Bad Faith

News & Analysis as of

Northern District of Alabama: No Bad Faith Where Insured Made Misrepresentations in Court Filings and Insurer Reasonably Relied on...

The Northern District of Alabama finds that an insurer did not act in bad faith by denying coverage for damage caused by a house fire where investigators suspected arson, the insured made misrepresentations in bankruptcy...more

Eleventh Circuit: Excess Insurer, Like All Florida Bad Faith Claimants, Must Prove Causation to Succeed on Bad Faith Claim Against...

Westchester Fire Insurance Co. v. Mid-Continent Casualty Co., No. 13-12932, 2014 WL 2766764 (11th Cir. Jun. 19, 2014) - The Eleventh Circuit finds that a primary insurer did not act in bad faith by failing to inform...more

Supreme Court Provides Standard for Evidentiary Hearing in IRS Summons Enforcement Proceeding

On June 19, 2014, the Supreme Court unanimously ruled that taxpayers have a right to an evidentiary hearing in an IRS summons enforcement action when the taxpayer “offers some credible evidence supporting his charge” of...more

Sanctions Are Appropriate for Factual Misrepresentation and Abuse of Judicial Process

Monsanto Co. v. E.I. Du Pont de Nemours & Co. - Addressing the issue of sanctions following a finding that a litigant abused the judicial process and acted in bad faith, the U.S. Court of Appeals for the Federal...more

Objective Baselessness and Subjective Bad Faith for Exceptional Case Determination Are Still Applicable Even After Octane Fitness

Bianco v. Globus Medical, Inc. - Interpreting recent Supreme Court of the United States precedent that arguably relaxed the legal test for determining whether a case is “exceptional” to warrant an award of attorneys’...more

Eleventh Circuit Rejects Excess Insurers Bad Faith Claim Against Primary Insurer Due to Lack of Damages Causation

The Eleventh Circuit Court of Appeals reversed a Florida district court’s award of damages to the excess insurer on the ground that the excess insurer failed to prove the primary insurer’s alleged bad faith had caused the...more

High Court Opens Door To IRS Personnel Examination

The U.S. Supreme Court issued a unanimous opinion Thursday in United States v. Clarke (No. 13-301) addressing the standard that must be satisfied before a taxpayer can question Internal Revenue Service personnel about its...more

IRS Information Document Request Enforcement Procedures Update

The U.S. Supreme Court clarifies what is necessary to challenge a summons issued by the IRS for an improper purpose. On June 19, in United States v. Clarke, the U.S. Supreme Court held that a taxpayer is entitled to...more

Bad Faith Sentinel - June 2014

In This Issue: - Court of Appeals of the State of Washington: Bad Faith Damages May Exceed the Amount of a Reasonable Covenant - Southern District of Mississippi: Insurer Providing Coverage Opinion to Insured...more

Supreme Court Decides United States v. Clarke

On June 19, 2014, the United States Supreme Court held that a taxpayer has the right to examine Internal Revenue Service (IRS) officials regarding their reasons for issuing a summons only if the taxpayer points to facts or...more

"Supreme Court Clarifies Standard to Challenge IRS Summons"

On June 19, 2014, the U.S. Supreme Court in United States v. Clarke1 held that a taxpayer has a right to conduct an examination of IRS officials regarding their reasons for issuing an administrative summons when the taxpayer...more

Court of Appeals of the State of Washington: Bad Faith Damages May Exceed the Amount of a Reasonable Covenant Judgment

Miller v. Kenny, No. 68594-5-I, 2014 WL 1672946 (Wash. Ct. App. Apr. 28, 2014) - The Court of Appeals of the State of Washington held that a reasonable covenant judgment, consisting of the total liability of the...more

California Court of Appeals: Insurer Liable for Settlement Negotiated by Insured

California Court of Appeals affirms a jury verdict finding an insurer liable for settlement costs of its insured when the insurer refused to defend its insured in bad faith. San Diego Apartment Brokers (“Brokers”)...more

Not Feeling It: Court Nixes Claim for Feng Shui Fees and Finds No Bad Faith

In Patel v. American Economy Ins. Co., — F. Supp. 2d. —, 2014 WL 1862211 (N.D. Cal. May 8, 2014), the U.S. District Court for the Northern District of California granted the insurer’s motion for partial summary judgment,...more

Southern District of New York: Bad Faith Claim Based on Underlying Contract Claim Must be Dismissed as Duplicative

Orange v. The Travelers Indemnity Co., No. 7:13-CV-06790-NSR (S.D.N.Y. May 14, 2014). The Southern District of New York granted an insurer’s partial motion to dismiss insured’s separate claim of bad faith as...more

Why Even A ‘Bad Guy’ Won’t Have to Pay Your Attorneys’ Fees

I've been a trial lawyer for 32 years. And if I had a dollar for every time I heard a litigant vow to collect actual attorneys' fees from an adversary -- because the bad guy's claim was "frivolous" -- then I'd have a pocket...more

SEC Bans Repeat, Bad-Faith Tipster From Future Submissions

Last month, after an individual filed 196 award applications, the SEC Office of the Whistleblower (OWB) issued a detailed Final Order deeming him/her ineligible for an award in any of his/her pending applications and...more

North Carolina Abusive Patent Assertions Act (H1032) Makes Its Way Through General Assembly

The 2013 General Assembly convened its 2014 Regular Session on Wednesday, May 14, 2014 with the introduction of House Bill 1032 The Abusive Patent Assertions Act by primary sponsor Representative Tom Murry (Rep). The Bill...more

RTP Legislator Takes on Patent Abuse

Representative Tom Murry, who is a lawyer and a pharmacist and represents the RTP-commuting folks in western Wake County and lives between the Triangle's 3 research institutions, is trying to discourage bad-faith claims of...more

Bad Faith Sentinel - May 2014

In This Issue: - Northern District of New York: Primary Insurer That Waited Nine Years to Tender Policy Limits to Injured Plaintiff Was Liable to Excess Carrier for Bad Faith - Middle District of Pennsylvania:...more

Summary Update On The Law Of Chapter 93a

Standards Governing Business Claims Under 93A ¦ Higher standard applies for business plaintiffs. More decisions confirm that a business plaintiff must make a higher showing of defendant wrongdoing in order to...more

Thorny Issues to Consider Before Buying Into BYOD

A salesperson and her boss are attending a conference at a hotel. Their goals are twofold: learning the latest industry trends and mingling with clients to generate business. After the sessions end, they invite two potential...more

Northern District of Iowa: Litigation “Reasonably Foreseeable” After Insured Accuses Insurer of Acting in Bad Faith

Meighan v. TransGuard Ins. Co. of Am., Inc., No. C13-3024-MWB, 2014 WL 1199596 (N.D. Iowa Mar. 24, 2014). The Northern District of Iowa finds that claim reserves and settlement information created after litigation was...more

Eastern District of New York Dismisses Bad Faith Claims in Dispute Over Property Damage Caused by Hurricane Sandy

433 Main St. Realty, LLC v. Darwin Nat’l Assurance Co., No. 14-cv-587 (NGG) (VMS) (E.D.N.Y. Apr. 22, 2014) - Eastern District of New York dismisses claims for breach of the covenant of good faith and fair dealing and...more

Time To Reconsider The Assignability Of Certain Claims

If an insurance company refuses to settle a claim, once liability has become reasonably clear and there is an opportunity to settle within limits, the defending insurer runs the risk of an excess verdict. Once the verdict is...more

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