The Changing Landscape of Settlements in Plaintiff-Friendly Venues: Implications of Ferguson v. Spraggins
By: Joshua Smith
The Georgia Court of Appeals recently affirmed a decision that could have significant implications for insurance clients and litigation strategies in plaintiff-friendly venues. Ferguson v. Spraggins, 902 S.E.2d 708 (Ga. Ct. App. 2024), which revolved around a fatal automobile collision and subsequent settlements, may cause a shift in how plaintiffs approach settlements with individual defendants in multi-defendant cases in such venues.
The case arose from a multi-vehicle accident that resulted in the deaths of Amy Leigh Ferguson and Sylvia Spraggins. Eric Ferguson, as executor of Amy Ferguson's estate, along with David Ferguson, her surviving heir, filed a lawsuit against multiple defendants, including Spraggins’s estate, a school bus driver, the driver of a Ford F250 and the landowner conducting a controlled burn that contributed to poor visibility at the accident site.
The plaintiffs executed a limited liability release under O.C.G.A. § 33-24-41.1 with Allstate, the insurer of Sylvia Spraggins, which released both Allstate and Spraggins’s estate from personal liability. Additionally, they settled with Progressive Premier Insurance Company, which provided uninsured motorist (UM) coverage for Amy Ferguson.
The pivotal issue before the court of appeals was whether Spraggins’s estate should remain a defendant after the plaintiffs executed the limited liability release. The plaintiffs wanted to keep the estate in the case as a defendant to anchor venue in the State Court of Dougherty County, which has a history of plaintiff-friendly verdicts. But the court held the release under O.C.G.A. § 33-24-41.1, which mandated releasing the insurer and the insured from personal liability “except to the extent other insurance coverage is available,” entitled Spraggins’s estate to be dismissed from the case.
The court affirmed once all available insurance coverage was exhausted, the insured's estate could not be held liable. Moreover, the court dismissed the argument Spraggins' estate should remain in the case to defend against potential subrogation claims by Progressive, noting Allstate still had a duty to defend any such claims.
This decision may have far-reaching consequences for plaintiffs, particularly in plaintiff-friendly venues. Plaintiffs often want to keep individual defendants in the case to leverage a more favorable venue or to apply pressure for higher settlements; however Ferguson could lead plaintiffs to rethink this strategy. Indeed, venues in Georgia with defendant-friendly histories have seen very large verdicts recently, including a recent $47 million verdict in Cherokee County State Court. As such, plaintiffs may determine there is a little benefit of keeping a venue-anchoring defendant in a case.
The ruling also emphasizes the finality of releases once insurance limits are exhausted. Moving forward, plaintiffs will more carefully consider the insurance coverage available and the implications of releasing defendants from personal liability. For example, it may be more advantageous for plaintiffs to settle with an individual defendant for less than full limits – or not settle at all – if they believe the venue is more important than the empty chair risk.
Ferguson serves as a crucial reminder for insurers about the evolving landscape of litigation and settlements in Georgia. The court's interpretation of limited liability releases under O.C.G.A. § 33-24-41.1 may prompt plaintiffs to be more strategic in their settlement negotiations, particularly regarding the role of individual defendants and the utilization of plaintiff-friendly venues. Insurers should stay informed about such legal developments and consider their implications when engaging in settlement discussions. As the legal terrain continues to shift, staying proactive and adaptable will be essential in navigating the complexities of litigation and achieving favorable outcomes.
Attorney Contact Info
Joshua Smith
joshua.smith@swiftcurrie.com
404.888.6231