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162632P.pdf 08/11/2017 McShane Construction Company v. Gotham Insurance Company
U.S. Court of Appeals Case No: 16-2632
U.S. District Court for the District of Nebraska - Omaha
[PUBLISHED] [Shepherd, Author, with Riley and Beam, Circuit Judges]
Civil case - Insurance. In action seeking insurance coverage related to
the improper installation of a fire detection and suppression system by
one of plaintiff's subcontractors, the district court did not err in
dismissing the action under Rule 12(b)(6) for failure to state a claim
upon which relief can be granted; two of the claims were based on Nebraska
statutes which do not provide a private right of action; with respect to
claims concerning breach of contract, plaintiff failed to allege a legal
obligation to pay any judgment covered under the terms of the policy;
similarly there could no be claim for breach of the duties of good faith
and fair dealing in the absence of a reasonable basis for denying
benefits; plaintiff, a third party beneficiary under the subcontractor's
policy failed to plausibly alleged the terms of the policy demonstrate a
reasonable intendment to include plaintiff in the subcontractor's Errors
and Omissions coverage; mitigation claim was properly rejected as was
plaintiff's claim that defendant waived denial of coverage or was estopped
from denying coverage because plaintiff detrimentally relied on the
existence of coverage when it hired the subcontractor. Judge Beam,
concurring in the judgment.