USCA11 Case: 21-11134 Date Filed: 07/07/2022 Page: 1 of 5
[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 21-11134
Non-Argument Calendar
____________________
DANIEL LEE POTTER,
JOLENE POTTER,
Plaintiffs-Appellants,
versus
PROGRESSIVE AMERICAN INSURANCE COMPANY,
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Middle District of Florida
D.C. Docket No. 8:20-cv-02204-JSM-TGW
____________________
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2 Opinion of the Court 21-11134
Before WILSON, ROSENBAUM, and BRANCH, Circuit Judges.
PER CURIAM:
This appeal involves a Florida third-party bad faith insurance
claim. The question is whether, under Florida law, a final
judgment stemming from a consensual settlement can qualify as an
“excess judgment”—a necessary element for a bad faith insurance
action. The district court held that a final judgment enforcing a
settlement is not an excess judgment or its functional equivalent as
a matter of law. The Potters, the injured parties and third-party
plaintiffs, appealed.
This Court recently decided a case involving a consent
judgment in a bad faith insurance claim, concluding that a “final
judgment that exceeds all available insurance coverage—regardless
of whether it results from a consensual settlement or a jury
verdict—constitutes an ‘excess judgment’ that can satisfy the
causation element of an insurer-bad-faith claim under Florida law.”
McNamara v. Gov’t Emps. Ins. Co.,
30 F.4th 1055, 1057, 1063 (11th
Cir. 2022). Because the insurance action here involved a settlement
followed by a final judgment that could legally qualify as an excess
judgment, the district court erred in dismissing the case. After
careful review, we reverse and remand for further proceedings.
I. Background
This is a third-party bad faith insurance action brought by
Plaintiffs Daniel Lee Potter and Jolene Potter against Defendant
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21-11134 Opinion of the Court 3
Progressive American Insurance Company. The Potters allege that
Progressive acted in bad faith in its handling of a bodily injury claim
that the Potters asserted against Progressive’s insured, Ronald Dale
Evans, arising from an automobile accident that occurred on
November 10, 2016. At the time of the accident, Evans was insured
under a Progressive policy that provided bodily injury liability
coverage for up to $10,000 per person. The Potters sued Evans,
and served proposals for settlement to Evans pursuant to
Fla. Stat.
§ 768.79, offering to settle the claims in exchange for Evans
stipulating to a dismissal and agreeing to pay the Potters $125,000
total. Evans’s attorney who was hired by Progressive
recommended that he take the settlement and told Evans that
doing so would not waive any claims against Progressive for
negligence or bad faith. Evans accepted and the Potters filed an
action for bad faith against Progressive in state court that
Progressive removed to federal court.
In granting summary judgment in Progressive’s favor, the
district court relied heavily on the district court’s decision in
McNamara v. Gov’t Emps. Ins. Co., No. 8:17-CV-3060-T-23CPT,
2020 WL 5223634, at *3–4 (M.D. Fla. July 29, 2020), rev’d and
remanded,
30 F.4th 1055 (11th Cir. 2022), which relied heavily on
our unpublished decision in Cawthorn v. Auto-Owners Ins. Co.,
791 F. App’x 60 (11th Cir. 2019). In Cawthorn, we held that a
consent judgment is not an excess judgment for third-party bad
faith claims. 791 F. App’x at 65. Because an excess judgment is
required before a bad faith claim can proceed, following Cawthorn,
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4 Opinion of the Court 21-11134
the district court found that there was no excess judgment as a
matter of law. The Potters appealed.
II. Standard of Review
We review a district court’s grant of summary judgment de
novo, “view[ing] the evidence in the light most favorable to the
non-moving party.” Gogel v. Kia Motors Mfg. of Ga., Inc.,
967 F.3d
1121, 1134 (11th Cir. 2020) (en banc) (quotations omitted).
Summary judgment is proper if the materials in the record indicate
“that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a). “Only disputes over facts that might affect the outcome of
the suit under the governing law will properly preclude the entry
of summary judgment.” Anderson v. Liberty Lobby, Inc.,
477 U.S.
242, 248 (1986).
III. Discussion
The Potters argue on appeal that Cawthorn’s holding that a
consent judgment is not an excess judgment is inconsistent with
Florida law on bad faith insurance claims. Under Florida law, a
plaintiff who brings a bad faith claim against an insurer for failing
to settle a lawsuit must prove that the insurer’s conduct caused the
loss. McNamara, 30 F.4th at 1059. One way to do so is by showing
an excess judgment—i.e., a judgment against the insured that
exceeds his insurance coverage. Id. The Potters argue the final
judgment in this case qualifies as an excess judgment and their case
should have been able to proceed.
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21-11134 Opinion of the Court 5
Our recent decision in McNamara v. Government
Employees Insurance Co. resolves this appeal. In that case, we
addressed whether consent judgments in excess of policy limits
constitute excess judgments that could satisfy the causation
requirements for bad faith claims under Florida law. Id. at 1057. In
a published decision, we held that Cawthorn misinterpreted
Florida law and that a consent judgment can qualify as an excess
judgment. Id. We looked to Perera v. U.S. Fidelity & Guaranty
Co.,
35 So. 3d 893 (Fla. 2010), and Fridman v. Safeco Insurance Co.
of Illinois,
185 So. 3d 1214 (Fla. 2016), in which the Florida courts
noted that third-party bad faith claims should not be limited to
judgments acquired after trial.
Id. at 1059–1060. We held that “[a]
final judgment that exceeds all available insurance coverage—
regardless of whether it results from a consensual settlement or a
jury verdict—constitutes an ‘excess judgment’ that can satisfy the
causation element of an insurer-bad-faith claim under Florida law.”
Id. at 1063.
Here, the Potters accepted a proposal for settlement and the
judge entered a final judgment in the underlying action that
exceeded the policy limits. This final judgment qualified as an
excess judgment and the district court erred by granting summary
judgment for Progressive on this issue. We reverse and remand
for further proceedings.
REVERSED and REMANDED.
