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Recently, a New York state court gave the New York Liquidation Bureau (“NYLB”) permission to notify more than 300,000 creditors of Union Indemnity Insurance Company (“Union Indemnity”) that it plans to make the first distribution from the insolvent property casualty insurer’s estate. …
Read More New York State Court to Determine Whether Distribution from Insolvent Union Indemnity Estate Should be Permitted

A shareholder class action suit was filed against Merrill Lynch & Co. on October 30, 2007 following an announcement by Merrill Lynch that it would have to write-down $8.4 billion in connection with mortgage-related investments. The charge for that write-down is being taken in the third-quarter of 2007. 

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Read More Shareholders File Class Action and Derivative Suits Against Merrill Lynch Over $8.4 Billion Subprime Write-Down

On Tuesday, Washington voters approved a measure to allow plaintiffs to receive treble damages from claims alleging bad faith claims handling by an insurer.   This is a marked increase from the current law that limits recoveries resulting from bad faith of an insurer to the actual damages incurred. 

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Read More Washington Voters Approve Measure to Allow Treble Damages in Insurer Bad Faith Actions

In Zurich American Ins. Co. v. The Superior Court of Los Angeles County, et al., No. B194793 (Cal. App., 2nd Dist., Oct. 11, 2007), an appellate panel reversed a lower court’s order and held that the attorney-client privilege extends to communications between an insurer’s employees regarding legal advice and strategy, even if such communications do not contain advice directly from counsel, when disclosure is reasonably necessary for the transmission of that information or to further the purpose of the legal consultation. …
Read More California Appellate Court Rejects Narrow Definition of Attorney-Client Privilege With Respect to Documents Contained in Insurer’s Claims Files

On November 8, 2007, Louisiana Attorney General Charles C. Foti, Jr. announced that his office filed a petition in New Orleans Civil District Court suit against Allstate Insurance Company, Lafayette Insurance Company, Xactware, Inc., Marshall & Swift/Boeckh, LLC, Insurance Services Office, Inc., State Farm Fire and Casualty Company, USAA Casualty Insurance Company, Farmers Insurance Exchange, Standard Fire Insurance Company and McKinsey & Company for alleged violations of the Louisiana Monopolies Act. …
Read More Louisiana AG Files State Antitrust Suit Against Insurers

In Transportation Insurance Company v. The Regency Roofing Companies, Inc., C.A. No. 05-80830 (S.D. Fla. Oct. 2, 2007), the United States District Court for the Southern District of Florida recently ruled that the “known loss” exclusion in a commercial general liability (“CGL”) policy did not preclude coverage for mold related injuries that arose from the insured’s faulty roof installation and repair. 

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Read More Federal District Court Holds “Known Loss” Exclusion Does Not Apply to Mold Damage Resulting From Faulty Roof Repair

In Encarnacion v. 20th Century Ins. Co., Nos. B179825 & 182737 (Cal. Ct. App. Sept. 27, 2007), an unreported decision, a California appeals court recently affirmed a multimillion-dollar verdict against an insurer that failed to settle the underlying suit for the $100,000 policy limit. 

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Read More California Court Affirms Multimillion-Dollar Verdict Against Insurer That Failed to Settle Underlying Case for $100,000 Policy Limit