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Cribari v. Allstate Fire & Casualty Insurance Co.

United States District Court, D. Colorado

June 11, 2019

BEVERLY CRIBARI, Plaintiff,
v.
ALLSTATE FIRE & CASUALTY INSURANCE COMPANY, Defendant.

          ORDER ON OUTSTANDING MOTIONS IN LIMINE

          N. REID NEUREITER U.S. MAGISTRATE JUDGE

         This matter is before the Court on a number of outstanding motions in limine, filed by both parties. On June 5, 2019, I held a two and a half hour trial preparation conference where I tried to get through as many of the outstanding motions in limine as possible, ruling from the bench on some, reserving other decisions for trial, and taking others under advisement.

         This Order addresses the remaining motions in limine and clarifies certain rulings to the extent I was not clear at the June 5, 2019 hearing.

         Background

         This is an insurance bad faith lawsuit brought by an insured, Ms. Cribari, against her insurer, Allstate, for breach of contract and unreasonable delay or denial in paying an uninsured motorist claim, after Ms. Cribari suffered injuries from a car accident.

         Mrs. Cribari made a claim for underinsured motorist benefits under her Allstate policy, which has a limit of $250, 000. Allstate initially did not pay the claim, and this lawsuit followed. Mrs. Cribari claims in this lawsuit that her damages in fact exceed the amount paid by the negligent motorist, and Allstate breached her contract of insurance by not paying any benefits, that Allstate unreasonably delayed and denied payment of her insurance claim, and that it further acted unreasonably and in bad faith. While Allstate previously denied that Mrs. Cribari's damages met or exceeded the $250, 000 in available underinsured motorist benefits, it recently changed its position and agreed that the claim is worth that full amount. Allstate sent Ms. Cribari a check for $250, 000 under a reservation of rights. Allstate has reserved the right to recoup the $250, 000 payment, claiming that Ms. Cribari has forfeited her benefits under the policy because she failed to cooperate in the investigation of her claim.

         Allstate denies that it breached the contract, unreasonably delayed or denied payment of the claim, or otherwise acted in bad faith. Allstate asserts that while Mrs. Cribari's damages from the accident do exceed the limit of her underinsured motorist insurance policy, it is not obligated to pay this amount because Mrs. Cribari failed to cooperate in Allstate's investigation. Allstate's theory is that Ms. Cribari failed to cooperate by not providing all the necessary information so as to bring a bad faith lawsuit to obtain the additional penalties and attorneys' fees that Colorado law provides for insureds whose insurance benefits have been unreasonably delayed or denied. This has been called the “set up” argument-that Ms. Cribari “set up” Allstate for a bad faith lawsuit by intentionally withholding information that would have allowed Allstate to evaluate the claim fairly and promptly.

         I previously addressed each sides' respective motions for summary judgment. In my order denying summary judgment. See Dkt. #137. I found that there was sufficient evidence from which a reasonable jury could conclude that Allstate acted unreasonably and unreasonably delayed or denied payment. I also found that there was evidence from which a reasonable jury could conclude that Ms. Cribari failed to cooperate in the investigation of the claim.

         Legal Standards on Motions in Limine

         Motions in limine exist outside of the Federal Rules of Civil Procedure and Federal Rules of Evidence and serve to enable the court “to rule in advance of trial on the relevance of certain forecasted evidence, as to issues that are definitely set for trial, without lengthy argument at, or interruption of, the trial.” United States v. Cline, 188 F.Supp.2d 1287, 1291 (D. Kan. 2002) (quoting Palmieri v. Defaria, 88 F.3d 136, 141 (2d Cir. 1996) (further citations omitted)). Pre-trial rulings issued in response to motions in limine can save time during trial as well as cost and effort for the parties as they prepare their cases. However, “a court is almost always better situated during the actual trial to assess the value and utility of evidence.” Koch v. Koch Industries, Inc., 2 F.Supp.2d 1385, 1388 (D. Kan. 1998) (citing Hawthorne Partners v. AT & T Technologies, Inc., 831 F.Supp. 1398, 1400 (N.D. Ill. 1993) (“Unless evidence meets this high standard [of clearly inadmissible], evidentiary rulings should be deferred until trial so that questions of foundation, relevancy and potential prejudice may be resolved in proper context.”)). With these principles in mind, I turn to the outstanding motions in limine.

         • Dkt. #147-Allstate's Motion in Limine re: Other Claims or Litigation.

