Wal-Mart Accuses Insurers of Bad Faith in Tracy Morgan Case

November 2, 2015

Wal-Mart Stores Inc. has filed a lawsuit against a number of its commercial excess liability insurers. The lawsuit alleges that the insurers are delaying to pay claims related to the giant retailer’s settlement paid to actor-comedian Tracy Morgan and others for the 2014 New Jersey Turnpike crash involving a Wal-Mart truck.

Courthouse News Service reported last month that Wal-Mart filed the suit in Benton County Court in Bentonville, Arkansas on Sept. 30 against Liberty Insurance Underwriters, The Ohio Casualty Insurance; QBE Insurance; St. Paul Fire & Marine Insurance, The Travelers Companies; and XL Insurance America. The report says Wal-Mart is seeking compensatory and punitive damages for breach of contract, negligent failure to settle claim within policy limits and bad faith.

Morgan was riding in a van that was struck from behind by a Wal-Mart truck in June 2014. The crash had left the former “Saturday Night Live” and “30 Rock” star in a coma for days and killed James McNair, a comedian who had been traveling with Morgan. Morgan and two friends injured in the crash settled a lawsuit against Wal-Mart in May for an undisclosed amount. Wal-Mart settled a wrongful death claim filed by McNair’s children for $10 million, according to court papers.

In its suit, Wal-Mart alleges that the insurers unfairly refused to pay for the settlements. Wal-Mart alleged in its complaint that “Defendants engaged in an oppressive and malicious effort to prolong the investigation and payment of Wal-Mart’s claim by failing to properly investigate the claim and by continually making oppressive and unwarranted requests for information from Wal-Mart,” according to Courthouse News Service.

QBE, The Travelers Companies, XL Catlin and Liberty Mutual declined to comment. Wal-Mart Stores did not immediately respond to a request for comment.

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Insurance Journal West November 2, 2015
November 2, 2015
Insurance Journal West Magazine

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