Malnar Injury Law takes Colorado insurance dispute to state Supreme Court

Malnar Injury Law is backing a case before the Colorado Supreme Court that could shape what post-lawsuit insurance claim materials injured policyholders can seek in bad-faith cases. The court’s ruling in Berns v. State Farm could set statewide guidance on discovery in disputes over uninsured and underinsured motorist claims.

Why it matters: - The Colorado Supreme Court’s answer could affect how injured drivers pursue insurance bad-faith claims across the state. - The case could determine whether policyholders can obtain post-lawsuit claim notes, evaluations and other materials that may show how an insurer handled a disputed claim. - The ruling may also clarify how Colorado courts balance discovery rights against attorney-client privilege in insurance litigation.

What happened: - Malnar Injury Law is helping take Berns v. State Farm Mutual Automobile Insurance Company to the Colorado Supreme Court. - The case is Colorado Supreme Court No. 26SA86 and stems from federal case 1:24-cv-01971-GPG-NRN. - The court accepted a certified question in March 2026. - The case asks when, and to what extent, discovery is allowed into an insurer’s post-litigation claim notes, claim file and post-litigation evaluation of the claim. - The dispute involves James Berns and State Farm Mutual Automobile Insurance Company.

The details: - Berns was rear-ended in March 2020. - The at-fault driver’s insurer later offered its $25,000 policy limit. - Berns then sought underinsured-motorist benefits under his own State Farm policy, which provided up to $250,000 in UM/UIM coverage. - State Farm questioned whether Berns’ injuries and medical treatment were caused by the collision. - State Farm maintained that Berns’ claim did not exceed the insurance available from the at-fault driver. - Berns and his attorneys continued sending medical information and asking State Farm to reevaluate the claim. - Berns filed suit in 2024, bringing claims for underinsured-motorist benefits, common-law bad faith, and unreasonable delay or denial under Colorado law. - State Farm disputes those claims, and no liability determination has been made. - During litigation, Berns sought portions of State Farm’s claim file and post-suit claim evaluations. - State Farm has relied on the “suspension rule,” which in some circumstances says an insurer’s duty to negotiate, settle or pay a disputed claim may be suspended after litigation begins. - Berns argues that an insurer still owes a continuing duty of good faith after a lawsuit is filed. - Berns also argues that relevant, nonprivileged post-litigation claim materials should remain discoverable. - Ryan Malnar said filing a lawsuit should not automatically hide otherwise relevant evidence, while privileged attorney-client communications remain protected.

Between the lines: - U.S. Magistrate Judge N. Reid Neureiter said federal judges applying Colorado law have reached different conclusions on the suspension rule and an insurer’s continuing duty of good faith. - The federal court said the issue comes up repeatedly in insurance litigation and that no controlling Colorado Supreme Court precedent resolves the discovery question. - United Policyholders and the Colorado Trial Lawyers Association filed an amicus brief supporting Berns. - The organizations want the court to reject a categorical rule shielding post-litigation claim materials and instead apply ordinary relevance and privilege standards. - The dispute started as one injured driver’s insurance claim, but the ruling could guide discovery rules in future bad-faith cases statewide.

What's next: - The Colorado Supreme Court will answer the certified question and set guidance for lower courts. - Any ruling could affect how insurers handle disputed UM/UIM claims after policyholders file suit. - Malnar Injury Law says the case reflects its willingness to push disputed insurance issues beyond the settlement table when needed.

The bottom line: - The case could decide whether Colorado insurers can broadly block post-suit claim evidence or whether injured policyholders can still seek it through ordinary discovery.