Estate of Rochow v. Life Insurance Co. of North America
Year 2014
Court U.S. Court of Appeals, 6th Circuit
Case Number 12-2074
  • Disgorgement of Profits
  • Michigan

Where an insurer has wrongfully delayed or denied a covered claim, extra-contractual remedies are necessary to punish the conduct at issue and deter similar conduct in the future. UP argued in its brief that disgorgment of profits is an appropriate remedy for bad faith denial of a valid ERISA claim. UP reminded the Court of the Panel Majority’s own recognition that “…if no remedy beyond the award of benefits were allowed, insurance companies would have the perverse incentive to deny benefits for as long as possible, risking only litigation costs in the process.” Rochow I, 737 F.3d at 417.See DeBofsly and Associates’ blog for a full case summary.