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    Allen Feingold v. Liberty Mutual Group, 3rd Cir. (2014)

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    The document summarizes a court case between Allen Feingold, Barbara Quinn, and Liberty Mutual Group regarding claims of bad faith insurance practices. The District Court dismissed Feingold's claim for lack of standing and granted Liberty Mutual's motion for summary judgment on Quinn's claim. The Third Circuit Court of Appeals affirms both judgments. It finds that bad faith claims are not assignable under Pennsylvania law, preventing Feingold from having standing. It also finds that Quinn did not provide clear and convincing evidence of bad faith to survive summary judgment. Challenging an arbitration award alone does not demonstrate bad faith.

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    Allen Feingold v. Liberty Mutual Group, 3rd Cir. (2014)

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    115 views7 pages
    The document summarizes a court case between Allen Feingold, Barbara Quinn, and Liberty Mutual Group regarding claims of bad faith insurance practices. The District Court dismissed Feingold's claim for lack of standing and granted Liberty Mutual's motion for summary judgment on Quinn's claim. The Third Circuit Court of Appeals affirms both judgments. It finds that bad faith claims are not assignable under Pennsylvania law, preventing Feingold from having standing. It also finds that Quinn did not provide clear and convincing evidence of bad faith to survive summary judgment. Challenging an arbitration award alone does not demonstrate bad faith.

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    Filed: 2014-04-04 Precedential Status: Non-Precedential Docket: 13-1977

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    The document summarizes a court case between Allen Feingold, Barbara Quinn, and Liberty Mutual Group regarding claims of bad faith insurance practices. The District Court dismissed Feingold's claim for lack of standing and granted Liberty Mutual's motion for summary judgment on Quinn's claim. The Third Circuit Court of Appeals affirms both judgments. It finds that bad faith claims are not assignable under Pennsylvania law, preventing Feingold from having standing. It also finds that Quinn did not provide clear and convincing evidence of bad faith to survive summary judgment. Challenging an arbitration award alone does not demonstrate bad faith.

    Copyright:

    Public Domain
    Download as PDF or read online from Scribd
    Download as pdf
    115 views7 pages

    Allen Feingold v. Liberty Mutual Group, 3rd Cir. (2014)

    Uploaded by

    Scribd Government Docs
    The document summarizes a court case between Allen Feingold, Barbara Quinn, and Liberty Mutual Group regarding claims of bad faith insurance practices. The District Court dismissed Feingold's claim for lack of standing and granted Liberty Mutual's motion for summary judgment on Quinn's claim. The Third Circuit Court of Appeals affirms both judgments. It finds that bad faith claims are not assignable under Pennsylvania law, preventing Feingold from having standing. It also finds that Quinn did not provide clear and convincing evidence of bad faith to survive summary judgment. Challenging an arbitration award alone does not demonstrate bad faith.

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    of 7

    NOT PRECEDENTIAL

    UNITED STATES COURT OF APPEALS


    FOR THE THIRD CIRCUIT
    __________
    No. 13-1977
    ___________
    ALLEN L. FEINGOLD;
    BARBARA QUINN,
    Executrix of the Estate of Theresa Thompson, Deceased
    v.
    LIBERTY MUTUAL GROUP;
    LIBERTY MUTUAL INSURANCE COMPANY;
    LIBERTY MUTUAL FIRE INSURANCE COMPANY.;
    and LIBERTY GUARD AUTOMOBILE COMPANY
    BARBARA QUINN,
    Appellant
    __________
    No. 13-1978
    ___________
    ALLEN L. FEINGOLD;
    BARBARA QUINN,
    Executrix of the Estate of Theresa Thompson, Deceased
    v.
    LIBERTY MUTUAL GROUP;
    LIBERTY MUTUAL INSURANCE COMPANY;
    LIBERTY MUTUAL FIRE INSURANCE COMPANY;
    and LIBERTY GUARD AUTOMOBILE COMPANY
    ALLEN L. FEINGOLD,
    Appellant

    ______________
    APPEAL FROM THE UNITED STATES DISTRICT COURT
    FOR THE EASTERN DISTRICT OF PENNSYLVANIA
    (D.C. Civ. Action No. 2-11-cv-05364)
    District Judge: Honorable Harvey Bartle, III
    ______________
    Submitted Under Third Circuit LAR 34.1(a)
    January 17, 2014
    ______________
    Before: AMBRO, HARDIMAN, GREENAWAY, JR., Circuit Judges.
    (Filed: April 4, 2014)
    ______________
    OPINION
    ______________

    GREENAWAY, JR., Circuit Judge.


