Federal Court Dismisses Insurance Fair Conduct Act Claims
By Stephania Camp Denton
In a rare victory for insurers, the U.S. District Court for the Eastern District of Washington dismissed Insurance Fair Conduct Act (IFCA) claims against Evanston Insurance Company. Washington’s IFCA provides a statutory cause of action against insurers for unreasonable denials of coverage or payment of benefits. The claims arose out of Evanston’s pursuit of a declaratory judgment (DJ) action against a law firm and one of its attorneys regarding the availability of coverage for a malpractice claim. Evanston ultimately agreed to dismiss the DJ, but the insureds separately filed suit against Evanston alleging that it violated IFCA by pursuing a DJ while simultaneously defending the underlying claim. In the case of Workland & Witherspoon, PLLC v. Evanston Insurance Co., — F. Supp. 3d — (E.D. Wash. 2015), Chief Judge Rosanna Malouf Peterson rejected the insureds’ arguments seeking to expand the scope of IFCA claims.
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