NOVEMBER 2012 BAD FAITH CASES: COURT STRIKES BAD FAITH CLAIM AND PREVENTS IT FROM MOVING TO A DE NOVO TRIAL BECAUSE THE INSURED FAILED TO MEANINGFULLY PARTICIPATE IN ARBITRATION PROCEEDINGS AS TO THAT COUNT OF ITS COMPLAINT; DENIES DISMISSAL FOR SPOLIATION ON REMAINING CLAIM (Philadelphia Federal)
In Rogers v. Allstate Ins. Co., the court heard a carrier’s motion to strike its insured’s request for Trial De Novo. The case was originally assigned for arbitration pursuant to Local Rule 53.2(3)(A) because it involved less than $150,000. However, during the arbitration, the insured’s attorney only presented evidence with respect to the breach of contract count.
Under Local Rule 53.2(5)(B), a party is required to meaningfully participate in such an arbitration proceeding. The carrier’s motion argued that the insured’s violation of this rule warranted striking the bad faith count. The court agreed, permitting only the breach of contract claim to proceed to a de novo trial.
The court also addressed the carrier’s motion to dismiss for spoliation of evidence. The insured allegedly disposed of a computer that should have been preserved as evidence. However, the court declined the motion because dismissal for spoliation is an extreme remedy and it cannot be proven that the insured should have foreseen the computer’s relevance to potential litigation.
Date of Decision: October 22, 2012
Rogers v. Allstate Ins. Co., No.: 11-cv-7776, 2012 U.S. Dist. LEXIS 151818, U.S. District Court for the Eastern District of Pennsylvania (E.D. Pa. Oct. 22, 2012) (Sitarski, J.)
