Business Litigation

Subscribe to Business Litigation via RSS

A decision of the District Court for the Eastern District of Wisconsin has serious implications regarding the amount of damages payable where an insurance company breaches its duty to defend its insured from claims made against it.

Wisconsin law provides that an insurance company is obligated to defend its insured from legal action even if only one of several claims made against the insured is covered under the insurance policy.  Wisconsin state courts have not specifically addressed what damages are payable by an insurance company where only one of several claims are covered by the policy.

In Johnson Outdoors, Inc. v. General Star Indemnity Co., 2009 WL 4043194, the Eastern District Court determined that damages payable for breach of the duty to defend would be damages attributable to the covered claim only.  Therefore, where there had been a settlement of various claims made against the insured, the insurer could discover information pertinent to the question what portion of the settlement related to the covered claim.Continue Reading Damages for Insurer’s Failure to Defend

About a year ago I posted on fired Kentucky coach Billy Gillespie’s claims against the school related to their alleged failure to honor a letter of intent. Now, former UK coach Tubby Smith is on the losing end of a lawsuit involving somewhat similar legal theories.    Apparently, the plaintiff quit his job based on representations…

The following was posted by Thomas Kertschner of the Journal Sentinel on July 5, 2010:

Oak Creek – The Common Council, which was hit by a storm of denunciation after it considered using eminent domain to acquire a 94-year-old farmer’s property, will be asked Tuesday to pay the man’s $9,081 legal bill.

The request comes from Michael Schober, the attorney who represents Earl Giefer.

Giefer’s family has said it has no interest in selling the farm at 10523 S. Howell Ave., which has been in family since the 1800s.

City officials had argued that the 25-acre property would impede plans for a business park nearby and believe the farm qualifies as blighted.

The council decided June 1 to stop discussions of the possible use of eminent domain.Continue Reading Oak Creek Will Be Asked To Pay Farmer’s Legal Bills

In Roehl Transport v. Liberty Mutual, 2010 WI 49, the Wisconsin Supreme Court significantly expanded the tort of bad faith as it applies against insurance companies.  Insurers can engage in bad faith when improperly handling an insured’s claim or a third party claim against an insured in certain circumstances.  In the past, the bad faith doctrine has been applied in situations where an insured is liable for an excess judgment (one beyond policy limits) due to such mishandling. 

The doctrine has now been extended to circumstances where an insured is forced to forfeit a large deductible.  In Roehl Transport, the deductible was very substantial–$500,000.00.  The insurer settled the matter within its policy limits, but in an amount in excess of the deductible.Continue Reading Wisconsin Supreme Court Extends Doctrine of “Bad Faith” in Insurance Litigation

A recent Wisconsin Supreme Court opinion filed June 25, 2010, Ehlinger v. Hauser and Evald Moulding, Inc., 2010 WI 54, is a candid reminder that co-owners of a business should not only take the important step of entering into a written Buy/Sell Agreement to determine how important issues such as death, disability, divorce, bankruptcy…

Businesses sometimes seek to appear in court through their officers or other employees, and wonder whether this can be done.

The Wisconsin Constitution provides that any individual may represent himself/herself in court.  Unless licensed as an attorney in the state, however, no person may represent another person, corporation, partnership, association or organization in court; doing…

When a business is sued, it should report the action to its insurance company, as soon as possible.  Sometimes, an insurer will deny coverage of the claim, asserting that a certain exclusion in its policy is applicable, or other policy defenses.

In Wisconsin, however, this is not necessarily the end of the story.  If there is any possibility that coverage may exist given the terms of the claim made against its insured, the insurer is required to provide its insured with a defense attorney at its cost, and seek a stay of the action while the court determines whether it owes coverage under its policy.  It’s failure to do so may result in it being held liable for the claim and its insured’s defense costs, regardless of whether coverage actually exists under the policy.Continue Reading Insurance Coverage Denied: Now What?

For over 50 years, Wisconsin has been deciding cases related to covenants not to compete in working relationships under Wisconsin Stat. § 103.465. On July 14, 2009, in an opinion authored by Justice Michael J. Gableman, Wisconsin’s Supreme Court changed the way that statute will work, much to the benefit of employers. Here’s what they did.Continue Reading Wisconsin Makes Covenants More Employer Friendly