Recently the Third Circuit Court of Appeals reduced an award of punitive damages by over two-thirds, holding that a 1:1 ratio between punitives and compensatory damages is the appropriate limit where the harm is purely economic and the compensatory damages award is substantial. Jurinko v. Medical Protective Co., Nos. 06-3519 & 06-3666 (3rd Cir., December 24, 2008). The court reduced the award from $6.25 million to just under $2 million.
Read More Third Circuit Vastly Reduces Punitive Damages Award Against Insurer, Applies 1:1 Ratio
Extra-Contractual Liability
Delivery of a Policy is not a Prerequisite to the Enforcement of its Terms; Insurer Can Deny Coverage Based on “Claims Made and Reported” Prerequisites Without First Investigating the Claim
The United States District Court for the District of Massachusetts recently held that delivery of a policy is not a prerequisite to the enforcement of its terms unless a policy so explicitly states. The court also held that an insurer can deny coverage for the failure to satisfy “claims made and reported” policy prerequisites without first investigating the claim.
Washington Supreme Court Holds that Procedural Bad Faith Claims Are Not Dependant on an Insurer Breaching its Duty to Defend, Settle, or Indemnify
By Troutman Pepper Locke on
The Washington Supreme Court recently held that a cause of action for bad faith claims handling is not dependant on whether the insurer breached its duty to defend, settle, or indemnify, either in the third-party context under the common law, or under the Washington Consumer Protection Act (“CPA”).
Massachusetts Federal Court Finds Retroactive Date Bars Coverage Despite Plaintiff’s “Continuing Scheme” Theory
The United States District Court for the District of Massachusetts recently held that an insurer had no duty to defend or indemnify its insureds where the insureds’ claims “arose out of” acts that occurred prior to the policy’s retroactive date.
Ohio District Court Refuses to Bifurcate Bad Faith Counterclaim from Coverage Action and Refuses to Prohibit Disclosure of Pre-Denial Communications with Coverage Counsel
By Troutman Pepper Locke on
An Ohio District Court recently denied an insurer’s motion to bifurcate its insured’s bad faith counterclaim from its declaratory judgment coverage action and to stay related bad faith discovery.
New York Insurance Department Issues Circular Letter Summarizing Late Notice Legislation and Advising Insurers to Promptly Revise and File Policy Forms Conforming With New Requirements
The New York Insurance Department has now issued Circular Letter No. 26 (2008) dated November 18, 2008 to remind liability insurers writing property/casualty policies of the changes resulting from the new law, which takes effect on January 17, 2009, and also to clarify certain aspects of the Legislation.
Insurer’s Conduct And Communications At Mediation Are Discoverable In Subsequent Bad Faith Litigation
By Troutman Pepper Locke on
A Washington district court recently held that an insurer’s conduct and communications during a mediation were discoverable in a subsequent bad faith lawsuit brought against the insurer by another insurer in its status as the insured’s subrogee.
New York Court Finds Insured Entitled to Seek “Consequential Extra-Contractual Damages” on Breach of Contract Claim Against Carrier
A New York federal district court recently held that an insured’s claim for consequential extra-contractual damages is properly part of its breach of contract claim against its carrier.
Florida District Court Refuses to Dismiss Claim for Breach of Implied Warranty of Good Faith, Holding that It Was Not a Bad Faith Claim in Disguise
A Florida district court recently denied two insurers’ motion to dismiss a count for breach of the implied warranty of good faith and fair dealing. Arlen House East Condo. v. QBE Int’l Ins. Ltd., No. 07-23199, 2008 WL 4500690 (S.D. Fla. Sept. 30, 2008). The court rejected the insurers’ argument that the breach of implied warranty count was merely a “disguised” first-party statutory bad faith claim.
Florida Supreme Court Holds that an Insured Can Assign its Causes of Action Against a Nonparty Insurance Broker and Obtain a Release, Consistent with the Court’s Decision in Cope
In Wachovia Ins. Serv., Inc. v. Toomey, No. 06-1110, 2008 WL 4379587 (Fla. Sept. 29, 2008), the Florida Supreme Court answered two interrelated, certified questions from the Eleventh Circuit.