News & Analysis as of

Bad Faith Duty to Defend

West Virginia Supreme Court: Bad Faith Claims Are Premature when the Insurer Is Providing a Defense

by Cozen O'Connor on

The West Virginia Supreme Court recently granted an insurer the extraordinary legal remedy of a writ of prohibition, awarding it an immediate dismissal of the insureds’ bad faith claims. State ex rel. Universal Underwriters...more

Absolute Pollution Exclusion—Not So Absolute

by Perkins Coie on

Slapping insurers with breach of contract and bad faith, Washington state’s highest court recently found that a general liability policy’s so-called “absolute” pollution exclusion may not be so absolute. In Xia et al. v....more

Washington Supreme Court Applies Efficient Proximate Cause Test to Pollution Exclusion

In its recent decision in Xia v. ProBuilders Specialty Ins. Co. RRG, 2017 Wash. LEXIS 443 (Wash. Apr. 27, 2017), the Supreme Court of Washington had occasion to address the concept of efficient proximate cause as it relates...more

Pennsylvania Federal District Court: Insurer’s Reliance on “Reasonable” Interpretation of Law Does Not Automatically Bar Bad Faith

by Cozen O'Connor on

On March 13, 2017, the United States District Court, Eastern District of Pennsylvania, rejected the argument that an insurer does not act in bad faith if it relies on a reasonable interpretation of unsettled case law. The...more

South Carolina Federal District Court: Insurer May Act in Bad Faith by Considering Extrinsic Evidence to Deny Duty to Defend

by Cozen O'Connor on

On February 6, 2017, the United States District Court, District of South Carolina, found a genuine dispute of material fact existed as to whether a Roofing Limitation Endorsement in a liability policy barred the insurer’s...more

Federal Court Holds California Insurance Code Bars Duty to Defend Against False Claims Act Violations

by Carlton Fields on

The Central District of California held that Section 533 of the Insurance Code eliminated any potential for coverage for suit under the state False Claims Act. On January 4, the U.S. District Court for the Central...more

Missouri Supreme Court Addresses Insurer Intervention, Garnishment Proceedings and Bad Faith Findings

by Williams Venker & Sanders on

Allen v. Bryers and Atain Specialty Insurance Company, — S.W.3d —, 2016 WL 7378560 (Mo. banc, December 20, 2016) In a recent opinion, the Missouri Supreme Court addressed the timing for an insurer’s intervention in a...more

Wisconsin Supreme Court Reaffirms Four-Corners Rule for Insurers’ Duty to Defend

by Foley & Lardner LLP on

An insurer’s decision whether to defend a lawsuit against its insured can be a critical issue involving tens of thousands, if not millions, of dollars for Wisconsin companies who are sued. The Wisconsin Supreme Court recently...more

Insurers Beware: Defending Bad Faith Claim May Lead to Waiver of Privileged Communications

by Cozen O'Connor on

On July 27, 2016, the United States District Court for South Carolina ordered an insurer to turn over its privileged communications. The Court explained that the insurer waived the protections afforded under the...more

Policyholder’s Bad Faith Claim Against Cyber-Insurer Survives Summary Judgment

In follow up on an older entry, the Court in Travelers Prop. Cas. Co. of Am. V. Fed. Recovery Servs., recently issued another order granting partial summary judgment in favor of a cyber-insurer, but also allowed the bad faith...more

Insurance Recovery Law - January 2016

Despite Finding Policy Application Misrepresentation, Jury Rules Against Policy Rescission - Why it matters: A federal jury concluded that Starr Surplus Lines Insurance Company did not have a valid basis to rescind the...more

Insurance Coverage – Bad Faith – Duty to Defend Multiple Policies

by Low, Ball & Lynch on

21st Century Insurance Co. v. The Superior Court of San Bernardino County - Court of Appeal, Fourth District (September 10, 2015) - Typically, where an insurer is defending an action, it is not bound by any...more

Insurance Recovery Law - October 2015

Unfair Trade Practices Exclusion Doesn't Cover Consumer Protection Suits - Why it matters: An unfair trade practices clause did not bar coverage for a policyholder's subsidiary, an Illinois federal court ruled, ordering...more

Pennsylvania Supreme Court allows insured to settle without consent of insurer defending under reservation of rights

by Dentons on

Bad faith claims can have major consequences for insurers. Stopping the Setup gets into the minds of plaintiffs' lawyers and addresses the ways they try to create bad-faith claims against insurance companies. This overview...more

Insurance Recovery Law - August 2015 #2

Good News for Corporate Policyholders: Insurer Cannot Refuse Coverage Based on Insured's Assignment of Rights Under Policies After Loss Has Occurred - Why it matters: Reversing its holding in a 2003 case, the Supreme...more

Insurance Recovery Law - August 2015

Insured's Notice to Broker Satisfied Policy Requirements, Illinois Court Rules - Why it matters: An insured's notice to its broker satisfied the policy's notice requirements, an Illinois appellate panel recently...more

For “At-Issue Waiver,” The Best Defense May Not Be An Affirmative Defense

by Carlton Fields on

As this blog has repeatedly documented, it can be hard for insurers to assert the attorney-client privilege in the context of bad faith litigation. One difficulty arises in states that enforce a presumption against the...more

Duty to Cooperate Ruling Narrows Insurers’ Ability to Foreclose Coverage for Settled Class Action Claims

Insurance policies typically include a cooperation clause, which requires the insured to cooperate with the insurer in the defense of a covered claim. Insurers routinely use this clause as a sword against their insureds by...more

Perspectives on Insurance Recovery

Welcome to the latest edition of Pillsbury’s Perspectives on Insurance Recovery. As this 2015 edition of Perspectives demonstrates, our team is working on the most challenging issues—from cyber-insurance and complex claims...more

Insurance Recovery Law - July 2015 #2

California Court: Rejected Demand Within Policy Limits Not Necessary for Bad Faith Claim - Why it matters: Insurers must proceed with caution when they become aware that a settlement within policy limits is possible,...more

Business Litigation Reporter - May 2015

by Goodwin on

Lawsuit Dismissed Where Defendant Hulu Did Not “Knowingly” Disclose Personal Identifying Information. In In re: Hulu Privacy Litigation, 2015 WL 1503506 (N.D. Cal. March 31, 2015), the plaintiffs alleged that Hulu had...more

A Delayed Defense is a Waiver of Civil Code Section 2860

by Nossaman LLP on

When presented with a lawsuit potentially seeking covered damages, a liability insurer owes a duty to defend and is faced with three options:1) tender the defense unconditionally and therefore control the defense, including...more

Western District of Washington: Insured That Violated Duties of Notice and Cooperation Could Not Make Out Claim for Bad Faith...

Granite State Ins. Co. v. Integrity Structures, LLC, No. C14-5085BHS, 2015 WL 136006 (W.D. Wash. Jan. 9, 2015). The U.S. District Court for the Western District of Washington held that an insurer did not act in bad faith...more

New York Court Dismisses Bad Faith Cause of Action

In its recent decision in Spandex House, Inc. v. Travelers Property Cas. Co. of America, Inc., 2015 U.S. Dist. LEXIS 14667 (S.D.N.Y. Feb. 6, 2015), the United States District Court for the Southern District of New York had...more

Insurance Client Alert: Denial of Summary Judgment Does Not Automatically Establish Duty to Defend

In McMillin Companies v. American Safety Indemnity (No. D063586, filed 1/20/15), a California appeals court ruled that an insurer's loss of a summary judgment motion on the duty to defend does not necessarily establish that a...more

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