This little piggy went to market mediation,
This little piggy stayed at home,
This little piggy had roast beef got taken
This little piggy had none.
And this little piggy went “Wee wee wee” all the way home.
Evidence was produced showing State Farm staged the mediations in advance and actively concealed material evidence from homeowners during the “mediation” process.
Q. Do you recall being involved…in putting on mock mediation?
A. We did put on mock mediation, that is correct.
Q. Do you remember you doing anything related to that?
Q. What part did you play?
A. …Oh, okay. Yes. When we started mediation, they — they asked that — I guess because I had done mediation in Florida, they asked that Cori and I role play mediation for the entire mediation team. Continue reading this little piggy went to mediation…and this little piggy
You see, State Farm has a bank. A thrift to be exact. And it likes to offer loans, and other banking products to its insurance customers. But the people that they do this through are not employees of State Farm. They are the various independent agents (as State Farm likes to call them) that run State Farm offices.
Russell introduced State Farm’s Bank so well in A different State Farm Battle (January 2008) that it seemed appropriate to give it another run. It should come as no surprise that State Farm’s website has a more formal introduction (another h/t to Steve):
State Farm Bank, F.S.B. received formal approval for a thrift charter from the Office of Thrift Supervision (OTS) in November 1998 and is generally referred to as “State Farm Bank®”. Its focus is on consumer-oriented financial products, complementing State Farm’s insurance focus on personal lines.
State Farm Bank is a nontraditional financial institution and does not have branch offices. The bulk of direct customer interaction and product assistance is provided by State Farm® agents, augmented by a telephone call center, mail and the Internet. As of December 31, 2005, the Bank held $12 billion in total assets.
Documents filed in Katrina litigation introduce State Farm’s Bank in a different light – suggesting just how nontraditional it may have been following the storm. In fact, the amended RICO complaint added the State Farm Bank as a Defendant:
… State Farm Bank is wholly-owned by State Farm Mutual, and is headquartered in Bloomington, Illinois. As of March 21, 2003, State Farm Bank had assets totaling in excess of 5,000,000,000 (five billion) U.S. dollars.
State Farm Bank aided and abetted a civil conspiracy by providing substantial assistance in carrying out the civil conspiracy. State Farm Bank aided and abetted a civil conspiracy by committing one or more tortious acts in concert with State Farm, or pursuant to a common design, engaged in same with State Farm.
State Farm Bank knew that State Farm’s conduct in the civil conspiracy was a breach of duty to the Plaintiffs as insured policyholders, and yet the Defendants and each of them gave substantial assistance or encouragement to the scheme. State Farm Bank’s aiding and abetting a civil conspiracy to conduct corrupt property inspections and procure contrived inspection reports was a direct and proximate cause of damages sustained by Plaintiffs.
…these competing interests–the right to full and free access to the courts and the right to be free of groundless and vexatious litigation–are important considerations in the evenhanded process our judicial system provides for the resolution of legitimate disputes …it is my sincere hope that the type of normal, professional, and focused advocacy necessary to resolve the individual merits of the cases still outstanding will presently come to the fore.
Judge L.T. Senter, Abney v State Farm June 4, 2008
It is time and past time for the internecine and acrimonious warfare among the attorneys to stop and for the focus to shift to the task of resolving the many remaining cases on their merits. Anything short of this will not be tolerated.
Judge Senter’s commitment to focus on the individual merits of the cases is as reassuring, and I believe as heartfelt, as his wonderfully warm smile. Consequently, it grieves me greatly to say his north Mississippi roots are showing when he segregates the role of State Farm Mutual from the “merits of the case”.
State Farm Mutual is to State Farm Fire what SKG was to the attorneys working for the member law firms – two parts of the same whole, according to his Order in McIntosh v State Farm disqualifying all attorneys of the member firms; but, contrary to his opinions and orders when plaintiffs attempt to hold State Farm Mutual accountable for the conduct of one of the claims handling process.
Tim Marshall, storm chaser…drove from his home in the Dallas area to a Slidell parking garage in an extended cab Chevy pickup, loaded down with supplies and technology, to track Hurricane Katrina…
The Sun Herald’s Anita Lee described Marshall, a shareholder in Haag Engineering, as appearing every inch the mild-mannered engineer in his business suit and oversized wire-rimmed glasses on the witness stand. But get him out of a courtroom and it’s like Superman stepping from the phone booth.
Oklahoma attorney Jeff Marr, on the other hand, told Lee, The jury hated him…They viewed him as a professional witness… gave him the consideration his expert opinion deserved and wrote him off.
Following Hurricane Katrina, Haag’s Superman, the professional witness, became a survey-thumping Reverend Leroy holding forth in the Church of What’s Happening Now -Mississippi’s Southern District Federal Court.
