“Southern California Edison will pay $2.2 billion to settle insurance claims for the Woolsey fire that tore through Malibu in 2018,” reports Catherine Traywick of Bloomberg in the Press Telegram’s News.

“The company also reached settlements with plaintiffs involving the 2017 Thomas and Koenigstein fires and the 2018 Montecito mudslides, it said in a statement. Edison, which did not admit wrongdoing or liability, last year reached a $360 million settlement with local government agencies that were harmed by the same fires.”

“Utility equipment has been tied to several devastating California wildfires in recent years, saddling the state’s power companies with billions of dollars in potential liabilities and forcing its largest, PG&E Corp., into bankruptcy in 2019.”

Read the article.

“UnitedHealth Group Inc. announced Friday its hire of Matthew Friedrich as chief legal officer, a role he will assume Jan. 11, as the managed health care and insurance company copes with the ongoing fallout from the coronavirus pandemic,” reports Brian Baxter in Bloomberg Law’s The United State Law Week.

“Friedrich, 54, is a former partner at Boies Schiller Flexner and Freshfields Bruckhaus Deringer who has spent the past three years as general counsel and chief corporate affairs officer at Cognizant Technology Solutions Corp., an information technology services provider and large federal government contractor.”

“He will succeed retiring UnitedHealth legal chief Marianne Short, 69, the first female managing partner at Dorsey & Whitney in Minneapolis. Short stepped down from the law firm in 2013 to take over as UnitedHealth’s top lawyer, replacing Richard Baer, now chief legal officer at Airbnb Inc.”

Read the article.

“The owners of the Scandies Rose have reached a settlement of more than $9 million with two surviving crew and the families of four men who died when the Washington-managed crab boat went down Dec. 31 off Alaska,” reports Hal Bernton in The Seattle Times.

“The agreement was confirmed by Michael Barcott, an attorney representing the Washington and Alaska owners, who said the settlement will be funded by insurance.”

“The agreement will be subject to review in state Superior Court, and how the money will be divided up among survivors and families of the deceased is under discussion, according to Markham.”

Read the article.

“A judge in Durham County, North Carolina has handed down what may be the nation’s first dispositive ruling in favor of policyholders in a COVID-19 business-interruption lawsuit,” reports Jim Sams in Claims Journal.

“Superior Court Judge Orlando F. Hudson Jr. ruled on Oct. 7 that closure orders that restricted the use of a group of 16 restaurants in the Raleigh-Durham area constituted a ‘direct physical loss’ that was covered by the policy.”

“According to a litigation tracker maintained by the University of Pennsylvania law school, as of Thursday 1,183 lawsuits have been filed seeking coverage from insurers for business income losses caused by coronavirus closure orders. Judges have granted insurers’ motions to dismiss in 26 cases, but have denied dismissal motions in 12 cases, including the Durham County lawsuit, according to the university’s data.”

Read the article.

“More than eight years after Bonnie Winslett tore up and threw away a summons that notified her she was being sued, the Georgia Supreme Court is being asked to resolve questions of law that will determine whether GEICO Indemnity Co. must pay approximately $2.7 million of a court’s award against her,” reports Jim Sams in Claims Journal.

“The 11th Circuit Court of Appeals on Monday sent three certified questions to the state’s high court. Once answered, the federal appellate court can then rule on an appeal of a district court’s order in a bad faith case that requires GEICO to pay 70% of the nearly $2.9 million in damages awarded by the jury, plus interest.”

Read the article.

“Wheeling Hospital, Inc. has agreed to pay the United States a total of $50,000,000 to resolve claims that it violated the False Claims Act by knowingly submitting claims to the Medicare program that resulted from violations of the Physician Self-Referral Law and the Anti-Kickback Statute, the Justice Department announced Wednesday,” reports MetroNews Staff in MetroNews.

“According to the Justice Department, in this case, the United States alleged that from 2007 to 2020, under the direction and control of its prior management R&V Associates, Ltd. and Ronald Violi, Wheeling Hospital systematically violated the Stark Law and Anti-Kickback Statute by knowingly and willfully paying improper compensation to referring physicians that was based on the volume or value of the physicians’ referrals or was above fair market value.”

Read the article.

“A deadlocked Pennsylvania Supreme Court on Tuesday voted to let stand a state Superior Court ruling overturning a $21 million bad faith ruling against Nationwide,” reports John Huetter in RDN Repairer Driven News.

“The Superior Court had held in a 2-1 2018 decision that Common Pleas Judge Jeffrey Sprecher overreached in a 2015 ruling on Nationwide’s behavior related to a Jeep left unsafe after repairs tied to a Blue Ribbon auto body shop.”

