Insurance lawyers can tell a client that proper pleadings, especially in Federal Court, are essential to being able to have a day in Court.  This is illustrated in a 2020, opinion from the Eastern District of Texas, Sherman Division.  It is styled, Albion Investments, Inc. v. Travelers Casualty Insurance Company of America.

Albion owned property that was insured by Travelers insurance.  Albion filed a claim with Travelers for property damage after a storm struck the property with hail and high winds.  The claim was ultimately denied based on the amount of damages falling below the deductible of the policy.

Albion filed suit alleging that Travelers did not conduct a thorough investigation of the claim, failed to account for all of the damages covered, failed to fairly evaluate and adjust the claim, failed to perform its contractual duty to compensate Albion under the policy, made misrepresentations to Albion regarding the damages to the Property and whether it was covered, failed to make an attempt to settle the claim in a prompt and fair manner, and failed to explain why full payment was not being made.

Here is a case that may apply to many of the rural areas of Texas.  The case is a 2020, opinion from the Corpus Christi Court of Appeals and is styled, State Farm Mutual Insurance Company v. Rolando Lopez, Individually and Rolando Lopez D/B/A R&A Transport.

This is an appeal of a summary judgment in favor of Lopez and against State Farm.  This Court reversed the trial court and rendered judgment in favor of State Farm.

The main point of this case is the interpretation of the words “in use” in the commercial policy at issue.  The policy provides in part:

Here is a claims denial opinion worth reading.  It is a 2020 opinion from the Northern District of Texas, Dallas Division.  It is styled, DFWS, LLC v. Atlantic Casualty Insurance Company.

Atlantic insured DFWS.  DFWS alleges it suffered damages as the result of a tornado and high winds.  After making a claim for damages, DFWS alleges that Atlantic “engaged in a results-based investigation to find a non-covered cause of loss to the detriment of DFWS and contrary to the clear evidence otherwise.”

The resulting lawsuit sued for violations of Texas Insurance Code, Sections 541.060(a)(1), (2), (3), (4), and (7).  Atlantic files a Rule 12(b)(6) motion to dismiss in response to the lawsuit.

Here is an opinion from the Northern District of Texas, Dallas Division, that discusses the pleadings in a lawsuit where in the property owner claims to have suffered hail damage and the insurer denied the claim.  The opinion is styled, Valtex Properties LLC v. Central Mutual Insurance Company.

The insured, ValTex, sued Central for various violations of the Texas Insurance Code.  The allegations are that Central violated sections, 541.060(a)(1), 541.051, 541.052, and 541.061.  In response, Central filed a Rule 12(b)(6) motion to dismiss.  This blog will deal with only Section 541.060(a)(1).  However, the case is a good read on how the Court dealt with remaining Insurance Code sections.

To survive a motion to dismiss, a plaintiff must plead enough facts to state a claim to relief that is plausible on its face.  Thread bare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.  A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.  The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted unlawfully.  When well-pleaded facts fail to achieve this plausibility standard, the complaint has alleged—but it has not shown—that the pleader is entitled to relief.

The Employee Retirement Income Security Act of 1974 (ERISA) offers many of the same types of insurance coverage for individuals as other plans.  The distinctions with ERISA is that the plan is a plan for employers to offer to employees that is set and governed by Federal Law rather than State Law.

ERISA plans offer retirement programs, life insurance, disability insurance, and health insurance.  The Southern District of Texas, Houston Division, issued an opinion in November 2020, on a case that is governed by ERISA.  The opinion is styled, Wagna Mina huerta v. Shell Oil Company and Shell Oil Comprehensive Welfare Benefits Plan.

This case discussed a couple of issues.  One of those, rarely seen in an opinion, is discussed here.

It is easy to get focused on the factual parts of a lawsuit.  In other words, what happened, who did what, who said what, etc.  As insurance lawyers, the legal aspects of the lawsuit need to be watched carefully.  This is illustrated in the November 2020, opinion styled, Tim Long Plumbing, Inc. v. Kinsale Insurance Company.  The opinion is from the Eastern District of Texas, Sherman Division.

This is an insurance claim denial lawsuit.  Plaintiff Tim Long Plumbing had a commercial general liability policy with Kinsale.  This facts of this case can be read in the opinion.  The focus of this article is on the lawsuit discovery process of this case.

