Articles Posted in Insurance Law

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3M filed an insurance claim to recover losses incurred on a number of investments due to fraud perpetrated by its own investment advisors. The Eighth Circuit affirmed the district court's grant of summary judgment to the Insurers, holding that the ownership requirement of Endorsement 8 applies to the Employee Dishonesty provision. Therefore, 3M does not own the stolen earnings and cannot seek coverage for the earnings under the Policy. Until the earnings were distributed to the partners, the stolen earnings were property of WG Trading, not 3M. The court explained that it is fundamental that property acquired with partnership funds is partnership property, and individual partners do not own partnership assets until the winding up of the partnership. Finally, the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., does not alter general commercial property rights, but merely defines the nature and scope of the fiduciary duties owed to plan participants. View "3M v. National Union Fire Insurance" on Justia Law

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The court affirmed the grant of summary judgment to Underwriters after Underwriters denied coverage based on the flood exclusion of the insurance policy at issue. The court concluded that the district court did not abuse its discretion by denying Hudson's motion to strike Underwriters' expert's opinion, because only a few days had passed at most between when Underwriters obtained their expert's opinion and disclosed it to Hudson; the term "flood" in this insurance contract was unambiguous and the court adopted the definition of "flood" given in Ebbing v. State Farm Fire & Cas. Co.; and Hudson's submission of lay testimony that the storm generated strong wind gusts and a photograph of the downed utility pole did not create a genuine issue of material fact as to whether wind or flood caused the damage to the docks, nor that the force generated from the flood waters directly or indirectly caused the damage to the marina's docks. View "Hudson Enterprises v. Certain Underwriters" on Justia Law

Posted in: Insurance Law

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Plaintiff filed suit against F&G, an insurance company and its affiliates, under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1964(c), alleging that F&G committed numerous acts of mail and wire fraud in the course of a bookcooking scheme. The district court granted F&G's motion to dismiss for failure to state a claim on which relief can be granted based on the McCarran-Ferguson Act, 15 U.S.C. 1012(b). The court concluded that plaintiff's RICO claims would interfere with state regulation of the insurance business, and the claims were thus barred by the McCarran-Ferguson Act. Accordingly, the court affirmed the judgment. View "Ludwick v. Harbinger Group, Inc." on Justia Law

Posted in: Insurance Law

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After Kelly D. Williams died when her car was hit by Dylan A. Meyer's vehicle, her parents submitted a claim for underinsured motorist (UIM) coverage. AMCO filed suit seeking a declaration of no coverage under Kelly's auto policy, and the district court granted summary judgment for AMCO. Under Missouri law, the court applied the general rules of contract construction when interpreting the policy. In this case, the court concluded that, because the bodily-injury liability for Meyer's vehicle was greater than the policy's UIM liability limit, Meyer's vehicle was not an "underinsured motor vehicle." The court rejected plaintiffs' claims that the policy was ambiguous and concluded that the district court did not err in finding the policy was neither ambiguous nor misleading. Accordingly, the court affirmed the judgment. View "AMCO Insurance v. Williams" on Justia Law

Posted in: Insurance Law

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After he was injured, an ARI employee filed a civil suit against ARI and was awarded over $1.5 million in damages. ARI then sought insurance coverage against Hartford. The district court granted summary judgment for Hartford. The court affirmed, concluding that ARI did not strictly comply with the policy's notification provision and forfeited any right to recover from Hartford. Furthermore, the Hartford attorney did not unambiguously deny coverage and thus Hartford is not estopped from enforcing its notice provision. View "American Railcar Industries v. Hartford Insurance Co." on Justia Law

Posted in: Insurance Law

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Adam Fetzer, a delivery driver for the Papa John's restaurant chain, was killed in a car accident in the course of his employment when another driver ran a red light and struck his vehicle. Mary Hegel, the personal representative of Fetzer's estate, sought underinsured motorist (UIM) coverage under a business auto insurance policy issued by American Fire to Papa John's. After American Fire denied the claim, the district court granted summary judgment against American Fire. The court concluded that the district court erred in applying North Dakota law and thus finding American Fire was required to provide UIM coverage to Papa John's. Rather, the policy is subject to Kentucky law, which does not require such coverage. Therefore, American Fire is entitled to judgment in its favor as a matter of law. The court reversed and remanded. View "American Fire and Casualty Co. v. Hegel" on Justia Law

