Two Tokio Marine Holdings Inc. units have prevailed in bad faith litigation filed by a California school district stemming from an accident where a 78-year-old man became a paraplegic after a fall.

The man was attending a soccer game in 2014 in which his granddaughter was participating, which was held on a field owned by the Oak Park Unified School District, when he tried to retrieve a soccer ball with the intent of kicking it back onto the soccer field, according to the complaint in Oak Park Unified School District; the Ventura County Schools Self-Funding Authority vs. The Philadelphia Insurance Cos. et al.

However, he fell in his attempt, tumbled down a nearby hillside and broke his neck, which left him a quadriplegic, according to the complaint.

Although the litigation filed by the victim was resolved for an undisclosed amount, a dispute developed between the Oak Park, California-based school district and Camarillo, California-based Ventura County Schools Self-Funding with Tokio Marine units over coverage for defense costs. Plaintiffs sought $1.3 million plus punitive damages, attorneys’ fees and costs.

The plaintiffs charged the insurance units with breach of contract and breach of the implied covenant of good faith in the lawsuit filed in U.S. District Court in Pasadena.

The district court ruled in the insurers’ favor and was affirmed by a three-judge appeals court panel in the ruling filed Tuesday.

Oak Park contended the district court erred by relying on a design defect exclusion cited in two previous cases, the panel’s ruling said. “Under well-settled California law, a court’s subsequent analysis of a policy exclusion can serve as evidence that an insurer acted reasonably when it interpreted the policy similarly,” it said. 

The ruling states also that “Oak Park also argues that Philadelphia conducted an inadequate investigation before denying coverage.

“But Oak Park cites no authority suggesting that when an insurer denies coverage based on a reasonable interpretation of a policy exclusion, the insurer might nevertheless be liable for bad faith because it failed to conduct an adequate investigation,” the panel said, in affirming the lower court’s decision.

Attorneys in the case did not respond to requests for comment.

In March, a federal appeals court affirmed a lower court’s ruling against a Tokio Marine unit in litigation with a Brooklyn school.