“The Supreme Court on Tuesday declared itself ‘divided in a fashion which prevents a majority disposition’ and therefore dismissed the appeal by the Jeep’s lessee. (Justice Christine Donohue didn’t participate in the case.) The move means the Superior Court decision remains intact.”

Read the article.

Despite COVID-19 travel restrictions, quarantine, travel insurance claim denied  

MARSHALL, Texas – An East Texas woman has filed a proposed class action lawsuit against the company that serves as the VRBO travel website’s exclusive travel insurance provider. The lawsuit alleges that CSA Travel Protection, the American affiliate of Italy-based Assicurazioni Generali Group, has refused to honor its policy and refund more than $3,500 for a cancelled booking of oceanfront property in Florida. 

 Tralisa Sheridan, a resident of White Oak, Texas, made a reservation through VRBO in March 2019 for accommodations in Navarre, Florida, to host multiple family members for her daughter’s destination beach wedding, planned for March of 2020. At the time of the booking, Ms. Sheridan paid $180 for a travel insurance coverage plan from CSA. 

Sheridan and the wedding party planned to drive to and from the destination, beginning on March 21, the same day Santa Rosa County officials suspended all access to Navarre’s beaches. Because of this action and the prior rollout of other COVID-19 travel restrictions, including the imposition of 14-day quarantine requirements for interstate travel between Texas and Florida, Sheridan promptly notified VRBO and CSA of the need to cancel the booking and provide a refund. 

 CSA responded by email 38 days later that the claim was being denied, and despite multiple subsequent requests by Sheridan, the insurer has provided no further details or rationale for the denial. 

 “Unfortunately, we’re seeing too many examples of insurers in the travel and hospitality sector attempting to shirk their responsibilities and failing to honor rightful claims,” said Derek Potts, the attorney for Ms. Sheridan. “Through a class action against these defendants, we will seek the compensation that thousands of individuals who booked through VRBO and purchased this insurance are due.” 

 The case is Tralisa Sheridan et. al. v. Assicurazioni Generali et.al., No.220-CV-244, filed in U.S. District Court for the Eastern District of Texas in Marshall.  

“In Richards v. State Farm Lloyds … the Texas Supreme Court answered a certified question posed by the Fifth Circuit Court of Appeals; namely, whether the absence of a clause requiring a carrier to defend claims that are “groundless, false or fraudulent” means that the “eight-corners” rule does not apply when determining the existence of a duty to defend. The Texas Supreme Court held that the eight-corners rule applies regardless of whether the underlying policy obligates a carrier to defend claims that are groundless, false or fraudulent,” write Alissa K. Christopher and Gregory S. Hudson in Cozen O’Connor’s Recent News & Publications.

“Ten-year-old Jayden Meals died in an ATV accident while under the supervision of his paternal grandparents Janet and Melvin Richards. Jayden’s mother filed suit against the Richards, alleging that they negligently failed to instruct or supervise Jayden in his operation of the ATV. The underlying petition, however, contained no allegations regarding where the fatality occurred and no allegations regarding the custody relationship between Jayden and his paternal grandparents.”

“State Farm Lloyds provided a homeowner’s policy to the Richards. It agreed to defend the Richards under a reservation of rights and separately initiated a declaratory judgment proceeding in federal court.”

Read the article.

As the coronavirus spreads around the world and economic losses mount, insurance should not be overlooked. Pasich LLP has published a Legal Alert on Insurance Coverage for Losses and Claims Associated with the Coronavirus. It addresses why many common types of insurance may provide extensive coverage for the economic losses and litigation associated with the coronavirus. “We believe that many kinds of insurance afford protection against economic losses associated with the spread of the coronavirus and steps taken to minimize its spread,” said Kirk Pasich, Esq.  “We also believe that insurance exists for lawsuits—which have begun to be filed—relating to alleged exposures to the coronavirus or alleged failures to protect against exposure. The reality is that even if, for example, an insured does not have event cancellation insurance, or its event cancellation insurance has a clear express exclusion barring coverage, other policies may afford coverage.  In fact, there often may be coverage afforded for coronavirus-associated losses and litigation under policies that, at first blush, might not be considered as providing coverage. Those policies include property insurance policies and general liability and workers’ compensation insurance,” said Pasich.

Get the full report.

“A certificate of insurance is a document, normally issued by an insurance broker, that supposedly verifies the existence and terms of an insurance policy,” write Gene Killian in The Killina Firm’s Fraud.

