MISSOULA, Mont. — An insured’s expectation that its commercial auto insurer would negotiate a release on its behalf prior to paying the full policy limits to claimants injured in an auto accident was reasonable, a Montana federal judge said Feb. 4 in denying the insurer’s motion to dismiss the insured’s bad faith claim (High Country Paving Inc. v. United Fire & Casualty Co., No. 18-163, D. Mont., 2019 U.S. Dist. LEXIS 17610).
WHEELING, W.Va. — A West Virginia federal judge on Jan. 30 denied a motion to remand a bad faith lawsuit filed by insureds against their auto insurer and insurance agent after determining that the negligence claim against the insurance agent cannot be maintained under West Virginia law (Keith Jay Fischer, et al. v. State Farm Mutual Automobile Insurance Co. Inc., et al., No. 18-167, N.D. W.Va., 2019 U.S. Dist. LEXIS 14694).
UTICA, N.Y. — An insured’s claim for consequential and extracontractual damages must be dismissed because the insured failed to show that the insurer’s actions in its handling of a claim for a collapsed building amounted to bad faith, which is necessary to justify a claim for consequential and extracontractual damages, a New York federal judge said Jan. 30 (Russell Bryant v. General Casualty Company of Wisconsin, No. 18-562, N.D. N.Y., 2019 U.S. Dist. LEXIS 14369).
JACKSONVILLE, Fla. — Basing his decision on a recent Florida Supreme Court ruling concerning similar issues, a federal judge in Florida on Jan. 28 declined to grant an insurer’s motion for summary judgment in an insurance breach of contract and bad faith lawsuit, ruling that the state supreme court’s ruling compels him to send the case to trial (Tanner Wiggins v. Government Employees Insurance Co., No. 16-1142, M.D. Fla., 2019 U.S. Dist. LEXIS 12794).
LAFAYETTE, La. — A Louisiana federal magistrate judge on Jan. 28 dismissed a bad faith claim against an auto insurer because the claimant seeking underinsured motorist benefits under the policy failed to establish that she provided the insurer with a satisfactory proof of loss related to the benefits claim before she filed suit against the auto insurer (Magdalena Placencio v. Progressive Paloverde Insurance Co., et al., No. 17-1433, W.D. La., 2019 U.S. Dist. LEXIS 13517).
TYLER, Texas — An insurance company tells a Texas appeals court in a Sept. 13 appellant brief that it should be awarded a new trial because a trial court judge erred when not severing an insured’s extracontractual claims from her claim seeking benefits under the underinsured motorist (UIM) provisions of her policy (American National County Mutual Insurance Co. v. Tina Holland, No. 12-18-00141-CV, Texas App., 12th Dist.).
NEW ORLEANS — A law firm was improperly joined in an insurance bad faith lawsuit to defeat removal jurisdiction; therefore, an insured failed to sufficiently show that remand of the action to state court based on diversity jurisdiction is warranted, a federal judge in Louisiana ruled Jan. 9 (Rhino Shield Gulf South LLC., et al. v. RSUI Group Inc., et al., No. 18-11247, E.D. La., 2019 U.S. Dist. LEXIS 3951).
PHILADELPHIA — An auto insurer cannot be held liable for acting in bad faith after refusing to defend a noninsured who was driving an insured vehicle when an accident occurred because the noninsured has no standing to bring claims against the insurer, a Pennsylvania federal magistrate judge said Jan. 10 (Louis K. Myers v. GEICO Casualty Co., No. 17-3933, E.D. Pa., 2019 U.S. Dist. LEXIS 5093).
KANSAS CITY, Mo. — A federal judge in Missouri on Jan. 23 ruled that an insurer failed to sufficiently show that an insured acted in bad faith by failing to file a cross-claim against the insurer for bad faith failure to settle an underlying garnishment action within one year of the action being filed and, thus, failed to show that removal of the underlying action from state court was statutorily proper (Philip Stratman v. Allstate Fire and Casualty Insurance Co., No. 18-540, W.D. Mo., 2019 U.S. Dist. LEXIS 10673).
