SPECIFIC CONCERNS INSURANCE COVERAGE DENIALS AND SPECIFIC PERSONAL JURISDICTION

• Published in: The Brief (Chicago. 1980) Vol. 51; no. 4; pp. 60 - 62
• Main Authors: Strasavich, Michael D, Snider, M. Corban
• Format: Journal Article
• Language: English
• Published: Chicago American Bar Association 22.06.2022
• Subjects: Bad faith; Due process of law; Insurance; Insurance companies; Insurance coverage; Insurance policies; Jurisdiction; Litigation; Products liability; Settlements & damages; State court decisions; Montana; California; Connecticut; Missouri; United States > US; Texas
• ISSN: 0273-0995; 2163-0178

"1 For a corporation to be sufficiently "at home," it must either be incorporated in the state or have its "principal place of business" in the state.2 Courts are clear, since the opinion in Goodyear, that while widespread, continuous activity may well have satisfied the standards for general personal jurisdiction in the days of International Shoe Co. v. Washington,3 it will no longer serve to establish general personal jurisdiction over insurers.4 Some courts have even held that being licensed and doing business in a state would not give rise to general personal jurisdiction-even if that business includes maintaining some 80 dealer locations and service centers throughout the given forum.5 Specific Personal Jurisdiction However, these developments have not deterred plaintiff insureds from seeking jurisdiction over their insurance carriers when the insureds' claims have been denied. Key Insurance Co. v. Roldan, the plaintiff insured (Nash) was issued an automobile insurance policy in her home state of Kansas.10 Subsequently, her father had a wreck in Missouri while driving the covered automobile, and the insurer (Key) denied coverage to Nash and the injured party (Wright) who was seeking coverage.11 After arbitration, Wright and Nash then filed suit in the appropriate county in Missouri, alleging that Key had refused to settle the claims in bad faith.12 Pursuant to Missouri's long-arm statute, which allowed for personal jurisdiction over "tortious actions," the Missouri Supreme Court held that Key's tortious conduct in allegedly refusing to settle in bad faith was, "by itself," enough to satisfy due process in establishing specific personal jurisdiction.13 Indeed, that court made clear that "[a] single tortious act is sufficient to support personal jurisdiction consistent with due process standards. "14 Similarly, the claims in Sodexo Management, Inc. v. Old Republic Insurance Co. arose out of an insurance policy that was issued in Minnesota by an insurance company incorporated in Pennsylvania with its principal place of business in Illinois.15 The plaintiff in that case alleged that the defendant had breached its contract in its failure to defend and indemnify the plaintiff in underlying actions that took place in California courts, and alleged breach of the duties of good faith and fair dealing.16 California's long-arm statute, like those of many states, extends its jurisdiction to the "full extent" of due process allowance.17 Ultimately, the court found that California appropriately had specific personal jurisdiction over the insurance company because it had allegedly violated its contractual duties to the plaintiff and such breach occurred in California.18 In certain jurisdictions, this application of specific personal jurisdiction to insurers' denials of coverage has been a battleground for decades. The Path Forward While courts are closing the door on general personal jurisdiction arguments regarding insurers, the window of specific personal jurisdiction seemingly remains open. [...]this issue is likely to continue arising for insurers, particularly in states with broad long-arm statutes.