Case Law Update – Eleventh Circuit Holds Damages in UM Case not Binding in the Subsequent Bad Faith Case when Insurer did not Receive Appellate Review of Damages Verdict

June 20, 2017 by on News

In Bottini v. Geico, No. 15-12266 (11th Cir. June 17, 2017), the insurer challenged an order granting partial summary judgment on the binding effect of the verdict in the UM case. A jury returned a verdict in favor of the plaintiff in excess of the policy limits in the UM case. GEICO appealed the judgment on grounds related to the computation of damages. The Second District affirmed the judgment in favor of the plaintiff in a per curiam opinion finding that even if errors affected the computation of damages, the errors were harmless. GEICO did not seek discretionary post-judgment review in the Second District or in the Florida Supreme Court.

The plaintiff subsequently brought an action against GEICO in the Middle District of Florida alleging violations of Florida Statutes section 624.155 and moved for summary judgment arguing that the damages totaled the amount of the jury verdict totaling $30,872,266. GEICO responded that because it did not receive appellate review of the damages verdict, “giving effect to the verdict in the bad-faith lawsuit would violate its right to procedural due process.” The district court granted the plaintiff’s motion and held that the jury verdict was binding in the bad faith lawsuit.

On appeal, the Eleventh Circuit reversed the district court’s order granting partial summary judgment on the binding effect of the verdict in the UM case. The Court found that the Second District failed to review the alleged errors that GEICO argued caused the excess jury verdict, and GEICO was entitled to such review under Florida law. Relying on the Florida Supreme Court decision in Fridman v. Safeco Ins. Co., 185 So. 3d 1214 (Fla. 2016), the Court held that because GEICO did not receive appellate review of the damages in the underlying UM case, the damages determination was not binding in the subsequent bad faith case. The Court further reasoned that the fact that GEICO failed to seek alternative review from the Second District or the Florida Supreme Court did not change its right to object to the damages verdict as the alternatives are discretionary.

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Jane Anderson
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