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Third Circuit Denies Rehearing En Banc

Discussion in 'Alternative Dispute Resolution' started by Seeker624, Apr 30, 2007.

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  1. Seeker624

    Seeker624 Law Topic Starter New Member

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    I have a case that was just denied a rehearing by the Third Circuit Court Of Appeals after a 3 to 0 affirmation of the original District Court decision. The main issue is the dismissal of a breach of an insurance contract at the 11th hour prior to trial based simply on a defendant's oral settlement offer with no terms of such offer disclosed to anyone.

    Although I am not an attorney, I have consulted with many attorneys and law sites who simply have no answer and no experience in this type of situation. I have had the same answers such as " talk with your attorney" or "i don't know enough about the case". I can say that I've been in business for 30 years and am not a stranger to the law or litigation.

    The main problem I have with all of the opinions, both by the District Court and Third Circuit,is that they strictly cite cases that have involved Federal Rule 68. These cases all had proper Offers of Judgment made in writing 10 days before trial pursuant to Rule 68. My case had no such offer and this oral settlement offer was made 5 days before trial after the Judge had called the case for trial in full knowledge that the defendants had deposited the amount offered in the court(without prejudice) over a year earlier.

    The case had been litigated extensively for about 5 years and all motions for Summary Judgment regarding this count had been denied even when the defense motioned and was allowed to deposit the limits of the insurance policy in the court. Amazingly, on the record, the District Court Judge stated that even though it was five years later, now that the defendants had offered the limits of the policy, there was no longer a breach of contract and no case or controversy. Why pay anybody on a contract when you can wait five years, force litigation and try to break a plaintiff then finally escape a breach of contract trial by offering the contract amount at the last second ?

    There are several problems with the "no more breach of contact" theory, the most important being that the defendants violated many state insurance statutes by failing to pay or deny the claim 90 days after submission and inspection by their adjuster. This was clearly presented to the District Court. Additionally, their breach and fail to pay caused the litigation. I spent thousands continuning to store damaged moldy items to preserve for trial.

    The District Judge also stated on the record that the offer was not a "settlement offer" but full tendering of the policy limits. Why did he decide this after all these years of litigation and the depositing of the policy limits(which the court ruled was made without prejudice) over a year earlier? What about cases where the plaintiffs are offered more than the policy limits? There are no rules as I know them, regarding such offers, which all are settlement offers.

    Rule 68 is being used more than ever to dispose of class action suits mostly involving the Fair Debt Collection Practices Act. The important part of Rule 68 is that the offer be made in writing 10 days before trial and costs must be included. It was clearly pointed out both times to the Third Circuit that the an offer of judgment never was made and no costs offered. The District Court Judge asked on the record at that pre trial hearing whether or not an offer of judgment had been made and the defendants repied "no". Absent a formal Rule 68 offer, there is no caselaw regarding the ability to dismiss a case for lack of subject matter jurisdiction.

    The more bizarre part of this situation is that the District Court Judge had to explain in his opinion why the case was still in the federal court system when the sole remaining count of( breach of an insurance) was primarily valued at $15,000. Normally, folks would say I have the right to now take this to state court but the Judge valued the case at 0 saying that "a plaintiff who fails to accept the maximum he can get loses outright". This quote actually came from a case (Zimmerman v. Bell ?)which again involved a formal Rule 68 Offer of Judgment.

    I am unsure whether or not to take this to the Supreme Court regarding the Federal question of dismissing a case in this manner absent a Rule 68 offer. This certainly isn't right what happened here and this is only the tip of the iceberg. There are other issues such as the Third Circuit's opinion stating that the defendants were grossly negligent but not willful or wanton....My appeal brief contained several pages regarding willful and wanton behavior in addition to Rule 68 and their opinion ignored it completely.
     

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