re: Woman gets STD from boyfriend after car sex, Geico ordered to pay $5.2 million

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Posted by SpringBokCock online on 6/12/22 at 8:36 pm to NOLAVOL16
GEICO was dumb. They brought this on themselves.

Woman asked them to pay $1,000,000 — which was the liability limits for the guy. GEICO refused to pay. So far so good.

But then the woman sued the man. GEICO refused to provide a defense. Not good. Policy says you have to provide your insured a defense even if the plaintiff has no case.

Woman and insured go to binding arbitration. Arbitrator awards $5.2 million. No participation from GEICO.

Woman moves to enroll the award as a judgment. GEICO moves to intervene. Court says you can intervene but you step into your insureds shoes — so they are stuck with the binding arbitration award.

GEICO filed a separate declaratory judgment action in federal court. If the judge says there is no coverage for the case, they are off the hook. Their argument is that sex in the car “does not arise out of the use of the insured vehicle.” They could very well win that, although there are court decisions covering drive by shootings because they arise out of a use of the vehicle.

GEICO put themselves in this situation. They should have hired a lawyer for the std spreader. Would have saved a ton of money.

This won’t affect premiums ( except maybe for the guy). $5.2 million is a drop in the bucket for GEICO and you can bet they will learn from this.

As an aside, arbitration is usually used by big business to screw regular people. I feel a little bit of schadenfreude seeing the lizard have the tables turned on them. Especially since GEICO is a bottom feeder among insurance companies (along with Allstate and Progressive)..

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Woman asked them to pay $1,000,000 — which was the liability limits for the guy. GEICO refused to pay. So far so good.

But then the woman sued the man. GEICO refused to provide a defense. Not good. Policy says you have to provide your insured a defense even if the plaintiff has no case.

Woman and insured go to binding arbitration. Arbitrator awards $5.2 million. No participation from GEICO.

Woman moves to enroll the award as a judgment. GEICO moves to intervene. Court says you can intervene but you step into your insureds shoes — so they are stuck with the binding arbitration award.

GEICO filed a separate declaratory judgment action in federal court. If the judge says there is no coverage for the case, they are off the hook. Their argument is that sex in the car “does not arise out of the use of the insured vehicle.” They could very well win that, although there are court decisions covering drive by shootings because they arise out of a use of the vehicle.

GEICO put themselves in this situation. They should have hired a lawyer for the std spreader. Would have saved a ton of money.

This won’t affect premiums ( except maybe for the guy). $5.2 million is a drop in the bucket for GEICO and you can bet they will learn from this.

As an aside, arbitration is usually used by big business to screw regular people. I feel a little bit of schadenfreude seeing the lizard have the tables turned on them. Especially since GEICO is a bottom feeder among insurance companies (along with Allstate and Progressive)..

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I think there are a few issue that are more complicated than you suggest. I would point out I am not licensed in MO and my information comes from reading the appeals court decision once.

MO allows potential litigants to enter into a contract that limits recovery to a specified list of assets in arbitration. In this case it was limited to the insurance policy. I am not sure the insurance company was even aware of the arbitration which is likely the reason they did not appear. They only seemed to have discovered this occurred by monitoring a docket site that popped when the plaintiff filed for the arbitration findings to be reduced to judgment. This is when Geico filed to intervene.

To the previous poster binding arbitration is considered "binding" but it is just a contract and if the losing say refuses to pay or meet other obligations (rare) it has to be filed at the trial court level to be entered as a judgment which then the winning party can pursue in a legal manner. In certain instances and in certain jurisdictions the arbitration findings can be reviewed using the states using the review standards for a judicial trial. This fits the scenario because it was a codified arbitration process in MO law. So both the trial court and appellate court applied these standards and affirmed the arbitration findings met the standards.

While the courts did not find any conclusion to fraud I think there was a chance there was, partly because Geico was never (apparently) notified of the arbitration contract by their insured.

It reminds me of a case I had 12 years ago where the defendant colluded with the plaintiff to produce a huge award. I was brought in at the appellate level and was able to prove the fraud and collusion.

I would like to see an analysis by an attorney that has more time to dig into it, preferably one that practices in MO.