A federal judge in Florida has dismissed two counts in a lawsuit against Ohio National Life Insurance Company. The lawsuit, filed by financial giant Raymond James, makes numerous allegations against Ohio National. The two counts that were dismissed related to bad faith and wrongful interference with business relationships. The lawsuit is a good example of why having an experienced New York insurance defense attorney is so important.
Raymond James sued back in May concerning alleged failure to pay out over a financial product sold to its clients. The suit accused Ohio National of promising to pay firms for a financial product it offered that ultimately lost money. The insurer is said to have breached its agreement to compensate for the losses. Raymond James is seeking significant damages from Ohio National.
Two claims have been dismissed by Judge William Jung of the U.S. District Court for the Middle District of Florida. They were as follows:
- Breach of the implied covenant of good faith and fair dealing (accused Ohio National of acting in bad faith)
- Wrongful interference (accused Ohio National of intentionally and continually interfering with Raymond James’ business relationships with clients and financial advisers)
The latter count was dismissed without prejudice. That means Raymond James and its attorneys have the chance to refile the claim.
The complaint contains a detailed history of how the two parties ended up in federal court. Back in 2002, Raymond James entered into an agreement with Ohio National. The insurer sells a variety of products to financial companies, including a certain variable annuity contract. This contract allowed policyholders to purchase a guaranteed minimum income benefit (GMIB riders) for an additional cost.
About a decade later, the agreement between the two companies started to deteriorate. According to the complaint, Ohio National tried to convince Raymond James to switch to a different product. This was after the financial company realized the GMIB riders would not be profitable.
Ohio National is accused of knowing they were losing money on the annuity products. It then sought to minimize its losses by breaking its promises to compensate, says Raymond James. By refusing to pay, Ohio National allegedly breached its contract with the firms to which it had sold the products.
The claims made against Ohio National, especially bad faith, are common in insurance litigation. Bad faith essentially means the company did not fairly uphold its obligations to policyholders. This may be through refusal to pay a legitimate claim, as alleged here. It can also mean failing to investigate and process an insurance claim within a reasonable amount of time. The key issue is whether the insurer’s actions were wrongful in light of its obligations.
Lawsuits such as these illustrate the difference that skilled legal representation can make. Ohio National sought the dismissal of two additional claims in the lawsuit. Although they weren’t all granted, the dismissals that were won could save Ohio National money. That includes additional legal fees and potential damages. When your insurance company is defending against a legal claim, significant sums of money are on the line. That’s where a dedicated insurance defense attorney helps.
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Insurance defense is one of many practice areas we handle at Rosenbaum & Taylor. If you’re an insurer in New York, you need top-notch legal counsel in the event of a lawsuit. We understand New York insurance law and we know how to build a compelling legal defense. No matter what sort of litigation you’re facing, let us go to work for you. Give us a call today.