National News: May 2018

New York tackles workplace sexual harassment issues, Florida releases updated Hurricane Irma claims statistics, and wildfires burn in Oklahoma.

Indiana

Subrogated Insurer May Be “Real Party in Interest”

The Indiana Court of Appeals reversed a trial court ruling that a subrogated insurer was not a “real party in interest” for purposes of pursuing a breach of contract claim against its insured’s tenant. In Hoosier Insurance Co. v. Riggs, the court held this type of subrogation action should be considered on a case-by-case approach, instead of there being an absolute rule, with consideration being given to the terms of the lease existing between the parties. In Hoosier, a landlord’s insurer sought to recover for fire damage allegedly caused by the defendant tenants, who were required under their lease to return the premises at the end of the lease term in as good condition as when the lease commenced, and obtain fire insurance that listed the landlord as an additional insured under the policy. The trial court dismissed the breach of contract claim, determining that a subrogated insurer was not a landlord. But the Court of Appeals said the lease needed to be considered to evaluate the parties’ intent regarding the appropriate party to bear the risk of fire loss.—From CLM Member Thomas Switzer

West Virginia

AG Files Suit Against Equifax Over Data Breach

West Virginia Attorney General Patrick Morrisey filed suit against Equifax over a 2017 data breach that exposed the personal data of 148 million consumers across the country. The lawsuit, filed in Boone County Circuit Court, alleges Equifax ignored warnings to secure its system, failed to safeguard consumer information, and stalled in notifying the public after the breach. A statement from Morrisey claims the breach put the information of over 730,000 West Virginia residents at risk. Morrisey’s suit seeks $150,000 for each security breach, $5,000 for each violation of the state’s Consumer Credit and Protection Act, and reimbursement for all fees and costs related to the state’s litigation. Morrisey’s lawsuit comes after a judge in Massachusetts rejected an Equifax motion to dismiss a lawsuit that the state’s attorney general filed in relation to the breach.—From Managing Editor Phil Gusman

Oklahoma

Wildfires Rage Across Northwest

A pair of wildfires burned hundreds of thousands of acres in northwest Oklahoma through much of April, aided by dry, windy conditions. But cooler, wetter weather toward the end of the month ultimately helped firefighters bring the blazes under control. According to the Oklahoma Forestry Services (OFS), the Rhea Fire was 100 percent contained as of April 25 after burning nearly 287,000 acres. The 34 Complex of Fires—made up of three separate fires that joined together amid high winds—was 98 percent contained after burning over 62,000 acres. News reports indicate the two fires, which began on April 12, burned within 20 miles of each other and affected over 60 residencies. Reports also indicate at least 1,100 cattle died as a result of the two fires, a number that is expected to rise as more information is gathered. As firefighters gained the upper hand late in April, OFS said in a statement, “Rain amounts have been generally under what was hoped for thus far, but will provide an extension of reduced fire danger concern.”—From Managing Editor Phil Gusman

Florida

Hurricane Irma Insured Losses Pass $8.6 Billion

Updated statistics from the Florida Office of Insurance Regulation show that insured losses from Hurricane Irma, which cut a path through the entire length of the state late this past summer, have surpassed $8.6 billion so far. Just under 771,000 of the 924,439 filed claims are for residential property. Other claim types include commercial property, private flood, and business interruption. By county, Dade saw the highest number of claims, making up 13 percent of the total. So far, 88.5 percent of all claims are closed, including 90.1 percent of residential property claims. Meanwhile, Citizens Property Insurance, Florida’s state-backed insurer, has reopened around 37 percent of its Irma claims to “allow policyholders or their representatives to provide additional information” about their claims. Jay Adams, Citizens’ chief of claims, said in a statement, “We want to reinforce to people that what we have provided them is an estimate and that estimates may change as repairs begin. The initial estimate and payment does not necessarily mean your claim has been concluded.”—From Managing Editor Phil Gusman

Pennsylvania

Supreme Court Considers Data Breach Liability

In Dittman v. UPMC, Pennsylvania’s highest court heard arguments in April to decide the question of whether an employer should face potential liability for a data breach involving the personal information of its employees. The appeal stemmed from claims originally filed in a Pittsburgh trial court by a putative class of some 62,000 current and former employees of the University of Pittsburgh Medical Center (UPMC). The class seeks damages for a breach that exposed their names, birthdays, SSNs, addresses, salaries, and bank and tax information. The stolen information was subsequently used to file false tax returns and steal refunds. UPMC urged the Supreme Court to uphold the lower court decisions, which had rejected the damages claims on the basis that cyber threats are too wide-ranging and that safeguarding against such attacks would be too onerous for employers. In response, however, the would-be class argued that the imposition of liability should be based on common law negligence principles. The Supreme Court took the matter under advisement.—From Northeast Ohio Chapter Vice President Michael C. Brink

New York

Budget Bill Addresses Sexual Harassment

On April 12, Governor Andrew Cuomo signed the New York State budget bill, which has significant provisions for the prevention of sexual harassment. The provisions are directed at both private and public employers with 15 or more employees and require, among other things, annual anti-sexual harassment training and record-keeping requirements. Non-disclosure provisions in settlement agreements for claims of sexual harassment are prohibited unless that is the complainant’s preference. Similarly, confidentiality language can only be included in settlement agreements if that is the complainant’s preference. Complainants must also be given 21 days to consider whether to accept confidentiality language, and then seven additional days to revoke their acceptance. New York City is following suit and passed the Stop Sexual Harassment in NYC Act, which is awaiting Mayor Bill de Blasio’s signature.—From CLM Member Dianna D. McCarthy