Confidential
Settlement – $5,786,670Mediator
Court
L.A. Superior Santa Monica
Attorneys
Plaintiff
Calvin E. Davis
(Gordon & Rees LLP)
Defendant
Facts
The plaintiffs in this case were the owners of 10 mid to high-rise office buildings located in Los Angeles and the San Fernando Valley that sustained damage during the Jan. 17, 1994, earthquake. The buildings were owned by pension plans with a Los Angeles-based trust company acting as trustee. Prior to the Jan. 17 earthquake, the trust company sought to better protect the interests of its pension plan clients by having its real estate investment manager pool plan resources to purchase one insurance policy covering all 10 buildings. The policy from the primary insurance company contained a $10 million limit of liability for earthquakes. To cover losses of more than $10 million, the pension plans bought a series of excess insurance policies from other insurers. After the earthquake, the plaintiffs sought benefits for the damage sustained. Per defendant, approximately $44 million was paid prior to litigation. The defendant insurers (third layer excess carriers) claimed that this was the maximum loss because the policy language stated that each damaged building was subject to its own deductible based upon the reported value of the building. The plaintiffs disagreed and brought this action against the defendants based on breach of the covenant of good faith and fair dealing and breach of contract theories of recovery for the balance of their claim. The primary insurance carriers ultimately paid their policy limits to repair damaged buildings and were not parties to the settlement.
Settlement Discussions
The plaintiffs made a C.C.P. º998 settlement demand for $__________. The defendant made a C.C.P. º998 offer of compromise for $___________.
Damages
The plaintiffs claimed over $8 million in damages.
Other Information
The settlement was reached approximately three years and two months after the case was filed. MEDIATION: A mediation was held on Dec. 11, 1997, before the Hon. Robert Feinerman, retired, resulting in the reported settlement.
Length
one day
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