Allen, Flatt, Ballidis & Leslie experienced first-hand that taking GEICO to court was not “so easy,” but after six years fighting on behalf of its client in a bad faith lawsuit, the Newport Beach law firm secured nearly $23 million.  

Plaintiff Omar Dauod was a real estate developer and was represented by partner James E. Ballidis. Dauod was severely injured in an auto accident on Oct. 29, 2009. After the accident, he couldn’t work and underwent surgery for his injuries. Consequently, he lost a $1.4 million development in Colorado in 2012 because he was unable to travel, work and perform construction management responsibilities and oversee projects, Ballidis said. He underwent surgery for his injuries and continuous treatment in 2010 and 2011, incurring more than $125,000 in medical expenses. In April and May 2012, he requested payment of $400,000 of his coverage from GEICO, beginning the six-year battle with GEICO to settle the case.

Ballidis said it was disheartening to see the impact the delaying tactics by GEICO had on the Dauod family, financially and emotionally, since GEICO is a subsidiary of Berkshire Hathaway, which had $242 billion in revenues in 2017, according to its annual report, including revenues from its insurance subsidiaries of $192.9 billion.

“Mr. Dauod couldn’t work, he had ongoing medical bills he couldn’t pay, and they lost their two homes, which was humiliating,” Ballidis said. “GEICO knew of their troubles, but rather than expediting reimbursement, the company continued with delay tactics. It has a proven pattern of delaying payments of claims to try and force plaintiffs to accept a lower amount, while they have use of the money. They requested spurious and irrelevant documents, disputed the need for Mr. Dauod’s medical treatments and delayed scheduling a medical examiner for more than a year. The GEICO-appointed examiner agreed with Mr. Dauod’s doctors, which GEICO never shared until forced to during arbitration.”

On March 29, after a trial lasting four weeks, a jury of seven women and five men awarded Omar Dauod, the victim, $9.9 million in general damages. On April 10, it awarded $13 million in punitive damages, bringing the total to almost $23 million.

In awarding general damages on March 29, the jury summarized the findings:

  • GEICO delayed payments of policy benefits, unreasonably and without proper cause;
  • The delays caused harm to the plaintiff;
  • GEICO actions resulted in past and future economic loss to the plaintiff;
  • GEICO caused noneconomic loss, including emotional distress and mental suffering;
  • The company engaged in conduct with malice, oppression and fraud;
  • GEICO officers and managers knew of, approved and authorized the conduct.

“The findings of the jury underscore the importance of insurance companies to act fairly, promptly, equitably and in the public interest, rather than using their size and power to limit disbursements and maximize their gains,” Ballidis said.