RG&M’s Million Dollar Bad Faith Verdict Affirmed on Appeal

On October 6, 2020, a panel of Division One of the Arizona Court of Appeals unanimously affirmed the trial court’s $1.6 million judgment in favor of RG&M’s client against a primary insurer for bad faith failure to settle.

In May 2019, Michael Raymond and Daniel McCarthy prevailed on behalf of their client against a primary insurer who failed to settle an underlying lawsuit within its $2 million policy limits. That failure eventually led to a Maricopa County jury verdict against the primary insurer’s insured for nearly $4 million. Michael Raymond helped his client, an excess insurer, settle the underlying claim on appeal and then sought reimbursement from the primary insurer for the $1 million the excess insurer was forced to pay to resolve the underlying claim.

A unanimous jury found that the primary carrier did not act in good faith when it rejected multiple opportunities to settle the underlying claim within its $2 million layer. As a result, RG&M’s client was awarded a $1.65 million judgment which included prejudgment interest and attorneys’ fees.

The primary insurer appealed. The Court of Appeals rejected the multiple grounds asserted as error and awarded RG&M’s clients attorneys’ fees on appeal. The Court of Appeals Memorandum Decision is attached.