California Insurance Litigation Blog

After much anticipation, last week the Supreme Court of California heard oral arguments in the pivotal case of Yanting Zhang v. California Insurance Co., S178542 on May 8, 2013.  This case looks to have a substantial impact on insurance litigation in California and could open up another significant avenue for insureds to pursue claims against their insurance companies.  The key issue in Zhang is under what circumstances may an insured bring a cause of action against an insurer under the “Unfair Competition Law” (Bus. & Prof. Code, section 17200 or “UCL”).  Specifically, the issues on review by the Supreme Court are: (1) Can an insured bring a cause of action against its insurer under the unfair competition law (Bus. & Prof. Code section 17200) based on allegations that the insurer misrepresents and falsely advertises that it will promptly and properly pay covered claims when it has no intention of doing so? (2) Does Moradi-Shalal v. Fireman's Fund Ins. Companies 46 Cal.3d 287 (1988) bar such an action?  Based on the Court’s questions during the oral arguments, as they were reported in the Los Angeles Daily Journal, it appears that the Supreme Court may be on the verge of ruling in favor of the Plaintiff in Zhang and thereby substantially broadening the scope of potential claims available to insured.

The Wednesday May 1, 2013 edition of the Los Angeles Daily Journal featured Robert McKennon and Victor Xu’s article entitled:  “Insurance Brokers’ Duties to Third Parties Continue to Shrink.”  In it, Mr. McKennon and Mr. Xu discuss how a new appellate decision- Travelers Property Co. of America v. Superior Court 2013 DJDAR 5005 (Cal. App. 2d Dist. 2013)- clarifies and limits the duties owed by insurance brokers to third-party claimants.  The article discusses how in Travelers, the court specifically addressed the holding in Nowlon v. Koram Insurance Center, Inc., 1 Cal.App.4th 1437 (1991) and limited the holding in that case to the unique circumstances of negligence per se.  The article also discusses how Travelers does not foreclose the possibility of other types of breach of professional duty claims by third-parties against brokers, especially where the harm was reasonably foreseeable.  The article is posted below with the permission of the Daily Journal.

The McKennon Law Group PC periodically publishes articles on its California Insurance Litigation Blog that deal with frequently asked questions in the insurance bad faith and ERISA area of the law.  This is another such article in that series.

If an insurance company has unfairly denied an insured’s disability benefits or has otherwise committed bad faith, an insured may be entitled to substantial compensation for harm that the insured has suffered.  In fact, not only may an insured seek payment of all the unpaid benefits, but the insured can also sue for future policy benefits, among other damages.

The McKennon Law Group PC periodically publishes articles on its California Insurance Litigation Blog that deals with frequently asked questions in the insurance bad faith and ERISA area of the law.  This is another such article in that series.

McKennon Law Group PC is proud to announce that its founding partner, Robert J. McKennon, has been recognized as one of Southern California’s "Super Lawyers" for Insurance Coverage and will appear in the upcoming 2013 edition of Southern California Super Lawyers magazine as well as the Los Angeles and Orange Coast Magazines.

Each year, Super Lawyers magazine, which is published in all 50 states and reaches more than 13 million readers, names attorneys in each state who attain a high degree of peer recognition and professional achievement.  The Super Lawyer designation is given to less than 5% of  lawyers nationally after being nominated and voted on by their peers.  Mr. McKennon also received this Southern California Super Lawyer designation in 2011 and 2012.