Feature Realty, Inc. is a California-based real estate developer that developed a large mixed-use complex in Spokane, Washington.  Feature sued the City of Spokane for lost profits caused by the failure to issue permits and delays in the review and approval of an amended plat application.  

The City’s liability insurers included United States Fidelity & Guaranty Company (“USF&G”), a Travelers company.  USF&G refused to meaningfully participate in settlement discussions on behalf of the City, and never offered more than $500,000 to settle Feature’s claims.  As a result, in early 2005 Feature and the City entered into a settlement under which the City stipulated to a $5.5 million covenant judgment in favor of Feature.  Feature agreed not to execute on the judgment except as against the City’s insurance claims, which the City assigned to Feature.

GTTC represented Feature in the ensuing coverage litigation between Feature and USF&G in U.S. District Court for the Eastern District of Washington.  Feature prevailed, with the District Court finding that the USF&G policy issued to the City provided coverage for Feature’s claims, and that the covenant judgment was reasonable.  This hotly contested litigation generated several lengthy opinions, including  In re Feature Realty Litig., 468 F. Supp. 2d 1287 (2006); In re Feature Realty Litig., 2007 U.S. Dist. LEXIS 34352 (E.D. Wa. May 10, 2007); In re Feature Realty Litig., 2007 U.S. Dist. LEXIS 53702 (E.D. Wa. July 25, 2007); and In re Consolidated Feature Realty Litig., 2008 U.S. Dist. LEXIS 5505 (E.D. Wa. Jan. 25, 2008). 

On July 30, 2009 the case settled while on appeal to the Ninth Circuit.  USF&G paid $5.5 million, the full amount of the underlying liability.  Feature Realty was represented by GTT&C partners Frank Cordell and Mike Rosenberger. Feature’s co-counsel was C. Blaine Morley of Portland, Oregon.