He discusses how “It’s common in the construction industry, where contractors and subcontractors are generally required to carry certain types of coverage, but really, the insurance card in your car is also a kind of certificate of insurance. The certificate of insurance is one of the most important documents that you can review in connection with your business contract, because if something goes wrong, you may need to tap that coverage.”

“The problem is, when it comes to enforcing the terms of the coverage reflected on the certificate of insurance, the certificate of insurance is essentially worthless. It’s just a written statement by an insurance broker, not an actual policy.  While it might get the broker or policyholder into trouble for negligence or misrepresentation if it’s not valid, it creates no rights against the insurance company.”

Read the article.

Jason Reeves and Helen Campbell of Zelle LLP offer some advice on commercial property insurance contracts in the firm’s Articles.

“Over the past decade, as commercial property insurance rates softened, so too have terms and conditions. In some instances, attempts to broaden coverage have also had the effect of diluting the clarity and consistency of manuscript forms. The role that underwriters’ contract wordings managers once played in tidying up such issues was weakened when the new imperative was to sign up to a policy wording as presented or risk not having an offered line taken up.” they write.

“The market is changing. As the property market continues to show signs of hardening,” he offers some fixes underwriters should consider.

Read the article.

A financial tug-of-war is emerging over the $13.5 billion that the nation’s largest utility has agreed to pay to victims of recent California wildfires, as government agencies jockey for more than half the money to cover the costs of their response to the catastrophes, reports Insurance Journal.

Pacific Gas & Electric had acknowledged that  its power lines ignited some of the 2017-2018 fires that caused billions in damages. The company declared bankruptcy nearly a year ago as it faced about $36 billion in claims.

“Those claims were settled as part of the $13.5 billion deal that PG&E reached last month with lawyers representing uninsured and underinsured victims,” explains the Journal‘s Daisy Nguyen.

But the settlement leaves open just how much would be used to compensate victims, their lawyers and federal and state agencies for the money they spent on rescue and recovery operations.

Read the Insurance Journal report.

Bloomberg Law reports that a federal judge in Chicago ruled that Lincoln National Life Insurance Co. wrongly shortchanged a tax attorney’s disability benefits by $3,000 per month by determining he became disabled one day before he received a $65,000 raise.

Harlan Ten Pas, a former partner with McGladrey LLP, suffered a heart attack on Sunday over Labor Day weekend in 2014, one day before his raise became effective. The insurer based his disability benefits on his salary without the benefit.

Ten Pas sued, saying he was entitled to an additional $3,000 per month because the date of disability couldn’t be any earlier than the first non-holiday workday after his heart attack.

Read the Bloomberg  Law article.

Peter M. Gillon, writing in Pillsbury’s Policyholder Pulse blog, discusses an important decision in the world of professional liability (including D&O and E&O policies).

He explains that the Seventh Circuit recently held that a “contractual liability” exclusion—i.e., an exclusion for claims “based upon or arising out of … breach of contract”—when inserted in a professional liability policy, that is, a policy intended to insure professionals for services they perform under contract, renders the coverage “illusory.”

He adds that the court concluded that the exclusion as written eliminated all coverage under this professional liability policy for the very kinds of claims the policyholder sought to insure—on its face, not just as applied to the particular claim.

Read the article.

Even if an errors and omissions policy contains a breach of contract exclusion, coverage may be available in a breach claim, depending on the circumstances and applicable law, writes Charles P. Edwards for Barnes & Thornburg.

Writing in the firm’s Policyholder Protection blog, Edwards discusses a recent court ruling involving coverage for a breach of contract claim brought against a corporate policyholder by one of its customers.

The article also covers two other similar cases.

Read the article.

The U.S. Court of Appeals for the 4th Circuit held that a subrogation waiver provision in a construction contract barred an association’s insurance company from seeking to recover from an allegedly negligent contractor, reports Daniel Miske in the Husch Blackwell Association Alert.

He describes the case of United National Insurance Company v. Peninsula Roofing Company, Inc., which involved $3 million in damages to a condominium complex caused  by a contractor’s generator. The association’s insurer sued the contractor for negligence, gross negligence, and breach of contract.

After detailing the appellate court’s ruling, Miske presents four lessons a practitioner can learn from the case.

Read the article.

The current, third quarter 2019 issue of the Defense Counsel Journal (DCJ), published by the International Association of Defense Counsel (IADC), features numerous articles that highlight important trends in the law, as well as an introduction by newly elected IADC President Amy Sherry Fischer.

The quarterly DCJ spotlights the IADC’s defense bar leadership through its articles about legal development and reform issues, as well as the practice of law in general. DCJ articles are written by members of the IADC, which is a 2,500-member, invitation-only, worldwide organization that serves its members and their clients, as well as the civil justice system and the legal profession.

