Wal-Mart Sues Insurers for Alleged Breach of Contract in Morgan Settlement Case

By | October 16, 2015

Wal-Mart Stores Inc. recently 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 personal injury settlement paid to actor Tracy Morgan and others for the 2014 New Jersey Turnpike crash involving a Wal-Mart truck.

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

Morgan was riding in a van that was struck from behind by a Wal-Mart truck in June 2014. The settlement was announced in May though the terms weren’t disclosed.

Morgan and Wal-Mart settled the actor’s lawsuit over the crash that had left him in a coma for days and killed James McNair, a comedian who had been traveling with Morgan. McNair died when a Wal-Mart truck struck the rear of the van carrying Morgan and others after a comedy show in Delaware.

In its suit against insurers, 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 the report by 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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