Hodges v. Geico Insurance Company
MEMORANDUM OPINION AND ORDER by District Judge Judith C. Herrera GRANTING IN PART 22 Defendants Unopposed Motion to Bifurcate Trial and Stay Discovery on Plaintiffs Extra-Contractual Claims to the extent that the Court will bifurcate at trial the determination of the contractual issues from extra-contractual issues, but will try all counts before the same jury. In all other respects, the motion is DENIED WITHOUT PREJUDICE.. (baw)
UNITED STATES DISTRICT COURT
DISTRICT OF NEW MEXICO
No. 17-cv-0960 JCH/KRS
MEMORANDUM OPINION AND ORDER
On November 11, 2017, Defendant GEICO Choice Insurance Company (“GEICO” or
“Defendant”) filed an Unopposed Motion to Bifurcate Trial and Stay Discovery on Plaintiff’s
Extra-Contractual Claims (ECF No. 2). The Court, having considered the pleadings, motion, and
relevant law, concludes that the motion should be granted to the limited extent that trial of the
extra-contractual claims may be bifurcated from the contractual claims, but decided by the same
jury, should the jury find for Plaintiff on the contractual claims. The motion will otherwise be
FACTUAL ALLEGATIONS AND CLAIMS
This case arises out of a dispute over an underinsured motorist (“UIM”) insurance claim.
On December 16, 2016, Plaintiff Claudell Hodges (“Plaintiff”) was a passenger in a vehicle
driven by Delrae Kelly, and they were involved in a motor vehicle collision. Compl. ¶ 2, ECF
No. 1-2. GEICO is the insurer of Delrae Kelly. Id. ¶ 3. GEICO believes that the car driven by
Delrae Kelly was owned by Claudell Hodges. Answer ¶ 2, ECF No. 6.
Plaintiff asserts she suffered rib fractures, deep bruising in her clavicle and anterior chest,
ongoing low and mid back pain, pain standing or walking for more than a few minutes, and that
her chronic and permanent daily pain and suffering and medical treatment will continue into the
future. See Compl. ¶¶ 7-10, ECF No. 1-2. The liability insurance limit of $50,000 by the
tortfeasor was tendered. Id. ¶ 11. GEICO was notified on May 17, 2017, that State Farm
Insurance tendered Ms. Hodges the UIM policy limits of $25,000, after the offset of the tender of
liability on behalf of the tortfeasor. Id. ¶ 12. Ms. Hodges alleges she paid GEICO for UIM
coverage in the amount of $75,000, plus $1,000 in medical payments to cover her and her
passengers. Id. ¶ 13. GEICO admits that Ms. Hodges purchased $75,000 in stacked UIM
coverage, but asserts that after the $50,000 statutory offset, only up to $25,000 was available to
Ms. Hodges. Answer ¶ 13, ECF No. 6.
Ms. Hodges made a timely demand upon GEICO for UIM policy limits, less the
tortfeasor offset, providing medical records and bills in support. Compl. ¶¶ 14-15, ECF No. 1-2.
GEICO responded with an offer of $10,000. Id. ¶ 16. Plaintiff asserts that the single offer by
GEICO was unreasonably low, and she sued GEICO for breach of insurance contract and duties
of fair dealing (Count I); breach of the Insurance Practices Act and bad faith (Count II), violation
of the Unfair Practices Act (Count III). Id. ¶¶ 17-40. GEICO asserts that its offer of $10,000 was
reasonable. Answer ¶ 16, ECF No. 6.
Defendant moves to bifurcate and stay discovery on the extra-contractual claims until
Plaintiff’s underlying UIM claim is resolved. Def.’s Mot. 1, ECF No. 22. Plaintiff does not
oppose the motion. Id.
“For convenience, to avoid prejudice, or to expedite and economize, the court may order
a separate trial of one or more separate issues, [or] claims…” Fed. R. Civ. P. 42(b). A district
court has broad discretion in determining whether to sever claims for trial. Easton v. City of
Boulder, 776 F.2d 1441, 1447 (10th Cir. 1985). Bifurcation may be in the interest of efficiency
and judicial economy when the issues are clearly separable or resolution of one claim obviates
the need to adjudicate other claims. See Mandeville v. Quinstar Corp., 109 F. App’x 191, 194
(10th Cir. July 14, 2004).
Although a determination of the contractual claim in favor of Defendant would dispose of
the extra-contractual claims, Defendant has not established that convenience, efficiency, or
prejudice to Defendant warrants a stay of discovery and separate trials before separate juries. In
this case, the breach of contract claim involves whether Plaintiff is legally entitled to recover
UIM benefits for damages related to the motor vehicle accident. Def.’s Mot. 2, ECF No. 22. The
extra-contractual claims involve the fairness and reasonableness of GEICO’s investigation and
offer of settlement. See NM UJI 13-1702 (“In deciding whether to pay a claim, the insurance
company must act reasonably under the circumstances to conduct a timely and fair [investigation
or evaluation] of the claim.”). The parties have not convinced the Court that there will be no
overlap in evidence and testimony between Count I and Counts II and III that compels
bifurcation. There are similar factual underpinnings between the contractual and extracontractual claims – the amount of the damages sustained by Plaintiff in the accident. If a jury
determines there was a breach of contract, evidence regarding the damages would be presented
twice. Bifurcation and stay would require the parties to restart discovery, thus prolonging the
course of the case.
Moreover, this District has an extensive criminal caseload that causes difficulty finding
time to try civil cases. To economize this Court’s resources, the Court will not stay discovery.
Instead, the Court will allow discovery on all claims to proceed, so that, should the jury find for
Plaintiff on the contractual issues, the parties can proceed before the same jury on the extracontractual claims. The Court will therefore permit bifurcation of the issues at trial, but will try
all counts before the same jury. Bifurcating and staying discovery at this stage is not in the
interest of efficiency and is not necessary to avoid prejudice. The Court’s decision on this motion
is without prejudice, because the motion was unopposed. Should the parties have additional
reasons or grounds for which they believe a stay of discovery is beneficial to all parties, they
may file another motion on these issues, and the Court will consider the arguments.
IT IS THEREFORE ORDERED that Defendant’s Unopposed Motion to Bifurcate
Trial and Stay Discovery on Plaintiff’s Extra-Contractual Claims (ECF No. 22) is GRANTED
to the extent that the Court will bifurcate at trial the determination of the contractual issues from
extra-contractual issues, but will try all counts before the same jury. In all other respects, the
motion is DENIED WITHOUT PREJUDICE.
UNITED STATES DISTRICT JUDGE
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