Federal Judge Rules Washington's IFCA Is Not Retroactive

Federal Judge Rules Washington's IFCA Is Not Retroactive

U.S. Magistrate Judge James P. Donohue of the District Court of the Western District of Washington on Feb. 1 denied HSS Enterprises' motion to file an amended complaint, finding that Washington's Insurance Fair Conduct Act (IFCA) is not retroactive.

HSS Enterprises sued AMCO Insurance Co. in the King County Superior Court for breach of contract, bad faith and violation of the Washington Consumer Protection Act on Sept. 15, 2006. AMCO removed the case to the District Court.

On Jan. 14, HSS Enterprises filed a motion for leave to amend it complaint by adding a claim for relief under the IFCA, which was approved by voters on Nov. 6, 2007.  The IFCA creates a new cause of action against insurers for unreasonably denying coverage claims, as well as provides for treble damges and attorney fees awards.

Judge Donohue denied HSS Enterprises' motion, finding that the Washington legislature has not expressed an intent to apply the IFCA retroactively, and HSS Enterprises offers no authority suggesting otherwise.

"Furthermore, the statute is couched in present and future tenses," the judge said.

Judge Donohue further found that the IFCA is not remedial.

"The fact that plaintiff's IFCA claim might arise out of the same factual scenario as his other claims is of no moment."