Charles Stokes and Trishe Hynes Successfully Move for Dismissal of Insurance Bad Faith Claim in Federal Court
On July 11, 2023, a US District Judge entered an Order granting a Motion for Judgment on the Pleadings filed by Russo & Gould Partner Charles Stokes and Associate Trishé Hynes, dismissing Plaintiff’s Complaint in its entirety. In Fuggi v. West, et al., which was filed in the US District Court for the District of New Jersey, Plaintiff/Policyholder made a claim against his homeowners policy for more than $40,000 in personal property that he alleged was in his vehicle when it was stolen. In his lawsuit, he claimed that Berkshire Hathaway Guard had delayed adjustment of the claim and had wrongfully withheld benefits. Chuck and Trishé countered on behalf of the carrier that Plaintiff had refused to appear for an Examination Under Oath as required by the policy, justifying its denial of the claim.
Plaintiff’s Complaint asserted five causes of action, most notably for common law bad faith, and statutory fraud under the New Jersey Consumer Fraud Act (“NJCFA”). Significantly, Plaintiff relied on the NJCFA’s allowance of treble damages and attorney fees to meet the $75,000 damages threshold for claims founded on diversity of citizenship.
In the motion, Chuck and Trishé argued inter alia that the NJCFA has repeatedly been held by New Jersey state and federal courts to be inapplicable to claims arising from an insurance carrier’s denial of policy benefits. The Court ultimately agreed and dismissed Plaintiff’s statutory fraud claim. Since the remaining claims no longer met the jurisdictional threshold, the Court dismissed Plaintiff’s Complaint in its entirety.