Aetna Life Insurance Company v. Lavoie
United States Supreme Court
475 U.S. 813 (1986)
The Lavoies (plaintiffs) won a large punitive-damages verdict against their insurer, Aetna (defendant), for bad-faith claim denial, affirmed by a 5-4 vote of the Alabama Supreme Court with Justice Embry casting the deciding vote and writing the opinion. Aetna later learned Embry had a strikingly similar bad-faith lawsuit pending against another insurer, Blue Cross, at the very time he decided Aetna's case, and that Blue Cross paid him $30,000 directly into his personal account shortly after the Aetna ruling came down. Aetna's motions for Embry's recusal and for rehearing were both denied by the state supreme court.
Whether, under the Due Process Clause, a judge must recuse himself from a case in which he has a direct, personal, substantial, and pecuniary interest in the outcome.