Judge Senter’s decision on Relator’s claim of Retaliatory Discharge raises question – Where’s the evidence?

There is no evidence in this record to indicate State Farm had the authority to terminate the Relators’ employment status. Accordingly, I will grant State Farm’s motion for summary judgment on this portion of the Relators’ claim.

In awarding State Farm summary judgment on this point, Judge Senter put his yardstick for all decisions on the table – evidence and controlling law.

However, his decision on the Relators’ Claim for Retaliatory Discharge from Their Employment begs the question – Where’s the evidence?

In a zoo? Exactly. Isn’t that where seals usually do their tricks? In this case, the zoo is the Federal Court for the Northern District of Alabama and the trick seals do in that zoo is shield evidence – the contract between E.A. Renfroe and State Farm, for example.

Knowing what evidence is needed begs a second question that in turn begs a third – Could the Rigsby sisters overturn this decision? and, in their position, Would you focus on winning every battle or winning the war?

E.A. Renfroe  provides adjusters under contract with the Company to separately contracted insurance companies and other entities.  Not all employee leasing and temporary help agencies are as specialized as Renfroe but all professional employer organizations (PEO) contract with individuals and separately contract with employers.  However, these agencies are “third parties” and the contracting employer retains the authority to hire and fire, set compensation and other terms of employment.

Professional employer organizations (PEOs) enable clients to cost-effectively outsource the management of human resources, employee benefits, payroll and workers’ compensation. PEO clients focus on their core competencies to maintain and grow their bottom line.

Businesses today need help managing increasingly complex employee related matters such as health benefits, workers’ compensation claims, payroll, payroll tax compliance, and unemployment insurance claims. They contract with a PEO to assume these responsibilities and provide expertise in human resources management. This allows the PEO client to concentrate on the operational and revenue-producing side of its operations.

A PEO provides integrated services to effectively manage critical human resource responsibilities and employer risks for clients. A PEO delivers these services by establishing and maintaining an employer relationship with the employees at the client’s worksite and by contractually assuming certain employer rights, responsibilities, and risk.

State Farm was unquestionably the employer with the right to terminate the employment of the Rigsby sisters but not their contract with E.A. Renfroe.

The “original source” of Kerri’s concern was seeing people in her community denied the coverage they had purchased from State Farm and she has maintained that concern for the well-being of others even as her own was exposed to increasing risk.

She does indeed remind one of the soft-spoken third grade teacher Chip Merlin described.  Merlin’s description indicates long-proven findings from research on human growth and development.  By third grade, typically developing children are able to transfer their life long trust in their parents to a significant other, their teacher.

Kerri, a trusted teacher to her community, returned the trust in her.  Even with Judge Senter’s earlier Order disqualifying her testimony, her community evidenced continued trust as case after case was filed based on the lessons learned from her teaching.

When I think of Cori’s trust in her sister, I am reminded of my own sisters and the trust we have in one another.  I’m also mindfind that Cori’s name appears first on every lawsuit.

Although it would have had no impact on our trust for one another, in that same position, I’m confident my sisters and I would have asked our mother why she didn’t spell the name Kori!

Judge Senter’s Opinion on the Rigsby’s Claim of Retaliatory Discharge follows:

31 U.S.C. §3730(h) of the FCA, sometimes known as the “whistleblower” provision, is intended to prevent adverse job actions against employees who assist in or bring actions under the FCA.

This subsection of the act provides:
(h) Any employee who is discharged, demoted, suspended, threatened,harassed, or in any other manner discriminated against in the terms and conditions of employment by his or her employer because of any lawful acts done by the employee on behalf of the employee or others in furtherance of an action under this section, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee whole. Such relief shall include reinstatement with the same seniority status such employee would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys’ fees. An employee may bring an action in the appropriate district court of the United States for the relief provided in this subsection.

The Relators acknowledge their employment contract was not with State Farm but with Renfroe, the party with whom the Relators recently reached a comprehensive settlement agreement. I have been unable to find any FCA case in which any party other than the whistleblower’s direct employer has been found liable under 31 U.S.C. §3730(h). There is no evidence in this record to indicate State Farm had the authority to terminate the Relators’ employment status. Accordingly, I will grant State Farm’s motion for summary judgment on this portion of the Relators’ claim.

