## Facts

- Bruce Hammann sued Hartford Accident and Indemnity Company in federal court to recover under a fire insurance policy for a barn in Ohio that was destroyed by fire.
- Hartford denied coverage, asserting arson and fraud: that Hammann intentionally caused the fire and/or made willful misrepresentations connected to the loss.
- Hartford offered evidence of multiple prior fires involving Hammann and/or his property, some tied to insurance claims.
- Hartford argued the prior-fire evidence showed intent, knowledge, absence of accident, a common scheme or plan, and undermined Hammann’s credibility.
- Hartford also presented evidence that Hammann failed to disclose prior fires on the insurance application and during the claims process, characterizing the omissions as willful concealment.
- Hammann denied responsibility for the barn fire and objected that the prior-fire evidence was improper character/propensity evidence under Federal Rule of Evidence 404(b) and unfairly prejudicial under Rule 403.
- A jury returned a verdict for Hartford, and Hammann appealed, challenging the evidentiary rulings admitting the prior-fire evidence.

## Issues

1. Whether the district court abused its discretion by admitting evidence of Hammann’s prior fires under Federal Rule of Evidence 404(b) for permissible, non-propensity purposes.
2. Whether the district court erred under Federal Rule of Evidence 403 by allowing the prior-fire evidence despite the risk of unfair prejudice.

## Decision

- The Sixth Circuit affirmed the judgment for Hartford.
- The court held the district court did not abuse its discretion in admitting the prior-fire evidence under Rule 404(b).
- The court concluded the evidence was offered for permissible purposes, including credibility/impeachment and proof of intent, knowledge, and absence of mistake or accident.
- The court held the district court reasonably determined under Rule 403 that the probative value was not substantially outweighed by unfair prejudice.

## Legal Principles

- Rule 404(b) bars other-acts evidence to prove character or propensity, but permits such evidence for other purposes, including intent, knowledge, plan, and absence of mistake or accident.
- In civil insurance arson/fraud litigation, evidence of prior similar fire incidents may be admissible under Rule 404(b) when tied to disputed issues such as intent or whether a loss was accidental.
- Evidence that an insured concealed prior fire losses from an insurer may be admissible to impeach credibility and to support an inference of fraudulent intent in dealings with the insurer.
- Rule 403 permits exclusion of relevant evidence only when the danger of unfair prejudice substantially outweighs probative value; trial courts have broad discretion in this balancing, and appellate review is for abuse of discretion.

## Conclusion

The Sixth Circuit upheld a defense verdict for the insurer, ruling that evidence of the insured’s prior fires and related nondisclosures was properly admitted for non-propensity purposes under Rule 404(b) and survived Rule 403 balancing in an arson/fraud coverage dispute.


Hammann v. Hartford Accident & Indem. Co., 620 F.2d 588 (6th Cir. 1980)