PHILADELPHIA – A federal judge has dismissed a Bucks County company's bad faith claim against its insurer over a fire that damaged its business, ruling that moving forward with the case would be "futile."
In her seven-page memorandum opinion handed down Nov. 18, U.S. District Judge Wendy Beetlestone, on the bench in Pennsylvania's Eastern District, ruled that the insured failed to allege sufficient facts to support a bad faith claim and granted the motion to dismiss.
Beetlestone's opinion refers to a fire that damaged a business owned by the plaintiff in the case, Purvi LLC, in May 2017. Purvi apparently owns two adjacent motels in Feasterville-Trevose on Lincoln Highway, Route 1, between Philadelphia and Bensalem.
United States District Judge Wendy Beetlestone | law.upenn.edu/
One of the Purvi-owned properties, the Lincoln Hotel, was heavily damaged in a fire in May 2016 when a Philadelphia man killed his girlfriend by throwing a coffee cup of gasoline into her face while she was smoking at the Lincoln Motel. In addition to burning the woman to death, the fire reportedly caused about $1.8 million in property damage and threatened more than 40 guests and employees inside the motel at the time.
The man, Kevin Lamar Small, pleaded guilty to first-degree murder in March of the following year and is expected to spend the rest of his life in prison. Small is not a party in the case before Beetlestone.
As part of the aftermath of the 2016 fire, Purvi sued National Fire & Marine and another insurance company, KK Insurance Agency.
This past February, Beetlestone granted a KK Insurance motion to dismiss, ruling that Purvi failed to raise a genuine dispute of material fact about whether KK Insurance violated duties "to advise, or otherwise," following the 2016 fire.
Beetlestone's more-recent opinion refers to Purvi's allegations that National Fire & Marine improperly denied payment of benefits and didn't comply with a settlement agreement reached this past May that was supposed to resolve Purvi's claims in a separate action filed in January 2018.
Purvi claimed one count of breach of contract and another count of breach of good faith and fair dealing for National Fire & Marine's alleged failure to comply with the settlement agreement, in which the insurance company said it would issue a settlement check that named Purvi's mortgagee.
Purvi initially filed suit over the settlement agreement in Philadelphia Court of Common Pleas but National Fire & Marine removed the case to the federal court in September. National Fire & Marine also asked Beetlestone to dismiss Purvi's case for failure to state a claim for which damages could be awarded.
Beetlestone granted National Fire & Marine's motion, ruling that Purvi's claim "cannot survive as either a tort claim, or as an independent breach of good faith and fair dealing claim sounding in contract," the opinion said.
Beetlestone also denied Purvi leave to file a second amended complaint, "because, for the reasons set forth above, any amendment would be futile," the opinion said.