    Allen L. Feingold and Barbara Quinn brought an action against Liberty Mutual
    Group, Liberty Mutual Insurance Company, Liberty Mutual Fire Insurance Company,
    and Liberty Guard Auto Company (together Liberty Mutual or Appellees) for
    violation of Pennsylvanias bad faith insurance statute, 42 Pa. Cons. Stat. Ann. 8371.
    The District Court dismissed Feingolds claim for lack of subject matter jurisdiction and
    dismissed Quinns claim pursuant to Liberty Mutuals motion for summary judgment.
    For the reasons discussed below, we will affirm the District Courts judgments.

    I. Factual Background
    Because we write primarily for the parties who are familiar with the facts and
    procedural history, we recount only the essential facts.
    Theresa Thompson, a New Jersey resident, sustained serious personal injuries on
    June 24, 1997, as a result of an automobile accident in Philadelphia. Thompson made a
    claim for uninsured motorists coverage under a policy issued to Thompson by Liberty
    Mutual Fire Insurance Company. After Liberty Mutual refused to pay the benefits,
    Thompson hired Feingold as her attorney to bring a claim against Liberty Mutual in
    Pennsylvania state court. The Court of Common Pleas of Philadelphia County granted
    Thompson her motion to compel arbitration. On February 4, 2003, an arbitration panel
    found in favor of Thompson in the amount of $90,000.
    In a letter dated March 5, 2003, counsel for Liberty Mutual Insurance Company
    informed Feingold that it rejects this award. (App. 66a.) Thompson thereafter became
    seriously ill and died in 2006. Quinn was appointed as Executrix of Thompsons estate.
    On June 3, 2011, Quinn filed a petition in the Philadelphia Court of Common Pleas to
    confirm the arbitration award, which was granted. On December 8, 2011, Liberty Mutual
    Fire Insurance Co. paid the amount of the arbitration award, plus interest, in the total
    amount of $134,744.38.
    On August 25, 2011, Quinn and Feingold brought the present action alleging
    violation of Pennsylvanias bad faith statute in the United States District Court for the
    Eastern District of Pennsylvania. On February 28, 2012, the District Court granted the
    motion to dismiss Feingolds case for lack of standing, but allowed Quinns claims to
    3

    proceed. On March 7, 2013, the District Court granted Liberty Mutuals summary
    judgment motion regarding Quinns claims. This appeal followed.

    II. Jurisdiction
    The District Court had jurisdiction under 28 U.S.C. 1332. This Court has
    jurisdiction pursuant to 28 U.S.C. 1291.

    III. Analysis
    A. Claim of Allen Feingold
    Feingold claims that the District Court erred in dismissing his complaint for lack
    of standing. Feingold maintains that he has standing pursuant to a partial assignment
    agreement, which stipulated that Feingold is entitled to forty percent of Quinns claim
    against Liberty Mutual. (App. 16a.) On appeal, Feingold contends that there is no
    prohibition against the assignment of bad faith claims under Pennsylvania law.
    Federal courts sitting in diversity apply the substantive law of the state whose law
    governs the action. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). Our review of
    the District Courts prediction and application of state law is plenary. Clark v. Modern
    Grp. Ltd., 9 F.3d 321, 327 (3d Cir. 1993). When ascertaining Pennsylvania law, the
    decisions of the Pennsylvania Supreme Court are the authoritative source. State Farm
    Mut. Auto. Ins. Co. v. Coviello, 233 F.3d 710, 713 (3d Cir. 2000). In the absence of a
    controlling decision by the Pennsylvania Supreme Court, we must predict how it would

