Feld v. Fireman’s Fund Ins. Co., Case No. 12-1789 (D.D.C. Sept. 13, 2016).
In a case where Saul Ewing represented Fireman’s Fund Insurance Company (“FFIC”), the District Court for the District of Columbia granted FFIC’s motion for summary judgment on the insured’s claims for breach of contract and bad faith. In so doing, the court rejected the claim to recover in excess of $2.1 million in defense costs, finding that the insured’s defense counsel had agreed to accept the rates FFIC was willing to pay.
The case arose out of an underlying action in which Kenneth Feld (“Feld”), the owner of Feld Entertainment and the Ringling Bros. and Barnum & Bailey Circus, was sued by his sister Karen Feld for more than $100 million for personal injuries she allegedly suffered while being thrown out of a Shiva by Kenneth’s body guards. Feld gave notice and sought a defense under his policy with FFIC. FFIC indicated the claim was not covered because Karen alleged intentional conduct, but it agreed to defend under a reservation of rights. FFIC gave Feld the option to choose his own counsel, provided counsel agreed to FFIC’s hourly rate.
Feld opted to retain Fulbright and Jaworski, LLP (now Fulbright Norton Rose), which eventually incurred more than $4.5 million in fees defending Karen’s claim. When FFIC paid about $2 million of those fees citing a prior agreement on rates, Feld sued for the remainder, bringing breach of contract and bad faith claims.
On summary judgment, the U.S. District Court for the District of Columbia held that FFIC had established an agreement on fees between FFIC and Fulbright as a matter of law, thus precluding Feld’s claims. Following a lengthy review of the record, the Court concluded that both Fulbright’s words and deeds evidenced an agreement to accept the rates FFIC had offered, meaning that there could be no breach of contract for FFIC’s refusal to pay the remaining amounts billed. The court further held that, under Maryland law, which Feld had argued governed the dispute, there is no separate claim for bad faith.
