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Reeves v. The Travelers Companies

United States District Court, E.D. Pennsylvania

April 11, 2017

DOUGLAS REEVES Plaintiff
v.
THE TRAVELERS COMPANIES d/b/a TRAVELERS Defendant

          MEMORANDUM RE DEFENDANT'S MOTION TO BIFURCATE AND STAY COUNT II

         In this case, Plaintiff Douglas Reeves' contends that Travelers (“Defendant”) failed to honor the terms of the underinsured motorist provision of his insurance contract, and exhibited bad faith in its handling of Reeves' claim in violation of 42 Pa. C.S.A. § 8371. Presently before the Court is Defendant's Motion to Bifurcate and Stay Count II of Plaintiff's Complaint (the Bad Faith claim). For the reasons stated below, Defendant's motion is DENIED.

         I. Factual and Procedural Background

         Plaintiff alleges that on June 25, 2015, he was a passenger in a motor vehicle operated by a co-worker, when they were rear-ended by another vehicle, driven by a Mr. Blake. See ECF 1, Notice of Removal, Attached Complaint ¶¶ 3-4 (hereinafter “Compl.”). Plaintiff sustained significant injuries, and recovered from Mr. Blake for the maximum policy amount available on Mr. Blake's insurance. Compl. ¶¶ 6, 11. Because that was not enough to cover the extent of Plaintiff's injuries, Plaintiff filed a underinsured motorist (UIM) claim with his insurance company, Travelers. Id. ¶ 12.

         On February 4, 2016, Travelers denied plaintiff's UIM claim, citing an exclusion under the policy. Id. ¶ 20. In a letter to Defendant dated August 22, 2016 Plaintiff documented his belief that Defendant frivolously denied his claim. Id. ¶ 21. On September 13, 2016, Defendant issued a second denial of Plaintiff's UIM claim. Id. ¶ 22. Plaintiff again attempted to convince Defendant via letter that his claim should be paid, and on October 4, 2016, for a third and final time, Defendant denied the claim. Id. ¶¶ 23, 24. In November 2016, Plaintiff filed suit against Defendant Travelers in Philadelphia County Court of Common Pleas, alleging breach of contract and bad faith. Id. ¶¶ 29-48. Defendant removed to this Court on December 15, 2016, and answered Plaintiff's Complaint on December 22, 2016. See ECF 1, Notice of Removal; ECF 4, Answer with Affirmative Defenses.

         On February 17, 2017, Defendant moved to bifurcate and stay Plaintiff's bad faith claim. ECF 11. Plaintiff filed a response opposing the motion on March 2, 2017, and Defendant replied on March 10, 2017. ECF 13; ECF 14. Defendant's motion is ripe and before the Court.

         II. Jurisdiction

         This Court has jurisdiction under 28 U.S.C § 1332, and this case was properly removed under 28 U.S.C. § 1441.

         III. Discussion

         A. Legal Background

         Travelers brings its Motion to Bifurcate and Stay under Federal Rule of Civil Procedure 42(b), which provides that a court may order a separate trial “[f]or convenience, to avoid prejudice, or to expedite and economize.” Fed.R.Civ.P. 42(b). Under this rule, the district court has broad discretion to grant or deny a motion to bifurcate claims. Lis v. Robert Packer Hosp., 579 F.2d 819, 824 (3d Cir. 1978). Bifurcation “is not to be routinely ordered” and should be done on a case by case basis “where experience has demonstrated its worth.” Id. at 824 (quoting advisory committee note to Fed.R.Civ.P. 42(b) 1966 amendment).

         The moving party has the burden to show that bifurcation is proper under Rule 42(b). Innovative Office Prod., Inc. v. Spaceco, Inc., No. 05-04037, 2006 WL 1340865, at *1 (E.D. Pa. May 15, 2006). In determining whether to bifurcate claims, a district court should consider “the convenience of the parties, avoidance of prejudice to either party, and promotion of the expeditious resolution of the litigation.” Official Comm. of Unsecured Creditors v. Shapiro, 190 F.R.D. 352, 355 (E.D. Pa. 2000) (internal quotations omitted).

         B. Arguments of the Parties

         1) Defendant's Position

         Defendant argues that Plaintiff's claim for bad faith should be bifurcated from his breach of contract claim, and that the discovery related to the bad faith claim should be stayed pending the resolution of the contract claim. See Def.'s Mot. ...


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