    rule if faced with the issue. Spence v. ESAB Grp., Inc., 623 F.3d 212, 216 (3d Cir.
    2010).
    We need not repeat the District Courts comprehensive and well-reasoned analysis
    that claims under the Pennsylvanias bad faith statute are not assignable in this context.
    The Pennsylvania Supreme Court has determined that Pennsylvania law does not permit
    the assignment of a cause of action to recover for personal injuries. Hedlund Mfg. Co.,
    Inc. v. Weiser, Stapler & Spivak, 539 A.2d 357, 359 (Pa. 1988). Contrary to his
    assertion, Feingold does not belong to the class of plaintiffs allowed to pursue a claim
    under 8371. See Ash v. Contl Ins. Co., 932 A.2d 877, 882 (Pa. 2007) (explaining that
    8371 only permits a narrow class of plaintiffs to pursue the bad faith claim against a
    narrow class of defendants). Federal courts must apply substantive state law, as
    interpreted by the state courts, when applying that law in diversity. Federal courts cannot
    confer broader rights under a states law than that state court would itself recognize.
    Erie, 304 U.S. at 78; see also F. Andrew Hessick, Standing in Diversity, 65 Ala. L. Rev.
    417, 418 (2013) (As has been clear since Erie . . . [f]ederal courts cannot . . . confer
    broader rights under state law than the state court [itself] recognize[s].).
    Therefore, the District Court did not err in granting Liberty Mutuals motion to
    dismiss for lack of standing.

    B. Claim of Barbara Quinn


    Quinn argues that Appellees violated Pennsylvanias bad faith statute by engaging
    in a frivolous and unfounded refusal to pay her arbitration award. Central to her claim is
    5

    the allegation that Appellees placed their own interests ahead of those of their insured.
    (Appellant Quinns Br. 10.)
    This Court exercises plenary review over the District Courts grant of summary
    judgment. See Giles v. Kearney, 571 F.3d 318, 322 (3d Cir. 2009). Summary judgment
    is proper if the movant shows that there is no genuine dispute as to any material fact and
    the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). A factual
    dispute is material only if it might affect the outcome of the case. Anderson v. Liberty
    Lobby, Inc., 477 U.S. 242, 248 (1986). For an issue to be genuine, a reasonable factfinder must be able to return a verdict in favor of the non-moving party. Id.
    Under Pennsylvania law, an insured may bring a cause of action against an insurer
    who has acted in bad faith. See Polselli v. Nationwide Mut. Fire Ins. Co., 23 F.3d 747,
    750 (3d Cir. 1994). Accordingly, in opposing a summary judgment motion, the
    plaintiffs burden of proof also rises. See id.
    Here, Quinns claim rests entirely on circumstantial evidence. Even viewed in the
    light most favorable to her, the record does not come close to establishing bad faith.
    Fatal to her claim, challenging an arbitration award by itself does not indicate bad faith.
    As it has been emphasized by Pennsylvania courts, bad faith must be proven by clear
    and convincing evidence and not merely insinuated. Terletsky v. Prudential Prop. &
    Cas. Ins. Co., 649 A.2d 680, 688 (Pa. Super. Ct. 1994) (internal citations omitted). While
    Pennsylvania requires that an insurer act with the utmost good faith toward its insured, an
    insurer is not required actively to submerge its own interest. See Cowden v. Aetna Cas.
    and Sur. Co., 134 A.2d 223, 228 (Pa. 1957) ([T]he insurer must act with the utmost
    6

    good faith toward the insured in disposing of claims against the latter. . . . But, that does
    not mean that the insurer is bound to submerge its own interest in order that the insureds
    interest may be made paramount.).
    Therefore, the District Court did not err in granting Liberty Mutuals motion for
    summary judgment.

    IV. Conclusion
    For the foregoing reasons, we affirm the judgments of the District Court.

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