for almost eight years (Nancy Hart v. Unum Life Insurance Company of America, No. 15-5392, N.D. Calif., 2017 U.S. Dist. LEXIS 79970).



Judge Rejects 2 Equitable Apportionment Methods In Dispute Over 'Moonlight Fire'
SACRAMENTO, Calif. - A California federal judge on May 22 found that neither the "policy limits" approach nor the "relative fault" analysis is an appropriate equitable apportionment method in a coverage dispute arising from damage caused by the September 2007 "Moonlight Fire" in California (American States Insurance Co. v. Insurance Company of the State of Pennsylvania, No. 12-01489, E.D. Calif., 2017 U.S. Dist. LEXIS 79103).



Appeals Court Says Evidentiary Hearing Needed In Insurance Fraud Suit
LOS ANGELES - An evidentiary hearing should have been held to determine whether a California Highway Patrol (CHP) officer had sufficient information in 2010 to begin an investigation into whether a man committed insurance fraud by further damaging a tow truck, a California appeals panel ruled June 12 (Mark Jeffrey Tornow v. Superior Court of Los Angeles County, et al., No. B271895, Calif. App., 2nd Dist., 7th Div., 2017 Cal. App. Unpub LEXIS 4020).



Judge Refuses To Dismiss Insurers' Class Claims For Damages After Subrogation
LOS ANGELES - A California federal judge on May 24 denied a motion filed by the makers of a defective dehumidifier that caused fires to dismiss class action claims for violation of California's unfair competition law (UCL) and negligence and other claims and ordered them to show cause as to why they should not be sanctioned for misrepresenting the law as it pertains to insurer's rights to subrogate the rights of insureds (Homesite Insurance Company of the Midwest, et al. v. Gree USA Inc., et al., No. 2:16-cv-06769, C.D. Calif., 2017 U.S. Dist. LEXIS 79809).



Federal Magistrate Judge Recommends Default Judgment Be Entered Against Insured
SAN JOSE, Calif. - A California federal magistrate judge on May 3 recommended that a default judgment be entered against an insured because the insured failed to response to its insurers' complaint seeking a declaration that no coverage is owed for an underlying construction defects suit and because no coverage exists for the underlying suit based on the insured's misrepresentation in a policy application (Associated Industries Insurance Co. Inc., et al. v. Detail Construction & Waterproofing, Inc., No. 16-6042, N.D. Calif., 2017 U.S. Dist. LEXIS 67722).



No Jurisdiction Under CAFA's 'Mass Action' Provision, Judge Rules In Remanding
RIVERSIDE, Calif. - A California federal judge on May 3 granted insurers' motion to remand a lawsuit arising from claims over defective water supply lines, finding that the 26 insurers, acting as subrogees of 145 insureds, are the only plaintiffs and therefore fail to satisfy the "mass action" provision under the Class Action Fairness Act (CAFA) to retain jurisdiction (Liberty Mutual Fire Insurance Co. v. EZ-Flo International Inc., No. 17-228, C.D. Calif., 2017 U.S. Dist. LEXIS 67761).



Abuse Exclusion Bars Coverage For Wrongful Death Verdict, 9th Circuit Affirms
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on May 17 rejected a doctor and his wife's argument that they were entitled to coverage for an adverse verdict in a wrongful death suit because their homeowners insurance policy's abuse exclusion was not applicable, affirming a lower federal court's summary judgment ruling in favor of the insurer (American Family Mutual Insurance Co. v. Carlos F. Verdugo, M.D., et al., Nos. 16-15687 and 16-15717, 9th Cir., 2017 U.S. App. LEXIS 8828).



Production Company Owed No Further Defense For Suits Over Fatal Train Accident
LOS ANGELES - A California federal judge on May 23 granted an insurer's motion for summary judgment on the remaining claims in a production company insured's lawsuit seeking coverage for damages caused by a train accident that killed a camera technician and injured the film's director and several crew members (Film Allman LLC v. New York Marine and General Insurance Co., Inc., No 14-7069, C.D. Calif., 2017 U.S. Dist. LEXIS 79139).



