Thursday, August 2, 2012

Some Recent Federal District Court Auto Law Cases of Note

Sypeck v. State Farm Mut. Auto. Ins. Co., 2012 WL 2239730 (M.D.Pa. June 15, 2012) (mem.)

(Court found claim for breach of contract stated but not statutory bad faith claim which was only supported almost entirely with conclusory allegations using boilerplate language; court rules that a facially unreasonable settlement offer does not prove bad faith; court also states that knew or should have known allegation offers the possibility of negligence which cannot establish bad faith under Pennsylvania law.).

Weber v. Nationwide Mut. Ins. Co., 2012 WL 2157712 (E.D. Pa. June 14, 2012) (mem.)

(Federal Court declines to exercise jurisdiction in UIM claim; although underlying high/low arbitration had a liability policy with $300,000, which exceeds the $75,000 federal jurisdiction threshold, there were no federal interests at stake, the matter involved state law claims, and there was a related proceeding pending in state court where the plaintiff is seeking a declaration that the high/low arbitration agreement constitutes a settlement requiring the UIM insurer to undertake action pursuant to Daley-Sand).

Watson v. Nationwide Mut. Ins. Co. of North America, 2012 WL 2159297 (E.D. Pa. June 14, 2012) (mem.)

(Four peer reviews conducted before insurer denied payment of certain bills; court notes that a Medicare Advantage Plan may seek repayment of liens from a tort recovery but such repayment is not automatic; Section 8371 bad faith claim not barred if insurer's conduct goes beyond scope of Section 1797; court stated that just because plaintiff's allegations of abuse of the peer review process are sufficient to state a claim does not mean they can necessarily survive a motion for summary judgment; court found that plaintiff failed to prove that insurer's decisions to seek peer reviews were a sham and that decisions were made on causation or relatedness; court stated that insurer's failure to describe force of impact to peer review doctors is not relevant; court rejected assertion that transactional relationship between insurer and PRO calls into question the whole peer review process; court also noted that, given time lapse between treatments, insurer did not act in bad faith by requesting peer reviews; court found that evidence did not show that insurer manipulated the insured--insurer offered $1,700 and on advice of counsel, insured demanded $2,000; court also noted that Section 8371 does not contemplate actions for bad faith upon alleged discovery violations--counsel's misbehavior must be serious to justify a finding of bad faith; inadequate settlement offer alone is not a basis for bad faith; court also stated that defendant's use of two attorneys at plaintiff's deposition was not bad faith; court additionally stated that non-disclosure of policy manuals is only relevant if those policy manuals exist and are discoverable).

Stricker v. State Farm Mut. Auto. Ins. Co., 2012 WL 2153977 (M.D. Pa. June 13, 2012) (mem.)

(Court ruled that dismissal of bad faith claim premature; court found that insurer's misrepresentation that UIM limits were $50,000 when they were at least $100,000 and arguably $150,000 may constitute more than an incorrect policy interpretation).

I send thanks to Attorney Bill Mabius of the Pennsylvania Association for Justice for advising me of the above recent decisions. 

Anyone desiring a copy of any of the above cases may contact me at

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