Like a Good Neighbor?

In my post that revealed the date the Missouri Qui Tam duo law firms actually met with the Rigsby sisters I noted that Bartimus, Frickleton, Robertson & Gorny had tangled with State Farm before per page 3 of their Response to State Farm’s Motion to Disqualify. Following is an excerpt from the response that mentions the case:

Perhaps State Farm is still smarting from the multi-million dollar punitive damages verdict BFRG obtained against State Farm for malicious prosecution in Missouri courts, recently affirmed on appeal and final. See, Hampton v. State Farm Mut. Ins. Co., — S.W.3d —-, 2008 WL 65107 (Mo.Ct.App. 2007)

Being an inquisitive soul and knowing we’d never hear about a case like this from the blogging insurance defense bar at Insurance Coverage Blog or Folo, I entered the search string in google and up popped the case. As I read the facts I was reminded of a comment left by Bellesouth today on our recent Todd Graves thread:

Why do people defend them knowing that they are all geared up for malicious conduct? What makes people assume that State Farm is pure as the driven snow and the Rigsbys are out to get something for it.

That is a great question. A company like State Farm is the sum of it’s parts. My State Farm agents are a fantastic gentleman. Just as all of us are a mix of good and bad so is a business like State Farm, just on a larger scale. That said Judge Lackey must not have seen Hampton when he was labeling Dickie Scruggs a monster or he’d be more careful of how he used the term to describe people. Belle, you wonder how anyone could question the motivations of the Rigsby sisters in good conscience after they read the story of Jennie Hampton. (Point of disclosure my commentary is mixed with that of the court decision.)

Jennie Hampton’s life changed forever on December 22, 1997 when her Toyota Forerunner was stolen. She was fully insured by the Good Neighbor. She reported the theft to the authorities and filed a claim with State Farm. On December 26, 2007 the police found her burnt out car in a rural field. Though she didn’t realize it then, her Good Neighbor nightmare was just beginning.

On December 29, 2007 State Farm recovered the vehicle. The next day State Farm’s hired expert Carter Enterprises concluded the engine in the forerunner was inoperable before the fire. He reached his conclusion in the space of a day without dismantling the engine.

Despite the fact State Farm had statements that Hampton had driven the vehicle the night before it was stolen, State Farm, relying on their hired expert Carter Enterprises, concluded that Ms Hampton had provided false information to them by saying that the engine was in “excellent” condition when in fact Carter concluded the 4Runner had engine failure. The theory was that Hampton, along with the help of her boyfriend’s brother, Marvin Vail, had towed the car to Miami County and burned it to collect the insurance. Her claim was denied and Jennie Hampton sued State Farm.

While the civil suit was ongoing in August 1999, State Farm investigator Chris Pool contacted the National Insurance Crime Bureau (NICB). Paul Yonally, the local NICB agent, testified that Pool, the State Farm investigator handling Hampton’s claim, told him that they had a case he might be interested in. On September 2, 1999, Pool sent the file to Yonally and requested that he refer the case to the Johnson County District Attorney for charging. Of course Pool withheld exculpatory evidence from Yonally including a police report from the Miami County police report that made no mention of dual tire marks in the area where the 4Runner was found. Dual tire tracks would have been present if it had been towed to the scene of the fire by Vail, as State Farm’s theory of the case required. State Farm chose their NCIB investigator carefully too, they knew by going through Yonally, a former Kansas Bureau of Investigation employee, that the Johnson County District Attorney was more likely to file charges, as the prosecutor himself later admitted.

It was at this point that a legal dispute over a $10,300 claim became very ugly. On December 21, 1999, the day before the statute of limitations was to run on any criminal charges, Yonally met with Richard Guinn, the Johnson County Assistant District Attorney. On that same day, Guinn filed charges against Hampton, Vail, and Michael Storm, Hampton’s boyfriend. Hampton was charged with insurance fraud for listing the engine in “excellent” condition, and all three were charged with conspiracy to commit insurance fraud. Hampton and Vail went to trial in May 2001, and the jury found both not guilty. After all there was no evidence to support State Farm’s fanciful theory that Ms Hampton had torched her own vehicle.

