Minnesota Lawyer Blog

The bill to require insurance companies to act in good faith and to allow direct action against insurers didn't make it through the meat grinder that was the last days of the legislative session. The direct action language gave rise to an extensive -- and some might say dishonest -- advertising campaign about "double lawsuits" and greedy trial lawyers. The Senate decided to drop direct action and a conference committee followed suit.

Then the wrangling about good faith kicked in, reports Wil Fluegel of the Minnesota Association for Justice, formerly known as the Minnesota Trial Lawyers Association. After 14 modifications were made to the bill to accommodate various insurance interests, it was passed off the House floor. It was attached to a finance bill in the Senate but that didn't work because the leadership believed the governor would veto the finance bill if the good faith bill was attached, and it wanted the finance bill to get signed. So then the interested parties began working on a stand-alone bill, but representatives of the insurance industry wouldn't commit, Fluegel said. However, the bill made it to the Senate floor after a provision for punitive damages was dropped. It looked like it might pass, but the Senate commerce committee wanted more hearings and "the wheels came off the bill," Fluegel said.

"There was an earnest effort to work though a compromise that the governor would sign but time ran out," Fluegel said.

Others say that in the end, the "double lawsuit" campaign did the job. "The money big insurance spent spreading misinformation, distortions and outright lies did have an impact," said trial lawyer's lobbyist Joel Carlson.