Category: Emerging Issues

Newmont USA Ltd. v. Allstate Ins. Co., et al. (U.S. District Court, E.D. WA)

Newmont USA Ltd., one of the world’s largest gold producers which also mines lead, silver and uranium, settled claims on Monday against two insurers, Allstate Insurance Company and Seaton Insurance Company.  The claims involved a coverage dispute over the cleanup of a former uranium mine in the state of Washington.  Approval of the settlement and dismissal of the action was made in separate Orders by U.S. District Court Judge Justin Quackenbush …

Nationwide Mut. Ins. Co. v. The Overlook LL (E.D.Va., May 13, 2011)

This coverage disputed arises out of an underlying property damage claim caused by Chinese drywall. Overlook, LLC is a real estate developer that operated in Richmond, Virginia. Overlook has developed a complex known as the “Overlook Townhouse.” One of the units was purchased by Mr. Ricky Edmonds. After Overlook determined that various homes were constructed with Chinese drywall, Overlook undertook efforts to “work with” homeowners and remediate the affected homes. Overlook, however, did …

In Re: Global Industrial Technologies, Inc. (May 4, 2011, 3^rd Circuit (PA))

The United States District Court for the Third Circuit has given insurers the opportunity to contest the formation of mass-tort bankruptcy trusts, and potentially to minimize potential tort claims. Despite a strong four-judge dissent and recognizing the insurer’s financial stake in such proceedings, the Third Circuit succinctly summarized its holding:

The decision we announce is no more far-reaching that this: when a federal court gives its approval to a plan that allows …

Philadelphia Indemnity Ins. Co. v. Allied Mortgage and Financial Corp. S.D. Florida, May 9, 2011

U.S. District Judge Adalberto Jordan refused to toss a lawsuit filed by plaintiff insurer against defendant policyholder to free insurer from providing coverage to the insolvent company in investor actions.  The underlying action involved a state claim by investors seeking damage over defendant’s mishandling of investments and loans.  Specifically, the investors alleged negligent misrepresentations. 

Plaintiff issued an insurance policy to defendant providing professional liability coverage in connection with the company’s …

FIELDSTON PROPERTY OWNERS ASSOCIATION, INC. v. HERMITAGE INSURANCE COMPANY AND FEDERAL INSURANCE COMPANY

(N.Y. Ct. App. February 24, 2011)

Fieldston Property Owners Association, Inc. (“Fieldston”) was sued first in federal court and subsequently in New York state court by Chapel Farm Estates (“Chapel Farm”) based upon “false statements and fraudulent claims Fieldston allegedly made concerning Chapel Farm’s right to access Fieldston’s property during a construction project.  In the federal lawsuit, Chapel Farm asserted causes of action for injurious falsehood and interference with …

Pulsar Re Ltd v. Lehman Brothers Holding, Inc. Case No. 08-13555

Pulsar Re has filed a $450 Million suit against Lehman Brothers alleging the former investment company looted money it held for Pulsar in an effort to improve its books. The Adversary Suit filed in the U.S. Bankruptcy Court for the Southern District of New York seeks an order placing the $450 Million placed into a trust contending that the money is not part of the bankruptcy estate.

According to the complaint, Pulsar and Lehman …

Liberty Mutual Insurance Co., et al. v. Viking Industrial Security, Inc., et al., Superior Court of New Jersey, Law Division:  Somerset County, Docket Nos. SOM-L-525-07; SOM-L-1223-07.

On January 20, 2011, the Superior Court of New Jersey entered a $1.4 million judgment in this case of first impression.  The judgment is based on the 35 page written opinion in which the Court applied both New Jersey’s workers compensation fraud statute and Insurance Fraud Prevention Act to an elaborate premium fraud scheme.

 The fraud scheme …

10 Ellicott Court Corp. v. Mountain Valley Indemnity Corp.  (2nd Cir. December 23, 2010)

In 10 Ellicott Square Court Corp. v. Mountain Valley Indemnity Company, the Second Circuit noted the divergence between New York’s Appellate Divisions regarding whether a Certificate of Insurance can create coverage.  In the First and Second Departments, courts have held that Certificates of Insurance are insufficient standing alone to provide a basis for estoppel.  The Third and Fourth Departments have held that where a party seeking coverage reasonably relied on a …

National Union Fire Ins. Co. v. Vicino Drywall (S.D. Florida, November 29, 2010)

On Monday, November 29, 2010, Judge Alan Gold of the U.S. District Court for the Southern District of Florida, issued an order dismissing a suit brought by an insurer that asked the court to declare the insurer has no duty to defend or indemnify defendant policyholder and two other companies in 17 lawsuits over allegedly defective Chinese drywall.

Plaintiff insurer issued three umbrella insurance policies, which provided excess coverage, to the defendants.  …