Greg Worden Secures Wash. Supreme Court Opinion
Seattle Partner Gregory S. Worden recently convinced the Washington Supreme Court to affirm a trial court order of summary judgment dismissing State Farm from a lawsuit where the plaintiff sought underinsured motorist (UIM) contract damages and extracontractual damages after a car accident. The decision resolved the hotly contested issue of first impression in the Washington courts of whether a regulatory violation by itself can support a cause of action under the Insurance Fair Conduct Act, which would expose the insurer to the potential for triple damages and attorneys' fees.
The suit was brought by Isidoro Perez-Crisantos, who was waiting to turn left off a snowy avenue in Spokane, Washington, when his car was struck from behind by an underinsured motorist. He contended that he incurred more than $50,000 in medical bills as a result of injuries from the accident. Perez-Crisantos settled with the other driver for his policy limits and made a first-party UIM insurance claim to State Farm for the remaining damages resulting from the accident. State Farm contested the claim on the grounds that Perez-Crisantos was seeking benefits for excessive chiropractic treatment and an unrelated shoulder injury.
Perez-Crisantos sued alleging that State Farm violated the IFCA, several of the IFCA’s implementing regulations, and the Consumer Protection Act. In arbitration, Perez-Crisantos was able to recover about $24,000, and he subsequently amended his complaint to make it clear that he was alleging an IFCA claim based on the violation of IFCA regulations relating to unfair settlement practices, specifically that State Farm forced him to litigate in order to get payments due to him.
State Farm moved for summary judgment, arguing that there was no genuine dispute that it had acted reasonably and in good faith throughout the claims process. The trial court granted the motion and dismissed the case with prejudice on the merits.
On appeal, the Supreme Court held that “we are asked to decide whether IFCA also created a new and independent private cause of action for violation of these regulations in the absence of any unreasonable denial of coverage or benefits. We conclude that it did not and affirm."
Read the full opinion here.
Watch Worden’s oral arguments in the case here.
Worden was also quoted in a Law360 article of the Washington Supreme Court’s opinion. Read what he had to say here. A subscription is required to view this article.