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Bad Faith Blog

We cover current issues, highlights and best practices exclusively on claims of bad faith and extra contractual damages.

Bad Faith Blog
October 2, 2016

Range of Valuations Support Bad Faith Summary Judgment for Insurer

Summary: State Farm issued an uninsured motorist policy to Enrique with a $100,000 limit. Enrique was injured in an auto accident, sought UM benefits and also sought to recover bad faith damages. The bad faith portion of the case was stayed pending resolution of the UM claim which resulted in a jury verdict awarding $260,000. However, the trial court granted summary judgment in favor of State Farm on the bad faith claim which a divided Delaware Supreme Court affirmed.

Bad Faith Blog
September 11, 2016

Delaware Bad Faith Claims Accrue When Excess Judgment Becomes Final and Unappealable

Summary: State Farm rejected an injured car driver’s $35,000 offer to settle against State Farm’s insured who admitted negligence. The trial resulted in a judgment for nearly $225,000, well above the $100,000 per person limit. The Delaware trial court dismissed the resulting bad faith claim on statute of limitations grounds, relying on an earlier unpublished superior court opinion. In a case of first impression, the Supreme Court of Delaware abrogated the unpublished decision and held that the bad faith action accrued when the excess judgment against the insured became final and unappealable.

Bad Faith Blog
February 24, 2016

Predominant Individualized Damages Issues Require Decertification of Bad Faith PIP Benefits Class Action

Summary: Plaintiffs sued GEICO alleging it used arbitrary computer “rules” to determine personal injury protection (“PIP”) payments when a Delaware statute required GEICO to pay “reasonable and necessary” PIP benefits. The court initially certified classes to pursue counts for bad faith breach of contract, breach of the duty of good faith and fair dealing, and consumer fraud. Thereafter, the court granted summary judgment in favor of the defendant and against the plaintiffs’ class representative. Thereafter, the court denied the motion to substitute a class representative while at the same time granting the defendant’s motion to decertify the class primarily because the individual issues regarding the damages claims would predominate over any common questions of law or fact.