The court referred to
Federal Rule of Civil Procedure 21 which grants the Federal District Courts
broad discretion in deciding whether or not to sever a case.
Judge A. Richard Caputo M.D. PA |
Judge Caputo noted that the factors used to decide a Motion to
Sever under Rule 21 are the same as utilized in deciding a Motion to Bifurcate
under Rule 42(b).
The court differentiated between the two rules by indicating
that a Rule 21 severance essentially creates a separate case, the disposition
of which is final and appealable, whereas Rule 42(b) does not create a new case
but bifurcates issues or claims within a single case for separate trials. A claim that is bifurcated under Rule 42(b)
is not final and appealable as long as the other claims in the case remain
unresolved.
The factors to be considered in deciding such motions to
sever or bifurcate in Federal Court cases includes the following:
- Convenience
of the parties
- Avoiding
prejudice, and
- Promoting
expedition and economy
In denying the Motion, Judge Caputo found that both the
convenience of the parties and the judicial economy weighed against
severance. The court also rejected the
Defendant’s claim that the resolution of the breach of contract action could
greatly impact and potentially moot the bad faith claim. The court noted that litigation on the bad
faith claim is not contingent upon the success of the breach of contract claim
in that a Plaintiff could simultaneously prevail on a bad faith claim while
losing the UIM claim. The court also
found that severance would hinder judicial economy by requiring separate cases
and separate trials instead of handling these claims within a single
action.
The court additionally opined that the potential prejudice
to the carrier of litigating the breach of contract and bad faith claims at the
same time did not outweigh the countervailing goal of judicial economy in the
prompt resolution of the entire matter.
For these reasons, Judge Caputo denied the Motion to Sever
and Stay the Plaintiff’s Bad Faith Claim.
Anyone wishing to review a copy of this decision may click
this LINK.
I send thanks to Attorney Lee Applebaum, the writer of the
excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog for
bringing this case to my attention.
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