Justia Civil Procedure Opinion Summaries

Petitioners Infinity Select Insurance Company and Infinity Property and Casualty Corporation (collectively, Infinity) are named Defendants in a pending action (the instant lawsuit). The instant lawsuit stems from an earlier 2013 case (the prior action) in which plaintiffs sued Infinity’s insured for negligence and wrongful death in connection with a three-vehicle collision (the collision). In August 2022, the court issued its ruling. The primary effect of the ruling was to reform the Infinity policy to provide greater bodily injury policy limits of $750,000. Per its terms, the ruling “establishes the policy limits for the jury’s consideration in the upcoming jury trial on the remaining causes of action” including plaintiffs’ cause of action against Infinity for bad faith breach of the implied covenant of good faith and fair dealing due to Infinity’s rejection of plaintiffs’ Code of Civil Procedure section 998 demand of $750,000. Infinity filed a petition for a writ of mandate challenging the subject ruling.   The Fifth Appellate District concluded that the trial court erred in reforming the Infinity policy. The court held that the motor carrier of property—not the insurer—bears ultimate responsibility for meeting the requirements necessary to obtain a motor carrier permit. Moreover, even where an insurer intends to issue and certify a policy under section 34631.5, it is not obligated to issue the policy in the full amount of $750,000. Additionally, the court wrote evidence of insurance is not the only means of complying with the MCPPA financial responsibility requirements and infinity was under no duty to determine whether the insured had otherwise complied with MCPPA requirements. View "Infinity Select Ins. Co. v. Super. Ct." on Justia Law

Plaintiff Gene Moran, who was a patient at Huntington Beach Hospital (the Hospital) three times in 2013, sued defendants Prime Healthcare Management, Inc., Prime Healthcare Huntington Beach, LLC, Prime Healthcare Services, Inc., and Prime Healthcare Foundation, Inc. (collectively defendants) under various theories in 2013. In a prior opinion, the Court of Appeal found that while most of Moran’s claims lacked merit, he had sufficiently alleged facts supporting standing to claim the amount that self-pay patients were charged was unconscionable, and reversed the trial court’s dismissal of the case. Moran’s sixth amended complaint included both the allegations regarding unconscionability and a new theory of the case: defendants had violated the Unfair Competition Law (UCL), and the Consumer Legal Remedies Act (CLRA) by failing to disclose Evaluation and Management (EMS) fees charged in the emergency room through signage or other methods. The complaint sought relief under both the old and new theories for violations of the UCL, CLRA, and for declaratory relief. Defendants moved to strike the allegations regarding EMS fees, arguing their disclosure obligations were defined by statute. The trial court agreed and struck the allegations from the sixth amended complaint. Finding no reversible error in that decision, the Court of Appeal affirmed. View "Moran v. Prime Healthcare Management, Inc." on Justia Law

Following a shooting at a bar in downtown St. Louis, Missouri, Plaintiff, who was injured as a bystander, obtained a $2.5 million judgment against the bar’s owner and operator, Steven Scaglione. Plaintiff thereafter filed this equitable-garnishment claim against Scaglione and his insurer, Acceptance Indemnity Insurance Company (Acceptance). Scaglione filed cross-claims against Acceptance, alleging that it had, in bad faith, failed to defend or indemnify him and breached its fiduciary duty. Acceptance filed motions to dismiss both Plaintiff’s and Scaglione’s claims, which the district court granted based on the applicability of an assault-and-battery exclusion in Scaglione’s policy. In this consolidated appeal, both Plaintiff and Scaglione assert that the district court erred in dismissing their claims. 
 The Eighth Circuit affirmed. The court explained that the district court did not suggest that the assault-and-battery exclusion did not apply solely because the purported victim was not the target. Accordingly, the court rejected this argument and concluded that the unambiguous policy language covers claims of injuries sustained by innocent bystanders arising out of an assault and battery. The court thus concluded that the policy exclusion applies. Further, the court concluded that Scaglione’s negligence was not independent and distinct from the excluded assault and battery. The court explained that the concurrent-proximate-cause rule thus does not apply, and, therefore, the exclusion bars coverage under the policy. Without coverage, Plaintiff and Scaglione cannot state a claim. The district court thus did not err in granting the motions to dismiss. View "Steven Scaglione v. Acceptance Indemnity Ins Co" on Justia Law

