Jonathan Allen, et al. v. National Casualty Insurance Company
Published: Dec. 23, 2000 | Result Date: Nov. 30, 2000 | Filing Date: Jan. 1, 1900 |Case number: CVS990594PMP Verdict – $200,000
Judge
Court
USDC Nevada
Attorneys
Plaintiff
Defendant
Experts
Plaintiff
Jay Beckerman
(technical)
Defendant
Paul Hamilton
(technical)
Facts
The plaintiffs, three officers and directors of a security guard company called General Security Corp., were named
insureds under a commercial general liability and errors and omissions insurance policy issued by defendant
National Casualty Co., a division of Scottsdale Ins. Co., for the policy period Dec. 17, 1994 to Feb. 17, 1995.
During November 1997, the plaintiffs were named individually as defendants in an amended third party
complaint alleging that on Dec. 16, 1995, one of the plaintiffsÆ security guards, on duty at the Guadalajara
Night Club in Las Vegas, pushed a person who fell on Raul Perez, causing Perez to sustain injuries.
The complaint also named GSI Security, Inc., as a defendant. General Security Corp. had gone out of business
between the date of the alleged injury and the commencement of the action, and the complaint alleged that GSI
should be liable for the incident as a "successor" corporation to General Security, Inc., the named insured. By
the time the action was filed, the plaintiffs were key employees of GSI, and GSI was owned by the brother of
one of the plaintiffs.
The plaintiffs tendered their defense in the lawsuit to the defendant on July 14, 1998. Six days later, the
defendant opened a claim and retained counsel to file an answer. They defendant maintained a reservation of
rights.
However, on Aug. 5, 1998, the defendant disclaimed coverage based on an "assault and battery" exclusion in
the policy.
On Aug. 24, 1998, it mailed the plaintiffs a disclaimer of coverage letter, dated Aug. 11, 1998. Meanwhile,
GSI retained counsel who defended against and ultimately settled the action, resulting in a dismissal of the
action against the three individual plaintiffs as well. AttorneysÆ fees and settlement costs totaled approximately
$30,000.
Settlement Discussions
The plaintiffs demanded $400,000. The defendant made a statutory offer of $50,000, pursuant to FRCP 68. The court ordered mediation held during Spring of 2000 was unsuccessful.
Damages
$30,000 in attorneysÆ fees and expenses in defending the underlying action.
Injuries
The plaintiff claimed economic loss, emotional distress, punitive damages.
Other Information
The plaintiffs have moved for attorney fees pursuant to Brandt v. Superior Court. The defendants have filed a motion for judgment notwithstanding the verdict. The motions are pending. <E>The defendantÆs expert witness testified that the coverage decision (applying the assault and battery exclusion to disclaim coverage) was correct, the investigation was reasonable and there was no breach of contract or bad faith. The plaintiffÆs expert witness testified that the defendant acted unreasonably in disclaiming coverage without fairly and adequately investigating the claim; that it unfairly and improperly evaluated coverage and disclaimed coverage under an assault and battery exclusion that was inapplicable under the facts; and that it violated industry standards and acted contrary to the provisions of the Nevada Unfair Claims Practices Act.</E>
Deliberation
four hours
Poll
8-0 (on all issues)
Length
four days
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