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Bad Faith / IFCA Claims Bifurcated

In Karpenski v. Am. Gen. Life. Co., LLC, 2012 U.S. Dist. LEXIS 183976 (W.D. Wash. Dec. 20, 2012) (.pdf), Judge Ricardo Martinez granted a life insurer's request to bifurcate its rescission claim from the insured's claims for bad faith and violation of Washington's Insurance Fair Conduct Act (IFCA). Judge Martinez reasoned that bifurcation was proper because the rescission "issues are not in any way intertwined with the issues presented by [the] claims of bad faith and IFCA violation" and if the insurer defendants "should prevail on their rescission counterclaim, that resolution will be dispositive of the entire case." Based upon this ruling, Judge Martinez stayed all bad faith discovery until resolution of the rescission issues.

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