Richard Cohen

All articles by Richard Cohen

 

The Streak Continues: Insurers Again Shut Out of Federal Court in Contesting Coverage for a TCPA Class Action Settlement

The Sixth Circuit ruled sua sponte in Siding and Insulating, Inc. v. Acuity Mutual Insurance Co. (6th Cir. June 10, 2014), that the subject coverage dispute, which arose out of the settlement of an underlying TCPA blast fax suit, did not satisfy the amount in controversy requirement for purposes of diversity jurisdiction.  Following the Seventh Circuit’s recent holding in Travelers Property Casualty v. Good, 689 F.3d 714 (7th Cir. 2012), the Sixth Circuit concluded that the interests of the plaintiff
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Force-Placed Meets the Feds – The Insurance Regulatory Field Grows

Recent news regarding lender-placed insurance (more colloquially known as “force-placed” insurance) has focused on state efforts to regulate the industry. Now the Feds are getting involved, specifically the Federal Housing Finance Agency (FHFA).  FHFA is now prohibiting servicers of mortgages issued by Fannie Mae and Freddie Mac from receiving any compensation from those insurers providing the force-placed coverage. Fannie Mae and Freddie Mac write over 60 percent of all mortgages in the U.S. As such, this action is going to
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Colorado Court Applies Massachusetts Law to Bar Coverage for Chinese Drywall

A Colorado state court applied Massachusetts law to deny an excess carrier’s summary judgment motion that sought to disclaim coverage for defective Chinese drywall claims.  Specifically, the court found that use of the term “pollutant” within the absolute pollution exclusion to be ambiguous “at this stage in the proceedings.”  In doing so, the court set the case up for trial. The underlying claims giving rise to this coverage matter involve allegations that defective drywall, imported into the U.S. from China,
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Judicial Economy Requires Set-Off Rather Than Contribution Action By Non Settling Carriers

General Refractories Co. v. First State Ins. Co., September 6, 2013 The plaintiff, General Refractories Company (GRC), sued multiple defendant insurance carriers for a declaration of excess insurance coverage for underlying claims. Five of the defendant insurance carriers settled with GRC (settled carriers) but seven litigants remain (litigating defendants). Plaintiff GRC and the defendant settled carriers move for dismissal with prejudice of all claims asserted against the settled carriers. As the defendant insurance carriers would be jointly and severally liable
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Missouri Supreme Court Levies Insurer with Judgment $3 Million in Excess of Policy Limits in TCPA Case

Columbia Cas. Co. v. Hiar Holding, LLC (Mo. Aug. 13, 2013) The Missouri Supreme Court recently ordered an insurer to indemnify its insured for a $5 million settlement in an underlying Telephone Consumer Protection Act (TCPA) case, $3 million of which was in excess of the policy’s limits. The TCPA provides a private right of action for recipients of unsolicited communications that are sent via automatic dialers, among other methods. A recipient may bring an action to recover $500 per violation,
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Insurers’ Goal Line Stand: California Coverage Action Stayed While New York Case Marches On

National Football League v. Fireman’s Fund Ins. Co. (Cal. App. Ct. May 28, 2013) A California appellate court recently affirmed a stay of California litigation commenced by the NFL against multiple insurers seeking coverage for traumatic brain injury cases. The court held that the NFL was not a California resident for purposes of a forum non conveniens analysis even though it has three teams in California. The NFL administration and its intellectual property marketing arm were sued in multiple states
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Chartis Not Responsible For Losses on $103 Million Loan

CT Investment Management Co. LLC v. Chartis Specialty Insurance Co. New York State Supreme Court, New York County CT Investment Management Co. LLC (CT) brought action in New York State Supreme Court, New York County against Chartis Specialty Insurance Co. (Chartis), claiming that Chartis failed to meet its obligations under a political risk policy for damages suffered by CT.  The lawsuit pertains to a $103 million loan made by LaSalle Bank NA to various Mexican hotel operators.  In conjunction with the loan,
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Firm Left Without Malpractice Insurance For Botched Sales Contract

Koransky, Bouwer & Proacky, P.C. v. The Bar Plan Mut. Ins. Co. (7th Cir. (Ind.) Apr. 2, 2013) The Seventh Circuit recently affirmed a ruling that left a law firm without insurance coverage for a malpractice claim arising from a sales transaction gone awry. The court held that the firm’s failure to disclose the potential lawsuit to its malpractice insurer precluded coverage. The plaintiff law firm represented a potential buyer in the purchase of four Rite Aid drugstores in Ohio.
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Illinois Court Protects Insurers from Unripe Coverage Disputes

