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Extra-Contractual Liability Law
1. $1 Billion in a wrongful death action brought by a Florida college student when a truck struck him from behind while stuck in traffic. ($100M in compensatory/$900M in punitive damages).
2. $7.37 Billion against a Communications contractor for a systemic failure of safety processes that led to the robbery and stabbing death of an 83-year old woman by a cable repairman.
3. $155.5 Million verdict against an employer in an EPL case wherein the Plaintiff alleged he was wrongfully terminated.
4. $125 Million against Walmart for employment discrimination in a case brought by a 16-year-old employee with Downs Syndrome ($150K in compensatory and $125M in punitive damages).
Where this is heading is anyone’s guess, but the trend is not subsiding in any way by all accounts. Look for several industries (trucking for example) to seek legislative help on the state and federal levels. No matter what happens in the near future, one must keep this trend in mind when evaluating third-party exposure for an insured.
• Attacks on Attorney-Client Privilege:
We have all seen the very troubling erosion of the attorney-client privilege between carriers and their retained coverage/ EC counsel. This trend continues across the country. We can no longer assume that an attorney’s correspondence with their carrier client, where counsel has been retained to represent the carrier only in a first-party or third-party situation is protected. Increasingly, courts are judicially determining that the role of counsel may evolve from one of legal representation to more of a claims handling function, hence eviscerating the privilege. (See, Menapace v. Alaska National Ins. Co., Civil Action No. 20-cv-00053-REB- STV, 2020 U.S. Dist. LEXIS 191695 (D. Colo. Oct. 15, 2020).
It is more important than ever to carefully define the role of counsel from the very outset of retention. Perhaps including why counsel is being retained and the scope of that representation. Careful consideration must be given to exactly what tasks counsel is undertaking, such as the retention of an expert to assist in the adjusting of a claim, evaluating for the carrier a property loss, etc. Furthermore, careful consideration need
Michael K. Kiernan is the Managing Partner of Traub Lieberman Straus & Shrewsberry LLP’s St. Petersburg, FL office. Contact him at: mkiernan@tlsslaw.com. Andy Downs is a shareholder at Bullivant Houser in San Francisco, CA. Contact him at: andy.downs@bullivant.com. Linda J. Knight is a Partner of Spencer Fane in its Denver, CO office.
Contact her at: lknight@spencerfane.com.
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FDCC ANNUAL INSIGHTS 2023