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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 14-14854
Non-Argument Calendar
________________________
D.C. Docket No. 4:13-cv-00191-WTM-GRS
ERICA N. MCKEEL,
Individually,
ERICA N. MCKEEL,
As Surviving Parent of Murphy Foster McKeel,
Deceased,
DANIEL CALEB MCKEEL,
As Surviving Parent of Murphy Foster McKeel,
Deceased,
ASSIGNEES OF CUONG NGUYEN AND
MINH NGUYEN,
Individually,
d.b.a. Limelight Bar & Grill, LLC,
Plaintiffs - Appellants,
versus
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY,
Defendant - Appellee.
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Appeal from the United States District Court
for the Southern District of Georgia
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(July 23, 2015)
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Before MARCUS, JORDAN and JILL PRYOR, Circuit Judges.
PER CURIAM:
The Plaintiffs-Appellants in this appeal (the “McKeels”) -- assignees of
Cuong Nguyen and Minh Nguyen, individually and d/b/a Limelight Bar & Grill
LLC -- appeal from the district court’s order granting summary judgment in favor
of the Defendant-Appellee State Farm Mutual Automobile Insurance Company.
The case arises out of a car accident in which Cuong Nguyen, driving a vehicle
insured by State Farm, improperly struck a vehicle driven by Erica McKeel, who
was seven-months’ pregnant. As a result of the accident, Ms. McKeel’s baby was
born prematurely and, sadly, died from injuries sustained in the accident.
In a subsequent state court case involving the McKeels, Limelight and
Cuong Nguyen, the McKeels obtained a jury verdict against Cuong Nguyen in
excess of $3,000,000. Following entry of judgment in that case, Cuong Nguyen
and Minh Nguyen assigned their interest in any claim they might have had against
State Farm to the McKeels. Based on that assignment, the McKeels filed this suit,
alleging that State Farm acted in bad faith before and during the state court case by
refusing to settle on Cuong Nguyen’s behalf within the policy limits. The district
court granted summary judgment to State Farm, concluding that the McKeels had
failed to identify any issue of material fact concerning their bad-faith claim. On
appeal, the McKeels argue that the district court erred in granting summary
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judgment on their bad faith claim because State Farm: (1) negligently created a
conflict of interest that injured Cuong Nguyen; (2) negligently failed to provide all
material facts of the underlying situation to Cuong Nguyen; and (3) violated its
own policies in the adjustment of the case. After thorough review, we affirm.
We review de novo the district court’s grant of summary judgment, applying
the same legal standard as the trial court. Watkins v. Ford Motor Co., 190 F.3d
1213, 1216 (11th Cir. 1999). Summary judgment is proper if “the movant shows
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).
Under Georgia law, “where a person injured by an insured offers to settle for
a sum within the policy limits, and the insurer refuses the offer of settlement, the
insurer may be liable to the insured to pay the verdict rendered against the insured
even though the verdict exceeds the policy limit of liability.” McCall v. Allstate
Ins. Co., 310 S.E.2d 513, 514 (Ga. 1984). We’ve said that, “[a]t a minimum, . . .
Georgia law mandates that the insured show that settlement was possible -- the
case could have been settled within the policy limits -- and that the insurer knew,
or reasonably should have known, of this fact.” Delancy v. St. Paul Fire & Marine
Ins. Co., 947 F.2d 1536, 1550 (11th Cir. 1991). The elements of a negligence
claim in Georgia are “duty, breach, proximate cause, and damages.” Cotton States
Mut. Ins. Co. v. Brightman, 568 S.E.2d 498, 500 (Ga. Ct. App. 2002). An assignee
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under Georgia law “stands in the shoes” of the assignor and has no greater rights
than the assignor possessed at the time of the assignment. See S. Telecom, Inc. v.
TW Telecom, Inc. of Ga. LP, 741 S.E.2d 234, 238 (Ga. Ct. App. 2013).
First, we are unpersuaded by the McKeels’ claim that State Farm acted in
bad faith by negligently creating a conflict of interest that injured Cuong Nguyen.
The undisputed record in this case reveals that before and during the state court
proceedings, State Farm repeatedly offered the McKeels the policy limits
($50,000.00 for Ms. McKeel’s personal injury claim and a separate $50,000.00 for
the claim of her minor child) in exchange for limited releases of liability -- releases
concerning Cuong Nguyen, Minh Nguyen, and Limelight, as insureds under the
policy. The record also reveals that the McKeels rejected all offers that included
Limelight as a releasee, and fails to show that State Farm knew, or reasonably
should have known, that settlement was possible. Indeed, the McKeels offer no
case law supporting the idea that State Farm should have abandoned one of its
insureds (Limelight) by not including it as a releasee in the limited liability
releases. Instead, Georgia courts have said that “in this state each insured under
the policy, whether a named insured or others, is entitled to be defended by the
insurer and judgments against such insured paid, within the limits of the policy.”
Strain Poultry Farms, Inc. v. Am. S. Ins. Co., 197 S.E.2d 498, 501 (Ga. Ct. App.
1973) (emphasis added). Without any Georgia law to the contrary, we are hard-
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pressed to conclude that State Farm could have acted in bad faith or negligently by
equally representing its insureds. See e.g., Shipes v. Hanover Ins. Co., 884 F.2d
1357, 1361 (11th Cir. 1989) (“[B]ad faith means a frivolous and unfounded denial
of liability. . . . Where questions of law . . . have not been decided by the courts of
Georgia and are not of easy solution, then a finding of . . . bad faith . . . [is] not
authorized.”) (quoting State Farm Mutual Auto. Ins. Co. v. Harper, 188 S.E.2d
813, 817 (Ga. Ct. App. 1972)). Nor is there any basis for the McKeels’ reliance on
attorney-client conflict-of-interest cases. The district court did not err in granting
summary judgment on the McKeels’ conflict-of-interest claim.
We also are unpersuaded by the McKeels’ argument that State Farm
negligently failed to provide all material facts of the underlying situation to Cuong
Nguyen -- that is, that the McKeels were “willing to release him individually.”
The McKeels’ claim is merely another way of arguing that State Farm should have
abandoned Limelight by removing it from the release document. As we’ve
explained above, this argument has no merit. In addition, as the undisputed record
shows, counsel retained by State Farm to defend its insureds met with the
purported owners of Limelight on several occasions to see if they would consent
for Limelight to be removed from the release and they would not. There is nothing
in the record to indicate that Cuong Nguyen’s knowledge of any additional
material facts would have led to a different result, especially given the Limelight
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owners’ refusal to consent as well as Limelight’s alleged ownership issues. The
district court did not err in granting summary judgment on this negligence claim.
Finally, we reject the McKeels’ argument that State Farm violated its own
policies in adjusting the claim. In Georgia, a corporation’s failure to abide by its
own written guidelines is evidence of negligence. Luckie v. Piggly-Wiggly So.,
Inc., 325S.E.2d 844, 845 (Ga. Ct. App. 1984). The McKeels rely on language in
State Farm’s policy that gave it a duty to “diligently investigate the facts to
determine if a claim is valid.” However, as we’ve detailed, the record reveals that
State Farm began offering its entire policy limits before it received any demand
from anyone for any amount. There is nothing in the record to indicate that State
Farm was not diligent in investigating whether the insurance claim was valid, and
the district court did not err in granting summary judgment on this negligence
claim.
AFFIRMED.
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