Of course, Ms Hampton’s civil suit was stayed this entire time while the criminal prosecution wound it’s way through the system. Justice was now delayed by three and a half years plus Ms Hampton and her associates had to endure the unimaginable financial and emotional stress of standing trial for a crime they obviously did not commit. Equally unimaginable is the depths of malicious behavior State Farm engaged in to avoid paying a $10,300 claim.

I was reminded of the McIntosh case when I read this from the appeals court decision:

One of the most significant issues in this case is the evidence presented by the Plaintiffs regarding the possible falsification of the reports by Carter regarding the status of the engine. Not only did State Farm have statements that Hampton had been driving the 4Runner the evening before the theft, which would have been impossible if, as Carter reported, it was in total engine failure, but also that the circumstances surrounding Carter’s report were suspicious…

This case has all the hellish elements of our own Katrina cases rolled into one: Lawyers bullying and issuing threats to witnesses and their lawyers alike, withholding evidence, misrepresenting evidence and encouraging the falsification of the work product of outside experts to name a few. Is our own slab litigation and the claims of fraud by Cori and Kerri Risgby indeed anecdotal per insurance industry attorney David Rossmiller or am I detecting a pattern of egregious behavior? Again the appeals court sums up State Farm’s behavior best and why the award of $4,000,000 in punitive damages for malicious prosecution would stand.

The Plaintiffs presented substantial evidence that would allow the jury to find that State Farm acted maliciously. Examples of this evidence include that State Farm did not provide NICB and, therefore, the prosecutor with its complete files. This included omitting the evidence regarding glass fragments with blood on them found in the car, which would tend to show someone had broken into the vehicle as opposed to the Plaintiffs being involved. The file also did not include the Miami County police report that made no mention of dual tire marks in the area where the 4Runner was found. Dual tire tracks would have been present if it had been towed to the scene of the fire by Vail, as State Farm’s theory of the case required.

Other examples include the alleged encouragement of the falsification of Carter’s report of the engine. There were also accusations that State Farm’s attorney told Hampton’s uncle, who was serving as her attorney at the time, that she needed to be careful about pursuing her insurance claim because criminal charges could still be brought. Hampton’s uncle also testified that one of State Farm’s attorneys told him that there were plaster casts of tire tracks found near the burned 4Runner that matched Vail’s tow truck. However, no such plaster casts exist.

Finally, there was also evidence presented that Pool considered contacting one witness’s diversion officer after the witness had changed his testimony in such a way that would not have been useful to State Farm. Although there was no evidence that Pool or anyone else ever spoke to the diversion officer, there was evidence presented that one of State Farm’s attorneys may have threatened the witness with perjury.

This, along with other evidence presented by the Plaintiffs, provided substantial evidence to support the determination that State Farm acted maliciously.

If State Farm is willing to have someone locked up on trumped up insurance fraud charges over a simple $10,300 auto claim one can only imagine what they’d be tempted to try with 6 figure slab claims. With due respect to our new friend Alan Lange at Yall Politics we may not see eye to eye on all the home grown villains but this case hits far too close to home for State Farm and their subsequent treatment of slab claims. It also makes the charges of dishonesty, bad faith and worse levied against State Farm by the Rigsby sisters all the more believable.

In the end the $4MM plus paid out in Hampton was chump change to State Farm. I fear this pattern of behavior of delay, deceive and deny will continue, especially since we handcuffed our own civil remedies via tort reform. For every Jennie Hampton that stands and fights there are 99 others who take the abuse and suffer in silence. Finally were Chris Pool or Carter ever brought to justice for their actions? I don’t know the answer to that question but I suspect it would be no.

We’ve been getting a fair amount of visits from Missouri these days. This case litigated to the bitter end and unlike most where an insurer acts badly and then buys off the plaintiffs with large confidential settlements, Jennie Hampton can speak freely about her experiences with the “Good Neighbor”. We’d love to hear her opinion of the Rigsby sisters and her experiences with State Farm. Perhaps we’ll be able to track her down.

sop