Date: 10-08-2024

Case Style:

Mark Snyder v. State Farm Mutual Automobile Insurance Company

Case Number: 3:23-cv-01635

Judge: Adrienne Nelson

Court: United States District Court for the District of Oregon (Multnomah County)

Plaintiff's Attorney:

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Defendant's Attorney: Jeremy C. Rice

Description:

Portland, Oregon bad faith breach of insurance contract law lawyer represented the Plaintiff.

On July 17, 2002 Plaintiff Mark Synder ("Snyder") was riding a bicycle when he was struck by a motor vehicle driven by Chris Knight ("Knight"). Knight was at fault in causing this accident. As a result of this accident, Snyder suffered very serious spinal injuries which left him partially disabled.

The vehicle driven by Knight had a $25,000 liability insurance policy with Nationwide Insurance Company ("Nationwide"). Knight also had an excess coverage policy on the vehicle through State Farm in the amount of $50,000, giving him $75,000 in total liability coverage on the vehicle. Snyder had a UIM coverage policy with State Farm in the amount of $100,000, and UIM coverage under a policy issued to Nicole Bufano that provided $15,000 of coverage in the event of being a pedestrian involved in an accident. This gave Snyder a total UIM coverage amount of $115,000.

On January 19, 2004, Snyder received the $25,000 in liability insurance from Nationwide. On June 28, 2004, Snyder sued Knight in the Court of Common Pleas of Charleston County. State Farm retained counsel to defend the case, as provided for in § 38-77-160 of the South Carolina Code. In November 2005, after the completion of discovery in the case, Snyder received the $50,000 coverage limit from State Farm under Knight's excess liability policy.

Throughout this time period, State Farm claim representative Jane Coleman ("Coleman") was researching Snyder's claim for payments under Knight's UIM policy. Coleman requested copies of all of Snyder's medical records. State Farm determined that Snyder's medical claims were worth between $75,000 and $100,000. Given that Snyder had received $75,000 in liability coverage, State Farm believed that this meant that Snyder was only entitled to receive between zero and $25,000 in UIM coverage. Snyder's evaluation of his medical claims was, unsurprisingly, dramatically different in valuation. Snyder, through his attorney, made a written demand for $300,000, or the $115,000 in policy limits of Snyder's UIM policies.

The two sides commenced settlement negotiations. On November 15, 2005, Plaintiff contacted State Farm and offered to settle the case for the limits of Snyder's UIM coverage, excluding the UIM coverage to which he was entitled under Bufano's policy, in the amount of $100,000. On December 28, State Farm responded with a counteroffer of a summary jury trial, in which Snyder would have had a minimum recovery of nothing, a maximum recovery of $115,000, would have had to go through a trial, and would have been precluded from appealing the jury's verdict and from asserting a claim against State Farm for bad faith. On January 11, 2006, Plaintiff responded with a counteroffer of a summary jury trial at which the minimum recovery was fixed at $50,000. On January 13, State Farm responded to this by proposing a summary jury trial at which the minimum recovery was set at $25,000.

The parties are in dispute about whether Plaintiff's counsel recommended to Snyder that he accept this offer. State Farm asserts that Plaintiff's counsel represented to State Farm's counsel that he had passed the offer along to Snyder along with a recommendation that he accept the offer. Plaintiff, on the other hand, vigorously denies that this ever occurred.

On January 30, 2006, Plaintiff again contacted State Farm and offered to settle for his UIM policy limit of $100,000. State Farm refused this offer. The week before the case was to go to trial, Plaintiff contacted State Farm and offered to settle the case for $75,000. Once again, State Farm refused. Finally, on the day the trial was to begin, Plaintiff reduced his demand to $50,000 if State Farm would settle before opening statements. State Farm refused this offer as well.

At no point in the settlement negotiations did State Farm propose any offer which would not have forced Snyder to go through some sort of trial to get his UIM benefits. While State Farm did propose that Snyder could go to a summary jury trial where the jury would have to award him at least $25,000, Snyder never had the option of simply taking the $25,000 payment. This is amply supported by the record, and is acknowledged numerous times by State Farm employees involved with the case during deposition testimony.

