Monthly Archives: February 2017

Alaska Creates Exception to General Rule that Injured Party Cannot Sue Insured’s Carrier

The Supreme Court of Alaska in Burnett v. Government Employees Insurance Company, 2017 WL 382648 (Alaska 2017) recently decided in a 3-2 decision that an insurer who voluntarily assumed the responsibility for cleaning up an oil spill on a third party’s property caused by its insured may become liable to that third party if it does not correctly handle the cleanup operations. GEICO argued that its obligations to its insured effectively negated any responsibility to third parties for improperly performing that clean up duty. The Court, over a strenuous dissent, rejected GEICO’s argument holding that an insurer who undertakes an independent obligation to a third party creates a new and independent duty to the third party claimant. GEICO was alleged

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Are Attorneys’ Bills Privileged Once Litigation Ends – California Supreme Court Says No in ACLU Litigation?

The California Supreme Court recently held, in Los Angeles Board of Supervisors v. Superior Court (2016) that attorneys’ invoices may not be protected by the attorney-client privilege after litigation ends. The issue arose out of a lawsuit brought by the ACLU to obtain billing records by law firms representing the City of Los Angeles to defend litigation brought by jail inmates. The ACLU’s position was that these law firms engaged in “scorched earth” tactics. The Court affirmed some limitations on production of these bills. The Court conceded that information could be protected if it tells the client “of the nature or amount of work occurring in connection with a pending legal event” or even an uptick in amounts spent “could

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Alert! — Washington Supreme Court Limits “Insurance Fair Conduct Act”

Earlier this month, the Washington Supreme Court strictly limited Washington’s “Insurance Fair Conduct Act” (IFCA) private cause of action. Enacted in 2007, IFCA provides for uncapped triple-damages awards, and mandates attorney fee awards.  However, the statute’s enabling provisions restrict IFCA claimants to insureds whose claims for coverage or payment of benefits are unreasonably denied.  Therefore, as clarified in Perez-Cristanos v. State Farm Fire and Cas. Co., 2017 WL 448991, 2017 Wash. LEXIS 92, ___ Wn.2d ___ (2017), IFCA claims cannot proceed based only on alleged violations of claims regulations (for example, untimely insurer responses to the claimant’s communications), without a related denial of the insured’s coverage or benefits. The full Cozen O’Connor Alert! is linked here. About The Author

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Avoiding Insurance Bad Faith
Cozen O’Connor represents insurance clients in jurisdictions throughout the U.S. against statutory and common law first- and third-party extracontractual claims for actual and consequential damages, penalties, punitive and exemplary damages, attorneys’ fees and costs, and coverage payments. Whether bad faith claims are addenda to a broader coverage matter or are central to the complaint, Cozen O’Connor attorneys know how to efficiently respond to extracontractual causes of action. More
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