Wal-Mart claims some of its insurers have refused to consent to a confidential settlement with comedian Tracy Morgan and will not pay reimburse the company under its existing policies.
NEWARK--Five months after reaching a confidential settlement with comedian Tracy Morgan over the 2014 crash on the New Jersey Turnpike that seriously injured the "Saturday Night Live" star, Wal-Mart is claiming some of its insurers are balking at paying.
In a federal court filing in New Jersey, Wal-Mart said the insurers "in bad faith refused to consent to the settlements and have refused to pay their portions" under existing policies.
The move comes after Liberty Insurance Underwriters and Ohio Casualty Insurance filed suit in Middlesex County earlier this month, claiming the terms of the confidential settlement were unreasonable and questioning whether Wal-Mart agreed to a "high amount" to avoid punitive damages that would have fallen solely on the company.
Morgan, who was returning home on the turnpike after performing at the Dover Downs Hotel and Casino in Delaware, was seriously injured with two others on June 7, 2014 when a Wal-Mart truck driven by Kevin Roper struck their limo van from behind. The impact killed fellow comedian James McNair, who performed under the name of Jimmy Mack, and set off a chain-reaction collision that eventually involved six vehicles and 21 people.
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The National Transportation Safety Board in August blamed driver fatigue for the crash near Interchange 8A in Cranbury, which occurred in a construction work zone.
NTSB officials found Roper had not slept for more than 28 hours prior to the accident, in part because he drove 800 miles overnight from his home in Georgia to a Wal-Mart distribution center in Delaware, before getting behind the wheel of the truck. Roper had been traveling 20 mph over the posted 45 mph speed limit and did not slow down until it was too late, when he saw the brake lights of the vehicles ahead of him, the board said.
In May, Wal-Mart agreed to settle a lawsuit brought by Morgan and others in the van, but the terms and conditions were kept confidential. Following the settlement, Morgan's attorney, Benedict Morelli, said only: "Wal-Mart took full responsibility for the accident, which we greatly appreciate."
But in the new filing in federal court in Newark, the retailing giant said while some of its insurers met their obligations to cover their share of the cost of the settlement, others have not. Those insurers, which it said included Liberty Insurance Underwriters and Ohio Casualty Insurance, have "refused to pay their portions of the settlements under the insurance policies they sold to Wal-Mart in Arkansas."
Wal-Mart said it has already paid out the settlement to Morgan and others injured in the accident.
In the Middlesex County lawsuit, Liberty and Ohio Casualty, a Liberty Mutual subsidiary, charged that Wal-Mart agreed to a settlement without any attempt to negotiate. The insurers also said they were not consulted before an agreement was reached.
They said they "declined to reimburse Wal-Mart for the settlement" because the amount was unreasonable and was reached prematurely before there Wal-Mart's liability was determined.
A spokesman for Wal-Mart said the company "took full responsibility for the tragic accident and did what was right to ensure the well-being of those who were impacted. We funded the settlement agreements in full, but some of the insurance carriers have failed to pay their portion of the settlement amount."
Randy Hargrove, director of national media relations for the company, said Wal-Mart has had umbrella liability coverages for decades and paid premiums for years.
"This lawsuit is about the defendant insurance companies not living up to the requirements of their own policies," Hargrove said. "This is no different than any individual who holds an insurance policy, makes a claim for a covered loss, and then is told by the insurance company that despite the existence of coverage, they don't intend to pay."
Liberty Mutual did not immediately respond to requests seeking comment.
Ted Sherman may be reached at tsherman@njadvancemedia.com. Follow him on Twitter @TedShermanSL. Find NJ.com on Facebook.
