Ninth Circuit Finds No Implied Disparagement Coverage in First Case Decided After Swift Distribution

The Ninth Circuit affirmed the dismissal of Bullpen Distribution’s (Bullpen) suit against Sentinel Insurance Company (Sentinel) for breach of insurance contract, bad faith failure to defend, and declaratory relief.  Bullpen Distribution, Inc. v. Sentinel Ins. Co., No. 12-16369, 2014 U.S. App. LEXIS 17497 (9th Cir. Sept. 10, 2014).  The coverage dispute derives from allegations by A.Y. International, Inc (AYI) that Bullpen sought to take credit for AYI’s business practices and achievements and pass of AYI’s achievements, business relationships and practices,
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Court Finds TCPA Violations Do Not Relate to Other Lawsuits Involving Non-TCPA Claims

The Superior Court of Delaware, New Castle County, ruled that RSUI Indemnity Company owed its insured, Sempris, LLC, a duty to defend and indemnify against an underlying TCPA lawsuit pending in the United States District Court for the Northern District of Illinois. RSUI Indem. Co. v. Sempris, LLC, C.A. No. N13C-10-096, 2014 Del. Super. LEXIS 449 (Sept. 3, 2014). The coverage dispute arose out of the following circumstances.  RSUI issued a D&O liability policy to Sempris effective from March 1, 2013
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Another Victory for Insurers in Litigating the Scope of Coverage B: District Court Rejects Duty to Defend Against Alleged Violations of Data Privacy Laws

In National Union Fire Insurance Company of Pittsburgh, PA v. Coinstar, Inc. (W.D. Wash., No. C13-1014-JCC, Aug. 7, 2014), the U.S. District Court for the Western District of Washington ruled that National Union Fire Insurance Company of Pittsburgh, PA had no duty to defend Redbox Automated Retail, LLC (Redbox), a Coinstar, Inc. subsidiary, in two separate class action suits alleging that Redbox violated its customers’ privacy.  Notably, the first class action suit, Cain v. Redbox, alleged that Redbox violated Michigan’s
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Excess Carrier Has Equitable Subrogation Rights Against Primary Carrier For Not Settling Within Policy Limits

On September 19, 2007, claimant William Kelly was injured while descending a stairway in Hawthorne, California. Kelly sued F. H. Paschen, Inc., the general contractor for a construction project on the stairway. In the ensuing declaratory judgment action, Paschen’s excess carrier, Westchester Fire Insurance Company (Westchester), alleged that Paschen’s primary insurer, Zurich American Insurance Company (Zurich), failed to notify Westchester of the litigation and failed to settle the underlying case within the $1 million primary policy limits. Westchester sought to
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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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Tolling Agreements Cause Coverage Concern

An insurance coverage dispute has arisen in connection with litigation involving a robotic surgery medical device maker. A declaratory judgment action seeking rescission of product liability insurance policies issued to the manufacturer was filed in the U.S. District Court for the Northern District of California. If successful, the insurer may avoid obligations under its primary and excess insurance policies providing $15 million per occurrence and $50 million aggregate. To read the rest of this article, authored by Sean T. Stadelman,
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Rule Followed by NY Federal Court for Damages Outside NY

Indian Harbor Insurance Company v. The City of San Diego  (Case No. 12-cv-5787) (S.D.N.Y., September 25, 2013) A New York federal court continued to honor the line of New York cases that stand for the proposition that a showing of prejudice is not required for the late notice defense on policies issued or delivered prior to January 17, 2009. This case arose as a result of multiple underlying claims made against a California State municipality by two homeowners associations and
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Cases for the September 2013 Edition of CaseWatch: Insurance and Bad Faith Focus

Cases provided courtesy of LexisNexis. CaseWatch: Insurance Cases Admiral Ins. Co. v. Shah & Associates Admiral Insurance Company v. Marsh Alabama Gas v Travelers Aleman v. Ace Am. Ins. Co., Allstate Ins. Co. v. Nassiri Attorneys Liability Protection Society, Inc. v. Whittington Law Associates, PLLC Automax Hyundai South, L.L.C. v. Zurich Am. Ins. Co. Ba v. HSBC USA, Inc. California Ass’n of Rural Health Clinica; Avenal Community Health Center v. Douglas City of San Buenaventura v. Ins. Co. Colonial Oil
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No Coverage For Nightclub Dancer Set on Fire by Patron

Mount Vernon Fire Ins. Corp. v. Oxnard Hospitality Ent. Inc., Court of Appeal of the State of California, Second Appellate District, Division Three (September 16, 2013) An employee of the insured appealed a California trial court decision which held that Mount Vernon had no duty to cover a $10 million award. The award was granted to the employee after she was set on fire by a third party at the insured’s bar. The employee sued her employer and others for
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Challenge to Regulations on Required Use of Death Master File

United Ins. Co. of Am. v. Boron Cir. Ct.of Cook County, Illinois (Sept. 4, 2013) Three life insurers have filed an action seeking declaratory and injunctive relief from the Illinois Department of Insurance Regulations that impose an obligation on life insurers to utilize the Social Security Death Master File to ascertain whether its insureds are deceased and benefits owed to their beneficiaries under policies issued in the State of Illinois. The insurers claim that under the Insurance Code an insurer
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