Vann v. Travelers Ins. Co.
Gordon Vann was the former owner of an auto repair shop in Oakland, California. He had operated his repair shop in the same location for approximately 30 years. Following the death of his landlord, Mr. Vann was asked to vacate the premises. He was then sued and alleged to have caused certain environmental damage to the premises. Mr. Vann asked his insurance company to defend him. Rather than doing so, The Travelers at first denied that he even had a policy. Then after admitting that he had a policy, it inundated him with burdensome and harassing requests for information. Mr. Vann was nearly 70 years old at the time and unable to respond to these inquiries. The Travelers then improperly claimed that Mr. Vann didn’t have any insurance coverage in the first place and refused to hire an attorney to defend him. Mr. Vann was left to defend the case on his own. Later, an attorney agreed to help Mr. Vann defend himself but he was unable to afford an adequate defense.
Mr. Pillsbury proved at trial that The Travelers had intentionally adopted a manner of handling environmental claims that was intended to deprive individuals such as Mr. Vann of insurance protection. The jury found that The Travelers had acted in bad faith and that it had treated Mr. Vann with malice, fraud and oppression. It awarded Mr. Vann $26.5 million. The Travelers unsuccessfully appealed all the way to the United States Supreme Court.