Fraudulent Joinder of Adjuster ins Suit Against Insurer Does Not Work

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In Holden T. Alexander v. Mid-Century Insurance Company, a wholly owned subsidiary of Farmers Insurance And Gillian Bressi, Civil Action No. 2:21-cv-392, United States District Court, W.D. Pennsylvania (July 26, 2021) Holden T. Alexander (“Alexander”), sued Mid-Century Insurance Company (“Mid-Century”) and Gillian Bressi (“Bressi”) (an insurance adjuster), to avoid federal court. He sued them both in the Court of Common Pleas of Washington County, Pennsylvania, alleging that they breached an insurance agreement and that they did so in bad faith under 18 Pa. C. S. § 8371. (ECF No. 1-1, pp. 11-16). Defendants removed the action to the USDC arguing that it has diversity jurisdiction over the case because Bressi, a resident of Pennsylvania, was fraudulently joined to defeat diversity jurisdiction.

ZALMA OPINION

It is surprising to me that fraudulent joinder of adjusters and attorneys is still being tried by plaintiffs' lawyers who wish to avoid federal court. Thirty years ago, after a policyholders' lawyer gave a seminar, I, as a lawyer for insurers and each adjuster or claims manager for the insurer were added as defendants to bad faith lawsuits. I would be forced to use my E&O insurance to defend the lawsuits and defeated them at summary judgment with a declaration that "I am not now, nor have I ever been, and insurer." I then sued the lawyer and his clients for malicious prosecution until the frivolous suits were dismissed. Neither an adjuster nor a lawyer for an insurer have privity of contract with an insured and suing them for breach of contract is frivolous. Ms. Bressi should consider suing the plaintiff and his lawyers for the tort of Malicious prosecution.