Watch what he leaves out

Reform Warrior Ted Frank has a post up, about a case out of Missouri.  He uses it as parable about plaintiff’s lawyer’s dirty tactics and greed.  But there is something missing.

Wayne Davis, Jr., had a .203 blood-alcohol level, when he drove his pickup across the center line of a Camden County, Missouri, highway on March 24, 2000, and crashed head on into the compact car of Edward and Virginia Johnson.

You’ll be happy to hear that the Johnsons didn’t try to blame the beer company or the auto manufacturer, and simply sued Davis. Davis’s insurer, Allstate, contacted the Johnsons’ attorney, David Sexton, in April, and asked for access to the Johnsons’ medical record. Sexton responded by demanding the policy limits. Allstate requested the medical records three more times, and finally got the records on December 20. Allstate immediately agreed to pay the settlement limits, but now Sexton refused, saying his April offer had expired, and he now wanted $3 million from Allstate.

Ted implies in the text, and flat out states in the comments that he feels Allstate did nothing wrong.  But when you read the opinion, a few additional facts pop up.  Allstate acknowledge that the offer has expired in June.  A number of insurance experts testified that at the point that Sexton sent his demand letter, Allstate had enough information to determine liability.  In fact, at that point, they had been informed that Davis was drunk and the opinion makes it seem that Allstate had, at that point, already determined that the accident was entirely the fault of Davis.  Moreover, the Allstate manual does not require medical records be provided to make a decision, so it wasn’t like Allstate was just adhering to set policy.

Based on this, the jury felt, and the appeals court found sufficient evidence to agree, that Allstate had acted in bad faith by stalling.  That would seem to support the jury verdict, large as it may be.  Allstate could have avoided all of this by agreeing to pay the policy limits, which, incidentally, were quite below the actual expenses.  By delaying they exposed their insured, and themselves, to vastly increased damages.  Not calling attention to this, finessing the facts to make it appear that Allstate was just acting reasonably while the plaintiff’s attorney schemed to get more money, serves no purpose except to attempt to serve a partisan agenda of attacking the civil justice system.

That being said, none of this excuses what appears to be collusion between the plaintiffs and the defendant. The fact that Davis, the drunk driver, has the potential to come out ahead on this deal is disgusting.  That is a tragedy beyond words, and it strains my carefully maintained blog-profanity-filter.  So at least we can agree that there is something wrong here.

UPDATE:  Ted Frank responds, briefly, in the comments at Overlawyered.  Rather funnily, he leaves out about two thirds of the points I make.

Posted in Law
Tags: Hypocrisy, Tort Reform