Insurer Off-Base in Protesting Dish-Coverage Jury Award, Law Firm Says

OneBeacon Insurance's argument that a U.S. District Court jury was wrong in awarding exemplary damages and additional damages "is an odd argument considering it was OneBeacon that insisted on allowing the jury to award both ... rather than only one or the other," said Wade Welch and Wade Welch & Associates in a reply (in Pacer) Thursday in the 5th U.S. Circuit Court of Appeals. OneBeacon is appealing a 2014 jury verdict in favor of Welch, who was sued by OneBeacon after Dish Network separately received a $13 million judgment against the Welch firm for malpractice in its representation of Dish in a different civil claim altogether. OneBeacon's argument that its only mistake was in not accepting Dish's 2011 demand "oversimplifies the trial record and misstates its duty to its insured," said Welch the individual and the firm: The insurer's misconduct also includes its post-claim underwriting, "the deception it employed" in rejecting the Dish settlement "and its continued failure to effectuate a fair and reasonable settlement" after rejecting Dish's. The Welch entities said OneBeacon is offering a "frankly preposterous argument that a finding of 'gross negligence' under [Stowers Furniture Co. v. American Indemnity] is 'exactly the same' as a finding under [Texas Insurance Code] Section 541 that an insured acted 'knowing' the wrongfulness of its conduct." The Welch entities said that beyond rejecting the Dish settlement demand, OneBeacon "knowingly engaged in deceptive and unfair conduct to avoid effectuating a fair settlement of [the satellite company's] claim against Welch." Since the wrongful acts were separate, and subject to different standards of proof, "nothing prohibits two awards of punitive damages under these circumstances" and the court should restore the jury's $5 million award for gross negligence under the Stowers claim, the Welch entities said. OneBeacon didn't comment Friday. The insurance coverage dispute began with a 2003 Dish suit filed by Russian Media Group, which claimed Dish interfered with assets such as cable distribution contracts that RMG bought from SkyView World Media.