Nowdy’s instincts were right about there being a story behind the story in the case of the settlement of Shows v State Farm, which we broke here last Friday. In this case the more is that 225 individual claims were also settled albeit 42 months after the fact. Anita Lee filed the report for the Sun Herald:
Former policyholder clients of disgraced attorney Dickie Scruggs have settled their lawsuits against State Farm, including racketeering allegations that the insurance company conspired with vendors to shortchange customers.
Policyholder law firm Provost Umphrey indicated more than 225 cases — 90 percent of those the firm had against State Farm in Mississippi — have been settled, including the racketeering lawsuit with 38 plaintiffs. Terms of the settlements are confidential.
“A combination of factors came together to allow the successful resolution of these claims including, the compensation amount, the exhaustion of the clients with the legal pursuit of their claims, unfavorable legal rulings over the last year and half and a fresh perspective afforded by new counsel,” a typed statement from Provost Umphrey said.
“A settlement always represents compromise on the part of both parties and while that is true here, both State Farm and the individual claimants were mutually desirous of bringing the litigation to a close and putting this matter behind them.”
State Farm spokesman Jeff McCollum said, “State Farm always tries to resolve any disputes with our policyholders and is pleased we were able to do so here.
Scruggs filed the racketeering lawsuit with much fanfare in June 2007, calling a news conference at lead plaintiff Glenda Shows’ destroyed home on the Pascagoula waterfront. Scruggs’ team of attorneys said the lawsuit would show State Farm and its bank had engaged in a criminal enterprise with vendors to deprive policyholders of money they were owed for wind damage.
By December, Scruggs was under indictment for bribing a judge in North Mississippi. Most of his Katrina cases were transferred to the Provost Umphrey in Texas, recommended by the disbanded Scruggs Katrina Group.
The Shows case lay dormant for months before the settlement. The multiple plaintiffs asked last week that the racketeering claims be dropped.
“State Farm does not engage in the sort of activity alleged in this litigation,” McCollum said.
Thanks for the affirmation, Sop. I hope you and others will join me ROFLMAO over McCollum’s last statement – of course, they don’t. That’s why all these settlements are confidential!
Confidential settlements do not always mean the insurance company paid lots of money. Sometimes it’s just the opposite. I don’t know which it is in this case, but I sure would like to.
I wonder if the industry is trying to “mop up” the Katrina operations due to a change in political climate in Washington? If people finally get paid than that is good. If they get their checks the day Obama is sworn in that it is telling…
As for mopping up, I think it has to do more with all the case documents confirming the claims in the Rigsby’s qui tam. However, I think the plaintiffs are “mopping up” some pretty big settlements – on contingency basis, right?
The people I know who litigated were generally happy when the insurer finally paid up. Of course that group represents a fraction of the total; most people took a pittance through George Dale and Mike Chaney’s “mediation” program or Woullard lite.
sop