Judge Slams Florida’s Universal P&C for ‘Stonewalling’ Court Orders, Demands Answers

Universal Property & Casualty Insurance Co. officials have downplayed the significance of recent Florida judges’ rulings that have slammed the company for violating court orders, have forced Universal to default on lawsuits, have referred a Universal lawyer for disciplinary action, and required company officials to explain what’s going on.

Those court orders are no more common than sanctions against policyholder attorneys and are largely the result of “the war”–the vast amount of claims litigation and bad-faith actions brought by plaintiffs’ lawyers in Florida in recent years, which have burdened insurers with thousands of deposition and document requests, Universal’s legal officials said.

“Before the war, a lot of things would be worked out between attorneys, through professional courtesy,” said Travis Miller, a top attorney for Universal, one of Florida’s largest property insurance carriers.

One of the court orders against Universal came in November in Nassau County. It went far beyond previous sanctions orders and has raised eyebrows across the state, according to policyholder lawyers and a Florida law professor.

The circuit judge’s order, requiring Universal’s general counsel to answer questions about corporate legal practices, “is breathtaking, really,” said Robert Jarvis, a law professor at Nova Southeastern University in Fort Lauderdale.

The action by Nassau County Circuit Judge Eric Roberson is just the tip of the iceberg, said policyholder attorneys who have seen dozens of sanctions and other orders against Fort Lauderdale-based Universal in the last few years.

“In my 37 years of practice, I’ve never seen an insurance company exhibit such a contemptuous disregard for court orders,” said Matthew Danahy, of Tampa, a former insurance attorney who now represents policyholders in claims disputes and has obtained several court orders against Universal.

Others have said the alleged stonewalling practices are common among several Florida insurance companies and run the risk of earning the Florida insurance industry another black eye–especially if the practices and sanctions are widely reported in local news media, said Jarvis.

Several plaintiffs’ lawyers suggest that Universal’s team of in-house and law firm attorneys appear to be so overloaded that they can’t keep up with court deadlines. Either that, or it’s a deliberate strategy by the insurer to “wear out” plaintiffs, force settlements or delay payouts. In at least one pleading, a Universal lawyer blamed the missed deadline on his staff. Florida insurance defense attorneys have said that judges across the state are trying to clear away a backlog of cases that piled up during the COVID-19 shutdown, and have cracked down on missed deadlines.

Whatever the reason, earning the anger of judges has proved somewhat costly for Universal. In the Nassau County case, Judge Roberson took the unusual step of striking the pleading, forcing the insurer to default in the underlying claims lawsuit. The final amount to be paid is confidential, but the complaint asked for more than $30,000.

The Universal attorney that Roberson referred for a Bar investigation, P. Alejandro Perez, did not return phone calls and emails from Insurance Journal. A Bar official said an investigation has been opened, but she declined to provide further information.

Roberson lost his patience with Perez in a Fernandina Beach couple’s claims dispute. One order came in October when the judge sanctioned Universal for “blatant discovery stonewalling” and failing to comply with two previous court orders.

“The two prior times apparently did not get the message through that discovery gamesmanship will not be tolerated in this court,” Roberson wrote.

He fined Universal $100 per day, up to a maximum of $7,500, paid to the Florida Bar for efforts to promote professionalism. Less than three weeks later, Roberson found that Perez and Universal had still not disclosed all required information by the court’s deadline and Perez had displayed “a disturbing lack of candor to the court.” The judge then barred Universal’s expert witness and struck Universal’s pleading.

“This is now, without a doubt, the most egregious act of willfully defying court orders and professional obligations that the court has seen in its tenure,” Roberson wrote.

The judge also ordered Universal’s general counsel to a hearing Dec. 7 to provide answers to questions about Universal’s policies and procedures on discovery requests, as well as its legal staffing, training, and supervision of the staff. A transcript of the hearing was not available.

Veterans of the Florida insurance industry have argued that property insurers in the last half-decade have faced a flood of unnecessary claims lawsuits–so much that litigation costs became a key reason behind rate increases and at least 10 insurer insolvencies. The Florida Legislature responded in late 2022 and early 2023 with sweeping limits on litigation and plaintiffs’ attorney fees.

And just before the law took effect this year, several policyholder law firms filed more than 50,000 lawsuits, swamping insurance firms and filling court dockets, according to attorneys involved and news reports.

Insurers should be forgiven for making mistakes or “fighting back” while trying to handle an overwhelming number of legal actions, some in the industry have said. Others on the insurance side said that it would be counterproductive for an insurance carrier to purposely flaunt judges’ orders as a way to wear down the other side.

“It’s not deliberate. That would be absurd,” said Matt Lavinsky, president of the Florida Defense Lawyers Association. He added that he had never seen FDLA members engage in such tactics.

Universal officials said the fault lies in part with overzealous claimants’ lawyers. So many requests for depositions of corporate representatives have led to a scheduling and logistical nightmare, which has led to missed deadlines, Universals’ lawyers said.

And plaintiffs’ attorneys have been hit with just as many, if not more, sanctions orders in recent years, some for misrepresenting the facts or exaggerating the amount of damage in claim–a major violation in the eyes of most judges.

The plaintiffs’ lawyers have brought the recent Universal sanctions orders to the attention of the news media in an attempt to disparage insurers and fuel a reversal of the 2022 and 2023 tort-reform legislation, said Lavisky.

Members of the plaintiffs’ bar have said there’s little chance of Florida’s lawmakers changing course anytime soon. Danahy and Robert Jameson, the claimants’ attorney in the Nassau County case, said the alleged stonewalling practices have gone on for years, all around the state, and have little to do with the recent flood of claims suits. Danahy, Jameson and others provided Insurance Journal with more than 40 judges’ orders since 2017, imposing sanctions on Universal or demanding that its lawyers comply with court orders.

“I’ve never heard of any defendant that has caught the attention of judges like this and has been sanctioned by so many judges,” said Jarvis, the law professor.

On legal staffing levels, Miller and Lewis noted that Universal has about 250 attorneys, two-thirds of which are in-house. The carrier currently has about 9,800 claims suits pending, or roughly 38 cases per lawyer. The Florida Bar said it does not have rules on a maximum number of cases per lawyer. But compared with Citizens Property Insurance Corp., the largest carrier in the state, the number of Universal lawyers seems low.

Citizens has about 18 cases per attorney for Citizens, half the load carried by Universal litigators.

Topics Florida Legislation Property Casualty