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Insurance and Business Claims Top the List of Large Verdicts and Settlements in North Carolina

    Client Alerts
  • April 26, 2005

Every year, North Carolina Lawyers Weekly publishes a list of large verdicts and settlements in North Carolina for the previous year.(1) Often, catastrophic death and personal injury claims top the list. For the last three years, however, business misconduct claims have topped the list of large verdicts and settlements.

The top twenty-five large verdicts and settlements in 2004 each totaled at least $3.28 million. Seven business-related cases fell in that category. Six medical negligence recoveries fell in that category, the largest medical negligence settlement totaling $13.5 million. Six automobile negligence claims also fell in that category, with two $7 million settlements tying for the largest automobile negligence recoveries in 2004. Three of the top 25 recoveries in 2004 resulted from unsafe workplace claims. No claim in that category reached the top verdicts or settlements two years ago.

The largest settlement in 2004, reportedly valued at $400 million, concerned alleged mishandling of insurance premium pool payments. The insurance company that handled the pool allegedly made the pool appear profitable through improper accounting and false and deceptive financial reporting. The insurance company, Fortress Re, also fraudulently caused the pool to transfer hundreds of millions of dollars in dividends to Fortress Re and its shareholders.

The second highest settlement in 2004 also involved allegations of fraud, negligent misrepresentation, and unfair and deceptive trade practices. The defendant was a medical imaging company that allegedly gained access to ultrasound machine technology after leading the plaintiff to believe that the defendant intended to buy the plaintiff’s company.

Some of the other cases resulting in large verdicts and settlements in 2004 included the following:

1. $14.2 million jury verdict against National Union Fire Insurance Company for breach of its duty to defend, misrepresenting the terms of the policy in order to change its coverage obligations, and bad faith for failure to settle when the insurer’s liability to pay claims was reasonably clear. The bad faith claims also supported an unfair trade practices claim, which resulted in treble damages under North Carolina’s Unfair Trade Practices Statute.

2. $13.5 million settlement for alleged medical negligence resulting in an infant suffering a broken neck and brain damage during delivery.

3. $7.5 million jury verdict for mesothelioma from occupational exposure to asbestos.

4. $7 million settlement for severe brain injury and other injuries suffered when a pedestrian was struck by a milk truck.

5. $6 million settlement for cancer allegedly caused by workplace exposure to nickel and chromium.

6. $5 million settlement for alleged medical negligence resulting in brain injury at birth and cerebral palsy.

7. $3.39 million arbitration award for non-payment of a contingent contract payment under a merger agreement.

8. $3.28 million settlement for delays, extra work, and other damages in a construction dispute.

(1) North Carolina Lawyers Weekly, Jan. 24, 2005