Texas Mutual v. Ruttiger : The : The Texas Mutual v. Ruttiger End - - PowerPoint PPT Presentation

Texas Mutual v. Ruttiger Texas Mutual v. Ruttiger: The : The End of End of Aranda Aranda and Worker's and Worker's Compensation Bad Faith? Compensation Bad Faith?

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An intentional dishonest act evidenced An intentional dishonest act evidenced by one party not fulfilling a legal or by one party not fulfilling a legal or contractual obligation, or by misleading contractual obligation, or by misleading another, entering into an agreement another, entering into an agreement without the intention or means to fulfill without the intention or means to fulfill it, or violating basic standards of it, or violating basic standards of honesty in dealing with others. honesty in dealing with others.

Insurance Bad Faith Insurance Bad Faith – – What Is It? What Is It?

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Aranda v. North American Ins. Co. Aranda v. North American Ins. Co. (1988) (1988)

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Aranda Aranda’ ’s s Progeny Progeny

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Workers Workers’ ’ Compensation Reform Compensation Reform

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A Bargain is Struck A Bargain is Struck

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A Bargain is Struck A Bargain is Struck

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Texas Labor Code Texas Labor Code

• Sec. 408.001
• Sec. 408.001-
• 408.222

408.222

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11.

• Post Reform

Post Reform – – 1990s 1990s

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)+442+. 2.; 2.;3 3+11. +11. 1.2012 1.2012

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011 222 2227 7*.1 *.18 8

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1';2:01

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5.,11 1 191 91 42; 42; 2. 2.

• 2000

2000’ ’s: Bad Faith Returns s: Bad Faith Returns

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!113 3

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?.1%3 3.024 .024 .1,+122 .1,+122 +11. +11.

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+3 3 .01 .01 20..2@ 20..2@

• The Turning Tide

The Turning Tide

• 1999

1999 --

• - Steve W. Killion v. Cigna Insurance Co.

Steve W. Killion v. Cigna Insurance Co.

$1,877,189 $1,877,189

• 2001

2001 --

• - Mark Bennett v. Security Insurance Co.

Mark Bennett v. Security Insurance Co.

$1,300,000 $1,300,000

• 2006

2006 --

• - P. Lance Morris v. Tex. Mutual Ins. Co.
• P. Lance Morris v. Tex. Mutual Ins. Co.

$250,000 $250,000

• 2006

2006 --

• - Lloyd Snyder v. Christus Health Gulf

Lloyd Snyder v. Christus Health Gulf Coast Coast

$4,332,799 $4,332,799

• 2008

2008 – – Priddy v. Commerce & Industry Ins. Co Priddy v. Commerce & Industry Ins. Co. .

$400,000 $400,000

%

Including This Verdict Including This Verdict… …

• 2006

2006 --

• - Timothy J. Ruttiger v. Texas

Timothy J. Ruttiger v. Texas Mutual Ins. Co Mutual Ins. Co. .

$385,000 $385,000

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Ruttiger Facts Ruttiger Facts

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!51..021 0444. 0444.

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Ruttiger Facts Ruttiger Facts – – (cont.) (cont.)

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Allegations Allegations

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Claims for Damages Claims for Damages

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:21

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1

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4

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1224

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Trial Court Proceedings Trial Court Proceedings

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Trial Court Award Trial Court Award

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121 224 224

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1221

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93 3 2 2

• Court of Appeals

Court of Appeals

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Texas Supreme Court Texas Supreme Court

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258 8

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Exhaustion of Remedies Exhaustion of Remedies

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• Ins. Code
• Ins. Code §

§ 541.060: 541.060: Unfair Settlement Practices Unfair Settlement Practices

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• Ins. Code
• Ins. Code §

§ 541.060 541.060

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• Ins. Code
• Ins. Code §

§ 541.060 541.060

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• Ins. Code
• Ins. Code §

§ 541.060 541.060

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• Ins. Code
• Ins. Code §

§ 542.003: 542.003: Unfair Claim Settlement Unfair Claim Settlement Practices Prohibited Practices Prohibited

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• Tex. Ins. Code
• Tex. Ins. Code §

§ 541.061: 541.061: Misrepresentation of Ins. Policy Misrepresentation of Ins. Policy

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• Ins. Code
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§ 541.061 541.061

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DTPA DTPA

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Good Faith and Fair Dealing Good Faith and Fair Dealing

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Workers Workers’ ’ Compensation Act Compensation Act

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TMIC Seeks to Overturn TMIC Seeks to Overturn Aranda Aranda

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Supreme Court Opinion Supreme Court Opinion

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Concurrence Concurrence

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Dissent Dissent

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Conclusion Conclusion

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F $'= $'=A A 2 2

• F

F $'= $'=A A 2+1 2+1

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F $'%/ $'%/A A 2 2

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Ruttiger Moves for Re Ruttiger Moves for Re-

• Hearing

Hearing

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Three Issues in Ruttiger II: Three Issues in Ruttiger II:

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Three Issues in Ruttiger II: Three Issues in Ruttiger II:

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Issue One: Chapter 541 and Issue One: Chapter 541 and 542 542

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.42112 91.9N42. 91.9N42. 4.0.+1 4.0.+1 141 141 1..1 1..1 1.4 1.4

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Issue Two: Misrepresentation: Issue Two: Misrepresentation:

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$'=11+1 2+N. 2+N. . .

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Issue Three: Issue Three: Aranda Aranda Overruled: Overruled:

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Texas Mutual v. Texas Mutual v. Ruttiger Ruttiger: The End of : The End of Aranda Aranda and Worker's Compensation Bad Faith? and Worker's Compensation Bad Faith?

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Texas Mutual v. Texas Mutual v. Ruttiger Ruttiger: The End of : The End of Aranda Aranda and Worker's Compensation Bad Faith? and Worker's Compensation Bad Faith?

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