DENVER — A Colorado federal judge on Jan. 9 determined that a choice-of-law analysis regarding bad faith allegations is not necessary because the plaintiff who is seeking underinsured motorists coverage under her father’s auto policy failed to allege facts in support of a bad faith claim (Kelsi Bowers v. Buckeye State Mutual Insurance Co., No. 18-496, D. Colo., 2019 U.S. Dist. LEXIS 4040).
By Robert M. Hall
PROVIDENCE, R.I. — An insurer owes no duty of good faith and fair dealing to third-party claimants because precedent dictates that the insurer’s obligation to act in good faith extends only to the insured, the Rhode Island Supreme Court said Jan. 15 (Summit Insurance Co. v. Eric Stricklett, et al., No. 2017-185, R.I. Sup., 2019 R.I. LEXIS 12).
FORT WORTH, Texas — An insurer is entitled to summary judgment on an insured’s breach of contract and bad faith claims arising out of a homeowner’s storm damage claim because the insurer fulfilled its contractual obligations when it paid the insured the amount owed following an appraisal proceeding, a Texas federal judge said Jan. 15 (Twanya Braden v. Allstate Vehicle and Property Insurance Co., No 18-592, N.D. Texas, 2019 U.S. Dist. LEXIS 7240).
LAS VEGAS — A federal judge in Nevada on Jan. 9 ruled that an insured has sufficiently stated her claim for insurance bad faith against her automobile insurance provider in arguing that the insurer failed to provide sufficient notice as to why it denied her claim for underinsured/uninsured motorist (UIM) benefits (Haynd [“Claudia”] Kirskey v. GEICO Casualty Co., No. 18-946, D. Nev., 2019 U.S. Dist. LEXIS 3970).
PHOENIX — Although an insurer has failed to establish that an insured breached the terms of a commercial insurance policy by notifying the insurer of hail damage until almost five years after it occurred, the insured has failed to provide sufficient evidence to support a majority of its arguments in support of its claim for insurance bad faith, a federal judge in Arizona ruled Jan. 22 (The Racquet Club at Scottsdale Ranch Condominium Association Inc. v. Philadelphia Indemnity Insurance Co., No. 17-1215, D. Ariz., 2019 U.S. Dist. LEXIS 100004).
SALT LAKE CITY — Because a clear debate existed regarding whether coverage was owed under an accidental death benefit policy, a beneficiary’s bad faith claim cannot stand, a Utah federal judge said Jan. 22 after determining that the insurer owes no coverage under the policy for the death of a man killed in a standoff with police (Molly Farrand v. American General Life Insurance Co., No. 16-134, D. Utah, 2019 U.S. Dist. LEXIS 10942).
LAS VEGAS — An insured’s claims for bad faith and unfair trade practices arising out of an auto insurer’s handling of an underinsured motorist claim must be dismissed because the insured failed to offer sufficient facts in support of the claims, a Nevada federal judge said Jan. 22 in dismissing the claims without prejudice (Annette L. Stebbins v. GEICO Insurance Agency, et al., No. 18-590, D. Nev., 2019 U.S. Dist. LEXIS 9768).
AUSTIN, Texas — The Texas Supreme Court on Jan. 18 agreed to review an appeals court’s ruling that affirmed a trial court's grant of summary judgment in favor of a homeowners insurer on the insured's breach of contract and bad faith claims arising from hailstorm damage, according to its orders pronounced (Oscar Ortiz v. State Farm Lloyds, No. 17-1048, Texas Sup.).
DENVER — The 10th Circuit U.S. Court of Appeals on Jan. 18 sua sponte granted a panel rehearing in a dispute over commercial property insurance coverage for an insured’s roof and interior damage following a wind storm (Billy Hamilton v. Northfield Insurance Co., Nos. 17-7049 and 17-7055, 10th Cir., 2019 U.S. App. LEXIS 1615).
AUSTIN, Texas — In its Jan. 18 orders pronounced, the Texas Supreme Court agreed to review an insured’s lawsuit seeking recourse against its insurer pursuant to the Texas Prompt Payment of Claims Act (TPPCA) after the insured argued that this case is important to the state's jurisprudence because it invites the high court to explain how the principles of USAA Texas Lloyds Co. v. Menchaca apply when an insurer invokes appraisal after the onset of litigation (Barbara Technologies Corporation v. State Farm Lloyds, No. 17-0640, Texas Sup.).