Lenora Bateman v. Federal Insurance Company

MEMORANDUM

Plaintiffs appeal the district court’s grant of summary judgment to Defendant Federal Insurance Company in this action for a declaratory judgment. Plaintiffs seek a declaration that Defendant, in handling Plaintiffs’ third-party claims, violated its duties under Montana’s Unfair Trade Practices Act (“UTPA”) and the common law. Reviewing de novo, Alexander Mfg., Inc. Employee Stock Ownership Plan & Trust v. Ill. Union Ins. Co., 560 F.3d 984, 986 (9th Cir.2009), we affirm in part, reverse in part, and remand to the district court.

We affirm the district court’s dismissal of Plaintiffs’ claim that Defendant failed to attempt a good-faith settlement, as required by the UTPA and common law. Plaintiffs fail to raise a genuine issue of material fact as to whether liability was reasonably clear. See Mont.Code Ann. § 33-18-201(6) (providing that an insurer has a duty “to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear”); Palmer ex rel. Diacon v. Farmers Ins. Exch., 261 Mont. 91 , 861 P.2d 895, 903 (1993) (holding that, under Montana common law, an insurer cannot be held liable for bad faith in…