{"id":877820,"date":"2015-08-19T06:10:54","date_gmt":"2015-08-19T12:10:54","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=877820"},"modified":"2015-08-12T12:12:43","modified_gmt":"2015-08-12T18:12:43","slug":"oregon-state-and-federal-district-courts-interpret-insurance-fee-shifting-statute-broadly","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/oregon-state-and-federal-district-courts-interpret-insurance-fee-shifting-statute-broadly\/","title":{"rendered":"Oregon State and Federal District Courts Interpret Insurance Fee Shifting Statute Broadly"},"content":{"rendered":"<p>Sally S. Kim and Shannon L. Wodnik | Gordon &amp; Rees LLP | August 6, 2015<\/p>\n<p>In Oregon, ORS 742.061 authorizes an award of attorney fees to an insured that prevails in \u201can action\u2026in any court of this state upon any policy of insurance of any kind or nature\u2026\u201d The Oregon Supreme Court, in\u00a0Morgan v. Amex Assurance Co., 352 Or. 363, 287 P.3d 1038 (2012), addressed whether this fee shifting statute applies to insurance policies issued outside of Oregon, as a later enacted statute, ORS 742.001, provides that ORS Chapter 742 \u201cappl[ies] to all insurance policies delivered or issued for delivery in this state\u2026\u201d In\u00a0Morgan, the Oregon Supreme Court concluded, after considering the text, context and the legislative history, that the legislature did not intend for ORS 742.001 to limit the scope of ORS 742.061. The Court held, therefore, that ORS 742.001 permits an award of attorney fees to an insured that prevails in an action in an Oregon court on \u201cany policy of insurance of any kind or nature,\u201d even if the policy was delivered or issued for delivery in another state. The Oregon Supreme Court noted that to hold otherwise would be \u201cto turn an expansion of the state\u2019s authority to impose substantive regulations on insurers transacting business in Oregon into a limitation on the remedial and procedural rules that affect insurers appearing in its courts.\u201d<\/p>\n<p>Now, insureds and insurers in Oregon are looking to the Ninth Circuit Court of Appeals for an answer to whether ORS 742.061 applies only to Oregon state courts, as the statute specifically states that it applies \u201cin an action\u2026in any\u00a0court of this state\u2026\u201d (emphasis added).\u00a0Schnitzer Steel Industries, Inc. v. Continental Casualty Corp.,\u00a02014 U.S. Dist. LEXIS 160031 (D. Or. November 12, 2014). In\u00a0Schnitzer Steel, the insured, as the prevailing party in a coverage action, moved for attorneys\u2019 fees in the amount of $3,483,878.00. Continental opposed, arguing that the plain language of ORS \u00a7 742.061 does not apply because the statute plainly states that it is limited to an action \u201cbrought in any court of this state upon any policy of insurance\u2026\u201d Continental argued that because Schnitzer did not bring its claim in a court\u00a0of\u00a0Oregon, but rather a court\u00a0in\u00a0Oregon, the statute does not apply. Continental based its argument on\u00a0Simonoff v. Expedia, Inc., 653 F.3d 1202 (9th\u00a0Cir. 2011), a decision from the Ninth Circuit Court of Appeals that interpreted the phrase \u201cthe courts of\u201d in the context of a forum selection clause. In\u00a0Simonoff, the Ninth Circuit held:<\/p>\n<p>We conclude[] that the choice of the preposition \u201cof\u201d in the phrase \u201cthe courts of Virginia\u201d was determinative \u2014 \u201cof\u201d is a term \u201cdenoting that from which anything proceeds; indicating origin, source, descent, and the like.\u201d\u00a0 Thus, the phrase \u201cthe courts of\u201d a state refers to courts that derive their power from the state \u2014\u00a0i.e.only state court \u2014 and the forum selection clause, which vested exclusive jurisdiction in the courts \u201cof\u201d Virginia, limited jurisdiction to the Virginia state courts.<\/p>\n<p>Simonoff\u00a0at 1205-06.<\/p>\n<p>While Judge Mosman found Continental\u2019s argument \u201cvery interesting\u201d and rejected all but one of Schnitzer\u2019s arguments in the reply as \u201cvery weak,\u201d Judge Mosman adopted Schnitzer\u2019s one argument based on\u00a0Erie\u00a0principles and ruled that ORS 742.061 applies to cases commenced in Oregon federal courts. Judge Mosman held that theErie\u00a0doctrine together with good public policy dictate that ORS \u00a7 742.061 should apply in this case as its holding \u2013 that ORS 742.061 applies to both federal and state courts of Oregon \u2013 will \u201cavoid the intrastate forum shopping that\u00a0Erie\u00a0is intended to prevent and it would support the stated purpose of this statute by not creating an easy backdoor to thwart any impact it might have on encouraging settlements or discouraging unreasonable rejections of insurance claims.\u201d\u00a0\u00a0Id.\u00a0*11-12.<\/p>\n<p>Continental has appealed to the Ninth Circuit Court of Appeals. It will be interesting to see how the Ninth Circuit will address the issue pertaining to ORS 742.061 in light of its decision in\u00a0Simonoff. It is possible that because the issue pertains to the construction of an Oregon statute, the Ninth Circuit Court of Appeals may certify the question at issue to the Oregon Supreme Court.<\/p>\n<p>via <a href=\"http:\/\/www.lexology.com\/library\/detail.aspx?g=e24feb2b-e08d-4031-a296-3dac4935d2dd&amp;utm_source=Lexology+Daily+Newsfeed&amp;utm_medium=HTML+email+-+Body+-+General+section&amp;utm_campaign=Lexology+subscriber+daily+feed&amp;utm_content=Lexology+Daily+Newsfeed+2015-08-10&amp;utm_term=\">Oregon state and federal district courts interpret insurance fee shifting statute broadly &#8211; Lexology<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Sally S. Kim and Shannon L. Wodnik | Gordon &amp; Rees LLP | August 6, 2015 In Oregon, ORS 742.061 authorizes an award of attorney fees to an insured that prevails in \u201can action\u2026in any court of this state upon any policy of insurance of any kind or nature\u2026\u201d The Oregon Supreme Court, in\u00a0Morgan v.&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/oregon-state-and-federal-district-courts-interpret-insurance-fee-shifting-statute-broadly\/\">Continue reading <span class=\"screen-reader-text\">Oregon State and Federal District Courts Interpret Insurance Fee Shifting Statute Broadly<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[3],"tags":[22,320],"class_list":["post-877820","post","type-post","status-publish","format-standard","hentry","category-insurance-claims","tag-insurance","tag-oregon","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Oregon State and Federal District Courts Interpret Insurance Fee Shifting Statute Broadly - Advise &amp; 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