Liberty Mutual Settles Quadriplegic's Lawsuit

A bitter battle over collecting a $12.8 million insurance judgment awarded to a 28-year-old quadriplegic and his friend ended quietly Tuesday in a Los Angeles courtroom.

Liberty Mutual Insurance Co. agreed to pay an undisclosed amount to settle claims arising from a 1992 automobile accident that left Burbank resident Oganes Saakyan a quadriplegic and his passenger, Garnik Paronyan, severely injured, attorneys said. Saakyan v. Modern Auto Inc., VC013709 (L.A. Super. Ct., filed June 25, 1993).

Citing a confidentiality agreement, the lawyers declined comment. But Saakyan, who now works in the accounting department at the hospital that has treated him since he suffered his disabling injuries, expressed relief that the case is finally over.

“I just can’t be much happier than this,” a beaming Saakyan, said after the hearing. “This is very good news.”

Paronyan would not comment, citing the confidential terms of the settlement.

Both sides described the settlement as “amicable.”
But the run-up to the long-awaited pact was anything but friendly.
In November, Liberty Mutual went to federal court, claiming Saakyan and Paronyan had named the wrong corporate entity in litigation to force payment of the $12.8 million judgment.

Plaintiffs’ attorney Garo Mardirossian of Los Angeles-based Mardirossian & Associates, retaliated last week by calling the insurance titan’s tactic a “parlor trick” intended to get the company “out from the mess they’ve put themselves into.”

A lawyer for Liberty Mutual declined comment. But in opposition papers, Liberty Mutual’s defense attorney, Raoul D. Kennedy of the San-Francisco offices of Skadden Arps Slate Meagher & Flom, accused Mardirossian of “gross negligence” for misconstruing the company’s name.

The dispute dates back 10 years, when Saakyan plunged off Interstate 605, minutes after the Modern Auto Shop in Whittier installed oversized wheel rims and tires on the car he was driving.
In 1994, Modern Auto’s insurance carrier, Liberty Mutual, rejected a $985,000 settlement offer and opted to go to trial.

Modern Auto assigned Saakyan and Patronyan the right to file a bad-faith insurance claim against the insurance company.
At an initial trial, the jury rejected Saakyan and Paronyan’s claims. The verdict later was overturned for jury misconduct and other reasons.

In 2000, a second jury found that Modern Auto had negligently installed the oversized wheel rims and tires, and jurors awarded Saakyan $12 million for injuries that have paralyzed him from the chest down. Paronyan got $800,000 for spinal cord injuries from which he has recovered.

Settlement talks ensued. But in November, with no agreement in sight, Liberty Mutual went to federal court claiming Modern Auto’s bad-faith suit assignment to Saakyan and Paronyan was “worthless” because it named the wrong corporate entity of the Boston-based company.

In sworn declarations before the court, Mardirossian and defense attorney Darrell A. Forgey, who negotiated the assignment for Modern Auto, said they learned for the first time just before Thanksgiving of Liberty Mutual Fire, the entity the insurance behemoth now claimed was the insurer on the loss.

Liberty Mutual Fire had not surfaced in 10 years of litigation and settlement discussions, Mardirossian said.

Kennedy, however, said the insurer, in communications over the years, had mentioned three Liberty Mutual entities, “placing the plaintiffs on notice that there was some question as to the exact name of Modern Auto’s insurer.”

“At a minimum, plaintiffs had an obligation to ask for a copy of the policy or at least the declaration page,” Kennedy said. In a declaration, Dikran Sulahian, Modern Auto’s owner, said that, in the 10 years since he was sued, he always had believed that Liberty Mutual was his insurer.

“I had been so informed both in writing and orally by the agents and employees of Liberty Mutual working on the case and [its attorneys] hired to protect the interests of Modern Auto in a court filing.

The waiting has been a financial strain on Saakyan, who said last week he owed hundreds of thousands of dollars in medical bills.
Saakyan lives with his elderly parents and relies on them to assist him at home with things like getting in and out of bed and taking a bath.

Recovering on the judgment could go along way toward helping him become independent, taking the pressure off his parents, who also have health problems, he said.

Saakyan said he also hopes to take advantage of revolutionary treatment that may one day restore some function to his legs.
Mardirossian, an Armenian immigrant like Saakyan, had said he wouldn’t let up until Saakyan received full justice.

“We’re going to be here for the long haul so that the 17-year old who was put in a wheelchair gets full justice,” he said earlier.
Tuesday, however, Mardirossian would not comment.

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