Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Welspun filed suit against its insurer, Liberty Mutual, arguing that its unpaid mitigation costs were "necessary expenses" included in the policy's loss of business income coverage. The Eighth Circuit affirmed the district court's grant of summary judgment for Liberty Mutual. The court held that the district court did not err in limiting necessary expenses covered in Paragraph C.2. of the policy to expenses incurred to avoid or reduce a loss of business income; reading the loss of business income policy provisions together, in light of their historical roots and obvious purpose, the court agreed with the district court that "necessary expenses" in Paragraph C.2. were limited to expenses that reduce a covered business income loss; and the incremental costs Welspun incurred in shifting some Seaway production to an affiliate in India were not "necessary expenses" within the meaning of Paragraph C.2. of the policy. View "Welspun Pipes Inc. v. Liberty Mutual Fire Insurance Co." on Justia Law

Fidelity filed suit seeking a declaration that a title insurance policy did not cover mechanics' liens. Captiva filed counterclaims, which sought a declaration that the policy covered the mechanics' liens and which asserted claims against Fidelity for failing to diligently defend and resolve the mechanics' liens claims and for tortiously interfering with Captiva's relationship with the attorneys Fidelity had hired to defend Captiva. The Eighth Circuit held that the district court did not apply the correct legal standard in deciding that Title Insurance Policy Exclusion 3(a) did not apply to the mechanics' liens at issue in this case; Exclusion 3(a) can apply under Missouri law even if the insured did not engage in intentional misconduct or inequitable dealings; Captiva failed to show that the title was unmarketable on or before the effective date of the policy and thus failed to prove its claim that Fidelity breached the policy's unmarketability-of-title provision; and thus the court affirmed the dismissal of the tortious interference claim, vacated the judgment and remanded for further proceedings, and also vacated the order awarding attorneys' fees and costs. View "Captiva Lake Investments v. Fidelity National Title Insurance" on Justia Law

Fidelity filed suit seeking a declaration that a title insurance policy did not cover mechanics' liens. Captiva filed counterclaims, which sought a declaration that the policy covered the mechanics' liens and which asserted claims against Fidelity for failing to diligently defend and resolve the mechanics' liens claims and for tortiously interfering with Captiva's relationship with the attorneys Fidelity had hired to defend Captiva. The Eighth Circuit held that the district court did not apply the correct legal standard in deciding that Title Insurance Policy Exclusion 3(a) did not apply to the mechanics' liens at issue in this case; Exclusion 3(a) can apply under Missouri law even if the insured did not engage in intentional misconduct or inequitable dealings; Captiva failed to show that the title was unmarketable on or before the effective date of the policy and thus failed to prove its claim that Fidelity breached the policy's unmarketability-of-title provision; and thus the court affirmed the dismissal of the tortious interference claim, vacated the judgment and remanded for further proceedings, and also vacated the order awarding attorneys' fees and costs. View "Captiva Lake Investments v. Fidelity National Title Insurance" on Justia Law

In the underlying lawsuit, A1's filed an action against Decker after the plastic bags Decker sold to A1's deteriorated in the sunlight because they were not manufactured with an ultraviolet inhibitor. In this appeal, the Eighth Circuit affirmed on remand the district court's grant of summary judgment to West Bend, Decker's insurer, holding that Decker's claims were properly dismissed because there was no property damage triggering coverage under West Bend's policies. The undisputed facts established that A1's landscaping materials were not physically injured due to the incorporation of the deteriorated packaging material. View "Decker Plastics Inc. v. West Bend Mutual Insurance Co." on Justia Law

The Eighth Circuit affirmed the district court's grant of summary judgment to Zurich, holding that the district court did not err in concluding that the commercial general liability policy issued by Zurich to EPS did not provide coverage for damage EPS caused to an electrical transformer while working on it. In this case, the "particular part" exclusion applied and there was no coverage for the claimed damage, because the damage to the coil at issue was caused by EPS's incorrect performance of its work in detaching the lead cable from the bushing. View "Electric Power Systems International, Inc. v. Zurich American Insurance Co." on Justia Law

The Insurer appealed the district court's grant of summary judgment for the insured in a dispute regarding damage from a hailstorm to windows in the insured's home. An appraisal panel issued an appraisal award but the parties disputed the meaning of the award. The Eighth Circuit held that the appraisal award was ambiguous and the district court should have returned the matter to the appraisal panel for clarification. Accordingly, the court vacated the judgment and remanded. View "Herll v. Auto-Owners Insurance Co." on Justia Law

Plaintiffs filed suit against Allstate after the insurance company denied their homeowner's insurance claim. The Eighth Circuit affirmed the district court's grant of Allstate's motion for judgment as a matter of law. In regard to the breach of contract claim, the court held that plaintiffs failed to present sufficient evidence of the home's value and the personal property's value before or after the fire. Furthermore, a bankruptcy filing was insufficient to establish value. In this case, plaintiffs could have submitted an estimate of the personal property's value immediately before the fire, but they did not. Values on their proof-of-loss list were estimates of original purchase prices and it did not account for deterioration, obsolescence, or other depreciation as required by the policy and under Missouri law. Because plaintiff's vexatious refusal claim was derivative of their breach of contract claim, the court affirmed as to that claim. View "Aziz v. Allstate Insurance Co." on Justia Law

Plaintiff filed a putative class action, alleging that State Farm's practice of deducting "labor depreciation" from estimated replacement cost in determining actual cash value breached the insurance contract. The Eighth Circuit reversed the district court's denial of State Farm's motion to dismiss and certify a class. Although the court did not rule out the possibility that State Farm's use of the estimating methodology tool would produce an unreasonable estimate of the actual cash value of some partial losses, this issue may only be determined based on all the facts surrounding a particular insured's partial loss. Therefore, there were no predominant common facts at issue. Furthermore, the district court's order upholding premature classwide discovery was vacated. The court remanded with directions to dismiss the complaint and held that State Farm's petition for writ of mandamus was moot. View "In Re: State Farm Fire & Casualty Co." on Justia Law

The Eighth Circuit affirmed the district court's grant of summary judgment for four insurance companies in an action filed by UnitedHealth, seeking indemnity and defense costs for underlying litigation settlements under its professional liability excess insurance policies. The court held that the district court properly concluded that UnitedHealth failed to present sufficient evidence as to how the settlement should be allocated between covered and non-covered claims; it was not enough under Minnesota law for UnitedHealth to show simply that its $350 million settlement included a covered claim of an unspecified amount; UnitedHealth failed to provide non-speculative evidence to allocate the $350 million settlement between the potentially covered AMA suit and non-covered Malchow suit; and the court declined to disturb the district court's grant of summary judgment for the Insurers on the matter of defense costs in the AMA litigation. View "UnitedHealth Group Inc. v. Executive Risk Specialty Ins." on Justia Law

The Eighth Circuit reversed the district court's award of damages to plaintiff for injuries that she sustained in a vehicle-related accident. The court held that the district court improperly applied a heightened duty to the sober designated driver for a group of intoxicated passengers. In this case, the findings of fact were insufficient to support apportioning greater fault to the driver based on her duty to exercise reasonable care in driving the vehicle. Accordingly, the court remanded for new findings and conclusions on the allocation of fault. View "Hiltner v. Owners Insurance Co." on Justia Law