State Farm loses Round One

Christian Action Network

A Virginia Circuit Court judge in Lynchburg has struck down State Farm’s efforts to dismiss a lawsuit against the insurer brought by the Christian Action Network (CAN).

CAN sued State Farm after the insurance giant refused to honor its policy to provide legal coverage in a defamation lawsuit brought against the organization.

In 2013, CAN was embroiled in a lawsuit filed by The Muslims of America, an Islamic group based in upstate New York. The suit claimed Martin Mawyer, CAN’s president, defamed the Muslim organization in a book he had written.

The book, Twilight in America, exposed how Muslims Of America members had committed terrorist acts such as murder, assassination and kidnapping, along with an assortment of other crimes inside the United States. The book became an Amazon number-one bestseller and was featured on the news program FOX and Friends.

TMOA claimed the book was fictitious and defamatory. 

For the first four months of the suit State Farm aggressively defended Christian Action Network by providing legal coverage, but the company then changed its position and  claimed CAN’s insurance policy did not include defamation coverage.

CAN immediately sued State Farm, demanding the insurance agency reinstate coverage and honor its policy to provide legal defense. 

Judge R. Edwin Burnette Jr.

Judge R. Edwin Burnette Jr.

For the next year, CAN was forced to pay for its own legal defense against the Muslim group while also incurring expenses from the suit against State Farm.

Mawyer said, “State Farm’s refusal to honor our insurance policy, which clearly provides defamation coverage, has cost our organization well over $100,000 in legal fees.”

In April 2014, CAN won the lawsuit brought by the Islamic group when a federal judge dismissed TMOA’s case. Undeterred, TMOA made another attempt to sue CAN over the book in October 2014.  But once again a federal judge dismissed the lawsuit, this time in August 2015.

“Throughout this painful period of defending ourselves against two lawsuits, which we ultimately won, State Farm sat in the background, digging in their heels and refusing to honor their policy,” Mawyer said.

“For 25 years we paid our State Farm premiums on time, even when we were short of money; even when we had to lay off staff members, even when we couldn’t pay our office rent,” Mawyer said.

“But when it came time for State Farm to honor our 25-year commitment to them, they ran and took cover. They abandoned us and basically left our organization for dead,” Mawyer said.

On Oct. 15, 2015, State Farm attempted to have CAN’s lawsuit dismissed.  But Judge R. Edwin Burnette Jr. refused to grant the request, deciding to focus first on whether State Farm breached its duty to defend under the insurance policy.

CAN attorneys will now ask Judge Burnette for a “summary judgment” requiring State Farm to reimburse CAN for its legal bills in the suit brought by TMOA. Oral arguments are expected within two months.

Published on by Admin.