For example, at her deposition, Coleman was asked, "Did you ever make Mr. Snyder an offer that would not require some sort of trial in the case?" Coleman answered, "No. All of my offers were attached to a summary jury trial, but I did not feel that his claims value exceeded what he had already been compensated . . ." (Coleman Depo. at 72.) See also id. at 62-63 ("[W]e were always offering the 25,000 on a summary jury trial. We never offered it without a summary jury trial."). On an internal State Farm document entitled "First-Party Pre-Trial Review Form" this is also emphasized. In the section entitled "Last Offer:," the form reads "No offer has been made to date." (Pl's Ex. 11.) The "State Farm Post Trial Report" also recognizes that "[n]o offers of UIM money" were made. Id.

Snyder declined to go to a summary jury trial, and instead took the case to full trial in the Court of Common Pleas. The trial took place in February 2006. Shortly before trial, Snyder visited his physician and learned that he would need additional surgery. Snyder attempted to delay the trial in order to depose this physician and get more information regarding this new condition so that this information could be brought before the jury, but State Farm refused to consent to the delay. At the conclusion of the trial, the jury returned a verdict for Snyder against Knight in the amount of $345,000. At this point, State Farm paid Snyder the maximum limit of his UIM coverage in the amount of $115,000. Upon receiving these UIM forms, Plaintiff signed a form acknowledging full satisfaction of the verdict. While Plaintiff certainly expressed a preference not to experience the stress of going through a trial, it is not disputed that Snyder benefitted from the trial financially.

There was, however, some dispute regarding the availability of the $15,000 in UIM coverage provided by Ms. Bufano's policy. Snyder and Bufano were never formally married, but have held themselves out to be common law husband and wife for a substantial period of time. In October 2005, State Farm sent Snyder a letter seeking to confirm that Snyder was no longer making a UIM claim under Bufano's policy since "plaintiff cannot establish a common law marital relationship." (Pl.'s Ex. 4.) Then, despite the fact that the claim adjuster Coleman had determined that Snyder and Bufano were married and Snyder had coverage under Bufano's UIM policy, State Farm's counsel proposed that the issue of the validity of Snyder's and Bufano's marital relationship be bifurcated from the negligence cause of action at trial. This motion was denied by the state court on the first day of the trial. After this motion was denied, however, State Farm conceded the issue and did not challenge the relationship any further.

Snyder's agreement with his attorney provided for a 33% contingency fee in the event of a settlement, and a 40% contingency fee in the event of a trial. After trial, then, Snyder received 60% of the $115,000 payment of UIM benefits, or $69,000. Had State Farm accepted the $50,000 settlement offer, Snyder would have received 67% of this, or $33,500. Even had State Farm accepted Snyder's initial $100,000 demand, he would have recovered $67,000, less than he received from the trial verdict.

On January 23, 2007, Snyder filed suit in the Charleston County Court of Common Pleas against State Farm for negligence, bad faith refusal to pay benefits, unfair trade practices, breach of contract, improper claims practices, and waiver and estoppel. Snyder is seeking actual and punitive damages, as well as litigation costs. State Farm removed this action to federal court on February 13, on the basis of diversity jurisdiction. After the conclusion of discovery, on November 26, State Farm moved for summary judgment in this matter. On January 4, 2008, Plaintiff issued a Response in Opposition to this motion. Defendant replied to this on January 7. Plaintiff filed a Sur Reply on January 11.

State Farm's Reply and Snyder's Sur Reply are largely dedicated to the issue of whether Plaintiff's counsel, in Plaintiff's Response in Opposition to State Farm's Motion for Summary Judgment, impermissibly blurred the line between advocate and witness by making factual statements in the Response that were unsupported anywhere in the record. A plaintiff may not seek to establish an issue of material fact by having an attorney make factual statements in pleadings which are otherwise unsupported in the case's record. Such representations are not evidence and will not be considered as evidence. However, to the extent such improper statements were made in the Response, they concerned matters of relatively minor importance to this litigation, and the court sees no need to take dramatic corrective measures such as removing Mr. Wigger as Plaintiff's counsel.

Outcome: The Court having been informed by counsel for the parties that this action has been settled, IT IS ORDERED that, pursuant to LR 41-1, this action is dismissed with prejudice and without costs and with leave, upon good cause shown within sixty (60) days, to have this order of dismissal set aside and the action reinstated if the settlement is not consummated. Pending motions, if any, are denied as moot. All pretrial deadlines and any trial date are stricken. By Clerk of Court Melissa Aubin. (joha) (Entered: 10/08/2024)

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