.

G. Mark Thompson

President & CEO

Chairman, Executive Committee

GMThompson@mdwcg.com

Portrait of G. Mark Thompson

Defense Digest

Message From the Executive Committee

Defense Digest, Vol. 28, No. 12, December 2022

December 1, 2022

by G. Mark Thompson

As the holidays approach, I want to thank our loyal clients and everyone at Marshall Dennehey for helping transform another challenging year into a success.

2022 produced a unique set of circumstances for the country at large and our industry in particular.

These included the Omicron surge at the beginning of the year, pitting a relatively milder variant against a largely vaccinated population. It was somehow less a threat but highly transmissible and, before long, the number of us testing positive had soared. This had a disruptive effect on businesses large and small and got many off to a slow start.

No sooner did Omicron recede did the Great Resignation intensify, which ultimately led to some 40 million Americans changing jobs. Perhaps you are one of them and now settling into a new position. We know both the claims and legal industry saw unprecedented movement this year and often fierce competition for talent.

But there is more. While these events were unfolding, the rate of inflation reached a 40-year high, the stock market tumbled, and our country’s supply chains stalled.

If it seemed like business was anything but usual, that is because it was. Anything but usual.

And yet, through all the uncertainty, Marshall Dennehey remained a beacon of reliability to clients and opportunity for employees. There we stood. An Am Law 200 law firm with 19 offices in seven states. Resolute. Proud to be celebrating 60 years in business. Grateful for our many blessings.

In one of the tightest labor markets in history, we continued to attract legal talent. Throughout the year, we recruited. We hired. We onboarded associates, lateral shareholders with portable business, and, in October, the former Delany Law Group—absorbing much of that firm.

How did we attract such extraordinary trial talent when a number of our competitors had approached them as well? In a conversation before his arrival, the Delany Law Group’s founder, Jack Delany, explained it was Marshall Dennehey’s “integrity, impeccable reputation and progressive ideals.”

This year, in addition to bringing associates, shareholders, and another law firm into Marshall Dennehey, we opened a brand new office in New Haven, Connecticut. In less than a year, it has become one of the fastest growing in the firm.

It has also been energizing, throughout the year, to reunite in person with clients from California to London, England, and resume attending and presenting at industry conferences. We had really missed the personal connections and have enjoyed congratulating so many of you on your promotions since we had last been together.

In that same spirit, one of the most important, consequential, and enduring things we did this year was stand up Marshall Dennehey’s next generation of leaders. Careers advanced at every level, including practice department directors, managing attorneys of our regional offices, practice group silos, and administrative departments. At our Annual Shareholder’s Meeting, 20 different attorneys were elected to shareholder effective January 1st. All this was done with an eye toward diversity and inclusion and was in keeping with an ongoing commitment to elevate women to positions of leadership and responsibility in the firm.

Such progress has attracted attention. In a large-scale, independent survey of law firms to determine where associates are happiest, BTI awarded the firm a coveted spot on its “Associate Satisfaction A-Listers.” Women attorneys, in particular, distinguished Marshall Dennehey for programs that associates value most. We were also named a 2022 “Tipping the Scales” law firm by the Diversity & Flexibility Alliance for our advancement of women in the profession.

This recognition complimented other accolades. Marshall Dennehey was named a “2023 Best Law Firm” in multiple practice areas, both nationally and across numerous regions of the country, by U.S. News – Best Lawyers®. It was recognized by BTI Consulting Group as one of the “Most Recommended Law Firms” in the country by corporate counsel.

Because we have long considered our culture one of the firm’s greatest assets, it was also nice to be applauded, for the tenth consecutive year, as a “Best Place to Work” by the Philadelphia Business Journal.

And as we enter a season of giving, it's worth noting that’s exactly how we celebrated the firm’s 60th Anniversary. By giving back. This year, in lieu of throwing ourselves a big gala, Marshall Dennehey celebrated 60 years in business by providing thousand dollar grants to 60 different charities in the local communities in which we do business. This benefited literacy programs, humane societies, homeless shelters, food banks, libraries, legal aid clinics, substance abuse programs, disease treatment centers, and a host of other worthy causes.

It was a rewarding experience that left us mindful of the significant need all around us.

Folks, it has been quite a year. One marked by adversity but filled with hope, resilience, and the thrill that comes from solving complex problems together. Whether you are a client or an employee, thank you for your contribution to these efforts and for making Marshall Dennehey the extraordinary firm that it is.

On behalf of the Executive Committee, we wish you and your families the very best of holidays and a new year filled with success, happiness, and good health.

