BBS Member Yolanda DeSipio Receives Order of Summary Judgment in Class Action Suit

Congratulations to local counsel Yolanda Konopacka DeSipio, along with lead counsel, who received an Order entering summary judgment for the insurer in a contested proposed class action suit. The federal judge dismissed a proposed class action filed on behalf of Pennsylvania homeowners who alleged that the insurer undervalued property damage claims in its use of the Xactimate software. The lead Plaintiffs sustained a fire loss at their home. Their complaint included counts for bad faith, fraud and deceptive business practices, breach of contract, bad faith, and unfair trade practices. They sought relief as a class action. Plaintiffs claimed that Defendant wrongfully used “new construction” numbers in Xactimate when it should have used “repair/reconstruction” numbers, and the difference led to an alleged underpayment of approximately $200,000.  Therefore, Plaintiffs alleged that the insurer failed to use a specific method of computation to assess their loss. Defendant argued that it had no contractual duty to use a particular setting when estimating losses, and it did not breach its loss settlement obligations. The Middle District of Pennsylvania judge agreed with Defendant that its policy did not require the insurer to use a specific computation method for loss calculations. The judge could not identify any policy language that “directly or indirectly” concerned any method of computation, “much less” any language that required a singular method of computation. The judge also noted that the insurer agreed to appraisal after the homeowners’ public adjuster and the insurer differed on the loss amount ,and the insurer paid the difference based on the appraisal award. He found that the fact that the parties’ appraisers found a higher value for the loss than the insurer’s estimate did not mean the insurer acted in bad faith. The judge dismissed the case.