CM Report of Recent Decisions – 2022 Volume 3

SIDEBAR – Nuclear Verdicts Are Becoming Thermonuclear Verdicts: A Suggestion For Combatting Them

Some commentators have defined a “nuclear verdict” as a verdict of $10 million or greater. Based upon recent verdicts, however, that definition may need changing.

If At First You Don’t Succeed On A Post-Trial Motion—Take An Appeal! More Tales From The Minefield Of Post-Trial And Appellate Practice

The Seventh Circuit’s recent decision in Word Seed Church & Civil Liberties for Urban Believers v. Homewood, 43 F.4th 688 (7th Cir. 2022), again shows why only experienced appellate advocates should navigate the minefield of post-trial and appellate litigation.

Texas Appeals Court Determines Flood Limit Does Not Cap Insured’s Claim For Loss Of Business Income

A three-judge panel for the Texas Fourteenth Court of Appeals recently held that the $4.5 million dollar limit for flood damage in a commercial insurance policy did not limit the insured from seeking loss of business income. Hanover Casualty Co. v. Seven Acres Jewish Care Services Inc., No. 14-20-00736-CV, 2022 Tex. App. LEXIS 6288.

Update: Insurers Continue To Succeed On Appeal On COVID-19 Property Claims

The body of federal and state appellate precedent keeps growing, with nearly every appellate tribunal holding that there is no property insurance coverage for pandemic related economic losses in the absence of physical loss or damage.

New York Court Of Appeals Addresses The Meaning Of “Penalty Imposed By Law” Under Wrongful Act Professional Liability Policy

J.P. Morgan Securities Inc. v. Vigilant Insurance Co., 182 N.E.3d 443 (2021), involves a dispute between insured securities broker-dealers Bear Stearns and certain of its excess insurers (“Excess Insurers”) regarding the availability of coverage under a wrongful act professional liability policy for funds disgorged from the insured as part of a settlement with the Securities and Exchange Commission (“SEC”). In a reversal, the New York Court of Appeals held that the $140 million disgorgement for which Bear Stearns sought coverage was not excluded as a “penalty imposed by law” under the policies at issue.

Insured Not Liable For Declining To Settle Within Its Self-insured Retention

When a primary liability insurer declines to settle a claim on behalf of its insured within the insurer’s policy limit, and a judgment later is entered against the insured for an amount in excess of the policy limit, a question may arise whether the insurer’s failure to settle was in good faith.

Illinois Appellate Court Strays From Established Faulty Construction Precedent To Find A Duty To Defend Vague Allegations Of Damage To “Other Property” In Acuity v. M/I Homes Chi, LLC

Illinois has consistently required damage to property other than repair and replacement of faulty construction to implicate coverage under a commercial general liability policy. The basis for doing so is rooted in the insuring language of the typical CGL policy that limits coverage to “property damage” caused by an “occurrence” in the policy period. The concept is best explained by the Illinois Supreme Court in Travelers Ins. Co. v. Eljer, that finding coverage for the cost of replacing or repairing defective work would transform the policy into something akin to a performance bond.

Free Bite? Maybe Not: Expanded Liability For Dog Bites   

You can’t help but love ’em. Dogs. Our relationship with these descendants of the gray wolf is unlike that with any other animal. To many people, they are like people—even like family. Maybe it’s because they’ll let you hug them. Maybe it is because they don’t talk back. Whatever the reason, people want them. Just look out the window and notice how many owners are walking multiple dogs. They’re everywhere, even in stores and shopping malls.