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State Farm’s breach of contract.” Respondent argues:
“payments made in settlement of breach of contract suits
are specifically excluded from the definition of damages
which might qualify for exclusion under the provisions of
I.R.C. sec. 104(a)(2).” Thus, according to respondent,
“none of the payments made in settlement of Campbell v.
State Farm are [sic] excludable from gross income under
section 104(a)(2).”
Respondent’s motion for summary judgment explains
that
Campbell v. State Farm was a class action lawsuit
in which it was alleged that State Farm breached
its insurance contracts with policyholders by
failing to pay Uninsured Motorist/Underinsured
Motorist (UM/UIM) benefits under more than one
insurance policy purchased from State Farm on
different vehicles owned by the individuals
involved, in a practice referred to as “policy
stacking.”
We note that the complaint filed in Campbell v. State Farm
had asserted that “Defendant State Farm’s refusal to allow
Plaintiff to ‘stack’ multiple uninsured and/or underinsured
motorist coverages provided by State Farm policies
constitutes a breach of contract.”
Respondent’s motion does not rely on the settlement
agreement that was entered into by the parties to Campbell
v. State Farm. Respondent’s motion refers to a document
entitled “Notice of Class Action, Proposed Settlement,
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