Thomas Gregory v. Arizona Pipeline Company, et al.
Published: Feb. 3, 2004 | Result Date: Jul. 9, 2003 | Filing Date: Jan. 1, 1900 |Case number: 02CC02955 Verdict – $25,875,000
Judge
Court
Orange Superior
Attorneys
Plaintiff
Defendant
Experts
Plaintiff
George Lightner
(technical)
Bernard F. Pettingill Jr.
(technical)
Sharon K. Kawai M.D.
(medical)
Defendant
George M. Brinton
(technical)
Tom Gravitt
(technical)
Facts
On the morning of April 10, 2001, the defendant Eduardo Rodriguez, an employee of the insured, Arizona Pipeline, parked his company truck in the bicycle lane of Superior Avenue in Costa Mesa so he could walk across the street and get some materials from the company's staging area. The plaintiff, Tom Gregory, was riding his bicycle down Superior on his way to work as a high school biology teacher when he ran into the back of the defendant's parked truck.
Settlement Discussions
The plaintiff demanded $21 million ($1 million primary with Zurich and $20 million excess with Kemper). After several extensions, the offer expired on Feb. 14, 2003. The defendant first offered $8 million and subsequently increased this on several occasions, culminating in a final offer of $23 million during the first post-trial mediation.
Specials in Evidence
$634,269 to date $1,292,191 to date $1,292,191 to date
Injuries
The plaintiff, who is 40 years old, was rendered an incomplete quadriplegic with partial use of hands and arms. While able to drive and return to teaching high school biology, the plaintiff had been severely limited and restricted in what was previously a very active lifestyle (e.g. surfing, skiing, bicycling, mountain climbing etc.).
Other Information
According to the plaintiff, during the pendency of the policy limits demand, it came to light that the excess carrier (Kemper) was undergoing serious financial difficulties and its financial rating precipitously declined to a "D." Several months before trial, Kemper went "out of business" in the sense it stopped selling insurance policies. Kemper and its attorneys then attempted to use Kemper's precarious financial position as leverage to force a settlement below the policy limits. The plaintiff stated that during mediation and shortly before trial in July, 2003, Kemper and its attorneys suggested that Kemper was going out of business on June 30 and that the plaintiff could never get the trial started in time (presumably before Kemper was forced into liquidation). Because of these concerns, the insured's attorney moved the trial court to advance the trial date, alleging that "my client is in serious danger of being without most of its insurance coverage for this serious lawsuit." The insured's attorney recommended that Kemper pay its $20 Million policy limits to settle the case. Kemper refused. The case was promptly tried, beginning on July 1 and a judgment in excess of the policy limits was entered on July 9. Kemper then offered its policy limits.The plaintiff refused to accept it. During post-trial mediation, Kemper insisted on settling the case somewhere between $21 Million policy limits and the judgment. The plaintiff insisted that Kemper pay the full $27,579,230 judgment plus post-judgment interest. Kemper attempted to compel its insured and the primary carrier to contribute more money. Both refused. On August 28, 2003 the plaintiff's counsel and Kemper's counsel finally resolved the case by agreeing to partially structure the settlement in exchange for the plaintiff cutting off the accrual of interest and reducing the judgment by $25,000. A settlement agreement and structured settlement document was prepared and sent to Kemper's counsel and the defendant's counsel and was approved by the defendant's counsel. On September 2, Kemper disavowed the settlement agreement and refused to partially structure the money and wired, over the plaintiff's objections, the full judgment, with interest and costs, into the plaintiff's counsel's trust account. The plaintiff responded by pointing out to Kemper and its attorneys that agreeing to partially structure did not cost Kemper anything and that wiring more than the agreed settlement into the plaintiff's trust account was done simply to deprive the quadriplegic plaintiff from being able to structure the settlement and receive potentially over $9 Million in tax savings. Kemper refused to respond. Thereafter, the plaintiff petitioned the trial court to approve a qualified settlement fund and to order the plaintiff's attorneys to pay the monies in their trust account into the qualified settlement fund. Thereafter, the partial structure was able to be accomplished over the objection of Kemper. At the hearing, Kemper's attorney argued that the order establishing the fund should release Kemper and its attorneys from any subsequent action based on their alleged bad faith and/or fraudulent conduct. The court rejected this request.
Length
eight days
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