United States District Court, D. Colorado
RAYMOND P. MOORE UNITED STATES DISTRICT JUDGE
matter is before the Court on Defendant's Motion for
Attorney Fees and Actual Reasonably Incurred Costs Pursuant
to Colo. Rev. Stat. § 10-3-1116 and § 13-17-101
(ECF No. 77). Plaintiff has filed a response (ECF No. 82),
and Defendant has filed both a reply and a supplement to its
reply (ECF Nos. 87, 88). For the reasons given below, the
motion is granted.
insurance dispute, Plaintiff filed a claim for damage to its
real property insured by Defendant. Defendant made an initial
payment on that claim. After the property was further damaged
by a hailstorm in June 2015, Defendant made an additional
payment on the claim, but it did not provide Plaintiff with
copies of the reports or photos from its inspections.
March 2017, Plaintiff became aware of additional damage that
it believed was due to the hailstorm. Plaintiff filed a new
claim and obtained another estimate for repairs. (ECF No. 1,
Compl. ¶ 18.)
2017, Plaintiff filed this lawsuit, asserting claims for
breach of contract, unreasonable delay, and bad faith. The
complaint alleges that Plaintiff suffered a loss due to the
June 2015 hailstorm, that it notified Defendant of the claim
in March 2017, and that Defendant had made no coverage
decision by the time the complaint was filed. Defendant
subsequently made a payment on the new claim. This Court
granted Defendant's motion to dismiss the claims for
unreasonable delay and bad faith (ECF No. 48), noting that
Plaintiff had not filed its claim until twenty-one months
after the June 2015 hailstorm and that Defendant had been on
notice of the new claim for only three to four months when
Plaintiff filed the lawsuit. (Id. at 3-4.) The Court
stated that “there is no nonfrivolous argument that can
be made that [P]laintiff's claims for unreasonable delay
and common law bad faith are warranted by existing law or by
extending existing law.” (Id. at 8 n.6.) In
denying Plaintiff's motion for reconsideration, the Court
reiterated that “the claims for bad faith and
unreasonable delay or denial were still frivolously
raised.” (ECF No. 59 at 8 n.7.) The Court then later
granted summary judgment in Defendant's favor on the
remaining claim for breach of contract. (ECF No. 75.)
Colorado law, a court must award costs and attorney fees to
the defendant in an action for unreasonable delay or denial
of benefits if the action was “frivolous.” §
10-3-1116(5). A claim is frivolous if a party is unable to
present a rational argument supporting it. Bernal v.
Lumbermeans Mut. Cas. Co., 97 P.3d 197, 204 (Colo.App.
2003). Section 13-17-101 provides for recovery of attorney
fees when an action or part of an action “is determined
to have been substantially frivolous, substantially
groundless, or substantially vexatious.”
Court has already determined that Plaintiff's claims for
unreasonable delay and bad faith were frivolous when filed.
In the order granting Defendant's motion to dismiss those
claims, the Court stated, “If there were ever two
claims that should not have been raised in an
insurance-coverage-dispute case, Claims Two and Three for
unreasonable delay and bad faith are certainly those two
claims.” (ECF No. 48 at 3.) Undeterred by the analysis
set forth in that order, Plaintiff moved for reconsideration.
(ECF No. 50). In the order denying Plaintiff's motion for
reconsideration as well as its motion for leave to amend the
complaint, the Court stated unequivocally, “[A]t the
time the claims for bad faith and unreasonable delay or
denial were first raised in June 2017, there was absolutely
no basis to assert those claims.” (ECF No. 59 at 7.) In
opposing Defendant's motion for attorney fees, Plaintiff
relies on the same arguments this Court has twice rejected.
There would be no point in reiterating yet again why these
arguments lack merit.
motion seeks only a determination as to liability for
attorney fees (ECF No. 77 at 6); however, Plaintiff's
response addresses the specific fees and costs requested by
Defendant in its proposed bill of costs (ECF No. 82 at 6-9).
The Clerk of the Court has already taxed a portion of those
costs: costs incident to taking depositions, fees for
exemplification, and other costs for subpoena service. (ECF
No. 86.) That leaves only the witness fees still at issue.
Plaintiff objects to all the witness fees for the same
reason. It contends that they are “completely
unrelated” to Defendant's Partial Motion to Dismiss
Pursuant to Fed.R.Civ.P. 12(b)(6), filed on October 23, 2017,
because they were incurred after the motion was filed. (ECF
No. 82 at 6-9.) In its reply, Defendant argues that it is
entitled to fees incurred up until the time Plaintiff's
motion for reconsideration was denied, on August 31, 2018.
The Court agrees with Defendant and concludes that it is
reasonable to award witness fees incurred while Plaintiff
continued to litigate Plaintiffs frivolous claims for
unreasonable delay and bad faith.