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Insurance
Bad Faith
Duty of Defend

Sentry Insurance Company v. Mesa West Inc.

Published: Jun. 10, 2003 | Result Date: May 22, 2002 | Filing Date: Jan. 1, 1900 |

Case number: 791310 Verdict –  $9,764,590

Judge

Robert H. Gallivan

Court

Orange Superior


Attorneys

Plaintiff

James Williams


Defendant

Nathan D. LaMoure

William Baker

Neil Pedersen

Paige Merrill Baker


Experts

Plaintiff

Edmund J. Mooney
(technical)

David J. Weiner M.B.A., AM
(technical)

Defendant

Robert L. Kehr
(technical)

Michael E. Carter
(technical)

Vanita M. Spaulding
(technical)

Facts

The plaintiff insurer sued on a duty to defend, duty to provide Cumis counsel, duty to indemnify, and sought "Buss" fees and settlement contributions for one of three underlying breach of warranty lawsuits, defended by the insurer under a reservation of rights. The defendant cross-complained for denial of policy benefits and bad faith for breach of duty to defend, duty to provide Cumis counsel, duty to settle and duty of candor in the three underlying breach of warranty lawsuits, declaratory relief action and another declaratory relief action in Oregon, plus bad faith extraction of policy releases in two of the underlying lawsuits.

Settlement Discussions

Confidential.

Damages

The insured claimed damages at a minimum of $3,528,000 up to a maximum of $5,137,000. Damage claims included over $1 million in attorney's fees for the defense of the underlying lawsuits, Cumis counsel fees and Brandt fees - plus loss of profits of $900,000 and loss of goodwill of $1.4 million to $1.8 million; additionally, settlement contributions of approximately $600,000, including $310,000 to satisfy a lien against it arising from one of the lawsuits, plus borrowing or financing costs incurred in order to obtain settlement money or pay its attorneys.

Length

six weeks


#107325

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