MAY 2016 BAD FAITH CASES: COURT ADDRESSES BIFURCATION OF BAD FAITH CLAIM AND WIDE RANGE OF DISCOVERY ISSUES (Middle District)

In Morris v. USAA Casualty Insurance Company, a UIM case, the Court provided a compact opinion addressing a wide range of discovery issues, and a motion to bifurcate the breach of contract and bad faith claims.  The issues relating to the bad faith claim are summarized as follows:

  1. The motion to bifurcate was denied. The court found there was “an overlap in the issues of the separate claims, and that having one trial would better serve judicial economy.”
  2. The court recognized “generally that an expert opinion is not required in bad faith cases, [but] there are times when expert testimony is appropriate.” Here, the court found testimony from the insured’s expert “would be helpful to the jury, but [the expert was] precluded from offering any legal conclusions.”  The court rejected the argument that report contained no legal conclusions, and found there were portions that went to the ultimate issues in this case and would not be permitted in the final report.
  3. The insurer was required to produce reserve information for a two year period, in line with a prior order.
  4. The court precluded any evidence, argument, comment or reference to any other claims or litigation to which [the insurer] is or has ever been a party, at any time during the course of the trial.”
  5. The insurer had asserted the allegations concerning the insured’s conduct as a defense and the insured sought to preclude evidence of that defense. The court ruled this was premature, and should be addressed via trial objections.
  6. The court rejected the insured’s effort to preclude payments by the tortfeasor. The amount paid is relevant to the bad faith claim.

Date of Decision:  May 3, 2016

Morris v. USAA Cas. Ins. Co., No. 3:12-cv-1664, 2016 U.S. Dist. LEXIS 58948 (M.D. Pa. May 3, 2016) (Kosik, J.)