Copart of Connecticut, Inc. (“Copart”) is a subsidiary of Copart, Inc., an online car-auction company that sells used, wholesale, and repairable vehicles. Copart owns several parcels of land in Lexington County, South Carolina, on which it operates “machine salvage junkyard and vehicle wash facilities.” This appeal concerns whether Copart’s insurer must defend or indemnify Copart with respect to a lawsuit filed against it in South Carolina Defendant Copart of Connecticut appealed the district court’s grant of summary judgment in favor of Plaintiffs Liberty Mutual Fire Insurance Company and Liberty Insurance Corporation.   The Fifth Circuit affirmed summary judgment as to Liberty’s duty to defend Copart in the Underlying Suit. The court reversed summary judgment as to Liberty’s duty to indemnify Copart with respect to the Underlying Suit and remanded to the district court for further proceedings to determine Liberty’s indemnity obligation, if any. The court explained that the duty to defend is negated here because the Livingston Plaintiffs only allege damage caused, either in whole or in part, by pollutants. But evidence arising from or related to the Underlying Suit may reveal that non-pollutants caused Plaintiffs’ damage. If, for example, relevant evidence shows that the plaintiffs’ “cloudy water” was caused only by sand and sediment, then the pollution exclusion may not apply. If this were so, Liberty may be obligated to indemnify Copart. View "Liberty Mutual Fire Ins v. Copart of CT" on Justia Law

This appeal arises out of a commercial property insurance policy (“Policy”) that Oregon Clinic, P.C. (“Oregon Clinic”) purchased from Fireman’s Fund Insurance Company (“Fireman’s Fund”). The Policy provides Oregon Clinic, a medical provider with more than fifty locations in Oregon, with coverage for a reduction of business income only if its insured property suffers “direct physical loss or damage.” In March 2020, after the COVID-19 pandemic began, Oregon Clinic, like hundreds of other insured businesses nationwide, sought coverage under its Policy. It alleged that it suffered “direct physical loss or damage” because of the COVID-19 pandemic and related governmental orders that prevented it from fully making use of its insured property. Fireman’s Fund denied coverage. Oregon Clinic then sued Fireman’s Fund in the United States District Court for the District of Oregon. At Oregon Clinic’s request, the Ninth Circuit certified to the Oregon Supreme Court the interpretation of “direct physical loss or damage” under Oregon law and stayed proceedings. The Oregon Supreme Court declined the certification request.   The Ninth Circuit affirmed the district court’s dismissal. The panel held that the Oregon Supreme Court would interpret “direct physical loss or damage” to require physical alteration of property, consistent with the interpretation reached by most courts nationwide. Because Oregon Clinic failed to state a claim under this interpretation and because the amendment would be futile, the panel affirmed the district court’s judgment. View "THE OREGON CLINIC, PC V. FIREMAN'S FUND INS. CO." on Justia Law

For many years, Zurn, a manufacturer of plumbing products and accessories, has faced multiple lawsuits in which claimants allege bodily injury or wrongful death caused by asbestos in its products. To cover litigation costs, Zurn used various insurance policies issued by various insurance companies. Eventually, Zurn was told by its primary and umbrella insurers that Zurn had exhausted the limits of liability under those policies. When Zurn’s excess policy insurers refused to pay, Zurn sought a declaratory judgment that it had exhausted the limits of liability under its primary and umbrella policies and that Zurn’s excess policy insurers had a duty to defend and pay defense costs in the underlying asbestos suits. After discovery, the district court interpreted the meaning of various primary, umbrella, and excess policies, and determined the scope of some duties insurers have under them.One excess policy insurer—American Home—appealed several partial summary judgment orders. The Third Circuit dismissed the appeal for lack of jurisdiction. American Home does not challenge orders that are functionally equivalent to an injunction, No part of the declaration-granting orders compels American Home “to undertake the defense” of Zurn. View "Zurn Industries Inc v. Allstate Insurance Co" on Justia Law

A healthcare provider contended it was underpaid for substance abuse treatment that it rendered to 29 patients. Seeking to recover the difference directly from the insurance company, the provider filed suit alleging the insurer entered into binding payment agreements during verification of benefits and authorization calls with the provider and otherwise misrepresented or concealed the amounts it would pay for treatment. The trial court entered summary judgment against the provider. After review, the Court of Appeal concluded the court did not err in determining one or more elements of the provider’s causes of action could not be established. View "Aton Center v. United Healthcare Ins. Co." on Justia Law

