Settlement or Verdict Amount:
Settlement $1.15 million

Case Name:
ANA JIMENEZ v. ROE INSURANCE COMPANY

Case number and date:
Confidential

Plaintiff:
Ana Jimenez Craig A. Miller, San Diego

Defendants:
Confidential

Facts and Background:
On November 26, 1989, defendant #1 issued an automobile insurance
policy to plaintiff. The insurance policy provided liability
coverage for bodily injury and property damage. On February 17,
1990, plaintiff was involved in a motor vehicle collision and,
one year later, was sued.

On or about June 11, 1991, defendant #1 retained defendant #2 to
"defend" plaintiff against the personal injury allegations. At
that time, defendant #1 informed defendant #2 that the accident
was "suspicious". Defendant #1 knew its suspicions created a
conflict of interest between it and plaintiff, but did nothing to
apprise her of her right to Cumis counsel.

Shortly after its assignment, defendant #2 began to communicate
with defendant #1’s attorneys about the possibility of the
plaintiff’s fraud. Defendant #2 never informed plaintiff of its
activities or of the suspicions of her insurance company.
Defendant #2 provided defendant #1’s attorneys with photographs,
pleadings and discovery. Eventually, defendant #2 learned that
defendant #1 was going to sue its client, the plaintiff, but did
not tell her.

Eventually, defendant #1 did sue plaintiff, but failed to serve
her with the complaint. As a result, plaintiff did not respond to
the complaint. Although defendant #1 knew that it never served
plaintiff, it nevertheless filed a request for entry of default
and judgment in the amount of $38,000.

Plaintiffs’ Contentions:
Plaintiff contended that defendant #1 failed and refused to
provide plaintiff with Cumis counsel despite its knowledge of a
profound conflict of interest. This undisclosed conflict allowed
defendant #1 to void coverage under the policy. Plaintiff further
contended that defendant #1 had engaged in the identical wrongful
conduct with defendant #2 on previous occasions in order to
achieve the same ill-advised objective. Finally, plaintiff
contended that defendant #2 breached its fiduciary duty and
engaged in legal malpractice by failing to disclose plaintiff’s
right to independent counsel and its participation in the plan to
defraud her.

Defendants’ Contentions:
Defendant #1 contended that plaintiff actively participated in a
staged accident in an effort to defraud it. This contention was
based on plaintiff’s extensive accident history, her involvement
in other accidents defendant #1 deemed fraudulent, the unusual
factual circumstances of the accident in question, the unsavory
individuals involved in the subject accident, and plaintiff’s
failure to cooperate with defendant #1’s investigation.

Damages:
Legal Malpractice, Malicious Prosecution, Breach of Implied
Covenant of Good Faith and Fair Dealing.