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Lawsuit Over Attendant Care Benefits is Settled (continued)

Carrier refused payment or did so at lower rates after two verdicts
$1,731,361

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In a federal lawsuit, plaintiff who was 10 years old when the accident occurred, next friend to plaintiff’s minor, sought attendant care benefits from defendant State Farm Mutual Automobile Insurance Co.

Plaintiff was involved in a March 29, 2006, automobile-pedestrian collision. He suffered a traumatic brain injury, including a sheering injury to the frontal lobe resulting in permanent brain damage and severe executive dysfunction. His doctors prescribed attendant care, which has been provided primarily by his mother and father.

Immediately following the accident, State Farm refused to pay for these attendant care benefits. Plaintiffs sued in Oakland County Circuit Court on Feb. 5, 2007, and a trial resulted in a June 13, 2008, jury verdict in plaintiffs’ favor, but immediately after, State Farm again refused to pay attendant care benefits.

Plaintiffs sued again June 18, 2009 in Oakland County. On July 1, 2009, State Farm requested for the suit to be moved to federal court, where on Feb.16, 2011, plaintiffs obtained a jury verdict in their favor.

The court also awarded plaintiffs $223,975 in no-fault attorney fees for State Farm’s unreasonable refusal to pay these owed benefits, which plaintiffs appealed, claiming it was not being a reasonable amount given the circumstances of the case.

Following the second verdict, State Farm paid attendant care benefits, but did so at an arbitrarily reduced rate, and also only paid for a reduced number of hours. Plaintiffs filed suit once again, this time in federal court Oct. 27, 2011.

State Farm’s own hired insurance doctor eventually contradicted its stated position for reducing the number of hours of attendant care, but State Farm continued to reduce them anyway.

A $1,731,361 settlement was reachedthat involved both the pending appeal relating to the award of attorney fees and the third lawsuit seeking proper payment of attendant care benefits incurred after the second trial.

The settlement also included an agreement by State Farm to pay a guaranteed rate of $504 per day for attendant care benefits for a period of at least six years into the future.

Type of action: Automobile first-party no-fault
Type of injuries: Traumatic brain injury
Court/Case no.: U.S. District Court, Eastern District of Michigan; 11-14735
Name of judge: Thomas Ludington
Mediation settlement amount: $1,731,361