Byer Clinic & Chiropractic, Ltd. v. State Farm Fire & Cas. Co. (Illinois Appellate Court Mar. 12, 2013) An Illinois Appellate Court recently held that an insurer’s defense obligation is not ripe for adjudication if that insurer is defending its insured in an underlying court action, even if subject to a reservation of rights. The plaintiff filed a class-action complaint against the insured, Kapraun, P.C., and Dr. Michael Kapraun, alleging a violation of the Telephone Consumer Protection Act of 1991 (TCPA).
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NFL Goes 0 for 2 Against Insurance Companies in Court

The National Football League is now 0-2. It lost yet another round on the legal gridiron last week when New York State Supreme Court Judge, Jeffrey K. Oing, ruled that the lawsuit between the NFL and its insurance companies could proceed in NY.  This is despite the fact that the NFL filed a similar lawsuit in California first. This echoes a previous ruling by Los Angeles Superior Court Judge John Shepard Wiley Jr. who held last fall that California was
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CT Judge Says Insurer’s New Claims Against Reinsurer Are Plausible

Travelers Indem. Co. v. Excalibu R Reinsurance Corp. (D.Conn.Feb. 1, 2013) On February 1, 2013, a federal judge in Connecticut granted an insurer’s motion to amend its complaint against a reinsurer to include claims based on information revealed during discovery. In the case, the reinsurer refused to pay to the insurer amounts the insurer claims it is owed under a treaty of reinsurance and the insurer sued the reinsurer to recover them. After discovery was already underway, the insurer moved
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Unjust Enrichment Claim Dismissed in Force-Placed Insurance Suit

On December 31, 2012, New Jersey District Court Judge Noel L. Hillman granted in part and denied in part defendant PHH Mortgage Corporation’s (PHH) motion to dismiss the class action suit brought against it, which challenged the practice of a PHH subsidiary of  purchasing force-placed hazard insurance from a provider in arrangements where PHH benefits financially. Specifically, Judge Hillman dismissed the plaintiffs’ unjust enrichment claim, but left intact some breach of contract and consumer fraud claims. Judge Hillman concluded that
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Tenth Circuit Denies Religious Companies an Injunction on Affordable Care Act Contraception Rule

Hobby Lobby Stores, Inc., v. Sebelius United States Court of Appeals for the Tenth Circuit (December 20, 2012) A chain arts and crafts store and its affiliated Christian bookstore business (plaintiffs) disputed the contraception rule under the Affordable Care Act claiming that it violates their constitutional rights in forcing businesses to offer insurance coverage for “abortion inducing drugs and devices.” The plaintiffs claimed that the rule violated the First Amendment and the Religious Freedom Restoration Act of 1993(RFRA). Accordingly, the
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CaseWatch: Insurance October 2012 Edition Now Available

For a free copy, please click here. If you would like to receive future editions of CaseWatch: Insurance directly by email, please contact Sarah Delaney at sdelaney@goldbergsegalla.com.
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Cases for the October 2012 Edition of CaseWatch: Insurance

Cases provided courtesy of LexisNexis. American Centennial v. Global Intl Anderson v. Blake Auto-Owners Insurance Co. v. Great American Insurance Co. Axiom Insurance Managers v. Capitol Speciality Insurance Corp. Callon Petroleum v. National Indemnity Co. Category 5 Management Group v. National Casualty Insurance Co. Continental Casulaty Co. v. North American Capacity Insurance Co. Courtney Dupree v. Scottsdale Insurance Company Du v. Allstate Firemans Fund v. Great American Fisery Soluntions Inc., v. West Chester Fire Insurance Co. Incorporated Village of Rockville
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Georgia Supreme Court: Insurers Waive Defenses Not Raised in Denial Letter

Hoover v. Maxum Indem. Co. (Ga. June 18, 2012) The Supreme Court of Georgia recently ruled that an insurer cannot both deny coverage for a claim outright and attempt to reserve the right to assert a different defense in the future. The ruling will undoubtedly pressure insurers into defending insureds where coverage defenses are not initially clear. In Hoover, the plaintiff fell from a ladder while descending from a roof, causing a serious brain injury. Just before the accident, Hoover,
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Texas High Court Finds That Stop-Loss Insurance to Self-Funded Employee Health-Benefit Plans is Not Reinsurance, and is Subject to Texas Insurance Regulations

TEX. DEP’T OF INS. V. AM. NAT’L INS. CO., Supreme Court of Texas, May 18, 2012. The defendant sells stop-loss insurance to self-funded employee heath-benefit plans. Under self-funded benefit plans, an employer assumes the risk of providing health insurance to its employees instead of ceding the risk to an insurance company. The employer then may purchase stop-loss insurance to limit financial exposure for catastrophic losses. The issue in this case was whether stop-loss insurance sold to self funded employee health-benefit
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