First Federal Court Decision to Interpret Moody

In a fire loss case against State Farm in Baker City, plaintiffs Cassie and Johnny Owens requested leave of court to file a motion to amend their complaint in Owens v. State Farm Fire and Casualty Company, U.S.D.C. Dist. Of Oregon Case No.: 2:22-cv-00119-HL to include a claim for negligence per se under the Oregon Court of Appeals’ recent decision in Moody v. Oregon Community Credit Union, 317 Or. App. 233 (January 26, 2022). Plaintiffs’ proposed amended pleading also included a claim for punitive damages arising out of the same conduct giving rise to plaintiffs’ proposed Moody claim.

State Farm declined to offer its consent, arguing that the proposed amendments were futile. Specifically, State Farm argued that (1) Moody was wrongly decided and did not constitute binding precedent that the District of Oregon was obliged to follow, (2) under Moody only “extreme” insurer misconduct can give rise to a claim for negligence per se against the insurer, and (3) conduct giving rise to a Moody claim against an insurer is insufficient as a matter of law to support a prayer for punitive damages. Plaintiffs filed their motion to amend, State Farm objected to the motion, and plaintiffs replied.  On April 4, 2022, Judge Andrew Hallman issued a minute order over State Farm’s objections, granting plaintiffs leave of court to state a Moody claim against the insurer for negligence per se and a prayer for punitive damages.