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Jury Verdict Adds More Fees After Low Settlement Offer

March 14, 2017 | Posted in : Fee Award

A recent Daily Report story by Greg Land, “Settlement Adds $700k in Fees to $3.7M Verdict,” reports that, following a 2015 Gwinnett County verdict awarding $3.7 million to a man whose back was injured in an auto accident, his lawyers collected another $700,000 in attorney fees after settling claims under Georgia's offer of settlement statute.

After what they said were extensive negotiations and a failed mediation, plaintiffs attorneys Mark Issa and Jeff Shiver said the case settled recently with a total payment of $4.4 million.  The lawyers noted that the defendant's insurer had refused multiple offers to settle for her policy limits of $25,000 early in the litigation and later declined a $475,000 settlement offer.

"This is most classic example of an insurance company stepping on dollars to pick up pennies," said Shiver of Shiver & Hamilton.  Issa said the fact that the insurer offered to pay $11,000 in response to the early demands meant it was aware that its driver bore some liability.

"They didn't reject it outright; they were clearly trying to save a few thousand dollars," said the Issa Law Firm principal.  "We had initially a case with $13,000 in medicals and a $25,000 demand.  Now we have $4.4 million to settle. … This was [a case of] bad decision after bad decision."

The accident happened in 2012 when a Chevrolet Colorado driven by Walter Smalls was struck by a Lincoln Navigator driven by Maria Camarillo. Smalls' 18-year-old daughter, a passenger in the pickup truck, was the more seriously injured, although Smalls suffered abrasions to his face and a leg injury.

After he was released from the hospital, Smalls experienced a sharp pain in his back that continued to worsen despite treatment.  Then a 47-year-old electrician, Smalls ultimately required surgery and had to give up his profession, his lawyers said.

Camarillo's insurer, Omni Indemnity, paid her $25,000 policy limits to Smalls' daughter after a pretrial demand but refused four policy limit demands on Smalls' behalf.  The insurer responded with an offer of $11,000 and continued to decline policy limit demands as Smalls' medical bills mounted.

After Smalls sued in Gwinnett County State Court in 2013, the insurer offered Camarillo's $25,000 limit during a mediation, which was declined.  In 2014, Omni Indemnity turned down the $475,000 offer of judgment, and a few months before trial it rejected a demand for $1.2 million.

Following a four-day trial before Judge Pam South, the jury returned a $3.7 million verdict in November 2015.  Basing their motion on the $475,000 demand, the plaintiffs lawyers filed for attorney fees under Georgia's offer of settlement statute, which declares that a party that declines a settlement offer and then loses at trial by at least 25 percent more than the rejected offer may have to pay the prevailing party's attorney fees accrued from the date of the offer.

The motion offered several calculations of the potential fee award, ranging from $1.1 million to nearly $1.5 million.  South declined to rule on the bid while the case was on appeal, and it was while the appeal was pending that the settlement was worked out.

The lesson for insurers?  "Don't stare a good offer in the face," Issa said.