A Philadelphia judge has thrown out a Dragonetti Act lawsuit that an insurance company and claims adjuster brought after they were sued for allegedly failing to investigate a claim.
Plaintiffs Laurie DiPasquale and the Philadelphia Contributionship Insurance Co., which employed DiPasquale, had sued attorneys Margaret Kiely and Kevin Wright, alleging that they wrongfully sued her and the company for denying coverage for a claim, but Philadelphia Court of Common Pleas Judge Frederica Massiah-Jackson dismissed their case last week, finding that the underlying litigation had been reasonable.
The underlying case had stemmed from a claim that DiPasquale and the insurance company failed to investigate Christine Feinstein’s claim before denying her coverage.
“Ms. Feinstein, attorney Kiely and attorney Wright had every reason to expect that the insurance company, acting through its employee and agent, would evaluate and investigate the mental health claims proffered by Ms. Feinstein before summarily denying coverage. The insureds were not provided any indicia of a reasonable basis for denial of coverage under the two policies,” Massiah-Jackson said. “Under the circumstances presented here it was not unreasonable for defendants-Kiely/Wright to name the insurance claims adjuster who denied Ms. Feinstein’s claims for coverage.”
Massiah-Jackson’s ruling was appealed to the Superior Court on Tuesday.
According to the judge, Wright had represented Kiely in the underlying lawsuit, which Kiely had filed on behalf of Feinstein as Feinstein’s power-of-attorney and fiduciary. Feinstein, Massiah-Jackson said, had previously been sued in Montgomery County, and the insurance company, with DiPasquale acting as the adjuster, denied her coverage.
Massiah-Jackson noted that Feinstein contended she suffered from bipolar disorder, obsessive compulsive disorder, anxiety and depression since 1991, and said the company allegedly declined coverage under Feinstein’s homeowners and umbrella policy without any investigation into her mental disorders.
DiPasquale was dismissed from Feinstein’s suit on preliminary objections—a ruling that Feinstein has also since appealed.
DiPasquale then sued the attorneys and Feinstein, with Philadelphia Contributionship suing as “subrogee,” raising claims of false light and wrongful use of civil proceedings, otherwise known as a Dragonetti suit.
DiPasquale contended, among other things, that the underlying contract had not been attached to Feinstein’s complaint, which caused “undue tension, duress and angst,” and that the suit “could severely impact Ms. DiPasquale’s professional development.”
Massiah-Jackson said that the plaintiffs failed to establish a false light claim, and further that the attorneys should be given judicial immunity.
Regarding the wrongful use of civil proceedings claim, Massiah-Jackson said the attorneys properly named DiPasquale in the case in an effort to determine whether she had been acting in the scope of her employment, whether the company would accept vicarious liability, and to further probe the specifics about the relationship between DiPasquale and the company.
Massiah-Jackson further noted that DiPasquale had said she accrued “potential liens for legal bills” from the underlying case, which led Massiah-Jackson to raise additional questions, including why DiPasquale allegedly filed “repeated” motions to dismiss. Ultimately, the judge determined that the Dragonetti suit should not have been brought.
“This court sits as an experienced trial court, and in trial after trial, employees remain on the caption and on the verdict sheet,” she said. “Plaintiffs herein should challenge the strategy, billable hours, and fees of counsel who represented them in the underlying legal action in order to recoup their legal fees. Certainly one summary judgment motion after the close of discovery would have sufficed.”
Mark Pearlstein, who represented Kiely, said he agreed with Massiah-Jackson’s ruling.
“I don’t believe there was ever a basis to bring either claim, and I think her honor’s opinion agreed with that position,” he said. ”I think the validity of the claims as a matter of law was suspect from the get-go.”
Wright is representing himself in the case. Chloe Mannings, an attorney at Wright’s firm, said Massiah-Jackson’s decision is sound.
“It’s our position that Judge Massiah-Jackson’s opinion was well reasoned,” she said. “We agree wholeheartedly with her.”
George Keahey of Venema, Proko, Keahey & Dalvet, who represented DiPasquale, did not return a call for comment.