Justia Contracts Opinion Summaries

Plaintiff Mark Strawn filed a class action suit against Defendants Farmers Insurance Company of Oregon, Mid-Century Insurance Company, and Truck Insurance Exchange (collectively, Farmers). Plaintiff alleged that Farmers had breached contractual duties and committed fraud by instituting a claims handling process that arbitrarily reduced payments for reasonable medical benefits owed under its automobile insurance policies. A jury returned a verdict in favor of Plaintiff, and awarded damages totaling approximately $8.9 million. Farmers appealed, and the appellate court concluded that the punitive damages awarded by the trial court exceeded constitutional limits, but otherwise affirmed the judgment. Both parties sought the Supreme Courtâs review. Farmers challenged the damages award, arguing that it should be lower. Plaintiff argued that the original award should be reinstated. The Supreme Court rejected Farmersâ arguments, and concluded that the appellate court should not have reached Farmersâ constitutional challenge to the amount of the punitive damages award. Consequently, the Court affirmed part, and reversed part of the appellate decision, and affirmed the judgment of the trial court.