Under Federal Rule of Civil Procedure 26(b)(1), parties “may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense . . . .” Relevance, for the purposes of Rule 26(b)(1), is when the request is reasonably calculated to lead to the discovery of admissible evidence.  It is well-established that control of discovery is committed to the sound discretion of the trial court.

Well, here is a case where the claim isn’t denied.  In fact it was paid.  But now the insurance company is suing the person who received the money and seeking to have the money returned.

The opinion is a 2020 opinion from the Western District of Texas, San Antonio Division, and it is styled, Metropolitan Life Insurance Company v. Lilliam Soto, Felix W. Soto.

MetLife initiated this declaratory judgment action seeking to resolve a dispute between the Soto’s.  Each assert entitlement to life insurance benefits payable under the Federal Employees’ Group Life Insurance Act (FEGLIA).  The decedent, Juan Soto, had a policy worth $350,000, which was payable on his death to his properly designated beneficiary and then, only if there was no designated beneficiary, to his wife Lilliam.

The Employee Retirement Income Security Act (ERISA) provides various kinds of insurance to employees.  The important thing for insurance lawyers to know about ERISA is that it is governed by Federal law and it preempts State law.  This is illustrated in a 2020, opinion from the Western District of Texas, San Antonio Division.  The opinion is styled, Marco Z. v. UnitedHealthcare Insurance Company, Forma Automotive, LLC.

Marco does not dispute that the health plan at issue is governed by the ERISA.  Further, it is undisputed that at the time of the incident forming the basis of this action Marco was a beneficiary of the subject ERISA health plan established and maintained by Forma Automotive and administered by UnitedHealthcare.

Marco sustained medical problems in Mexico and was forced to seek medical assistance.  Marco  assigned insurance benefits to the Hospital, which is not a network provider under the Plan.  As a non-network provider, it has no express contract with UnitedHealthcare establishing payment for medical services provided to beneficiaries of the Plan.

Virtually all insurance lawyers would like to see the “claims manual” each insurance company has made for its use.  Being able to access that claims manual is discussed in a 2020 opinion from the Northern District of Texas, Dallas Division opinion styled, Jose Chavez v. Standard Insurance Company.

Chavez had a wrist problem.  He applied for long term disability (“LTD”) benefits which Standard paid beginning September 2016.  Standard requested a medical referral in July 2017, which resulted in termination of Chavez’s LTD benefits.  During the considerable pretrial skirmishing, Chavez made a request for Standard’s “internal rules, guidelines, protocols, or other similar criterion” related to Chavez’s claim.  Standard moved for a protective order, claiming that its Claims Manual constituted a trade secret.  To avoid a discovery dispute, Standard agreed to produce the Claims Manual subject to the entry of a protective order to protect from public disclosure.  The Court entered a protective order, granting confidentiality status to the relevant documents.  Nearly two years after the parties agreed to the protective order, Chavez challenges Standard’s confidentiality designation and seeks to unseal the cover page and a 195-word excerpt from Standard’s Claims Manual.

The Fifth Circuit has made clear that the public “has a common law right to inspect and copy judicial records.”  This right promotes the trustworthiness of the judicial process, curbs judicial abuses, and provides the public with a better understanding of the judicial process, including its fairness, and serves as a check on the integrity of the system.  Even information that may not be of particular interest to the public is subject to the presumptive right of public access.  This right, however, is not absolute and merely establishes a presumption of public access to judicial records.  The Fifth Circuit has not assigned a particular weight to this presumption, nor has it interpreted this presumption as creating a burden of proof.  The cases that have recognized a common law right of access do agree that the decision as to access is one best left to the sound discretion of the trial court.  In determining whether to seal judicial records, “the court must balance the public’s common law right of access against the interests favoring nondisclosure” and consider “relevant facts and circumstances of the particular case.”

When Life Insurance claims are denied, a beneficiary should always have an insurance attorney look over the reasons for denial.  Most the time an experienced life insurance lawyer can find a way to make a recovery on the case.  But, sometimes it doesn’t work out.

An opinion form the Southern District of Texas, Houston Division, is an example where the pleadings were not sufficient to get the Court to consider coverage.  The opinion is styled, JECO Investors Partnership v. Pacific Life Insurance Company.

This is a case where a claim for life insurance benefits was denied.  The case was originally filed in State District Court and removed, by Pacific Life to Federal Court.  Pacific Life was quick to file a Motion for Judgment on the Pleadings and it was granted by the Court.  JECO then filed a Motion to Vacate Judgment and Grant Leave to Amend.  JECO’s motion was denied.

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