In 2007, Defendant PHL Variable Insurance Company issued two life-insurance policies to Plaintiff Catholic Charities of Southwest Kansas, Inc. on the lives of Elwyn Liebl and John Killeen. Both policies guaranteed Plaintiff, as their named beneficiary, $400,000 upon the insureds’ death. Between 2013 and 2014, Defendant sent Plaintiff grace notices for both policies and demanded premium payments. Plaintiff believed the demanded premium payments were too high and that the grace notices were defective and untimely under the policies. So Plaintiff did not pay the requested premiums. Because Plaintiff did not pay the requested premiums, Defendant sent cancellation notices, informing Plaintiff that both policies had lapsed. In 2016, the insureds died. Plaintiff sought payment of benefits under both policies. Defendant declined, believing that it terminated Plaintiff’s policies for nonpayment of premiums two to three years earlier. In 2020, Plaintiff sued Defendant in the District of Kansas for failure to pay the death benefits under both policies. Defendant moved to dismiss both claims, arguing that Kansas’s five-year statute of limitations for breach of contract actions bars them. According to Defendant, the statute of limitations began to run in 2013 and 2014 when it informed Plaintiff that it was terminating the policies. In response, Plaintiff asserted that Defendant first breached both insurance contracts when it failed to pay the benefits upon the insureds’ death in 2016 because Defendant never successfully terminated the policies. The district court agreed with Defendant and dismissed Plaintiff’s claims as untimely. The appeal this case presented for the Tenth Circuit's review centered on a question of when the statute of limitations for a breach of contract claim alleging the wrongful termination of a life insurance contract began to run under Kansas law: if the limitations period began when Defendant acted to terminate Plaintiff’s policies, the district court correctly dismissed Plaintiff’s complaint; if the limitations period began when Plaintiff’s death benefits became due, the district court erred. Finding the district court did not err in dismissing Plaintiff's claims, the Tenth Circuit affirmed. View "Catholic Charities of Southwest Kansas v. PHL Variable Insurance Company" on Justia Law

Defendant Union Mutual Fire Insurance Company appealed a superior court grant of summary judgment to plaintiff CC 145 Main, LLC, in a declaratory judgment action regarding the interpretation of an insurance policy exclusion. CC 145 Main owned an apartment building and purchased a “Businessowners Coverage” insurance policy that included “all risk” property insurance, which provided that Union Mutual would “pay for direct physical loss of or damage to” the covered property, unless coverage was specifically limited or excluded by the policy. The insured property sustained damage when a tenant poured cat litter down a toilet, clogging an interior pipe and causing water to overflow from a shower and toilet. The property required significant cleaning and repair, and tenants were required to temporarily relocate. CC 145 Main filed a claim with Union Mutual for water damage, which Union Mutual denied pursuant to a provision in the insurance policy excluding coverage for damage caused by “[w]ater that backs up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump or related equipment.” CC 145 Main filed a complaint seeking a declaration that the water exclusion does not apply to its claim. Union Mutual filed a motion for summary judgment, arguing that the damage at issue was caused by water that overflowed from “drains” within the meaning of the exclusion. The trial court concluded it was unclear whether the word “drain” in the water exclusion applied to shower and toilet drains and, therefore, the water exclusion was ambiguous and had to be construed in favor of CC 145 Main. Defendant challenged the trial court’s ruling that the policy’s water damage exclusion was ambiguous and its decision to construe the policy, therefore, in favor of CC 145 Main. But finding no reversible error, the New Hampshire Supreme Court affirmed the trial court. View "CC 145 Main, LLC v. Union Mutual Fire Insurance Company" on Justia Law

The Bert Company, dba Northwest Insurance Services (“Northwest”), was an insurance brokerage firm with clientele in northwestern Pennsylvania and western New York. From 2005 to 2017, Matthew Turk (“Turk”) was employed as an insurance broker with Northwest. First National Insurance Agency, LLC (“FNIA” or "First National") was an insurance brokerage firm. To grow its business in that region, First National developed a plan to takeover Northwest, initially by convincing key Northwest employees to leave Northwest for FNIA and to bring their clients with them. Through the fall and winter of 2016, Turk repeatedly met with First National about the plan with the hope that First National could gut Northwest by hiring the bulk of its highest producers, acquiring their clients, and ultimately forcing that company to sell its remaining book of clients. Pursuant to the plan, Turk remained at Northwest to convince the company to sell its remaining business to First National. Northwest refused, choosing instead to fire Turk and initiate legal action. In this appeal by permission, the Pennsylvania Supreme Court opined on the jurisprudence of the United State Supreme Court addressing the constitutionality of an award of punitive damages by a civil jury in the Commonwealth. The Pennsylvania Court's grant of allowance addressed the narrow issue of the appropriate ratio calculation measuring the relationship between the amount of punitive damages awarded against multiple defendants who are joint tortfeasors and the compensatory damages awarded. The superior court calculated the punitive to compensatory damages ratio using a per-defendant approach, rather than a per-judgment approach. The Pennsylvania Supreme Court generally endorsed the per-defendant approach as consistent with federal constitutional principles that require consideration of a defendant’s due process rights. Further, the Court concluded that under the facts and circumstances of this case, it was appropriate to consider the potential harm that was likely to occur from the concerted conduct of the defendants in determining whether the measure of punishment was both reasonable and proportionate. View "The Bert Company v. Turk, et al." on Justia Law