Burg Simpson Wins Important Appeal in Fight for Victims of Body Donation Scandal

Burg Simpson is proud to announce a major appellate victory in a case that has tested the limits of corporate accountability, insurance bad faith, and the dignity owed to grieving families.

Background

Our clients were the victims of one of the most egregious, shocking scandals in recent history. They, and their loved ones, made the deeply personal and generous decision to donate the remains of their loved ones (and themselves) to the Biological Resource Center (BRC) in Arizona, believing that those remains would be used respectfully for medical research. BRC promised Honesty, Respect, and Dignity. Instead, the remains were dismembered and sold for profit. Some remains were even sold to the Department of Defense (under the guise of signed consent) as so-called “crash test dummies” in explosive testing.

This was a betrayal of trust on a massive scale. Burg Simpson attorneys Michael Burg, Holly Kammerer, Dave TeSelle, Joshua Abromovitz, Rachel Denning, Patrick Sweet, and Lauren Knapp took the matter to court in 2019. After a two-week trial, a jury awarded $58.5 million to the families. To this day, it remains one of the largest jury trial awards in Arizona history.

The jury found BRC and its owner, Stephen Gore, liable for their roles in the scheme. Gore, who had no assets, assigned his rights against his insurer to the victims.

The Fight Over Insurance Accountability

Rather than honor its obligations, BRC’s insurance company refused to pay. The company had a chance to settle all claims for $1.6 million (well within the policy limits) before trial. The insurance company declined, despite internal assessments showing a 0% chance of a defense verdict and an expected judgment exceeding $35 million. Instead, it allowed Gore to face financial ruin, all while controlling his defense.

The insurance company’s refusal led to years of litigation over whether it had a duty to pay the judgment or act in good faith. Initially, a lower court ruled that the insurer owed no duty because it ultimately had no obligation to indemnify Gore. In doing so, the court dismissed our bad faith claims entirely.

We knew that was wrong.

An insurance company cannot wash its hands of responsibility simply because it wins a legal fight over coverage. When it controls the defense of an insured person facing financial ruin, it has a duty to treat that person’s interests as equal to its own, especially when deciding whether to accept a reasonable settlement offer. That duty does not disappear just because the insurer later argues there was no coverage.

How Burg Simpson Fought for Justice

Our clients deserved the compensation they were awarded at the original trial. We took the fight to the Ninth Circuit Court of Appeals in Pasadena, California, with attorneys David TeSelle and Dean Batchelder leading the appellate fight. After oral arguments in Pasadena on May 13, 2025, we prevailed on re-instating the bad faith claims for trial.

This is a crucial victory not only for our clients, but for anyone who relies on insurance companies to protect them. If left unchallenged, the lower court’s decision would have set a dangerous precedent: Insurers could gamble with people’s lives and finances without consequence, so long as they later argue that coverage did not apply.

We believe BRC’s insurance company acted in egregious bad faith. It had the opportunity to resolve the case for $1.6 million and failed to do so, knowing full well the likely outcome and consequences. Our clients, and the man they held accountable in court, deserved better. Now, we are one step closer to making sure the insurance company is held accountable, too.

Our Lawyers Can Help You, Too

If you have questions about your rights in an insurance dispute or believe an insurance company has acted in bad faith, contact Burg Simpson today. We represent clients nationwide in insurance disputes and claims involving the mistreatment of human remains.