BENTON – Jurors in U.S. district court awarded Thiems Construction of Roxana $1 million in punitive damages on April 8, finding its former insurer United Fire put its own interest ahead of the company’s interest.
Jurors found United Fire must also reimburse the company for a punitive damage award of $904,019.71 from the Madison County trial.
Late owner Gary Thiems personally paid that amount in 2015. He died in 2016.
The underlying suit involved erosion from the Fox Creek subdivision construction site in Edwardsville to a lake on property of Fred and Juanita Steinkuehler.
They sued Thiems Construction in 2010, and they added a claim for punitive damages as trial approached in 2013.
At trial before former judge Barbara Crowder, jurors awarded them actual damages of $440,000 for dredging and $325,000 for loss of enjoyment.
They awarded $765,000 in punitive damages.
An appeal failed and the Illinois Supreme Court denied review.
United Fire paid the actual damages, and Gary Thiems personally paid the punitive damages plus $139,019.71 in interest.
Jon Rosenstengel of Belleville sued United Fire for Thiems Construction in St. Clair County circuit court in 2015.
He alleged breach of contract, bad faith, breach of fiduciary duty, and willful and wanton conduct worthy of punitive damages.
He claimed United Fire had a duty to disclose a conflict of interest and pay for independent counsel on punitive damages.
United Fire removed the suit to district court, asserting diverse citizenship as an Iowa corporation.
United Fire claimed it followed advice of counsel and adjusters, communicated with Thiems Construction, and negotiated with the Steinkuehlers, all in good faith.
Prior to trial, District Judge Staci Yandle dismissed the breach of contract claim and allowed the rest.
“United Fire cannot be absolved from its obligation to give due consideration to Thiems’ interest in avoiding a judgment for punitive damages in the underlying case,” Yandle wrote.
Trial started Monday, April 5, and moved quickly except when a power outage required 20 minutes of recess.
Rosenstengel called eight witnesses including Tad Thiems, son of Gary Thiems, who testified for 13 minutes on Tuesday.
United Fire counsel John Schultz of Kansas City, Mo. called two witnesses.
Yandle had set aside a week, but testimony ended at 2 p.m. Wednesday.
Closing arguments ended at 10:45 a.m. Thursday, and jurors returned the verdict at noon.
Thursday’s minutes stated, “Judgment to follow.”