ATLANTA, GA – The United States Court of Appeals for the Eleventh Circuit has affirmed the district court’s entry of summary judgment in favor of GEICO Casualty Insurance Company in a bad faith lawsuit brought by Katherine Martinez. The panel, consisting of Circuit Judges Luck, Lagoa, and Abudu, held that no reasonable jury could find GEICO acted in bad faith under Florida law based on the evidence presented.
Martinez was severely injured in a three-vehicle crash in Miami-Dade County on February 12, 2009. The crash occurred when a pickup truck driven by Rene Carranza rear-ended the SUV in which Martinez was a passenger, causing it to spin into the path of a northbound truck driven by Diana Guevara. Guevara was insured by GEICO with a bodily injury policy limit of $10,000 per person and $20,000 per accident.
GEICO identified a potential coverage issue because Guevara’s truck was not listed on her policy. Nonetheless, thirty-two days after receiving notice of the claim, GEICO set aside the full $20,000 aggregate limit and tendered it at a global settlement conference. Martinez declined the offer and pursued a negligence suit in state court. That litigation concluded with a $2 million stipulated judgment, which Guevara assigned to Martinez.
Martinez then sued GEICO in federal court for bad faith, alleging the insurer delayed its investigation and settlement in a manner that failed to protect its insured from excess liability. The district court granted summary judgment in GEICO’s favor, and Martinez appealed.
On review, the Eleventh Circuit found that GEICO acted with appropriate diligence given the disputed coverage issue and the presence of multiple claimants. The panel noted that GEICO’s actions—including timely seeking the police report, contacting victims and attorneys, and ultimately tendering the full policy limits—did not amount to bad faith under the “totality of the circumstances” test required by Florida law.
The court also rejected Martinez’s arguments that GEICO’s internal policy violations or post-litigation conduct supported a finding of bad faith. It concluded that Martinez’s claim failed as a matter of law.
