Hamilton Wingo Closes the Books on Long-Running Dispute with $17.1M Insurance Bad Faith Appellate Ruling

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Jan 21, 2022, 15:50 ET

DALLAS, Jan. 21, 2022 /PRNewswire/ -- Hamilton Wingo has secured a Florida appellate ruling requiring Carolina Casualty Insurance Company to honor its insurance contract and provide coverage for a $17.1 million arbitration award involving Texas-based Primcogent Solutions.

The June 2021 ruling by the Florida First District Court of Appeal closes the books on the case Carolina Casualty Insurance Company v. John D. Spicer, a long-running dispute over Primcogent's 2011 acquisition of medical laser equipment from Santa Barbara Medical Innovations (SBMI). Primcogent was forced to file for bankruptcy in 2013 due to the acquisition. Subsequent litigation on behalf of the bankruptcy trustee claimed that SBMI had failed to disclose key information about the equipment, including revenue-generating potential and a history of customer complaints.

Prior to trial, the bankruptcy trustee offered to settle within policy limits. The insurance company denied coverage and refused to tender its policy limits, citing a litany of legal excuses.

After a six-day arbitration trial in 2016, an arbitration panel awarded $17.1 million to the bankruptcy trustee. The U.S. Court of Appeals for the Fifth Circuit affirmed the arbitration award in May 2019—issuing its opinion the same day Hamilton Wingo co-founder Chris Hamilton argued the case.

When SBMI's insurance carrier, Carolina Casualty Insurance Company, refused to pay the arbitration award, Hamilton Wingo filed a suit in Florida on behalf of the bankruptcy trustee. After an extended hearing in January 2019 on the parties' cross motions for summary judgment, the trial court granted summary judgment in favor of the trustee and denied the insurance company's motion for summary judgment on all counts.

Despite the insurance company's efforts to appeal the lower court's decision, further delay and evade accountability, in June 2021, the Florida First District Court of Appeal affirmed the award of coverage of the judgment in full, and lifted the discovery stay as to the plaintiff's claims for bad faith and fraud against the insurer—entitling the bankruptcy trustee to obtain the insurance company's files withheld as confidential.

The insurance company was also forced to pay all policy limits to the bankruptcy trustee. Hamilton Wingo, as the Special Counsel to the trustee appointed by the bankruptcy court, is now actively prosecuting claims against Carolina Casualty Insurance Company for insurance bad faith, fraud, exemplary damages, and treble damages.

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SOURCE Hamilton Wingo, LLP