Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
When Bad Faith Threatens Good Business: Third Circuit Developments in Insurer Bad-Faith Claims
Insurer bad-faith liability ' that is, any liability beyond the coverage or other benefits expressly provided for in the insurance contract ' has been litigated for about a century. For most of that time, judges and jurors applied it sparingly in egregious cases of blatant abuse by insurers. However, the tort of bad faith, by proscribing (among other things) 'unfounded' denials of coverage motivated by 'self-interest,' has always existed in tension with insurers' fundamental duty to maximize enterprise value by, for instance, paying claims only when contractually required. This tension, rarely explicit in the early cases, increasingly is laid bare as policyholders aggressively (if understandably) press doctrinal boundaries in the hope of recovering tort damages in suits on insurance contracts. Two recent cases involving disability benefits from courts within the Third Circuit ' Northwestern Mut. Life Ins. Co. v. Babayan, 430 F.3d 121 (3d Cir. 2005), and Saldi v. Paul Revere Life Ins., 224 F.R.D. 169 (E.D. Pa. 2004) ' illustrate this tension and suggest a need for judicial management to harmonize insurers' conflicting duties.
In Babayan, the Third Circuit upheld dismissal of the bad-faith claim of a policyholder who was denied disability benefits after discovery of admittedly inaccurate statements in her insurance application. The policyholder argued that the investigation of her medical background by an underwriter and others constituted impermissible 'post-claim underwriting,' but the court could not distinguish this 'nebulous' claim from ordinary post-claim investigation and observed that 'it is not bad faith to conduct a thorough investigation into a questionable claim.' Babayan, 430 F.3d at 139. In Saldi, the plaintiff alleged that disability benefits he received due to health-related temperature sensitivity were terminated following a claim investigation instituted 'as part of a bad-faith pattern and practice of terminating valid claims to improve [the defendant insurer's] profits.' 224 F.R.D. at 175. Based on documents produced in other disability cases against the same insurer, the Saldi court ordered extremely broad discovery of the profitability and claims handling practices of an entire national line of the defendant's disability insurance business.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Beach Boys Songs Written Decades Ago Triggered Current Quarrel With Lawyers
There's current litigation in the ongoing Beach Boys litigation saga. A lawsuit filed in 2019 against Nevada residents Mike Love and his wife Jacquelyne in the U.S. District Court for the District of Nevada that alleges inaccurate payment by the Loves under the retainer agreement and seeks $84.5 million in damages.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?
When Is a Repair Structural or Nonstructural Under a Commercial Lease?
A common question that commercial landlords and tenants face is which of them is responsible for a repair to the subject premises. These disputes often center on whether the repair is "structural" or "nonstructural."