Pa. judges nix $21 million verdict vs. Nationwide

A Pennsylvania appeals court has thrown out a $21 million judgment against Nationwide that started with an accident involving a $25,000 car in 1996.

The Superior Court of Pennsylvania, in a 2-1 ruling issued Monday, was critical of the trial judge who ordered Nationwide to pay $18 million in punitive damages to Sheryl and Daniel Berg, the Reading, Pennsylvania, residents whose car was insured by Nationwide. In addition, the couple’s attorney had been awarded $3 million in fees. The Superior Court said those sums were not supported by the evidence in the case.

The case was returned to the trial court with an order to rule in favor of Nationwide.

“The trial court engaged in a limited and highly selective analysis of the facts and drew the most malignant possible inferences from the facts it chose to consider,” the court said.

“We greatly appreciate the court’s detailed review of this case and their decision in favor of Nationwide. Nationwide has steadfastly maintained that we acted in good faith and this decision affirms that position,” Nationwide said in a statement Tuesday.

“While we are deeply disappointed by the Superior Court majority’s opinion, our faith in the judicial system remains strong,” said Ben Mayerson, the attorney for the Bergs, in a statement. “The facts of record amply support the trial court’s findings. ... We trust the issues are of sufficient pressing public importance that the Supreme Court of Pennsylvania will grant review.”

The Bergs’ car was damaged in a crash in 1996. Mrs. Berg, who was driving at the time, was not hurt, but the accident triggered a lengthy legal fight over Nationwide’s responsibility to either fix or replace the car.

Nationwide made repairs worth $12,500 to the car, but there were defects in the repairs, and the Bergs had trouble with the car until they finished the lease payments in 1998.

Judge Jeffrey Sprecher of Berks County Common Pleas Court in eastern Pennsylvania was especially critical of Nationwide when he ruled against the insurer in 2014.

He found that Nationwide concealed evidence of repair failures and risked further liability if it had not bought the car after the lease expired.

“Nationwide was willing to risk the Bergs’ lives to save itself money on an insurance claim,” he wrote in 2014.