Pretzel & Stouffer Frees Insurer from Obligation in $1.8 Million Consent Judgment

Pretzel & Stouffer attorneys Robert Chemers and Peter Syregelas obtained summary judgment for an insurer recently in a Macoupin County, Ill., court, freeing the insurer from an obligation to defend or indemnify one of its customers in a class-action lawsuit. The insured had been sued in an East St. Louis, Ill., the court for allegedly violating the Telephone Consumer Protection Act by sending blast faxes. After the insured and the class-action plaintiffs came to an agreement, a judge issued a consent judgment that awarded the plaintiffs $1.8 million. Mr. Chemers and Mr. Syregelas argued successfully that the consent judgment was collusive and entered into in bad faith. The implied duty of good faith and fair dealing is a two-way street, they argued, and the insured did not fulfill its duty to the insurer. This case is now on appeal.