Here is another case wherein there was a failure to properly stipulate to the amount of damages involved in the case and thus, ended up having to litigate his case in Federal Court, rather than the State Court in which the lawsuit was filed.
The case is from the Southern District of Texas, Houston Division, and is styled, Olga Rodriguez v. State Farm Lloyds.
Olga filed her claim against State Farm in State District Court and State Farm timely removed the case to Federal Court.
As stated before, insurance companies prefer to litigate cases in federal court, whereas, lawyers suing insurance companies prefer to litigate in state court. The laws are such that the insurance companies get their way most of the time. However, one of the ways to keep a case in state court involves properly stipulating to the amount of damages at issue in the case.
This issue is discussed in the 2019, Southern District of Texas, Houston Division, opinion styled, Osiel Rubio v. State Farm Lloyds.
Rubio filed suit arising out of an insurance claim against State Farm in state court. State Farm timely removed the case to federal court. Rubio filed a Motion to Remand which was denied.
Employee Retirement Income Security Act (ERISA). These cases are tough even under the best of circumstances. Lawyers who handle ERISA cases do not spend time advertising their great results. The reason is the ERISA law prohibits “great” results. A win is just getting what you should have received in the first place. But wins are few and far between, especially in the United States Fifth Circuit.
Here is a case from the Northern District of Texas, Wichita Falls Division. It’s styled is, Edythe Koch v. Metropolitan Life Insurance Company.
In this case, the Court denied MetLife’s motion for summary judgment which is unusual in these cases, thus, at first blush one thinks a win is coming. But when the Judge conducted it’s own review of the record, the Court upheld the plan administrator’s denial of accidental life insurance benefits.
Most of the time, Personal Injury Protection (PIP) benefits are paid when a proper claim for them is made and then if a claim for Uninsured Motorist (UIM) benefits is made, the insurance company takes/gets an offset for the PIP benefits in any settlement that occurs. But what if the case is tried to a jury?
A case involving PIP and UIM benefits was tried to a jury in Jasper County and a Judgement was entered in favor of the insured. No offset was given for the PIP benefits that had been paid by the insurance company. How did this happen?
An appeal was taken to the Beaumont Court of Appeals and the case is styled, Allstate Fire And Casualty Insurance Company v. Andy Alfred.
Claims for violations of the Texas Insurance Code must be stated properly against an insurance company adjuster. One way of doing this is talked about in this Western District of Texas, San Antonio Division, opinion styled, Jeanette Kotzur, David Kotzur v. Metropolitan Lloyds Insurance Company of Texas, Bryant Tullous, Michael Esmay.
This case involves a claim for damages arising out of a wind and hailstorm that is alleged to have caused damages to property owned by the Kotzur’s. Metropolitan is the insurance company and the adjusters were Tullous and Esmay.
The Kotzur’s sued Metropolitan and the adjusters in State Court. Metropolitan removed the case to Federal Court asserting the amount in controversy exceeds $75,000, that the Kotzur’s are citizens of Texas and Metropolitan is a citizen of states other than Texas. Metropolitan also asserts that the adjusters should be disregarded for citizenship purposes because the adjusters were improperly joined in the lawsuit in an effort to defeat diversity of citizenship. Metropolitan asserts that the Kotzur’s have not properly asserted claims against the adjusters. The Kotzur’s assert that they have properly asserted claims against the adjusters.
As is acknowledged in the following case, the federal courts are mixed as to their rulings on the timing of when an insurance company adjuster is sued and how that affects diversity cases.
This case is from the Western District of Texas, San Antonio Division. It is styled, Bexar Diversified MF-1, LLC v. General Star Indemnity Company, Paul R. White And Company Inc.
Bexar had an insurance policy with General Star. Bexar suffered a weather related loss and reported it to General Star. General Star assigned White, a company, to adjust the claim. Bexar was dissatisfied with the way the claim was handled and sued General Star and White in state court for violations of the Texas Insurance Code, Sections 541 and 542.
Spring is coming soon and exclusions in homeowner policies for “surface and ground water damage” will be an issue an insurance lawyer must be able to discuss with client.
Here is a November 2019, opinion from the Southern District of Texas, Houston Division, that “kinda” addresses this issue. The opinion is styled, Robert Salcetti v. AIG Property Casualty Company.
Salcetti suffered damage to his home after the U.S. Army Corps of Engineers decided to release water from reservoirs and Salcetti alleges that water entered his home causing significant damage.
What is “bad faith” in the context of insurance? There is a lot of material on this subject. Here is a little to know about.
In the 1997, Texas Supreme Court opinion styled, Universe Life Ins. Co. v. Giles, adopted the standard that an insurer breaches its duty of good faith and fair dealing by “failing to attempt in good faith to effect a prompt, fair, and equitable settlement of a claim with respect to which the insurer’s liability has become reasonably clear.” The current statutory version of this is Texas Insurance Code, Section 541.060(a)(2)(A).
The statutory standard adopted in Giles takes the place of the common-law standard for unreasonably denying a claim or unreasonably delaying payment. The court’s analysis in Giles also supports adopting the statutory standard for failing to conduct a reasonable investigation. That standard is found at Texas Insurance Code, Section 541.060(a)(7), which prohibits “refusing to pay a claim without conducting a reasonable investigation with respect to the claim.”
As discussed before, litigating cases in Federal Court is what an insurance company prefers to do. Ans as discussed before, there are ways to keep this from happening in the right circumstances. The United States 5th Circuit issued an opinion issued an opinion in 1998, that is worth knowing about as it relates to calculating damages and how that calculation effects whether or not a case will be litigated in Federal Court. The opinion is styled, St. Paul Reinsurance Co., LTD. v. Greenberg.
This declaratory judgment action is a case wherein the insurance company won their fight to have the case litigated in Federal Court because the amount in controversy requirement for diversity jurisdiction under 28 U.S.C., section 1332, was not satisfied.
Greenberg had a homeowners policy with St. Paul. Greenberg’s home was destroyed by arson. Greenberg filed a sworn proof of loss for $35,000, which was the policy limits. St. Paul denied the claim for three reasons.
All insurance lawyers understand that there are time limits within which an insurance company must accept and pay the claim or else deny the claim. And it is also understood that the insured making the claim has an absolute duty to cooperate with the claims investigation. But what about a situation where the insurance company needs to be able to get information from a third party, such as medical providers?
What is clear is that if the insurance company reasonably requests information from the claimant, deadlines for payment of the claim are postponed until the insurance company receives that information.
In contrast, the Prompt Pay Statute does not expressly extend any deadlines while the insurance company awaits information from third parties. However, if the insurance company cannot accept or reject a claim because it is still waiting for such information, Texas Insurance Code, Section 542.056(d) allows the insurance company a one-time 45 day extension.
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