State Farm Fire & Casualty Company, Petitioner v. James and Cynthia Simmons, Respondents

Summary

The Texas Supreme Court affirmed the appellate court's finding that State Farm breached its duty of good faith and fair dealing, but reversed the $2 million punitive damages award as legally insufficient, and ordered additional damages under the Deceptive Trade Practices‑Consumer Protection Act. The Court held that the evidence supported the bad‑faith finding and DTPA liability, while finding no basis for punitive damages. Two dissenting opinions argued that the evidence did not meet the objective element of bad‑faith liability and that punitive damages were improper.