Firm Highlights

Bret E. Dubbert Joins Marshall Dennehey’s Orlando Office as Special Counsel in the Casualty Department

News

Bret E. Dubbert Joins Marshall Dennehey’s Orlando Office as Special Counsel in the Casualty Department

Marshall Dennehey Named a Standout in Litigation by BTI Consulting Group

News

Marshall Dennehey Named a Standout in Litigation by BTI Consulting Group

Defense Victory Obtained in Workers’ Compensation Case

Result

Defense Victory Obtained in Workers’ Compensation Case

Thought Leadership

Florida Supreme Court Rules Florida Statute §627.70152 Does not Apply Retroactively

In a decision that resolves years of appellate uncertainty and confirms that insurers and insureds alike can rely on the legal framework in place when a policy is issued, the Supreme Court of Florida last week found that Florida Statute §627.70152, which involves an insured’s requirement to provide an insurer with pre-suit notice before filing a suit, cannot be applied retroactively. In Universal Property & Casualty Insurance Company v. Hughes, the Court was presented with the issue of whether the statutory pre-suit notice requirement applied retroactively and whether it would apply to a breach of contract of an insurance policy that was issued before the statute went into effect. Before the Court was an appeal from a homeowner, Ms. Hughes, who sued her insurance carrier, Universal Property & Casualty Insurance Company (Universal) for breach of contract under an insurance policy that was in effect from April 24, 2019 through April 24, 2020. During the policy period, Ms. Hughes suffered a loss and, on May 29, 2019, made a claim for water damage. The carrier investigated the loss and issued payment; Ms. Hughes disputed the payment, finding the amount insufficient for repairs. On July 1, 2021, Florida Statute §627.70152 went into effect, which required insureds to provide notice of intent to initiate litigation against the carrier prior to filing a lawsuit; if an insured filed the lawsuit without complying with §627.70152, a court must dismiss the case without prejudice. On August 4, 2021, Ms. Hughes filed her lawsuit against Universal for breach of contract. Universal moved to dismiss based on her failure to comply with §627.70152. Ms. Hughes contended the notice requirement could not be applied retroactively. The trial court disagreed and dismissed the lawsuit without prejudice, and Ms. Hughes appealed. During the appeal, the Fourth District Court of Appeal, in Cole v. Universal Property & Casualty, 363 So. 3d 1089 (Fla. 4th DCA 2023), ruled that Florida Statute §627.70152 did apply retroactively to policies issued before the effective date of §627.70152. However, the Sixth District Court agreed with Ms. Hughes and overturned the trial court’s ruling, finding the statute could not retroactively apply to policies issued prior to the statute effective date. Thereafter, the other district courts weighed in, with the Third District Court agreeing with the Fourth District Court, and the First, Second and Fifth District Courts agreeing with the Sixth District Court. In resolving the conflict amongst the district courts, the Supreme Court advised “as a general rule, ‘the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.’ Hassen v. State Farm Mut. Auto. Ins. Co., 674 So. 2d 106, 108 (Fla. 1996). The Court applied the two-step test when deciding whether a statute has retroactive application: “First, the Court must ascertain whether the Legislature intended for the statute to apply retroactively. Second, if such an intent is clearly expressed, the Court must determine whether retroactive application would violate any constitutional principles.” Menendez v. Progressive Exp. Ins. Co., 35 So. 3d 873, 877 (Fla. 2010). In analyzing the Legislature’s intent, the Court must determine whether the Legislature has manifested a clear command for retroactivity in the statutory text.  In review of the statutory text, the Court found nothing in the language of the statute to indicate that the phrase “all suits” was serving another purpose of expanding its reach to suits based on policies that both predate and postdate the enactment of the statute. Buis v. Universal Prop. & Cas. Ins. Co., 394 So. 3d 738, 741 (Fla. 2d DCA 2024). Further, the Court noted the statute has an effective date, which has long been considered to be evidence against retroactive application of a statute. The Court concluded that, on its face, no provision of §627.70152 speaks to application of the statute to insurance policies issued before the statute’s effective date and therefore, the Legislature did not clearly command retroactivity of the statute to include insurance policies issued prior to the enactment of the statute. The Court briefly reviewed Universal’s argument that the presuit notice requirement was procedural, not substantive, and therefore should be applied retroactively; however, the Court agreed with the Sixth District Court’s finding that, in its entirety, §627.70152 transformed an insured’s ability to sue an insurance company under a property insurance policy and an insurer’s obligations to respond to and pay insurance claims, thus making the requirement a substantive change. The Court thereby upheld the decision of the Sixth District and disapproved the decision of the Fourth District in Cole.

