Guessford v. Pennsylvania National Mutual Casualty Insurance, 918 F. Supp. 2d 453

Insurance policy provided underinsured motorist (UIM) coverage to plaintiff via employer’s policy; collision occurred July 6, 2007, with Corriher’s vehicle; Nationwide tendered its policy limits ($100,000) in exchange for a covenant not to enforce judgment; defendant Penn National waived subrogation and sought medical information before evaluating the claim; plaintiff’s medical expenses totaled over $727,000 with Hartford paying nearly $591,000; arbitration was demanded by plaintiff, resulting in a $2.5 million award, after which defendant paid $900,000 and sought a release; plaintiff filed suit in North Carolina state court alleging breach of contract, UDTPA, and refusal to settle in good faith; defendant removed to federal court and moved for judgment on the pleadings (Rule 12(c)); plaintiff moved to strike various affirmative defenses.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Breach of contract viability	Plaintiff asserts breach of contract due to failure to investigate and insufficient settlement offers.	Defendant argues contract provisions allow arbitration and no specific breach is pled.	Breach claim barred; arbitration provisions bar-plaintiff failed to plead a contract breach.
UDTPA viability	Plaintiff contends defendant’s unfair/deceptive practices violated §75-1.1.	Argues claims lack plausible misconduct beyond typical coverage disputes.	UDTPA claim plausibly stated; not foreclosed by breach dismissal.
Refusal to settle in good faith claim	Defendant delayed and engaged in bad faith handling of claim after recognition of liability.	Dispute over settlement value permissible within policy framework; not per se bad faith.	Claim survives; denial of judgment on the pleadings as to this claim.
Strike of affirmative defenses	Argues some defenses are legally or factually insufficient.	Standard Rule 8(c) suffices for fair notice; some defenses may be moot or legally invalid.	Several defenses struck as moot or legally insufficient; others remain under consideration for two remaining claims.

Fid. Bankers Life Ins. Co. v. Dortch, 318 N.C. 378 (N.C. 1986) (insurance policies construed as written; express language governs duties of parties)
Gray v. North Carolina Ins. Underwriting Ass’n, 352 N.C. 61 (N.C. 2000) (unfair claim settlement practices under UDTPA are governed by insurance statutes)
Lovell v. Nationwide Mut. Ins. Co., 108 N.C.App. 416 (N.C. Ct. App. 1993) (bad faith refusal to settle requires aggravating conduct; punitive considerations)
Robinson v. North Carolina Farm Bureau Ins. Co., 86 N.C.App. 44 (N.C. Ct. App. 1987) (tortious conduct in bad faith may be actionable even when damages are paid later)