Clement 1 LLC v. Scottsdale Insurance Company

I. Background

On December 14, 2022, plaintiff Clement 1 LLC (“Plaintiff”) filed a complaint against Defendant in Los Angeles County Superior Court, Case No. 22STCV39008. The Complaint alleges that on February 28, 2022, Defendant issued Plaintiff a commercial general liability policy (the “Policy’’) that included fire and water damage coverage. On October 8, 2022, Plaintiff had a fire loss at the insured premises. Plaintiff alleges that it timely notified Defendant of the fire loss, but that Defendant refused to provide coverage due to an earlier sent Notice of Cancellation. The Notice of Cancellation, sent May 13, 2022, purportedly cancelled the Policy and identified a single ground for cancellation, “[d]ue to carrier’s request.” Plaintiff alleges that the Notice of Cancellation was defective under California Insurance Code 676, which limits an insurer’s right to cancel. On November 18, 2022, Plaintiff notified Defendant that the Notice of Cancellation was defective and that the Policy was still in effect at the time of the October 8, 2022 fire loss. On November 28, 2022, Defendant responded that “[o]ur position remains unchanged, we are reiterating our disclaimer at…