Suing an Insurer & its Chairman as Racist for Denial of Claim is not Viable
Barry Zalma
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After a car accident, Nehemiah Rolle filed a claim with his insurer, Founders Insurance Company, a member company of the Utica National Insurance Group. Founders responded with a request for more information, and when none came, the company denied the claim only to find it and its Chairman sued claiming their racism resulted in the denial of Rolle’s claim. In Nehemiah Rolle, Jr. v. Richard P. Creedon, No. 22-1720, United States Court of Appeals, Seventh Circuit (February 23, 2023) the Seventh Circuit heard the appeal and warned Rolle that further frivolous filings would cause sanctions to be imposed against him.
FACTS
A few months after the denial Founders sent Rolle a notice that his policy was due to expire and would not be renewed. Rolle then sued Richard Creedon, the chairman and chief executive officer of Utica National, alleging that Founders breached its insurance contract by not paying his claim and discriminated against Rolle because he is Black by “aiding and abetting” white employees to “criminally defraud” Rolle by accepting his insurance premium while denying coverage.
Rolle sought compensatory damages of 1 billion dollars and punitive damages of 500 million dollars. Creedon moved to dismiss the case for lack of personal jurisdiction. In the meantime, Rolle filed a motion requesting an “Emergency Order” for “A Stay or Restraining Order” requiring that his insurance coverage continue beyond its expiration date and until the insurance company was required (through this lawsuit) to pay for the repairs to Rolle’s car.
The district judge construed Rolle’s motion for an “Emergency Order” as a request for a temporary restraining order under Rule 65(b) and denied it. Rolle, unhappy with the result, then moved for the district judge’s recusal because of alleged racial bias, which, he argued, is what caused the judge to deny the “Emergency Order” and say there was no emergency.
Rolle filed an interlocutory appeal after the denial of his two motions. The essence of a TRO is its brevity, its ex parte character, and (related to the second element) its informality. A preliminary injunction requires notice to the opposing party, and typically involves a hearing held before the injunction is issued.
Here, the district court labelled the motion as a request for a TRO and, consistent with such proceedings denied it without a hearing in a brief order. On the merits, Rolle argues the judge erred by finding it unlikely he would suffer irreparable harm without injunctive relief. Rolle contends that if his coverage is not maintained, he cannot be insured by another company because of the damage to his car that his insurer refused to pay.
ANALYSIS
To obtain a preliminary injunction, a plaintiff must show that it is likely to succeed on the merits, and that traditional legal remedies would be inadequate, such that it would suffer irreparable harm without the injunction. The Seventh Circuit concluded that the district judge did not err in determining that Rolle failed to demonstrate that the denial of his insurance claim (even if wrongful) or the non-renewal of his auto insurance policy would cause irreparable harm in these circumstances. The harm Rolle claims is measurable in monetary terms (the cost to repair his car or a higher insurance premium), and can be adequately addressed with damages.
VEXATIOUS LITIGANT
Rolle’s litigation history demonstrates a concerning pattern of misconduct against this defendant and others. Rolle filed a second suit against Creedon in the Northern District of Illinois four months after filing this one. The second complaint alleges that Creedon “defam[ed] and libel[ed]” Rolle by notifying the court of Rolle’s litigation history that was otherwise identical to the complaint before the Seventh Circuit.
Rolle is a prolific litigant. He has filed at least 55 federal lawsuits in the Eastern, Northern, and Southern Districts of New York, the Southern District of Ohio, and the District of New Jersey. Most allege that businesses, elected officials, judges, and government employees engaged in racist actions that violated his constitutional rights, but none went far. The majority of these cases have been frivolous and dismissed for lack of subject-matter jurisdiction. Two courts (E.D.N.Y. and S.D. Ohio) imposed restrictions on Rolle because of his vexatious filings.
The Seventh Circuit warned Rolle that further frivolous filings within this circuit may lead to monetary sanctions that, if unpaid, can result in a filing bar.
On the jurisdictional issue, the Seventh Circuit sided with Rolle but affirmed the denial of relief.
ZALMA OPINION
Insurance companies are often disliked, especially when a claim is denied. People like Mr. Rolle believe that filing a suit claiming bad faith and racism will result in a monetary settlement to avoid the costs of defending the suit. Mr. Rolle is a vexatious litigant who has received the kindness of federal courts who take the time to hear his frivolous lawsuits and claims that anyone who disagrees with him is a racist who must pay him millions of dollars for his hurt feelings. A warning after 55 frivolous suits is too little too late. Mr. Rolle should be severely sanctioned with sanctions that hurt – not just a refusal to allow him to file suits.
