L.A. Jury Awards Quadriplegic Man $10 Million

A Los Angeles jury has awarded a quadriplegic man $10 million in a bad faith case against Atlantic Mutual Insurance Company.

The jury found that Atlantic Mutual acted despicably and with malice and oppression in wrongfully refusing to settle a personal injury case in 2002. Steven Smith & William Chapman, partners at Smith, Chapman & Campbell, represented Plaintiff, Leon Bostick.

On Jan. 4, 2001, Bostick was working out on a "Smith" weightlifting machine at Gold's Gym in Venice Beach, California when he lost control of the weights, which broke his neck, rendering him a quadriplegic. This tragic accident could have reportedly been prevented if the manufacturer had included safety devices that would have cost $75.

Bostick filed suit against Flex Equipment and Gold's Gym. By December 2001, Atlantic reportedly knew Bostick's medical bills were over $600,000. Atlantic reportedly knew that if Flex was found liable, a jury would come back with an award of $5m-$10m. However, Atlantic reportedly heard "rumors" that the accident did not happen on the Flex machine and decided to defend on that basis.

After learning that Flex only had a $1m insurance policy, on Dec. 14, 2001, Bostick's lawyers offered to settle his claims against Flex for the $1m insurance policy. Atlantic was given 30 days to respond, then was granted an extension of another 17 days.

Before the expiration of the policy limits demand, a lawyer retained by Atlantic to defend Flex and independent counsel of Flex both advised Atlantic to settle. On Jan. 17, 2002, Atlantic concluded that "plaintiff was definitely using the insured's machine." However, the next day, Atlantic reportedly decided that it wanted to "reject" the policy limits demand.

On Friday, July 25, 2003, a Los Angeles jury rendered a verdict in the amount of $16.2m in favor of Bostick. Flex assigned to Bostick its rights to sue Atlantic for bad faith refusal to settle within the policy. On Monday, Jan. 29, 2007, the California Court of Appeal affirmed the judgment against Flex. On Tuesday, Nov. 18, 2008, the jury in the bad faith case awarded $10 million to Bostick.