Feingold v. Liberty Mutual Group
847 F. Supp. 2d 772
E.D. Pa.2012Background
- Feingold and Quinn sue Liberty Mutual in diversity for bad-faith insurance claims under 42 Pa. Cons. Stat. Ann. § 8371.
- Defendants move to dismiss Feingold for lack of standing under Rule 12(b)(1) (facial challenge).
- Thompson’s UM benefits dispute arose from a 1997 accident; arbitration awarded Thompson $90,000 which Liberty Mutual did not pay.
- Quinn, as Executrix of Thompson’s estate, sought confirmation of the arbitration award; Feingold’s disbarment and ongoing representation issues are noted.
- An assignment from Quinn to Feingold purportedly of 40% of the bad-faith claim is central to Feingold’s standing; the court must decide assignability of § 8371 claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the alleged assignment grants Feingold standing | Feingold asserts 40% interest via assignment | Feingold’s assignment is void because § 8371 claims are unassignable | Assignment void; Feingold lacks standing |
| Whether Feingold may prosecute a § 8371 claim as a non-insured in a tort action | Ash allows broader standing for statutory bad-faith claims | Ash limits standing to insureds or narrow class | Feingold lacks Article III standing; not an insured and not within the narrow class |
| Whether the action may proceed against Liberty Mutual with respect to Feingold given standing | If assignment valid, Feingold stands to recover | Without valid assignment, no standing | Proceeding denied for Feingold; remains for Quinn under § 8371 |
Key Cases Cited
- Ash v. Continental Ins. Co., 932 A.2d 877 (Pa. 2007) (§ 8371 is a statutory tort action, not contract, and is punitive-damages oriented)
- Sensenig v. Pennsylvania Railroad Co., 78 A. 91 (Pa. 1910) (unliquidated damages in tort cannot be assigned)
- Marsh v. Western New York and Pennsylvania Railway Co., 53 A. 1001 (Pa. 1903) (unliquidated damages in tort not assignable before verdict)
- Tugboat Indian Co. v. A/S Ivarans Rederi, 5 A.2d 153 (Pa. 1939) (unliquidated damages in tort cannot be assigned)
- Osborn v. First National Bank of Athens, 34 A.858 (Pa. 1896) (penalties are personal and non-assignable)
- North v. Turner, 9 Serg. & Rawle 244 (Pa. 1823) (exceptions for assignability in goods/tangible property actions)
- Hedlund Mfg. Co., Inc. v. Weiser, Stapler & Spivak, 539 A.2d 357 (Pa. 1988) (permits certain professional/tort claims to be assignable)