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected]
Write to Mr. Zalma at [email protected]; http://www.zalma.com; http://zalma.com/blog; daily articles are published at https://zalma.substack.com. Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma; Follow Mr. Zalma on Twitter at https://twitter.com/bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library
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Jury’s Findings Interpreting Insurance Contract Affirmed
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Madelaine Chocolate Novelties, Inc. (“Madelaine Chocolate”) appealed the district court’s judgment following a jury verdict in favor of Great Northern Insurance Company (“Great Northern”) concerning storm-surge damage caused by “Superstorm Sandy” to Madelaine Chocolate’s production facilities.
In Madelaine Chocolate Novelties, Inc., d.b.a. The Madelaine Chocolate Company v. Great Northern Insurance Company, No. 23-212, United States Court of Appeals, Second Circuit (June 20, 2025) affirmed the trial court ruling in favor of the insurer.
BACKGROUND
Great Northern refused to pay the full claim amount and paid Madelaine Chocolate only about $4 million. In disclaiming coverage, Great Northern invoked the Policy’s flood-exclusion provision, which excludes, in relevant part, “loss or damage caused by ....
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In Associated Industries Insurance Company, Inc. v. Sentinel Insurance Company, Ltd., No. 23-CV-10400 (MMG), United States District Court, S.D. New York (June 16, 2025) an insurance coverage dispute arising from a personal injury action in New York State Supreme Court.
The underlying action, Eduardo Molina v. Venchi 2, LLC, et al., concerned injuries allegedly resulting from a construction accident at premises owned by Central Area Equities Associates LLC (CAEA) and leased by Venchi 2 LLC with the USDC required to determine who was entitled to a defense from which insurer.
KEY POINTS
Parties Involved:
CAEA is insured by Associated Industries Insurance Company, Inc. ...
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Attack by Vicious Dog Excluded
In Foremost Insurance Company, Grand Rapids, Michigan v. Michael B. Steele and Sarah Brown and Kevin Lee Price, Civil Action No. 3:24-CV-00684, United States District Court, M.D. Pennsylvania (June 16, 2025)
Foremost Insurance Company (“Foremost”) sued Michael B. Steele (“Steele”), Sarah Brown (“Brown”), and Kevin Lee Price (“Price”) (collectively, “Defendants”). Foremost sought declaratory relief in the form of a declaration that
1. it owes no insurance coverage to Steele and has no duty to defend or indemnify Steele in an underlying tort action and
2. defense counsel that Foremost has assigned to Steele in the underlying action may withdraw his appearance.
Presently before the Court are two ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
See the full video at https://lnkd.in/gK_P4-BK and at https://lnkd.in/g2Q7BHBu, and at https://zalma.com/blog and at https://lnkd.in/gjyMWHff.
Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
Professional Health Care Services Exclusion Effective
Post 5073
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This opinion is the recommendation of a Magistrate Judge to the District Court Judge and involves Travelers Casualty Insurance Company and its duty to defend the New Mexico Bone and Joint Institute (NMBJI) and its physicians in a medical negligence lawsuit brought by Tervon Dorsey.
In Travelers Casualty Insurance Company Of America v. New Mexico Bone And Joint Institute, P.C.; American Foundation Of Lower Extremity Surgery And Research, Inc., a New Mexico Corporation; Riley Rampton, DPM; Loren K. Spencer, DPM; Tervon Dorsey, individually; Kimberly Dorsey, individually; and Kate Ferlic as Guardian Ad Litem for K.D. and J.D., minors, No. 2:24-cv-0027 MV/DLM, United States District Court, D. New Mexico (May 8, 2025) the Magistrate Judge Recommended:
Insurance Coverage Dispute:
Travelers issued a Commercial General Liability ...
A Heads I Win, Tails You Lose Story
Post 5062
Posted on April 30, 2025 by Barry Zalma
"This is a Fictionalized True Crime Story of Insurance Fraud that explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help everyone to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime."
Immigrant Criminals Attempt to Profit From Insurance Fraud
People who commit insurance fraud as a profession do so because it is easy. It requires no capital investment. The risk is low and the profits are high. The ease with which large amounts of money can be made from insurance fraud removes whatever moral hesitation might stop the perpetrator from committing the crime.
The temptation to do everything outside the law was the downfall of the brothers Karamazov. The brothers had escaped prison in the old Soviet Union by immigrating to the United...
