A federal district court in Virginia recently ruled that under Virginia law, an insured may not recover punitive damages in connection with a bad faith claim against its insurer. TIG Insurance Co. v. Alfa Laval, Inc., Civil Action No. 3:07CV683 (E.D.Va., March 5, 2008). The court explained that under Virginia law, a bad faith action against an insurer is a contract action, not an independent, willful tort for which punitive damages might be appropriate.
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United States
Auction Rate Securities Update: New York Attorney General Issues Subpoenas To 18 Firms
In the latest development arising from recent concerns regarding auction rate securities, the New York Attorney General has reportedly launched a wide-ranging criminal investigation by serving subpoenas on 18 firms, including UBS AG, Citigroup, Inc., Merrill Lynch & Co., J.P. Morgan Chase & Co. and Goldman Sachs Group, Inc. …
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Connecticut Act Concerning an Insured’s Right to Choose Auto Repairer
By Troutman Pepper Locke on
The Connecticut General Assembly’s transportation committee has recently approved Senate Bill 288 (the “Bill”), which prohibits auto insurers from recommending, requesting or requiring policyholders use certain auto repair facilities. The Bill also prohibits insurers from providing economic advantages to policyholders on the basis that they use certain facilities. …
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Doug Ommen Nominated to Missouri Administrative Hearing Commission
By Troutman Pepper Locke on
Posted in Regulatory, United States
Yesterday, Missouri Governor, Matt Blunt, nominated Doug Ommen to the state’s Administrative Hearing Commission (the “Commission”). The Commission is a neutral, independent, administrative tribunal. The Commission hears cases that are appeals from decisions of other Missouri agencies, as well as cases that an agency or private person brings before the Commission.
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Ninth Circuit Applies Tellabs
By Troutman Pepper Locke on
Posted in D&O Liability, United States
In In re Sketchers U.S.A., Inc. Securities Litigation, 05cv55980 (9th Cir. April 10, 2008), the Ninth Circuit applied the recent U.S. Supreme Court decision Tellabs, Inc. v. Makor Issues & Rights Ltd., 551 U.S. ___, 127 S.Ct. 2499 (2007) and found that plaintiffs failed to plead scienter, as required by the PSLRA.
Louisiana Supreme Court Overturns Prior State Court Decision and Holds that Insurer’s Flood Exclusion is Unambiguous
By Troutman Pepper Locke on
The Supreme Court of Louisiana recently overturned a Katrina-related Louisiana state appellate court decision, and held that an insurer’s flood exclusion was not ambiguous and that coverage could be denied for water damage sustained to an insured’s property on the basis of this exclusion.
Iowa Adopts STOLI Legislation
By Troutman Pepper Locke on
Last week, the Iowa Senate unanimously voted (49-0) to pass Senate File 2392 as amended by the Iowa House which, if signed by the Governor, would revise Iowa’s viatical settlements act to address stranger originated life insurance (“STOLI”) transactions.
Examining Proposals on Insurance Regulatory Reform
On April 16, 2008, the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises held a hearing on proposals on insurance regulatory reform. …
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Fifth Circuit Reverses Katrina Award Against State Farm
By Troutman Pepper Locke on
The Fifth Circuit recently reversed a January 2007 federal district court decision, Broussard v. State Farm, in which Mississippi policyholders, whose home was destroyed by Hurricane Katrina, had been awarded their policy limits and $ 1 million in punitive damages against State Farm. …
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U.S. House Bill Aims to Expand Commercial Property Insurance Options for Members of Risk Retention and Risk Purchasing Groups
United States House Representatives Dennis Moore (D-Kansas) and Deborah Pryce (R-Ohio) have recently introduced H.R. 5792, the Increasing Insurance Coverage Options for Consumers Act of 2008 (the “IICO Act”). …
Read More U.S. House Bill Aims to Expand Commercial Property Insurance Options for Members of Risk Retention and Risk Purchasing Groups