Topic: Extra-Contractual Liability

Earlier this summer, a federal district court in Washington certified questions to the Supreme Court of Washington concerning whether an insured can maintain a procedural bad faith claim despite the fact that coverage was properly denied.  The case, entitled St. Paul Fire and Marine Ins. Co. v. Onvia, Inc., Docket No. C06-1056RSL (W.D. Wash.)(see here), involved a claim based on a class action involving the insured’s practice of distributing advertisements via fax. 

In a bad faith case involving wrongful denial of coverage of a wrongful death suit, a Pennsylvania Court awarded the policyholder’s assignee $8,490,666 in damages, despite the fact that the policyholder had pled guilty to voluntary manslaughter. 

Princeton Insurance Company recently agreed to pay $20 million to settle a bad faith claim related to a dram shop lawsuit brought against their insured.  In the underlying lawsuit, a highway construction flagman sued Princeton’s insured, a tavern, after he was struck by a car driven by the tavern’s patron.