Cases and Constitutional interpretation have the potential to abolish statutory claims for insurance bad faith:
In 2016, the Roberts Court grafted a requirement onto the U.S. Constitution which is not found in it—standing—but which is instead found in the Court's cases. Cases decided in lower courts since the Roberts Court raised standing to a constitutional prerogative are divided over whether Congress and State Legislatures can provide standing by providing remedies for statutory violations.
In Spokeo, Inc. v. Robins,1 the Court raised the judge-made doctrine of standing to constitutional status. “Standing to sue,” the Court recognized, “is a doctrine rooted in the traditional understanding of a case or controversy. The doctrine developed in our case law,” said the Court in Spokeo, Inc. v. Robins.2
One of the elements of standing is “injury in fact,” which the Spokeo Court raised to “a constitutional requirement” which bars legislatures from conferring standing on people and organizations in most cases. To establish injury in fact, a person invoking a statutory remedy now must meet a newly-found constitutional requirement that she or he had a legally protected interest that is concrete and individualized to her or him, and that the harm is “actual” or “imminent,” not “conjectural” or “hypothetical.”3
***
If the idea of “injury in fact” has been elevated surreptitiously from standing to the U.S. Constitution, it can certainly have an effect on claims based on State statutes providing remedies to ‘private attorneys general’ that the States rely on to enforce the laws. Time will tell whether State Unfair Claim Handling Practices Acts and Penalties Statutes governing the business of insurance will feel the effects and, if so, how.
Footnotes
1
Spokeo, Inc. v. Robins, U.S. , 136 S. Ct. 1540 (2016).
2
Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016).
3
Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547-48 (2016).
The issues are fleshed out and the case law interpreting Spokeo are all addressed in Volume 1 of LITIGATION AND PREVENTION OF INSURER BAD FAITH § 3:28.50 by Dennis J. Wall (THOMSON REUTERS WEST 3d ed. & 2019 Supplement).
Please Read The Disclaimer. ©2019 Dennis J. Wall. All Rights Reserved.
©2019 Donna Bruno and Dennis J. Wall. Use of this Photo Courtesy of the Artist Donna Bruno.
Comments