Judge Vacates 3 Demands Of Reimbursement Against CIGA For Workers' Claims
LOS ANGELES - California Insurance Guarantee Association (CIGA) is entitled to an order vacating and setting aside three reimbursement demands of $119,122 made under workers' compensation insurance policies, a California federal judge ruled May 3 (California Insurance Guarantee Association v. Thomas E. Price, Secretary of Health and Human Services, et al., No. 15-cv-01113, C.D. Calif., 2017 U.S. Dist. LEXIS 67589).



9th Circuit: Court Properly Dismissed Complaint Without Leave To Amend
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on June 13 affirmed a lower federal court's dismissal of an insured's lawsuit against its partners management liability reimbursement insurer, finding that the lower court did not abuse its discretion in denying the insured leave to amend its complaint (Cove Partners, LLC v. XL Specialty Insurance Company, No. 16-55315, 9th Cir., 2017 U.S. App. LEXIS 10504).



Insurer Was Not Entitled To Rescind Policy, California Panel Says In Reversal
SAN FRANCISCO - A California appeals panel on June 12 reversed a lower court's finding that an insurer was entitled to rescind an "Owners, Landlords & Tenants Liability Coverage" insurance policy, finding that the insurer failed to satisfy its burden of showing that the insured made material misrepresentations on the insurance application (Victor Duarte v. Pacific Specialty Insurance Co., No. A143828, Calif. App., 1st Dist., Div. 2).



California Panel Reverses Ruling In Lawsuit Alleging Claim Under Elder Abuse Act
SAN FRANCISCO - A California appeals panel held June 2 that a first amended complaint sufficiently alleges "deprivation" of "the property of an elder" pursuant to the Elder Abuse and Dependent Adult Civil Protection Act, 42 U.S. Code Section 3058(i), 42 U.S.C. 3058i, reversing and remanding a lower court (Frederick Mahan, et al. v. Charles W. Chan Insurance Agency, Inc., et al., No. A147236. Calif. App., 1st Dist., 2017 Cal. App. LEXIS 507).



Magistrate Dismisses Yahoo's Suit Seeking Coverage For TCPA Class Action Claims
SAN JOSE, Calif. - A California federal magistrate on June 2 granted a commercial general liability insurer's motion to dismiss Yahoo! Inc.'s breach of contract lawsuit seeking coverage for underlying class action allegations that it violated the Telephone Consumer Protection Act (TCPA) by transmitting unsolicited text messages (Yahoo! Inc. v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 17-00447, N.D. Calif., 2017 U.S. Dist. LEXIS 85200).



9th Circuit Majority Vacates Ruling In Suit Seeking Coverage Under Surety Bond
PASADENA, Calif. - A majority of the Ninth Circuit U.S. Court of Appeals on June 2 vacated and remanded a lower federal court's ruling in favor of an insurer in a suit seeking to recover $305,000 under a surety bond (Nacimiento Water Company, Inc. v. International Fidelity Insurance Co., Nos. 15-56323 and No. 16-55311, 9th Cir., 2017 U.S. App. LEXIS 9810).



Investors: District Court's Ruling On Insurance Policy Limit Was In Error
SAN FRANCISCO - A company that contends that a federal judge in Montana wrongly dismissed its case against an insurance company recently filed an appeal brief in the Ninth Circuit U.S. Court of Appeals, arguing that the judge erred in determining that interrelated claims constituted a legal issue rather than a factual one (Sauerbier Ranches Inc., et al. v. Catlin Specialty Insurance Company, No. 16-35280, 9th Cir.).



California High Court Is Set To Rule On Coverage For Molestation Suit
SAN FRANCISCO - An employer in an April 10 reply brief urges the California Supreme Court to find that claims against an employer for negligent hiring, retention and supervision of its employee qualify as an "occurrence" under the employer's commercial general liability (CGL) policy and that an "accident" can include unintended consequences of the employer's intentional acts (Liberty Surplus Insurance Corporation, et al. v. Ledesma and Meyer Construction Company, Inc., et al., No. S236765, Calif. Sup.).