Texas Insurance Law Newsbrief - August 8, 2011

No Extra-Contractual Recovery for AFS/IBEX against Great American in Crime Policy Coverage Fight

Recently, in Great Am. Ins. Co. v. AFS/IBEX Fin. Servs. Inc., C.A. No. 3:07–CV–924–O, 2011 WL 3163605 (S.D. Tex. July 27, 2011) (O’Connor, J.), U.S. District Court Judge Reed O’Connor granted summary judgment in favor of Great American Insurance Company (“GAIC”) on the claims of bad faith and violations of Chapter 541 of the Texas insurance Code brought by its insured, AFS/IBEX Financial Services, Inc. (“AFS”).

American Auto Center Loses Coverage Bid against Gemini Insurance for Cars Flooded by Hurricane Ike

Last week, in Gemini Ins. Co. v. Hayssam Allaov, C.A. No. H–10–3413, 2011 WL 3323120 (S.D. Tex. Aug. 2, 2011) (Rosenthal, J.), U.S. District Court Judge Lee Rosenthal granted summary judgment in favor of Gemini Insurance Company in a declaratory judgment action brought against Gemini’s insured, Hayssam Allaou d/b/a American Auto Center (“AAC”).

Workers Compensation Carrier Must Pay Proportionate Share of Litigation Costs on Subrogation Recovery from Settlement Proceeds from Tortfeaser

Also last week, in Morales v. Michelin N. Am., Inc., – S.W.3d –, 2011 WL 3328792 (Tex.App. – San Antonio Aug. 3, 2011, no pet. h.), the court of appeals in San Antonio modified a judgment to reduce a workers compensation carrier’s subrogation recovery of settlement proceeds from third parties by a proportionate share of the worker’s litigation expenses.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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