Represent Medical Malpractice Insurer in Bad Faith Claim

In this case, the plaintiff’s estate claimed the medical malpractice carrier had acted in bad faith in handling and settling an underlying malpractice claim against the insured doctor. The plaintiff claimed that doctor ran a “pill mill” and improperly prescribed several narcotic medicines to the decedent who eventually overdosed. During this same time period the defendant doctor was cited by the state medical licensing board and thereafter restricted from prescribing medicines. The defendant doctor defended by claiming that he provided the decedent proper warning and that if taken as prescribed no overdose would have occurred. He retained two experts who were prepared to testify that the doctor complied with the standard of care and/or that his conduct did not cause the overdose. The case ultimately settled for less than the policy limits a little more than a year after it was commenced. The bad faith case followed, with the decedent’s estate claiming that the insurer had acted in bad faith by unduly delaying a claim where liability was reasonably clear and making offers less that the true claim value. After initial written discovery was exchanged, the insurer moved for summary judgment on the bad faith claim on several grounds, including that the doctor had not consented to settlement until the day of settlement and because the doctor’s liability for causing the overdose was not beyond dispute and absent such clear liability, an insurer was entitled to make no offer and proceed to trial without exposing itself to bad faith liability. The court ultimately concluded no additional discovery was needed to address these issues and entered summary judgment. The plaintiff filed a motion to vacate the order under Rule 59 and this, too, was denied. The case is currently pending before the Kentucky Court of Appeals.