Daily Archives: August 24, 2017

Ninth Circuit Grants a Small Reprieve to the Abuse of Discretion Standard of Review, Ruling That Discretionary Language Provisions in Self-Funded ERISA Will Apply

Posted in: Abuse of Discretion, De Novo Review, Disability Insurance News, ERISA, Insurance Litigation Blog, Standard of Review August 24, 2017

When litigating ERISA-governed short-term disability, long-term disability, life and medical insurance claims, a major consideration is which “standard of review” will apply to the Court’s review of the insurer’s decision – abuse of discretion or de novo.  The de novo standard of review is more claimant friendly.  When applying the abuse of discretion standard of review, the Court is required to give some deference to the insurer’s decision.  Under the de novo standard of review, the Court does not give any deference to the insurer’s decision, but simply makes a determination as to whether available evidence establishes that the insured was disabled under the terms of the Plan.

The abuse of discretion standard of review, which is friendlier to insurers, …

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High Court Changes Cumis Landscape

Posted in: Attorneys Fees, Attorneys' Fees, Case Updates, Duty to Defend, General Liablity August 24, 2017

We all know the maxim that “bad facts make bad law.”  Two years after J.R. Marketing, LLC prevailed in the Court of Appeal concerning its dispute with its commercial general liability insurer, Hartford, it ran out of luck before the California Supreme Court in its fight over important Cumis counsel issues.  Hartford Cas. Ins. Co. v. J.R. Marketing, LLC, 190 Cal. Rptr. 3d 599, 2015 DJDAR 9111 (Cal. Aug. 10, 2015).  This is a must read for every lawyer in California that acts as Cumis counsel.

The High Court held an insurance company can sue independent counsel (i.e., Cumis counsel) directly for reimbursement of unreasonable or unnecessary legal charges counsel billed it to defend its insured.  This …

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