17 thoughts on “Judge Senter’s decision on Relator’s claim of Retaliatory Discharge raises question – Where’s the evidence?”

  1. Isn’t it documented that State Farm — Lecky King — informed these guys that if they didn’t call all of these claims flood claims that they would be fired?

  2. I found this Oklahoma Law Review to be very helpful.

    OKLAHOMA LAW REVIEW [Vol. 61:189

    The Disaster After the Disaster: Insurance Companies

  3. I believe we owe a lot to the good people in Oklahoma.
    They have been most generous to us after Katrina.

    I will be looking for more links for you Nowdy and posting them when I can. You have a spot light on you now, and I am glad you are here. Keep up the good work.

    “…Judge Senter put his yardstick for all decisions on the table

  4. Nowdy, you ask:

    “in their position, would you focus on winning every battle or winning the war?” (i.e., continuing to fight to get their contracted “job” back w/State Farm).

    No doubt the Rigsby sisters are courageous, smart, and, MOST IMPORTANT OF ALL, THEY COULD NOT BE BOUGHT !!! THEY CHOSE NOT TO BE BOUGHT & PAID OFF BY their “employer” STATE FARM, and, instead, CHOSE TO SPEAK UP and bring light to these crimes. ARE THEY THE ONLY TWO PEOPLE WHO CHOSE TO NOT BE PAID OFF AND SUCCUMB TO THE GREED WHICH IS SO RAMPANT IN EVERY INDUSTRY surrounding Katrina?

    No doubt this stunned State Farm – who – obviously – was contentendly paying ENTIRE FLOOD LIMITS (w/o merit) and then having the Fed. Govt. (i.e., little taxpayers) “reimburse” them.

    It says that if they did prevail and got their “job” back w/State Farm, that their relief would provide:

    “…reinstatement with the same seniority status such employee would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination.”

    From what I’ve seen and read about the Rigsby sisters, I really do not think they’d want any more of this DIRTY MONEY even if they prevailed in the retaliatory action against State Farm – so, no, for me personally, I’d rather win certain battles than the entire war because this part of the war would require receiving more “dirty money” and the Rigsby sisters are above that.

    Of course, there are many out there who have no problem taking money from State Farm – whether it’s right or wrong, inflated, fraudulent, etc.


  5. Shirley I noticed this over at the State Farm website and wondered if anyone is checking the Farm’s top brass down in Florida to see if they have been smoking crack—


    State Farm will also continue to market other insurance products in Florida, such as auto and life insurance, as well as financial services products.

    As always, customers who have questions or need assistance may contact their State Farm agent.


    State Farm Florida Insurance CompanyA Subsidiary of State Farm Mutual Insurance Company

    A Message to Our Customers from State Farm Florida’s President
    State Farm Florida recently submitted a filing to the Florida Office of Insurance Regulation (OIR) to adjust or eliminate some policy discounts.

    On Aug. 6, 2009, the OIR approved this filing in part. This will affect several of our homeowners, renters, and condominium unit-owners discounts, including the Claim Record Rating, Utilities Rating, Building Code Effectiveness Grading System, Home Alert and Home/Auto discounts.

    The resulting premium change will vary from customer to customer, but it will equate to an anticipated average statewide premium increase of 28 percent. This will apply to policies renewed on or after December 1, 2009, and policies issued on or after November 1, 2009.

