New Orleans Grocer Wins Appeal in Massive Bad Faith Insurance Claim

New Orleans, LAA bad faith insurance case involving a grocer from New Orleans turned into a happy ending after an appeals court upheld a 2008 ruling that found in favour of the plaintiff in a lawsuit championed by an insurance bad faith attorney—as most successful lawsuits are, of course.

In this case, a bad faith insurance claim was made by Robert Fresh Markets of New Orleans in the aftermath of Hurricane Katrina. The grocer operates a series of outlets throughout the New Orleans area and suffered heavy damages as the result of one of the most devastating weather-related disasters in US history.

Following the storm, according to a report in the AM Law Litigation Daily, Robert Fresh Markets called in an insurance adjuster, who duly reported to United Fire & Casualty that storm damage to the roofs of the company's stores allowed rain and wind to access the premises, destroying merchandise and forcing the locations to close for repairs.

However it is alleged that the insurer stonewalled the claim. According to the lawyer for Robert Fresh Markets, United Fire & Casualty acted in bad faith and was hoping the grocer would either go out of business, or take pennies on the dollar just to survive.

The insurance adjustor testified that United Fire & Casualty pressured him into changing his report in a manner that favoured the insurer, only to be terminated from his job in the end.

Last year, at the conclusion of a bad faith insurance trial a New Orleans jury awarded $21.6 million to Robert Fresh Markets. United Fire & Casualty appealed, and Tuesday a three-judge panel of the US Court of Appeals for the Fifth Circuit Court, in a unanimous ruling, upheld the original award of $21.6 million and tacked on an additional $1 million in bad faith insurance damages.

Lawyers for the plaintiff were not surprised that the appeal went in favour of Robert Fresh Markets. However, they did express surprise at the speed by which the ruling was delivered. The appeal was argued August 3rd, with the ruling coming only eight days later this past Tuesday.

The two-page ruling was described as curt.

The two sides will meet again in October to argue a case involving a Robert Fresh Markets store that was not included in the federal litigation. The newest bad faith insurance case will be heard in Louisiana state court.