In December, I wrote a post in this blog about a case in which I had been retained to represent a insured where its insurer was defending it under reservation, and sought to intervene into the underlying tort case to litigate coverage. I thought the insurer’s plan of action was a really bad idea for the insured for a lot of different reasons.
I filed a response in opposition to the motion arguing that intervention of right was not appropriate because the insurer did not have a sufficiently “direct” stake in the underlying litigation to intervene. The principal case I relied on was Restor-A-Dent Dental Laboratories, Inc. v. Certified Alloy Products, Inc., 725 F.2d 871 (2d Cir. 1984). I also argued that the same reality prevented any conclusion that there were common questions of fact or law to justify permissive intervention.
Finally, I argued that Kentucky law regarding participation of insurers at trial precluded any situation where the insurer would participate in the formulation of jury instructions and/or other “behind-the-scenes” pretrial activities but remain unnamed at trial, and that conversely, insurance should not be needlessly interjected into the liability trial.
The judge in the case agreed with me, citing both the Restor-A-Dent case and the complications presented by Kentucky law as reasons for denying the motion.
All is right with the world again – at least for this case.