SUMMARY
The Pennsylvania Superior Court recently held that a trial court’s decision to impose $18 million in punitive damages and $3 million in attorneys’ fees for violations of Pennsylvania’s Insurance Bad Faith Statute, 42 Pa. C.S.A. § 8371, was unsupported by the record, and instead directed the entry of a judgment in favor of the insurer. Berg v. Nationwide Mut. Ins. Co., No. 713 MDA 2015 (Pa. Super. April 9, 2018). The Superior Court also admonished the trial court for making irrelevant observations about the insurance industry and rejected what it believed were unsubstantiated findings of fact.
The Berg case originated from a 1996 car accident and a subsequent property damage claim presented to Nationwide as the Berg’s insurer. In 2004, a jury awarded the Bergs $295 against Nationwide for a violation of Pennsylvania’s Unfair Trade Practices and Consumer Protection Law related to Nationwide’s involvement in the repair of Berg’s Jeep. The jury rejected the Berg’s fraud claim. In a bench trial, Nationwide prevailed on the insurance bad faith claim presented by Berg, but the Pennsylvania Supreme Court ultimately reversed that decision, Berg v. Nationwide Mut. Ins. Co., 6 A.3d 1002 (Pa. 2010), and the Superior Court remanded the matter for a new trial. Berg v. Nationwide Mut. Ins. Co., 44 A.3d 1164 (Pa. Super. 2012). The second insurance bad faith trial...
