Bad Faith Expert Permitted To Testify Against Progressive, Judge Rules

expert

KANSAS CITY, Kan., March 9 – A Kansas federal judge has ruled that an expert may testify on Plaintiff’s behalf in a bad faith case against Progressive Insurance, and that the expert can criticize Progressive’s handling of a third party auto liability claim.

In Grant M. Nelson v. Progressive Northwestern Insurance Co., No. 15-7454, D. Kan.; 2016 U.S. Dist. LEXIS 28952, District Judge John W. Lungstrom denied Progressive’s motion to preclude the Plaintiff’s expert from testifying.  Nelson sued Progressive for bad faith in the handling of his third party claim after suing and obtaining an excess verdict against a Progressive insured for personal injuries sustained in a car accident.

Progressive’s insured, Hardacre, had a $50,000 policy limit.  Following non jury trial of the personal injury case, a   state court awarded Nelson more than $530,000.  During the underlying case, Progressive offered the policy limit on Hardacre’s behalf, but Nelson declined to accept it, demanding $1 million.  Hardacre also assigned his rights against Progressive to Nelson in exchange for Nelson’s agreement not to collect against Nelson.

Nelson sued Progressive for bad faith in state court, and Progressive removed to federal court.   In the case, Progressive sought to bar opinion evidence from Plaintiff’s expert Jim Leatzow.  Judge Lungstrum rejected Progressive’s claim that Leatzow was unqualified because he had no specific auto claims handling experience.  He also rejected Progressive’s contention that Leatzow, in opining that Progressive’s investigation was insufficient, did not consider all relevant material in the claims investigation.  The judge wrote:

“Mr. Leatzow’s failure to find fault with every investigative step actually taken by Progressive is not remarkable and does not provide a basis for exclusion. Progressive will be free to cross-examine Mr. Leatzow at trial concerning the weight he gave to particular facts in forming his opinions, and the Court will assign only such weight to those opinions as warranted by the evidence. The Court denies Progressive’s motion to strike.”

While conceding the Plaintiff’s bad faith case was weak, the judge also denied Progressive’s motion for summary judgment in the bad faith case on the merits:

“there is at least some evidence that could support a finding that some percentage of fault would have been apportioned to Ms. Hardacre… the seriousness of plaintiff’s injury meant that even a small allocation of fault to Ms. Hardacre could have exhausted the policy limit of $50,000, leaving the possibility of an excess judgment. Thus, viewing the evidence in the light most favorable to plaintiff, the Court concludes that a question of fact remains concerning whether Progressive acted negligently or in bad faith in handling the claim and in failing to attempt to secure a settlement for the policy limit to protect the interest of its insured.”

The judge also ruled that Progressive’s tender of the limit did not moot the bad faith claims made by Nelson.

Grant M. Nelson v. Progressive Northwestern Insurance Co., No. 15-7454, D. Kan.; 2016 U.S. Dist. LEXIS 28952

 

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Author: CJ Haddick

C.J. Haddick is a Director with the law firm of Dickie, McCamey, & Chilcote, PC, based in Pittsburgh, Pa. He has advised and represented insurers in insurance coverage and bad faith litigation for more than a quarter of a century, and written and spoken throughout the United States on insurance coverage and bad faith prevention and litigation. He is Managing Director of the firm's Harrisburg, Pa. office. Reach him at chaddick@dmclaw.com or 717-731-4800.

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