“The Defense Counsel Journal is a significant part of the contributions of the IADC during its history,” said Fischer, a shareholder at Foliart, Huff, Ottaway & Bottom in Oklahoma City, Okla.

DCJ editor and former IADC board member Kenneth R. Meyer added that the current DCJ edition includes “three exciting and helpful articles.” These articles cover several significant proposed changes to the Federal Rules, insurance coverage issues involving inverse condemnation and public water systems, and the impact of a recent Supreme Court decision on maritime jurisdiction over asbestos claims.

The IADC’s third-quarter 2019 DCJ is available for free and without a subscription via the IADC’s website.

Following are brief summaries of key articles included in the third-quarter 2019 issue of the DCJ:

“Federal Civil Rule Reform – An Update” by Christopher E. Appel, of counsel, and Mark A. Behrens, co-chair of the Public Policy Practice Group, both at Shook, Hardy & Bacon L.L.P. in Washington, D.C. This article outlines proposed major changes to the Federal Rules of Civil Procedure and the Federal Rules of Evidence. If implemented, these changes could prove enormously consequential for all civil defendants.

“Insurance Coverage Rules for Inverse Condemnation Actions Involving Public Water Systems” by Paul Fuller, a director of the American Association of Water Distribution & Management and an insurance professional specializing in public water systems. This article encapsulates the problems owners of public water systems face from inverse condemnation – a topic at the crossroads of insurance and land use law. The article covers the legal theory’s underlying mechanics, available protections, and emerging areas of liability. The article also examines insurer defense and indemnity obligations for those insurance policies from which such action cloaks as a potential policyholder right.

“In the Wake of Devries: Revisiting the Extension of Maritime Jurisdiction Over Asbestos Claims” by Brian J. Schneider, a shareholder at Moran Reeves Conn PC in Richmond, Va. This article explores the impact of the recent Supreme Court decision in Air & Liquid Systems Corp. v. Devries. The article examines admiralty law and its applicability to proof issues relating to equipment manufacturers’ liability for component parts.

About the International Association of Defense Counsel
The IADC is the preeminent invitation-only global legal organization for attorneys who represent corporate and insurance interests. Founded in 1920, the IADC’s members hail from six continents, 52 countries and territories, and all 50 U.S. states. The core purposes of the IADC are to enhance the development of skills, promote professionalism, and facilitate camaraderie among its members, their clients, as well as the broader civil justice community.

Word out of the construction insurance brokerage community is that the construction insurance industry has entered a hard market, seemingly overnight, warns Jason Adams, senior counsel at Gibbs Giden.

In a LinkedIn post, he writes that property (i.e. builder’s risk), liability and wrap-up markets are all reacting unfavorably, resulting in higher premiums and decreased availability of coverage options.

He offers five key takeaways, such as the advice to lock in insurance quotes in now, before the underwriters are forced to increase the rates/restrict coverage, or pull the quotes entirely.

Read the article.

Boutique insurance recovery and entertainment firm Pasich LLP announced the addition of Peter A. Halprin, FCIArb, FAiADR. Halprin will serve as a partner.

Before joining Pasich LLP, Halprin was a shareholder in Anderson Kill P.C.’s New York office, where he focused on insurance recovery and served as deputy co-chair of the Cyber Insurance Recovery Practice.

In a release, the firm said Halprin represents commercial insureds in complex insurance coverage matters, with a particular focus on recovery strategies in relation to captive insurance, cyber crime, natural disasters, professional services, regulatory investigations, and technology disputes. Halprin has arbitrated, litigated, and mediated claims involving a broad range of insurance policies and recovered hundreds of millions of dollars in insurance proceeds for insureds. He advises clients under an array of forms and policies, including Boiler & Machinery, Builder’s Risk, Commercial Crime, Cyber, Directors & Officers, Employment Practices Liability, Errors & Omissions, Fidelity, General Liability, Kidnap & Ransom, Media Liability, Pollution Liability, Products Liability, Property, Technology E&O, Trade Credit, and Workers’ Compensation. Halprin also counsels U.S. and foreign companies in domestic and international arbitrations, including both ad hoc (ARIAS, Bermuda Form, London) and institutional (AAA, ICC, ICDR, JAMS, LCIA) arbitration forums. He has served as a party-appointed arbitrator and as sole arbitrator.

Halprin is a member of the AAA National Roster of Arbitrators. He has been recognized annually as a Super Lawyers New York Metro Rising Star for Insurance Coverage since 2013.