ST. LOUIS — A federal judge allowed White Knight Diner's complaint against its insurance company for allegedly making a settlement without its knowledge to move forward.
U.S. District Court Judge John A. Ross of the U.S. District Court for the Eastern District of Missouri-Eastern Division dismissed two of the nine counts in his March 25 order, allowing seven counts against Owners Insurance Co. to move forward.
White Knight Diner's complaint alleges that its insurance carrier, Owners Insurance Co., made an illegal subrogation claim with a third-party insurer without the plaintiff's knowledge.
The complaint stems from a two-vehicle collision on March 15, 2015 at the intersection where White Knight Diner was located. The collision caused damages to the building, owned by Karen Freiner and Larry Lee Hinds.
White Knight Diner filed a claim with Owners Insurance Co. for damages to the property as well as the loss of business income while the diner closed down to repair the building, the order states. The insurance company agreed to pay $66,336.27 on the claim–$49,965.10 for property damage and $16,371.17 for lost business income.
The insurance company then made a subrogation claim against State Farm Mutual, which was one of the insurance companies for one of the drivers in the accident. State Farm agreed to pay the insurance company $33,668.14.
White Knight was unaware of this subrogation claim until they filed a lawsuit against the two drivers, Ambar Arango and Dzemal Omervic on Nov. 11, 2015. During proceedings the diner first learned that Owners Insurance had filed the subrogation claim.
White Knight then filed suit against Owners, alleging the insurance company made an illegal subrogation claim. The complaint states because of that, the diner never received the full value of its deductible and were not properly reimbursed for litigation costs.
U.S. District Court for the Eastern District of Missouri-Eastern Division case number: 4:17-cv-02406