Posted in: Insurance Law

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Hiland filed suit against National Union, alleging that National Union had a duty to defend and indemnify it in connection with a lawsuit arising from an explosion at its natural gas processing facility. The district court entered summary judgment for National Union. The court concluded that National Union did not have a duty to defend or indemnify Hiland because the allegations in the underlying complaint fell within the policy's pollution exclusion. The court also concluded that, because Hiland did not offer specific facts showing that it reported the pollution to National Union within twenty one days, the district court did not err by concluding that the exception to the exclusion did not apply. Accordingly, the court affirmed the judgment. View "Hiland Partners GP Holdings v. National Union Fire Insurance" on Justia Law

Posted in: Insurance Law

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In the Original Action, Michelle Pratt filed a class action on behalf of residents of Autumn Hills against Collier and two other entities, alleging that two wells supplied by Autumn Hills contained contaminated water. Barbara Williams was later substituted as a class representative. The state court awarded plaintiffs $70,085,000 for medical monitoring, and $11,952,000 for the loss in value to their homes. Williams then filed an equitable garnishment action in state court against the Insurers and Collier pursuant to Missouri Revised Statute 379.200. The district court ultimately entered a consent judgment in favor of Collier. The court concluded that the consent judgment was a final judgment and the court had jurisdiction over the appeal of the consent judgment; Williams has not waived her right to appeal the consent judgment where Williams' consent to entry of judgment against her represented consent to the form, rather than the substance, of the judgment; and the judgment on the pleadings was not a final order, and thus Williams did not file her notice of appeal out of time. The court also concluded that because Williams brought this action on behalf of a class previously certified under a state-law analogue to Rule 23, the action was necessarily “filed under” Rule 23 or a state-law analogue, even though the complaint omits explicit reference to such a rule. Therefore, the district court had jurisdiction under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d). Finally, the court concluded that the district court did not err in granting judgment on the pleadings to the Insurer because the Insurers had no duty to defend or indemnify Collier for the claims asserted in the Original Action. Accordingly, the court affirmed the judgment. View "Williams v. Employers Mutual Casualty Co." on Justia Law

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JEI filed suit against its liability insurance carrier, U.S. Specialty, alleging breach of contract and seeking a declaratory judgment related to U.S. Specialty's refusal to indemnify JEI for settlement of the underlying suit brought by a former JEI director. U.S. Specialty argued that the underlying suit was excluded from coverage based on the language in the directors' and officers' liability insurance policy. The district court granted summary judgment for U.S. Specialty. The court concluded that application of the insured vs. insured exclusion in this case demonstrates that U.S. Specialty does not owe coverage to JEI; the exclusion applied to Cheryl Sullivan, an insured person under the policy, and her two daughters; U.S. Specialty need only show that the exclusion clause applied to the suit as brought and it has done so; the allocation clause does not restore coverage for any part of the underlying suit where the allocation clause speaks generally to any claim brought with covered and uncovered matters; and the insured vs. insured exclusion speaks directly to lawsuits brought with the participation of insured persons. Accordingly, the court affirmed the district court's grant of summary judgment in favor of U.S. Specialty. View "Jerry's Enterprises, Inc. v. U.S. Specialty Insurance Co." on Justia Law

Posted in: Insurance Law

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After defendant purchased an automobile insurance policy from Nationwide, he wrecked his car and Nationwide rescinded the policy. Nationwide then sought declaratory judgment that it had no duty to indemnify or defend defendant under the policy’s coverage because defendant made material misrepresentations in his online insurance application. The district court granted summary judgment to Nationwide. The court affirmed the judgment, concluding that defendant materially misrepresented his primary use of the vehicle as "work" instead of "business." In this case, defendant used the vehicle to make business-related deliveries, putting over 1,200 miles a week on the vehicle for such deliveries. Because the district court correctly determined that defendant failed to raise a fact issue about how the application screen appeared, the court presumes that the online application contained the parentheticals at issue, which are not ambiguous as a matter of law. Accordingly, the court affirmed the judgment. View "Nationwide Property & Casualty Insurance Co. v. Faircloth, Jr." on Justia Law

Posted in: Insurance Law