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Case Briefs
Statutory Remedy for Bad Faith Applies Before, During, and After Litigation
In Hollock v. Erie Insurance Exchange, Penna. Superior Court (Jan. 22, 2004) (en banc), the Pennsylvania Superior Court affirmed an award of $2.8 million in punitive damages and $278,825 for attorneys' fees, interest, and costs, approximately a 10:1 ratio to compensatory damages. Pennsylvania has a statutory cause of action for insurance company bad faith, which allows an award of punitive damages, interest, and attorneys' fees.
The Superior Court ruled that the conduct of Erie in the bad faith litigation itself could be considered in determining whether Erie acted in bad faith toward its policyholder, Jean Hollock. The trial court found that the conduct of Erie's witnesses at trial was “an intentional attempt to conceal, hide or otherwise cover-up the conduct of Erie employees.” The Superior Court ruled that “it was appropriate for the trial court to consider Erie's continued conduct in relation to its insured” because the statutory remedy was designed to remedy all instances of insurance company bad faith, whether occurring before, during or after litigation.
The Superior Court also ruled that a policyholder need not prove anything more than bad faith in order to recover punitive damages under the Bad Faith Statute. The policyholder need not also prove malice, vindictiveness, or a wanton disregard of the rights of others, which may be required to obtain punitive damages in a case of common law fraud.
Finally, the Superior Court considered whether the amount of punitive damages violated substantive due process under the standards enunciated by the U.S. Supreme Court in State Farm v. Campbell, 538 U.S. 408, 123 S.Ct. 1513 (2003). Noting the trial court's findings that Erie was “a company run [amok]” whose supervisory personnel “ sanction[ed] deceit” in the service of a “corporate belief that it is acceptable to tell a little lie so long as no one really gets hurt,” the Superior Court found Erie's conduct to be reprehensible. The Superior Court also found the 10:1 ratio appropriate because: 1) the compensatory damages contained no punitive element; 2) Erie has significant wealth; 3) the compensatory award was limited; 4) Erie engaged in reprehensible conduct; and 5) Erie faced potentially harsh civil penalties for its misconduct, including the suspension or revocation of Erie's license to sell insurance in Pennsylvania.
Timothy Law
Statutory Remedy for Bad Faith Applies Before, During, and After Litigation
In Hollock v. Erie Insurance Exchange, Penna. Superior Court (Jan. 22, 2004) (en banc), the Pennsylvania Superior Court affirmed an award of $2.8 million in punitive damages and $278,825 for attorneys' fees, interest, and costs, approximately a 10:1 ratio to compensatory damages. Pennsylvania has a statutory cause of action for insurance company bad faith, which allows an award of punitive damages, interest, and attorneys' fees.
The Superior Court ruled that the conduct of Erie in the bad faith litigation itself could be considered in determining whether Erie acted in bad faith toward its policyholder, Jean Hollock. The trial court found that the conduct of Erie's witnesses at trial was “an intentional attempt to conceal, hide or otherwise cover-up the conduct of Erie employees.” The Superior Court ruled that “it was appropriate for the trial court to consider Erie's continued conduct in relation to its insured” because the statutory remedy was designed to remedy all instances of insurance company bad faith, whether occurring before, during or after litigation.
The Superior Court also ruled that a policyholder need not prove anything more than bad faith in order to recover punitive damages under the Bad Faith Statute. The policyholder need not also prove malice, vindictiveness, or a wanton disregard of the rights of others, which may be required to obtain punitive damages in a case of common law fraud.
Finally, the Superior Court considered whether the amount of punitive damages violated substantive due process under the standards enunciated by the
Timothy 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.
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.
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?
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
The Cost of Making Partner
Making partner isn't cheap, and the cost is more than just the years of hard work and stress that associates put in as they reach for the brass ring.