Bad Faith Blog

Summary: American Modern insured James and Ruth Roller when Mr. Roller set fire to the garage in a failed suicide attempt. American Modern investigated the loss, denied their claim, and then the Rollers filed a declaratory judgment action. The trial court denied coverage which the appellate court affirmed on all grounds.

Summary: Allstate insured Valentine and Christina Zagorski’s home suffered a fire loss. Allstate’s Special Investigation Unit (SIU) assisted with the investigation of what was ultimately concluded to be an arson fire. Allstate’s retained counsel took an Examination Under Oath (EUO), and otherwise assisted with the claims handling before the claim was denied. After the denial, the Zagorskis filed suit for breach of contract, fraud, and sought extra-contractual damages for vexatious delay and refusal to pay. During the course of that litigation Allstate was ordered to disclose information through discovery, it refused, its attorney was held in civil contempt, and the matter was appealed to the Appellate Court, which then ruled on the various discovery issues, mostly in the Zagorskis’ favor, but also making some rulings in favor of Allstate. The Court also admonished Allstate’s counsel regarding properly responding to discovery.

Summary: Ibsen, Inc., the owner and operator of an urgent care medical clinic filed a four count complaint against a health insurance company, Caring For Montanans, and others, alleging violations of Montana’s Unfair Trade Practices Act (UTPA) and alleged common law counts for breach of fiduciary duty, breach of contract, and unjust enrichment. The Montana District Court held that all four counts were essentially for alleged violations of the UTPA and found that Montana did not allow a private right of action for such violations. Accordingly, it dismissed the individual and class action claims Ibsen sought to pursue. A unanimous Montana Supreme Court affirmed.