Confidential
Settlement – $400,000Court
L.A. Superior Van Nuys
Attorneys
Plaintiff
Defendant
Experts
Plaintiff
William J. Kluge JR
(technical)
Defendant
Brian Firth
(technical)
Gerard G. Moulin
(technical)
Wesley J. Schultz
(technical)
Facts
Plaintiff insurance company's insureds had a fire which originated in one of the insureds' automobiles and spread to extensively damage the entire house. Plaintiff, who paid $800,000 to the insureds under their auto and homeowners policies, hired defendant engineering company to investigate the cause of the fire. Plaintiff alleged the engineering company incorrectly diagnosed the cause of the fire as a defective alternator. In reliance on the engineering company's opinion, the alternator was kept as evidence and the cars were destroyed. Plaintiff initiated a subrogation lawsuit against the car manufacturer. Plaintiff alleged that it was conclusively established during that lawsuit that the alternator was not the cause of the fire. However, having disposed of the vehicles, the plaintiff insurance company was unable to prove the cause of the fire and, on that basis, a non-suit was granted in favor of the manufacturer. Plaintiff insurance company then brought this case against the defendant engineering company for professional negligence and negligent spoliation of evidence.
Settlement Discussions
The settlement discussions were not disclosed.
Damages
The plaintiff alleged $800,000 in damages.
Other Information
The defendant engineering company notified its insurance broker of the potential malpractice claim when their original diagnosis was shown to be a mistake. The broker failed to timely notify the engineering company's errors and omissions insurance carrier of the claim, which resulted in a denial of that claim when it was ultimately tendered. The settlement of this case was funded entirely by the negligent insurance broker.
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