    The OIR

  6. With all due respect, His Honor had His head up His ass (again) on this one. “There is no evidence in this record to indicate State Farm had the authority to terminate the Relators’ employment status.” This factual finding is totally inappropriate for a Judge to be making on a Motion for Summary Judment. The Judge’s role in deciding such a motion is NOT to decide factual issues, which is the function of the jury at trial, but to decide whether there are disputed factual issues to be tried. This inappropriate “summary disposition” of disputed factual issues might have been avoided with (1) a smarter Judge, (2) more articulate pleading by the Sisters’ counsel, and/or (3) an affidavit from the Sisters stating that they believed State Farm issued the “give them the axe” instructions to Renfroe. I also have a real problem with the Judge’s quote, supra. If State Farm didn’t “control” the Sisters’ employment with Renfroe, then why was EVERYBODY invited to State Farm’s office for the “this is your mission” meeting soon after 8/29/05? Obviously, State Farm also had great “influence” over who remained employed with the engineering firms who were performing the inspections and writing the reports, sometimes more than one for the same property. So i have a BIG problem with the Judge’s dismissal of the claim for retaliatory discharge against State Farm, which also ignored the obvious “borrowed servant” issue which this factual scenarion SCREAMS for. One man’s opinion.

  7. I don’t think E.A. Renfore is an “employee leasing and temporary help agency”. Rather it is a contractor providing claims handling services. They contract w/carriers and the cost of their services is negotiated. Renfroe then hires adjusters and support personnel as they believe necesary to fulfill their contract with the carrier and Renfore has control over what they pay the adjusters they hire and the terms of that employment. So, the RIgsby’s employment relationship was with Renfroe, not with State Farm. If SF didn’t like what Renfroe’s employees did, they could terminate their relationship with Renfroe but they didn’t have the legal right to terminate any of Renfroe’s employees.

    No doubt, SF could exercise some influence over Renfroe but they did not have (or should not have) the right of control over renfores employess.

  8. Renfroe’s adjusters are independent contractors “on call” and at one time the Company website advertised them as temp staff for insurers who needed additional adjusters. Nothing I’ve seen, however, refuted the Rigsby claim that they were leased to State Farm.

    Unless you’ve seen the sealed agreement between Renfroe and State Farm, you can’t be certain what State Farm could or couldn’t do but I doubt that the relationship is the all or none you suggest.

  9. Steve, yes, most Floridians (and especially those w/State Farm – I, unfortunately – have Homeowner’s w/them, but am working on changing that) are aware that they want to “selectively” insure (just the cars, boats, etc.) and from what I’ve read in the continuing “Reader’s Comments” in The Tampa Tribune, MOST will SWITCH ALL OF THEIR STATE FARM CVG. if they drop their Homeowner’s cvg. Nice of them to offer to continue to insure other things though – RIGHT !!!!!!


  10. Shirley I think State Farm is missing the boat on one major event in life—The internet. Having a bad reputation prior to the internet was something State Farm could manage with big advertising budgets. The internet is changing the way people shop for insurance and how they form their opinion about the insurance company. Recent research indicates that a full 65 percent of consumers who see a TV commerical on insurance will turn to the internet to get more information about the insurance product. State Farm has a very bad reputation on the internet and even on their own website they prominately place information about how they are treating their own customers badly. The letter to Florida consumers asking for their business on the link is a sign that State Farm has a disconnect between what they do and how they are perceived by consumers. Looking at video’s over at you tube shows the same problem. More on these later. State Farm has a MAJOR internet reputation problem because of the way it treats its customers. This can kill State Farm quicker than you can say Blockbuster Video…

  11. Dear Mr. O’Dwyer: Even I, just a little ole Legal Secretary/Paralegal, knows that you’re right on this one (i.e., the Jdg. just decides whether or not disputed factual differences exist in a SJ motion)….not deciding the facts himself !

    That’s how it supposed to be anyway. One can tell you’re a brillant Attorney (for everything you correctly pointed out above) !


  12. That he is Shirley. I researched and wrote a post about the “borrowed servant” after he made mention in an earlier comment.

  13. Further, by using Renfroe as an independent adj. firm, State Farm saves $ by not having to proivde said adjusters w/S.Farm health ins., 401K contributions, W/C coverage, payroll taxes, etc.

    State Farm does whatever it can to save $ because as MOST know – THE RICH ARE NEVER RICH ENOUGH AND THEY ALWAYS SUCCUMB TO GREED.

    State Farm has enough of its own Adjusters on their payroll w/o having to retain an ind. adjusting Firm – they’d just have to fly their adjusters in, put them up in hotels, pay for their meals – AND ALL OF THAT COST $ WHICH, AS WE ALL KNOW, IS A NO NO.


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