No Summary Judgment for Bad Faith for Lack of Evidence
Post 5437
Posted on August 28, 2026 by Barry Zalma
Genuine Dispute of Material Fact Avoids Summary Judgment
In Riley and Rebecca Ross v. Allstate Vehicle And Property Insurance Company, and Illinois Corporation, No. 2:25-CV-00006-JAG, United States District Court, E.D. Washington (August 18, 2026), Pending before the USDC was Defendant’s Motion for Partial Summary Judgment the plaintiffs brought claims against Allstate arising from its handling of an insurance claim. They alleged Allstate failed to make proper payment, adequately investigate the loss, retain an expert, respond to communications, and properly value damages including alternative living expenses and damage to a hydronic heating system.
Plaintiffs argued Defendant failed “to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies.”
ISSUES
Allstate sought dismissal of the plaintiffs’ claims under the Insurance Fair Conduct Act (IFCA), Consumer Protection Act (CPA), insurance bad faith, and negligent claims handling. Allstate also sought to bar recovery of attorney’s fees.
LAW
The USDC applied the summary judgment standard: summary judgment is proper only where there is no genuine dispute of material fact and the movant is entitled to judgment as a matter of law.
For the IFCA claim, Washington law permits suit where an insurer unreasonably denies coverage or payment of benefits. The USDC rejected an expanded “constructive denial” theory.
For the CPA claim, the plaintiffs had to show an unfair or deceptive act, trade or commerce, public interest impact, injury, and causation. Violations of certain insurance regulations can constitute per se unfair or deceptive acts.
For bad faith, plaintiffs had to show unreasonable conduct by the insurer. Summary judgment is improper if material facts remain disputed regarding the reasonableness of the insurer’s actions. Fees are available in coverage disputes, not merely disputes over claim valuation or damages.
DISCUSSION / ANALYSIS
Where the insurer pays or offers to pay a paltry amount that is not in line with the losses claimed, is not based on a reasoned evaluation of the facts (as known or, in some cases, as would have been known had the insurer adequately investigated the claim), and would not compensate the insured for the loss at issue, the benefits promised in the policy are effectively denied.
The court dismissed the IFCA claim because Allstate had not denied coverage or benefits. The court concluded that Washington law does not recognize a constructive denial theory under IFCA where the insurer made substantial payment but disputed the amount owed.
The CPA claim survived in part. The court dismissed CPA theories based on failure to adopt investigation standards, failure to affirm or deny coverage, failure to acknowledge communications, and settlement standards because plaintiffs failed to identify sufficient supporting facts. However, CPA theories based on allegedly unreasonable investigation and alleged underpayment sufficient to compel litigation survived because factual disputes remained.
The bad faith and negligent claims handling claims also survived. Plaintiffs presented enough evidence to create a factual dispute over whether Allstate’s investigation and valuation were reasonable, including the lack of an in-person adjuster inspection and handling of the heating-system damage.
The court rejected fees because the dispute concerned claim valuation and damages, not coverage. Allstate acknowledged coverage. The disagreement was over the extent and value of the loss.
CONCLUSION
Allstate’s motion for partial summary judgment was granted in part and denied in part. The IFCA claim was dismissed with prejudice. CPA claims based on WAC 284-30-330(4) and (7) remained. The plaintiffs’ breach of contract, bad faith, declaratory judgment, and negligent claims handling claims remained pending.
The USDC concluded that as to the IFCA claims, no issue of genuine factual dispute exists, consequently summary judgment is appropriate. Plaintiff also presented a genuine issue of fact regarding the Bad Faith and Negligent Claims Handing claim. Lastly, the USDC found fees do not apply.
ZALMA OPINION
Bad faith is a tort that requires a finding of unreasonable conduct by the insurer. The facts to prove that tort was not proved but the plaintiff presented sufficient evidence to raise a genuine issue of fact regarding the Bad Faith and Negligent Claims Handing claim. Whether they proved the torts at trial will be established by a jury.
(c) 2026 Barry Zalma & ClaimSchool, Inc.
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Insurance Expert May Not Testify to Speculative and Contains Unsupported Conclusions.
Posted on September 18, 2026 by Barry Zalma
See the full video at and at https://rumble.com/v7fmifw-expert-may-only-testify-to-what-experience-supports.html
In Michele A. Over, and The Estate Of Paul R. Over v. State Farm Mutual Automobile Insurance Company, and State Farm Fire And Casualty Company, Civil Action No. 23-cv-02243-PAB-STV, United States District Court, D. Colorado (September 14, 2026) Michele and Paul Over sued State Farm Fire and State Farm Auto over hail-damage and stolen-vehicle claims.
