This year, several state supreme courts have adopted ALI work. Some more recent examples follow:
In Baldwin v. Standard Fire Insurance Company, 2025 WL 2962254 (Ind. 2025), the Indiana Supreme Court established a “safe harbor” for insurers using interpleader actions to manage policy limits that were insufficient to satisfy multiple claimants, adopting Restatement of the Law, Liability Insurance § 26. In this case, the insurer of the culpable driver in a motorvehicle accident that caused serious injuries to the driver’s passengers and another motorist f iled an interpleader action naming all potential claimants and deposited the $100,000 policy limit with the trial court, after rejecting the other motorist’s “time-limited settlement demand” for the $50,000 per-person policy limit on the ground that it was concerned about the premature “exhaustion of the $100,000 policy limit” and wanted to protect its insureds’ interests. The other motorist later settled with the insureds for $700,000 without the insurer’s consent and was assigned insureds’ claims against the insurer.
Based on the assignment, the other motorist filed counterclaims against the insurer in the interpleader action, alleging that the insurer breached its duty of good faith and fair dealing and acted in bad faith by rejecting his initial settlement offer. The trial court granted the insurer’s motion for summary judgment. The court of appeals reversed in part, finding that genuine issues of material fact existed as to whether the insurer breached its duty of good faith and fair dealing when it declined the other motorist’s initial settlement demand and whether it acted in bad faith toward its insureds. The Indiana Supreme Court affirmed the trial court’s grant of summary judgment for the insurer, holding that insurers facing multiple potential claims against an insufficient policy did not breach their duty of good faith and fair dealing or act in bad faith by filing an interpleader action to manage the competing claims. The court adopted Restatement of the Law, Liability Insurance § 26 because it distilled the principles in Indiana case law by imposing a duty on insurers to make a good-faith effort to settle the actions in a manner that minimized the insureds’ overall exposure and by allowing insurers to file interpleader actions as a “safe harbor” that shielded insurers from liability to their insureds. The court concluded that the insurer’s conduct fell squarely within the “safe harbor” provision for interpleaders because it f iled the interpleader action, named all known potential claimants, deposited the full policy limit with the trial court, and continued to provide defense counsel to the insureds. The concurring and dissenting opinion concurred in the adoption of § 26 but felt that the other motorist had presented sufficient facts for a factfinder to conclude that the insurer may have breached its duty of good faith and fair dealing or acted in bad faith.
In Villarini v. Iowa City Community School District, 21 N.W.3d 129 (Iowa 2025), the Iowa Supreme Court adopted Restatement of the Law Second, Torts § 611 in holding that the fair-report privilege protected the publication of defamatory matter concerning another in a report of an official action or proceeding, or of a public meeting that dealt with a matter of public concern, as long as the report was an accurate depiction of what occurred and did not convey an erroneous impression to those who heard or read it.
In this case, a former tennis coach at a public high school, whose contract was not renewed because of comments made by former players at a public school-board meeting, f iled a defamation action against the school district, after it posted an unaltered video of the meeting, in which the players expressed concerns with the school district’s investigation and dismissal of their complaints that the coach had inappropriately touched, bullied, or harassed multiple players. The Iowa Supreme Court affirmed the trial court’s grant of summary judgment for the school district, holding that the fair-report privilege protected the school district’s online publication of the unaltered video of the meeting. The court pointed out that the publication of the video merely expanded access to a meeting that any member of the public could have attended. Adopting Restatement of the Law Second, Torts § 611 was appropriate, observed the court, because it was supported by prior court decisions and furthered Iowa’s open-meeting laws, which “protect[ed] those government bodies that provide the public with a full account of their meetings.”