Daily Archives: March 1, 2011

Court of Appeals Rejects Blue Shield's Attempt to Impose a Two-Year Statute of Limitations for Bad Faith

Posted in: Class Actions, Health Insurance, Insurance Bad Faith March 01, 2011

Myrna Kawakita was set to undergo gastric bypass surgery, and her health insurer, Blue Shield of California, initially authorized the procedure.  However, rather than paying for the procedure, Blue Shield rescinded Kawakita’s health insurance policy, asserting that her application contained misrepresentations about her height and weight.

Kawakita purchased her health insurance policy through Blue Shield’s alleged agent, Steven Stendal, and claimed that Stendal was responsible for any misstatements on her application.  Blue Shield rescinded Kawakita’s policy in August 2006, and she filed her lawsuit in July 2009, asserting causes of action for breach of contract, tortious breach on the implied covenant of good faith and fair dealing and declaratory relief.

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Blue Shield filed a motion for summary adjudication, arguing that …

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