Nationwide Insurance prevails in lawsuit filed by former independent agent alleging employment, contract, and fraud claims
Clients Nationwide Mutual Insurance Company
Jones Day client Nationwide Mutual Insurance Company successfully appealed a $42 million jury verdict finding the company liable for breach of contract, constructive discharge, invasion of privacy, and duress before the Ohio Supreme Court. The case was filed by an independent agent who owned an insurance agency that sold Nationwide insurance products. The plaintiff claimed that Nationwide induced her by fraud to sign a contract with the company, misrepresented information to her about future success, and breached the contract and duty of good faith and fair dealings. The plaintiff also claimed that she was an employee and not an independent contractor and that therefore the several release of liability she executed were procured by duress.
In the initial proceedings, the trial court directed verdict for Nationwide on the fraud claim, and the jury awarded the agent $42 million on the remaining claims. Subsequently, the case went to the 7th District Court of Appeals, which reinstated the fraud claim, dismissed the constructive discharge claim, and affirmed the remainder of the judgment. Pushing further, Nationwide took their case to the Ohio Supreme Court, who ultimately reversed the court of appeals' decision, finding instead that punitive damages are not recoverable in a breach of contract action. The court said that a party to a contract does not breach the implied duty of good faith and fair dealing by seeking to enforce the agreement as written or by acting in accordance with the express terms of the contract. The court also reinstated the directed verdict from the trial court.
Lucarell v. Nationwide Mutual Insurance Company, No. 2016-Ohio-0585 N.E.2d; Nationwide Mutual Insurance Company v. Christine Lucarell, No. 50 2010 cv 01417 (Ohio 7th DCA)