Massachusetts Anti-SLAPP Statute Did Not Protect Insurance Company That Failed to Make Reasonable Settlement Offer – Chiulli v. Liberty Mutual Insurance Company, Inc.

There are some cases in which liability is clear cut and the only real decision is the amount of the check that one party will write the other. In other cases, the issues are multiple, including who was at fault and to what degree. Recently, a Massachusetts appellate court was called upon to determine whether a particular case fell within the former or the latter category.

The Underlying Case

In the case of Chiulli v. Liberty Mutual Insurance Company, Inc., the plaintiff was a bar patron who was severely injured in a fight at a restaurant in 2008. Due to a skull fracture, he spent three months in a coma. His medical expenses were $661,928, and he was left with a permanent disability that he alleged significantly reduced his future earning capacity. The parties’ experts disagreed as to the exact amount of lost future earnings, but the figure was at least $413,532 and possibly as much as $1,589,949.

During pretrial discovery, employees of the restaurant testified that they had not been trained on safety rules related to liquor licenses and that, although they thought a fight was likely between two groups in the restaurant, they did not try to prevent it. The patron filed suit against the restaurant and three individuals who participated in the fight in state court, but the case was removed to federal court.

In 2010, the patron sent a demand letter to the defendant insurance company, but no settlement offer was made prior to the trial of the matter, which took place in 2012.  During the trial, the insurance company made a settlement offer of $150,000, and the patrol refused. The federal jury found the restaurant to be 90% at fault in causing the patron’s injuries and awarded him $4,494,665 in damages. The insurance company moved for judgment as a matter of law or a new trial, but the parties settled the case before the motions were ruled upon.

The Suit in Massachusetts State Court

The patron then filed suit against the insurance company in state court, alleging that it had violated Mass. Gen. Laws chs. 93A and 176D by engaging in unfair and deceptive settlement practices, namely by refusing to make a reasonable settlement offer after it became reasonably clear that the insurance company’s client was liable. The insurance company made a special motion to dismiss under Mass. Gen. Laws ch. 231, § 59H, the anti-SLAPP (Strategic Lawsuit Against Public Participation) statute. The trial court denied the motion, and the insurance company appealed.

The Decision on Appeal

The Appeals Court of Massachusetts affirmed, holding that the insurance company was not entitled to the protections of the anti-SLAPP statute and that “its deployment of that statute would eviscerate the consumer protections embodied in ch. 176D.” In so holding, the court rejected the insurance company’s contention that the application of chs. 93A and 176D against it was an unconstitutional infringement of its state and federal rights to a jury trial.

To Speak to an Experienced Cape Cod Premises Liability Lawyer

If you or a loved one has been injured due to a business owner’s failure to take proper measures to keep his or her premises safe, call the Law Firm of John C. Manoog, III today at (888)262-6664. We are currently reviewing premises liability and negligent security cases throughout the Cape Cod area, including Hyannis and Plymouth. We will be glad to schedule a free initial consultation about your case at your convenience.

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