State Farm puts the Court to the test in Bossier – files nine motions in limine UPDATED

Defendants mistakenly believe that just because evidence is prejudicial it is not admissible. Not so. All relevant evidence is necessarily prejudicial.

Are we going to see yet another case gutted before trial? Obviously,  State Farm would like nothing better.  The Company filed nine motions in limine on the last day of September with trial set for little more than a month away.

Taken in the order of just how offensive the motions are to the public interest, SLABBED examines the nine starting with #7: to Preclude Testimony or Evidence Relating to Interpretation of Insurance Policy Provisions or Principles of Mississippi Law and to Exclude the Wind Water Claim Handing Protocol.

State Farm anticipates that Plaintiff may attempt to introduce testimony and/or evidence regarding a State Farm document known as the Wind Water Claim Handling Protocol… That document, however, should not be used for any purpose during the trial of Plaintiff’s claims. First, the document should not be used during the coverage phase of trial because how an adjuster investigates a claim has no bearing on what damage wind or flood caused to Plaintiff’s property or on whether those damages qualify for coverage under the plain terms of the homeowners policy.

Second, the document is also inadmissible during the later phase of trial (if any) involving claims for extra-contractual and punitive damages because (1) introducing the protocol would inject unfair prejudice against State Farm and needlessly confuse the jury by introducing a purported investigatory process alongside the controlling Mississippi investigatory standard beyond the abilityof any instruction by the Court to cure and (2) the document does not evidence bad faith or other culpable conduct. (Emphasis added – and doubled)

The following excerpt from the November 1, 2006 deposition of Stephan Hinkle, principal developer of the Protocol, provides just one of the many reasons the Court should carefully consider this motion.

Q. [The Protocol]…involved policy interpretation decisions?
A. Right.
Q. And it was the thing about — this was the thing that controlled that, right?
A. This was the primary document on the wind versus water issue.

When measure by the Nowdy-scale, there was actually a three-way tie for most offensive motion in limine.  Motion #7 was simply the worst of the worst and SLABBED now looks at #3: Limiting Testimony or Evidence Relating to Insurance Department Bulletins and Related Correspondence.

…the MDI bulletins and related correspondence are not admissible under any
circumstances on Plaintiff’s breach of contract claims…

Hold onto your hat and read State Farm’s related motion in limine #2: to Exclude Testimony or Evidence Relating to the Market Conduct Report.

…the Report’s level of generality makes it impossible for the Court, the finder of fact, or State Farm to address its findings in any meaningful way at trial.The Report has no relevance to Plaintiff’s particular claim and its introduction into evidence would raise a substantial risk of confusing or misleading the jury and would cause unfair prejudice to State Farm. Accordingly, the Report should be excluded under Federal Rules of Evidence 402 and 403 for all purposes, including punitive damages. The Report is also inadmissible hearsay and contains further hearsay statements within it.  Accordingly, it should be excluded under Federal Rule of Evidence 802.

Surely the Farm is not just a fair weather friend to MID; but, just to make certain, I dropped by and found this glowing review of the MID exam:

On Oct. 30, 2008, the Mississippi Insurance Department (MID) released the results of its two-year examination of State Farm’s post-Katrina claim handling.

The MID’s report confirms what we have always maintained – State Farm settled the vast majority of policyholder claims quickly and satisfactorily despite their enormous volume and complexity.

The report clearly shows that examiners found no violations of state law or regulations, allegations of “fraud and abuse” were baseless, and, where mistakes were discovered in claims handling, we corrected them.

Shouldn’t the website be corrected so State Farm will have a consistent position.  After all, a company that doesn’t want to mislead or confuse a jury would not want to mislead or confuse the public, right?

Think about those questions as SLABBED turns to the last of the three “worst” – motion in limine #6: to Exclude Evidence Regarding Properties Other Than Plaintiffs Property.

This Court has repeatedly ruled in Hurricane Katrina cases that evidence regarding unrelated properties is not admissible. The “sole focus” of the trial of this case will be Plaintiff’s property and State Farm’s adjustment of his claim, not unrelated third parties.  As noted above, this Court has previously excluded testimony relating to other Hurricane Katrina claims where a plaintiff had asserted a claim for punitive damages because the testimony did not relate
to the facts surrounding the plaintiff’s specific claim.

