The Second District Court of Appeal affirmed jury’s $1 million punitive damages award against Geico General Insurance Co. for its unreasonable delay in paying an injured policyholder the full limits of his policy following a head-on collision.
California – 2nd District Court of Appeal AlderLaw is pleased to report that a California Appellate Court has affirmed a jury ’ s punitive damages award in one of its cases against Geico .
The case involved a frontal collision in which AlderLaw ’ s node Michael Mazik suffered a severe and inoperable fault to his heel bone. Mazik received $ 50,000 from the at-fault driver ’ second insurance company, Mercury Insurance Co., and then requested the $ 50,000 underinsured motorist limit under his own policy with Geico. unfortunately, Geico refused to pay out the underinsured motorist coverage and, between January 2010 and February 2012, Geico offered between $ 1,000 and $ 18,887 to settle his claim. Mazik rejected the offers and the challenge went to arbitration where our node was ultimately awarded the full $ 50,000 policy limit .
In May 2014, represented by Mike Alder, Lauri Brenner and Allison Stone of AlderLaw, Mazik sued Geico for bad faith. The encase proceeded to trial, and in July 2016, a jury found that Geico had unreasonably delayed paying out the customer ’ second policy limit .
The jury awarded Mazik $ 4,313,508* in compensatory and punitive damages. Geico appealed the punitive damages award saying there was insufficient evidence that any “ officer, director or cope agent ” of the insurance company acted in bad religion and that even the reduce prize was excessively a lot.
The 2nd District Court of Appeal found there was extensive evidence indicating Geico intentionally ignored checkup records establishing the severity of the foot injury suffered by Mazik during the 2008 car accident .
“ In concluding that Mazik ’ s call was worth far less than the policy limits, Geico disregarded information provided by Mazik showing that he had a permanent wave, painful wound, and rather selectively relied on portions of checkup records that supported Geico ’ s position that Mazik had fully recovered ”Administrative Presiding Judge Justice Elwood Lui
The Court found that the record in the case was full with evidence that Geico “ cherry-picked ” medical information refer to Mazik ’ s condition and “ disregarded unfavorable findings ” that supported his claim for the full policy terminus ad quem. They besides found that Geico ’ s regional administrator who oversaw Mazik ’ south title clearly qualified as the insurance company ’ south managing agent, and he “ either authorized unreasonably first gear settlement offers or approved decisions not to increase those offers ” on multiple occasions.
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“ There was sufficient attest for the jury to conclude that [ Geico through its regional administrator ] engaged in oppressive behave by ignoring data concerning the dangerous and permanent nature of Mazik ’ sulfur injuries for the function of saving the ship’s company money. ”Justice Lui
In summation, the appellate gore said the abridge $ 1 million punitive damages prize was not unconstitutionally excessive, given the “ degree of reprehensibility of Geico ’ s conduct. ” Among other things, the panel noted that, while the insurance company was withholding full payment on Mazik ’ second claim, he went into debt to pay bills and suffered through early personal difficulties due to the severity of his injury.
“ In light of the factors indicating significant condemnable conduct and the three-to-one proportion of punitive to compensatory damages, we can not say that the test court ’ randomness decision approving punitive damages of $ 1 million exceeds built-in restraints. ”Justice Lui
Appellate lawyer Norman Pine of Pine Tillett Pine LLP was quoted by Law360 : “ We are quite pleased with Presiding Justice Lui ’ s thorough opinion, which covers a huge range of punitive damages issues concerning, bury alia, wangle agent requirements, application of the five ‘ reprehensibility factors, ’ the proper ratio between the punitive award and the compensatory damages award, and early excess issues. Advocates of punitive damages will find much to be pleased with, ” Pine said. “ One major contribution the opinion makes is its focus on common smell realities concerning what jurors may sanely deduce from disputed testify. ”
- 2nd District Court of Appeal Justices: Presiding Justice Elwood Lui and Associate Justices Victoria M. Chavez and Brian M. Hoffstadt
- Geico was represented by John T. Brooks and Karin Dougan Vogel of Sheppard Mullin Richter & Hampton LLP.
- Mazik was represented at trial by Mike Alder, Lauri Brenner and Allison Stone of AlderLaw and Michael H. Silvers of Michael H. Silvers Law Corp. Norman Pine, Scott Tillett and Chaya M. Citrin of Pine Tillett Pine LLP handled the appeal.
- The case is Mazik v. Geico General Insurance Co., case number B281372, in the Court of Appeal of the State of California, Second Appellate District, Division Two.
- This case and appellate decision were featured on Law 360. Read the article here.
*After trial, the lower court found that the $ 4 million punitive damages sum awarded by the jury was excessive based on the circumstances and reduced it to $ 1 million .