The DRI Bad Faith conference concluded on Thursday afternoon with a presentation by Sarah M. Thorpe of Gordon & Rees LLP and Donald M. Carley of State Farm Insurance. The panel began with a discussion of the latest developments in strategies for defending bad faith claims. The panel observed that, when faced with an actual or potential bad faith case, counsel is advised to know the facts of the case by reviewing the claims file, interviewing key witnesses, identifying the undisputed and disputed issues, and reviewing the relevant case law. This allows an objective evaluation of the case, including good and bad aspects. Counsel should also carefully consider whether the case is one to bring to trial or whether it is one to settle, and if so, when settlement negotiations should begin. Cost-benefit considerations as to whether to settle include not only the chance of success, but also the financial and “human costs” of litigation, such as who will have to be deposed and whether the reputation of the company will be at risk.
The panel also recommended that counsel adopt a proactive approach to discovery. At an initial case management conference, counsel should have a well-thought out discovery plan, which can be an important defense against overzealous discovery tactics on the part of opposing counsel. In addition to formal discovery, counsel should consider utilizing informal avenues of discovery, such as social media. According to the panel, the use of publicly-available information is permitted in the majority of jurisdictions. This can be a very valuable tool in creative discovery.