Although Plaintiff “may have explored in discovery other claims related to different properties and claimants,” such evidence is inadmissible at trial because “the trial of this case will be limited to the facts surrounding the Plaintiff’s particular claims,” not unrelated third parties.

Now, if the Bossier trial “should be limited to the facts surrounding the Plaintiffs’ particularly claims, does logic now hold that the Court’s rulings should likewise exclude consideration of decisions made specific to other claims?

While State Farm is inconsistent is the application of logic, the Company is certainly consistent in its effort to exclude evidence.  For example, motion in limine #9 attempts to Exclude Evidence of or Reference to Plaintiff’s Other Properties; motion #8 seeks to Exclude Evidence of Dissimilar or Out-of-State Conduct; and motion # 5 asks the Court to Exclude Evidence of or References to Any Grand Jury or Government Investigations Relating to Response to Hurricane Katrina.

Rounding out the five not-the-worst-but-still-offensive State Farm motions in limine contrary to public interest are the final two motions in this all out effort to exclude evidence from trial: motion #4 requests the Court to Preclude Plaintiff from Introducing Evidence that Waiver or Estoppel Create or Modify Coverage; and, motion #1 wants the Court to Bifurcate Trial and to Preclude Evidence of or Reference to Claims for Extra-Contractual and Punitive Damages Prior to a Finding of Coverage Under the Policy. Three of the motions – #1 #2, and #8 –  have related memorandum of support.

True to form, State Farm appears to have used Bossier’s good faith attempt to honor the Court’s deadline to feather its own next and leave Bossier empty-handed save this very reluctant consent motion .

The pre-trial conference in this matter is scheduled for October 14, 2009, with the proposed pre-trial order due to the Court on October 7, 2009.

On September 4, 2009, undersigned counsel for Plaintiff forwarded her initial pre-trial order inserts to counsel for State Farm and asked that he provide his comments and inserts by the time she returned to the office in approximately three weeks. (See Exhibit 1).

On September 21, 2009, Plaintiff’s counsel’s office inquired as to the status of State Farm’s inserts to the pre-trial order. (See Exhibit 2). There was no response to this e-mail.

On Tuesday, September 22, 2009, Plaintiff’s counsel’s office inquired as to the status of State Farm’s inserts to the pre-trial order and was told that we should receive something by the end of the week. (See Exhibit 3).

On Friday, September 25, 2009, Plaintiff’s counsel again inquired as to the status of State Farm’s inserts. (See Exhibit 4). No response was received.

On Tuesday, September 29, 2009, Plaintiff’s counsel once again inquired as to the status of State Farm’s pre-trial order inserts. State Farm’s counsel advised that he was working on same and that “you’ll have it in plenty of time.” A followup email from counsel for Plaintiff requesting advice as to when they would be received resulted in no response. (See Exhibit 5) To date, Plaintiff still has not received same.

On Wednesday, September 30, 2009, Plaintiff’s counsel inquired again and asked counsel for Defendant to agree to this motion. Although Plaintiff has still not received the pre-trial order inserts nor been advised of when same would be received, counsel for Defendant has agreed to this extension as to Plaintiff only.

Plaintiff is unable to determine which motions in limine may be necessary without Defendant’s pretrial order inserts which will contain proposed exhibits, witnesses, issues, etc. Plaintiff requests an extension of time to file motions in limine in this matter and asks that he be given five (5) business days to file motions in limine after receipt of Defendant’s pre-trial order inserts. Defendant agrees to this request.

The docket shows exactly what Trust-me-Ben was working on.

Trust me.  Some people deserve more than just sanctions.

UPDATE

Rick Trahant’s comment sent me searching for files with Orders other than the ones I checked when writing the post to make certain we didn’t have a “local custom” that allowed a Magistrate Judge to decide motions in limine – but I changed the post title before searching and it now indicates “the Court” is on the hot set with State Farm’s nine motions in limine.  Thanks, Rick!

The truth is that we simply have not had that many cases go to trial – particularly since I joined Sop on Slabbed.