         Allstate is fearful that Plaintiff will seek to introduce evidence of claims handling by Allstate in other cases that “have nothing to do with the facts of this case.” Therefore, Allstate seeks to preclude evidence of other claims or litigation, arguing that it would cause undue confusion of the jury and excessively complicate matters leading to spinoff arguments about whether Allstate's conduct in other cases has been proper or not.

         The Plaintiff seeks to introduce evidence from other claims or litigation involving Allstate for two distinct purposes. Plaintiff first says that it is Allstate's pattern or practice to raise the “failure to cooperate” defense with respect to many insureds and the raising of this defense with “exceedingly high frequency” is relevant to Allstate's allegedly baseless raising of the defense in this case. Second, the Plaintiff says that evidence from other cases may be appropriately used to impeach Allstate's witnesses about what may or may not be feasible in terms of investigating a claim. For example, if Allstate

         As stated at the June 5, 2019 hearing, I GRANT Dkt. #147 with respect to other claims or litigation which are intended to show it is Allstate's pattern or practice to raise the failure to cooperate defense. This case is (in part) about whether Mrs. Cribari failed to cooperate or not. It is not about whether Allstate has raised (legitimately or not) this defense in other cases, or whether the plaintiffs in those other cases failed to cooperate or not.

         With respect to whether material or evidence from other claims or Allstate litigation may be used for impeachment purposes, I DENY without prejudice Dkt. #147 and will reserve for trial the issue of admissibility of specific evidence that may be used for impeachment purposes.

         • DKT. #148-Allstate's Motion in Limine to Allow Presentment of C.R.S. Section 10-3-1116 Damages to the Jury.

         Allstate seeks to introduce to the jury the fact of the additional damages available to a plaintiff in an unreasonable delay or denial case-two times the covered benefit plus attorneys' fees. See Colo. Rev. Stat. §10-3-1116(1). According to Allstate, allowing evidence of what would be available to the Plaintiff (and her counsel) in the event that the jury finds unreasonable delay is important to show the motivation the Plaintiff might have in not cooperating with Allstate's investigation of her claim. Per Allstate's argument, this evidence is important to prove the motive the Plaintiff (or her attorney) had to “set up” Allstate for bad faith litigation.

         Plaintiff responds that there are a number of reported decisions that explain that telling the jury of the availability of treble damages or additional statutory damages is improper and denies a plaintiff the right to a fair and impartial jury. See, e.g., Heritage Village Owners Assoc. v. Golden Heritage Investors, Ltd., 89 P.3d 513, 518 (Colo.App. 2004) (agreeing that information about treble statutory damages under CCPA is “not only irrelevant to the jury's performance of its function, but such knowledge likely will be prejudicial to the plaintiff while at the same time thwarting the legislative intent of requiring exemplary damages”); Cassareto v. GEICO Cas. Co., No. 16-cv-285-MEH, 2017 WL 7693513 (D. Colo. May 26, 2017) (“[T]he Court agrees statutory penalties are not relevant to the issues the jury must decide.”); Seidman v. Am. Family Mut. Ins. Co., No. 14-cv-03193-WJM-KMT, 2016 WL 8201768, at *3 (D. Colo. Sept. 13, 2016) (“[T]he statutory penalty is not relevant to the jury's deliberations. The jury need only determine the amount of the delayed or denied benefit.”); Toy v. Am. Family Mut. Ins. Co., 2014 WL 486173, at *1 (D. Colo. Feb. 6, 2014) (discussion of the penalty “may tend to confuse or prejudice a jury into reducing its eventual award”).

         I agree that discussion of the specific amount of the statutory penalty may tend to confuse the jury or prejudice the jury into improperly reducing its eventual award. However, in this case, I also agree that there is relevance to the issue of the statutory damages because it goes to the motive the Plaintiff might have had to withhold information and not cooperate in Allstate's investigation. It is part of Allstate's claim that this was a “set-up” by the Plaintiff in order to bring a bad faith lawsuit.

         Balancing these two competing concepts, I GRANT IN PART AND DENY IN PART DKT. #148 as follows: I intend to instruct the jury that a finding in favor of the Plaintiff on the unreasonable delay or denial claim will result in the Court “awarding an additional damage amount to the Plaintiff and against Allstate based on the amount of the benefit that was unreasonably denied or delayed, as provided by Colorado law.” There shall be no mention of attorneys' fees or the specific amount of the additional damage award, other than to say it is “an additional amount, based on the amount of the benefit that was unreasonably delayed or denied, as provided by Colorado law.” With this instruction in mind, Allstate ...


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