Complete Victory Obtained in a Workers’ Compensation Matter

Result

Complete Victory Obtained in a Workers’ Compensation Matter

Thought Leadership

Commonwealth Court Reaffirms the Constitutionality of Act 111's IRE Provisions

In this case, the claimant sustained a work injury of January 6, 1994, which was acknowledged by Notice of Compensation Payable (NCP). After the claimant’s receipt of 104 weeks of temporary total disability benefits, the employer filed a Request for an Impairment Rating Examination (IRE). The IRE was performed in May 2023 and the IRE physician found that the claimant had a 5% whole person impairment, under the AMA Guides. The employer filed a Petition based on the IRE results, and the Petition was granted by the WCJ. During litigation, the claimant argued that the IRE provisions of Act 111 (Section 306(a.3) of the Act) were not applicable to her injury, since it predated June 24, 1996, the date Act 57 went into effect, and that the IRE provisions were unconstitutional. The Workers’ Compensation Judge (WCJ)) granted the Petition and the Board affirmed. On appeal to the Commonwealth Court, the claimant argued that Act 111 violated the nondelegation doctrine and that its retroactive application to the claimant’s injury was unconstitutional. The court rejected the arguments on the basis that they had already found the same arguments without merit in multiple, prior cases. The court also addressed an argument made by the claimant that Act 111 was procedurally defective under the Pennsylvania Constitution because it was only considered on two days in each House after having undergone amendments and reassignments. The court noted that the Pennsylvania Constitution requires every bill to be considered on three different days in each House. The claimant maintained that, according to the legislative history, the bill did not receive three separate days of consideration from each House when it was assigned a new bill number. The court pointed out, however, that the bill number, H.B. 1840 remained constant and was considered on three occasions by the House. Further, the court concluded that minor amendments to the bill were germane to its original subject, which was to modify the Act’s IRE process, in accordance with Protz II.

Thought Leadership

The Tolling Trap: Filing Alone Will Not Toll the Statute Without Good-Faith Service

The Eastern District of Pennsylvania recently reinforced a critical limitation on bad faith claims, holding that a timely filing alone will not preserve a cause of action absent a good-faith effort to serve the original process. The plaintiff had presented a claim for underinsured motorist benefits to his auto insurer. The insurer evaluated the claim and determined that the plaintiff’s accident-related damages did not exceed the bodily injury liability insurance limits of the at-fault driver and denied his claim. Among other claims, the plaintiff sought to present a claim for insurance bad faith under 42 Pa. C.S.A. § 8371, to which a two year statute of limitation applies. He first filed a praecipe for writ of summons before the expiration of the statute of limitation. However, the plaintiff did not attempt to serve the praecipe or writ until after the statute of limitations had expired. Additionally, the service failed as the plaintiff had mailed the original process to an incorrect address. Despite receipt of the Postal Service’s failure to deliver the original process, the plaintiff did not attempt to re-serve the writ. Two months later, the plaintiff filed a complaint and then successfully served that complaint. The insurer sought to dismiss the plaintiff’s bad faith claim as time-barred by the statute of limitations. The district court agreed. Though the plaintiff had filed a praecipe for a writ of summons prior to the expiration of the statute of limitations, the statute is only tolled if there is a good faith effort to serve that original process. In this case, the court determined that the plaintiff had failed to perform a “good faith effort to serve the original process”. Additionally, though the filing and service of a complaint can serve as alternative original process when the lawsuit is commenced by the filing of a praecipe for a writ of summons, the plaintiff filed his complaint after the statute of limitations had expired. The plaintiff’s bad faith claim was therefore determined to be barred by the statute of limitations and dismissed by the court, with prejudice. A key takeaway for the defense is not to assume that the statute of limitations has been successfully tolled by a plaintiff merely because a praecipe for a writ of summons or complaint has been filed prior to the expiration of the statute. A filed complaint or writ is only part of the equation. The defense should carefully review the docket and filings to confirm that the plaintiff also performed the requisite good faith effort to serve that original process. A thorough review of the docket may reveal that the plaintiff failed to make the good-faith service efforts necessary to toll the statute of limitations.

business meeting photo

Result

Summary Judgment Obtained in Insurance Coverage Case

graphic announcing our 6 2027 Super Lawyers & Rising Stars

News

Marshall Dennehey Announces 2027 New Jersey Super Lawyers And Rising Stars

Event

CLM 2026 Focus Conference

Allison joins three insurance industry leaders to discuss how cyber coverage disputes, the growing impact of social inflation on bodily injury claim valuation, and the use of artificial intelligence are reshaping the bad faith landscape. The panel will examine emerging sources of extra-contractual exposure, including evolving cyber insurance coverage issues and the challenges of accurately valuing bodily injury claims. Practical approaches to claim evaluation using AI, along with defense strategies designed to help prevent or successfully defend against bad faith litigation, will also be addressed.