We’ve come close with Gagne, Payment and McIntosh but close only counts in horseshoes.  Nonetheless, my search was productive.

The Court considered many of the same motions in limine in preparation for a trial on the claim of Dr. Payment and Judge Senter issued a related Order in December 2008, for example:

Plaintiff intends to offer evidence concerning other properties in close proximity to his which were also insured by State Farm and where wind damage was allegedly sustained. State Farm seeks [102] to exclude this evidence. This Court has not allowed the introduction of evidence of claims adjusted by different insurance companies. On the other hand, State Farm’s own adjusting practices, policies, and procedures are fair game for cross examination. While the wholesale introduction of evidence of this type will not be allowed, Plaintiff will not be prohibited from developing fact-specific proof of State Farm’s own claims adjusting in any case where the property(ies) is/are in reasonably close proximity to Plaintiff’s and was/were exposed to similar storm conditions. Thus, State Farm’s motion will be denied.

State Farm’s [103] [111] motions are mixed bags. On the one hand, State Farm is correct that testimony concerning the interpretation of policy provisions and Mississippi law is not appropriate. Both subjects are issues of law within the province of the Court, not the jury. On the other, State Farm may not prevent Plaintiff from introducing evidence in the first phase of the trial concerning the manner in which the claim was handled (keeping in mind that the Court will instruct the jury on the applicable law, whether that relates to the policy provisions or the procedure adopted by State Farm in applying them (and what was done and not done in seeking guidance in that process).

As the Court has pointed out on numerous occasions (including its [97] order in the instant case), it is difficult to envision a breach of an insurance contract lawsuit without consideration of the policy provisions or the procedure utilized in handling the claim. This would be the case even if punitive or extra-contractual damages were not sought. Specifically, the wind / water protocol adopted by State Farm is also admissible, as it is just another part of the claim adjustment process in assessing Plaintiff’s entitlement to benefits under his insurance policy. This same conclusion applies to State Farm’s [111] motion for a phased trial. The Court outlined the procedure to be used in its [97] Order, which will not be repeated here. Of course, Plaintiff will be allowed to address the prospect of punitive damages in voir dire.

Judge Senter granted State Farm’s motion re: Motion to Preclude Plaintiff from Introducing Testimony that Waiver or Estoppel Create or Modify Coverage.  However, the matter at issue was not one I would expect Bossier to pose; so, precedent here may not be a factor.

Several of the State Farm motions Judge Senter granted may be subject to reconsideration due to events that have taken place and/or evidence that has become available and/or presented in a context that changed since he considered the matters in December 2008.  I’m thinking particularly about these State Farm motions: (1) Exclude Evidence, Testimony, or Argument Relating to Mississippi Department of Insurance Bulletins and Related Correspondence and (2) the MID Market Conduct Exam.  In both cases, allowing the information related to the handling of claims like that of Bossier would seem appropriate considering Judge Senter’s reasoning in allowing the Wind/Water Protocol.

One decision should stand, in my opinion, State Farm’s motion to exclude evidence of grand jury and government investigations.

Conversely, one I hope he will reconsider is State Farm’s motion to exclude Dissimilar out-of-state contact as it is my opinion State Farm’s definition of “dissimilar” would prove to be overly broad.  I particularly think the Company’s handling of Katrina claims in Louisiana is relevant and I know for certain evidence presented in cases there is relevant to the handling of Mississippi claims.

Most of all, I hope Judge Senter takes the opportunity to address the conduct of State Farm’s counsel and  hold State Farm accountable for causing and/or allowing the needless delays and increased cost of litigation Bossier has experienced as a result.  I’m still stunned by the week-long absence of the individual responsible for complying with the Court’s September 3 Order.

Finally, as Plaintiff Robert Gagne said so well (restated in Judge Senter’s order dated 11/16/06):

The collusion between the state regulatory scheme, the state regulators and State
Farm not only in allowing, but encouraging State Farm’s tactic of bankrupting the
homeowners of Mississippi so that they can not ever effectively assert their fundamental property claims (without expending exorbitant amounts of money prior to their day in court) in a timely or fair way amounts to a fundamental deprivation of due process of law…

We got rolled by Katrina but State Farm miscalculated when they decided to try and roll us again.