New Jersey Supreme Court Determined Whether Claims Brought Under the Insurance Fraud Protection Act and the Workers’ Compensation Act Were Subject to the Apportionment Procedure of the Comparative Negligence Act.

Marshall Dennehey

Liberty Ins. Corp. v. Techdan, LLC, 253 N.J. 87, 289 A.3d 429 (2023), as revised (Mar. 23, 2023)

The plaintiff alleged that the defendants misrepresented their relationship, ownership structure and submitted fraudulent payroll records to reduce the premiums for workers’ compensation insurance. The jury awarded different amounts in compensatory and punitive damages against the various defendants.

The trial court determined that all of the defendants should be jointly and severally liable for the $756,990 awarded as compensatory damages. The New Jersey Supreme Court found that the Comparative Negligence Act trumps the Insurance Fraud Protection Act and prohibits joint and several liability in these circumstances. Accordingly, the decision makes it more difficult for a plaintiff to recover damages under the Insurance Fraud Protection Act.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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