The operative dispute concerned State Farm Auto’s motion to exclude or limit opinions from plaintiffs’ insurance-industry expert, Aaron Castillo. Castillo.
Law
The proponent of expert testimony must establish by a preponderance of the evidence that an expert is qualified and that the opinions are helpful, sufficiently grounded, and reliably derived and applied. Experience-based opinions must explain how the...
150 Months in Prison for Tax Fraud
Post 4846
Posted on September 17, 2026 by Barry Zalma
See the full video at https://lnkd.in/g8rh3JBX and https://lnkd.in/gmkdy-9C, In United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
In United States Of America v. Thomas Addaquay, United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS
Thomas Addaquay controlled United Consolidated Accounting and Business Services (UC), nominally a check-cashing business.
The government proved a three-stage tax-refund scheme that converted the resulting refund checks into usable funds through ...
Major Fraud Perpetrator Asserts Fifth Amendment Privilege to Avoid Prosecution
Post 5489
Posted on September 14, 2026 by Barry Zalma
Fraudster Refuses to Answer Questions About His Alleged Fraud
See the full video at https://lnkd.in/gvicAMDr and at https://lnkd.in/gvicAMDr
In Great American Insurance Co. v. Gemstone Property Management, LLC, et al., No. 23-cv-9100 (LJL), United States District Court, S.D. New York (September 8, 2026) Great American Insurance Company alleged that it was defrauded through a scheme in which Subin Associates, LLP recruited individuals to stage construction-site injuries, arranged unnecessary medical treatment and litigation funding, and pursued fraudulent personal-injury claims.
Luis Manuel Garcia Salcedo, resulted in a $6 million settlement. Non-party Jose Hernandez allegedly worked as an assistant manager at Subin, operated Hernandez Associates, and owned litigation-funding companies that shared office space with Subin and provided services to its clients.
After Great American ...
Defendants Successfully Moved for Summary Judgment
Post 4854
Posted on September 30, 2026 by Barry Zalma
In Jeffrey Wayne Phillips v. Creative Website Studios, et al., No. 5:23-CV-568-BO-BM, United States District Court, E.D. North Carolina, Western Division (September 28, 2026) the Court needed to rule on the order and memorandum and recommendation (“M&R”) of the Magistrate.
Jeffrey Wayne Phillips had contracted with Creative Website Studios and SR Telecommunications for website and hosting services. He alleged that defendants repeatedly billed him for hosting periods he had already paid for and later took down his website. Phillips claimed the outage prevented him from bidding on U.S. government security contracts and sought roughly $300 million in consequential damages.
LAW
Under North Carolina law, fraud requires a false material representation or concealment, intent and effect of deception, resulting damage, and reasonable reliance. Obtaining property by false pretenses similarly requires an ...
Accused of 17 Counts Of Fraud Attempts to Keep Out Evidence of Crimes
Post 4853
Posted on September 29, 2026 by Barry Zalma
Court Refuses to Grant Most Motions in Limine
In United States Of America v. Seth Allen Aikens, II, Criminal No. 22-119, United States District Court, W.D. Pennsylvania (September 23, 2026) Defendant Seth Allen Aikens II faces thirty federal counts. The indictment alleges that, from about June 2016 through March 2020, Aikens solicited start-up businesses seeking websites, applications, hosting, payment processing, and related services. The Government estimated aggregate losses of approximately $1.3 million involving about eight charged customers.
The Government also sought to introduce evidence involving three uncharged persons. Robert Polonsky allegedly paid about $10,000 for web development, hosting, and advertising services but did not receive the promised core deliverables. Brandon Canwright allegedly paid approximately $1,877 for a website and related services that were not delivered and received no ...
Accused of 17 Counts Of Fraud Attempts to Keep Out Evidence of Crimes
Post 4853
Posted on September 29, 2026 by Barry Zalma
Court Refuses to Grant Most Motions in Limine
In United States Of America v. Seth Allen Aikens, II, Criminal No. 22-119, United States District Court, W.D. Pennsylvania (September 23, 2026) Defendant Seth Allen Aikens II faces thirty federal counts. The indictment alleges that, from about June 2016 through March 2020, Aikens solicited start-up businesses seeking websites, applications, hosting, payment processing, and related services. The Government estimated aggregate losses of approximately $1.3 million involving about eight charged customers.
The Government also sought to introduce evidence involving three uncharged persons. Robert Polonsky allegedly paid about $10,000 for web development, hosting, and advertising services but did not receive the promised core deliverables. Brandon Canwright allegedly paid approximately $1,877 for a website and related services that were not delivered and received no ...
