A federal judge in Florida has denied State Farm Mutual Automobile Insurance Company’s request for a summary judgment and default declaratory judgment, dealing a setback to the insurer’s efforts to avoid liability in an ongoing state court lawsuit. The case centers on whether State Farm must provide defense and indemnification to two defendants, Global Pioneer Business Solutions, LLC and Patricia Socorro, who are facing a negligence lawsuit after a serious automobile accident in 2017.
Judge Mary S. Scriven, in a ruling issued March 11, found that State Farm had not demonstrated an absence of material factual disputes, particularly concerning certificates of insurance issued by a State Farm broker that appeared to grant coverage to Global Pioneer. The ruling means the case will proceed to trial, where a jury may decide whether State Farm is obligated to cover Global Pioneer and Socorro in the underlying negligence lawsuit.
The case originates from a July 18, 2017, car accident, in which Patricia Socorro, an employee of Global Pioneer Business Solutions, was transporting Carol Taylor to a medical appointment. Taylor, along with her husband Sheldon Faulk, later sued Global Pioneer and Socorro for negligence, alleging that Socorro caused the accident while acting within the scope of her employment.
Global Pioneer was operating under a subcontractor agreement with Access2Care, LLC, a company that arranges medical transportation services. Under that agreement, Global Pioneer was required to maintain liability insurance and provide proof of coverage to Access2Care.
At the time of the accident, State Farm had issued two personal auto insurance policies to Bridgette Copeland-Gould, an officer of Global Pioneer. Neither Global Pioneer nor Socorro was listed as an insured party on those policies.
Despite this, State Farm has been providing a defense to Global Pioneer and Socorro under a reservation of rights, meaning that while the company has covered legal expenses so far, it has not conceded that it is ultimately responsible for any judgment or settlement.
State Farm filed a federal lawsuit seeking a declaratory judgment, arguing that it was not obligated to provide coverage for Global Pioneer or Socorro under its policies. The insurer moved for summary judgment, asserting that:
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State Farm also sought a default judgment against Global Pioneer and Socorro, as neither had responded to the federal lawsuit.
Scriven rejected State Farm’s motion, citing factual disputes surrounding the certificates of insurance issued by Flowers, a State Farm-authorized agent.
The key issue was that Flowers issued two certificates of insurance listing Global Pioneer as an insured entity—even though the actual policies did not name the company as an insured party.
Flowers later admitted that she made a mistake, acknowledging that she should have verified the correct policyholder name before issuing the certificates. Despite this, the certificates bore State Farm’s logo and were used to satisfy Global Pioneer’s contractual obligation to Access2Care, which required proof of insurance.
The court found that, under Florida law, a certificate of insurance issued by an authorized agent could bind the insurer, even if it contained errors. Scriven cited a 2022 Eleventh Circuit case, Liberty Mutual Fire Insurance Co. v. State Farm Florida Insurance Co., in which a certificate of insurance was found to grant coverage, despite not being reflected in the underlying policy.
State Farm argued that the certificates explicitly disclaimed any authority to modify policy coverage, a position that courts have upheld in some past cases. However, the judge distinguished those rulings, noting that in this instance:
The judge emphasized that, while State Farm may ultimately prove its argument at trial, factual questions remain about whether the insurance agent’s actions legally bound State Farm.
The court also denied State Farm’s request for default judgment against Global Pioneer and Socorro, despite their failure to participate in the lawsuit.
Scriven reasoned that, since Taylor and Faulk had contested State Farm’s position and the case was proceeding to trial, entering a default judgment against Global Pioneer and Socorro could create inconsistent rulings.
Additionally, the court expressed concern over potential unfairness, noting that if Taylor and Faulk ultimately win at trial, a premature default judgment could wrongly strip them of potential coverage under State Farm’s policies.
With State Farm’s motion denied, the case will move forward, with a jury likely determining whether State Farm must provide coverage for Global Pioneer and Socorro. The ruling underscores the legal weight of insurance certificates, particularly when issued by an authorized agent with apparent authority.
For policyholders and insurers, the case highlights the importance of accurate documentation and the potential liability that can arise from errors in issuing insurance certificates. For now, State Farm remains on the hook for legal defense costs, with its ultimate liability to be determined at trial.
