300,000 Verdict for Emotional Distress in Insurance Bad Faith Case

The Court of Appeal of the State of California affirmed a jury’s judgment in awarding Michael Federici $335,000 in economic and noneconomic damages in a first party insurance bad faith action involving IDS Property Casualty Insurance Company (IDS). Federici sought action against IDS for “breach of the implied covenant of good faith and fair dealing” following a settlement reached 16 months after Federici was involved in a motor vehicle accident with an underinsured driver. Federici was insured under IDS’ policy that provided a limit of $250,000 for bodily injury caused by an underinsured motor vehicle, and he subsequently tendered a claim for necessary dental expenses following the accident. Before the $140,000 settlement was reached, Federici struggled with temporary dental fixings and repeatedly reached out for settlements to cover his increased dental costs. In response to Federici’s bad faith action, IDS filed a series of contentions, including that Federici’s settlement disqualified him from pursuing said action and that his financial awards were “excessive.” All contentions were rejected.