GEICO denies property damage claim from low-impact collision, later says it relied on a third-party, no harm no foul.
- Case Name: Panorea White et al. v. GEICO Indemnity Company
- Court and Case Number: Los Angeles Superior Court / BC 471221
- Date of Verdict or Judgment: Tuesday, March 18, 2014
- Date Action was Filed: Wednesday, October 12, 2011
- Type of Case: Insurance – Bad Faith, Claims Handling
- Judge or Arbitrator(s): Hon. Mark V. Mooney
Plaintiffs: Panorea White, 39, homemaker
- Type of Result: Jury Verdict
- Gross Verdict or Award: $326,000
$326,000. The entire award was for emotional distress.
- Trial or Arbitration Time: 7 days.
- Jury Deliberation Time: 1 day.
- Jury Polls: 9-3 (liability); 10-2 (damages)
Attorney for the Plaintiff:
Grassini, Wrinkle & Johnson by Lars C. Johnson, Woodland Hills.
Attorney for the Defendant:
Law Offices of Mark W. Hansen by Mark W. Hansen, San Diego.
Plaintiff's Technical Expert(s):
Sterrett Harper, insurance claims handling, Burbank.
Defendant's Technical Expert(s):
Jim Shratz, insurance claims handling, Sonoma.
Facts and Background
Facts and Background:
Plaintiffs owned a vehicle that was insured by defendant GEICO. Plaintiff Panorea White was involved in an accident causing damage to her vehicle and one other vehicle. The accident occurred on July 28, 2010 near the intersection of Western Ave and Hollywood Blvd in Los Angeles. The repair costs to plaintiff's vehicle were estimated at $3,500.
Defendant GEICO denied plaintiff's first-party property claim, asserting plaintiff made a “material misrepresentation” in reporting the accident. Specifically, GEICO concluded the damages to the vehicles were inconsistent with the accident report (per defense counsel, facts as reported by Ms. White rather than accident report).
GEICO initially told the other driver's attorney that there was no coverage. The other driver later sued plaintiff. GEICO defended under "reservation of rights" and then settled that claim.
A year after Ms. White filed the instant bad faith lawsuit, GEICO paid plaintiff $30,000.00. GEICO did so by way of a letter stating that GEICO made an honest mistake and was paying her $30,000 to cover the loss of her vehicle (which was repossessed because she had to buy a replacement vehicle and could not afford to make payments on her damaged vehicle and the new vehicle) and her property claim.
At trial, plaintiffs sought to recover economic damages and emotional distress damages, as well as punitive damages.
That defendant insurance company acted in bad faith.
GEICO admitted there was no fraud by Ms. White, but contended it had not “unreasonably” denied the claim. GEICO argued it made an “honest mistake” by reasonably relying
on an independent forensic engineer who found there was no collision between the two vehicles.
Demands and Offers
- Plaintiff Final Demand before Trial: Per defense counsel, plaintiff demanded $1 million at mediation.
- Defendant Final Offer before Trial: $125,000