Leason Pomeroy and Robert Kupper v. Scottsdale Insurance Company
Published: Aug. 27, 1994 | Result Date: Aug. 5, 1994 | Filing Date: Jan. 1, 1900 |Case number: 700414 – $4,259,180
Judge
Court
Orange Superior
Attorneys
Plaintiff
Defendant
Experts
Plaintiff
Donald L. Hall
(technical)
Robert Quinn
(technical)
Facts
Plaintiffs Leason Pomeroy and Robert Kupper are the chairman and chief executive officer of LPA, Inc., and acted as the trustee of LPA's pension plan. Defendant Scottsdale Insurance Company issued a one-year general liability policy to the named insured, LPA, Inc. During the policy period, in 1991, the insured obtained an "employee benefit program liability" endorsement on a claims-made reporting basis. Several months later, the insured reported a suit against Pomeroy and Kupper by Pension Plans. Pomeroy and Kupper were allegedly directors and officers of H.P.M.I. Management, Inc. The suit alleged that the failure of Pomeroy and Kupper to take action resulted in losses. LPA's pension plan made an identical claim. Pomeroy and Kupper denied all responsibility and tendered their defense to Defendant Scottsdale Insurance Company. Scottsdale refused to defend. About one year after the notice was given to Scottsdale, Scottsdale filed an action for declaratory relief. Scottsdale moved for an order that it had no duty to defend. In June of 1993, the Superior Court found that there was a duty to defend. Four months later, in October of 1993, Scottsdale's designee testified that Scottsdale was "not defending." Pomeroy and Kupper settled with the claimants in the underlying action for $257,000 The instant action then proceeded to trial on Pomeroy and Kupper's Cross-complaint for breach of contract and tortious breach of the implied covenant of good faith and fair dealing.
Settlement Discussions
Plaintiffs contend that in 1993 they offered to settle for about $100,000 (defense costs to that date, plus $80,000) and Scottsdale offered $25,000. Defendant Scottsdale contends no offers or demands were exchanged.
Damages
$257,000 settlement paid; interest and legal fees; and punitive damages sought.
Injuries
Emotional distress.
Result
The jury found Scottsdale acted in bad faith in handling of the claim and were guilty of malice and oppression.
Other Information
Still pending is the trial Court's determination as to whether or not the liability of Pomeroy and Kupper -- as represented by the $257,000 -- is covered under the insurance policy.
Deliberation
1 day
Poll
12-0 on punitive damages; 9-3 the amount punitives
Length
6 weeks
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