Abundant evidence exists to document the role Haag played in State Farm’s claims handling. The date of the Survey’s publication, on the other hand, only documents the date a published report was available; but, Haag’s post-hearing brief attempts to play word games with the Court:
The evidence [sic] has shown that the Haag Survey did not exist at the time the McIntosh flood claim was adjusted and submitted to the government.
Evidentiary disclosure is Michael Oher protecting the Rigsby qui tam.
Nonetheless, State Farm, Forensics, and Haag each recently took a shot – a strategic play intended to force Judge Senter to reveal his game plan.
On its face, Judge Senter’s focus on the McIntosh claim seems too narrow. In the context of evidentiary disclosure in qui tam litigation, however, it takes on a different look – one that makes evidence such as the McIntosh claim secondary to the scheme of the fraud. A Fifth Circuit decision explains:
We hold that to plead with particularity the circumstances constituting fraud for a False Claims Act § 3729(a)(1) claim, a relator’s complaint, if it cannot allege the details of an actually submitted false claim, may nevertheless survive by alleging particular details of a scheme to submit false claims paired with reliable indicia that lead to a strong inference that claims were actually submitted.
When Hurricane Katrina made landfall on the 29th of August, 2005, construction was almost complete on the new home of Lori and Ambrose McMurphy insured by State Farm. The$1.3 million dollar three-story home and $650,000 in contents were lost to the storm and the property later lost to forclosure.
Their story is an all too familiar story of loss incurred from State Farm’s claim handling of property loss from the story – Katrina’s double whammy.
keep in mind the purpose of this hearing. We’re dealing here with summary motions, we’re dealing here with is there a genuine issue of material fact that will justify this case going forward to a full-blown trial. Would y’all like to brief that for me in writing rather than come back this afternoon and argue? What about it, Plaintiff?
Regardless of the ultimate outcome of this Action at the trial court level, there likely will be an appeal by one or more Parties and “[u]nder this Circuit’s general rule, arguments not raised before the district court are waived and will not be considered on appeal unless the party can demonstrate ‘extraordinary circumstances.’”
Further, as a general proposition, the Fifth Circuit “is barred from considering filings outside the record on appeal….” Accordingly, it is especially important to all Parties’ respective ability to prosecute a potential appeal to have all post-hearing summary judgment briefs in the record.
A federal judge ruled Monday that whistleblowers Cori and Kerri Rigsby can testify in the lawsuit the sisters brought against State Farm alleging the insurer defrauded the government through claims filed after Hurricane Katrina.
U.S. District Judge L.T. Senter Jr. also asked State Farm Monday to turn over details of certain claims that the company filed through the National Flood Insurance Program. The Rigsbys’ suit alleged the company defrauded the federal government by wrongfully denying homeowner’s insurance claims and shifting the burden for the storm’s damage to the taxpayer-funded NFIP.
A previous order in a different case had prohibited the two from testifying in civil suits against State Farm, but the Risgbys had asked Senter whether that would apply to the current proceedings. Senter said the matter at hand was substantially different than previous actions. He said the two, who worked as insurance adjusters for E.A. Renfroe, a company State Farm used after Katrina, “have relevant knowledge” and should be permitted to testify in all further proceedings. Continue reading The Sun Herald picks up the coverage of Judge Senter’s decision in Ex Rel Rigsby
During the claims adjustment process, and prior to filing suit on August 20, 2008, Plaintiff provided State Farm with an affidavit of his nearby neighbor, Mr. Ziz, who witnessed the total destruction of the outbuilding and fence prior to the arrival of water.
Joseph Ziz signed his affidavit January 08, 2008, and State Farm continued to deny the Bossier’s claim over the next eight months until the Bossiers finally filed suit just a few days before the SOL on the third anniversary of Hurricane Katrina.
Counsel also attached the May 11, 2009, recorded statement State Farm took of Mr. Ziz confirming his eye witness account (Exhibit 3); and Mr. Ziz’s sworn deposition testimony given July 9,2009, that confirms without contradiction his eyewitness account of the destruction of the outbuilding and fence prior to the arrival of water(Exhibit 4).
Thanks to a comment on the Order from eagle eye Shirley Heflin, legal secretary for Chip Merlin for 20 years before she became a full-time student, I caught an important connection that I’d missed earlier.
And my personal favorite part of this is: “The privilege claimed for all the documents reviewed by the Court is “anticipation of litigation.” … Documents prepared in the ordinary course of business are not protected as prepared in anticipation of litigation…”
If it were allowed, it would mean that State Farm was “investigating” a claim with an eye toward litigation for who knows how long? From the inception of the claim?…No, that’s not the way its supposed to be.
I pulled Walker’s Order and checked dates in a footnote to her “favorite part”.
1The emails are dated between March 6, 2008 and June 19, 2008
Renfroe’s suggestion of mootness by virtue of Scruggs’ satisfaction of the June 5, 2008, contempt judgment is unavailing… The satisfaction of a joint and several liability does not moot the appeal of the debtor satisfying the judgment. See United States v. Balint, 201 F.3d 928 (7th Cir. 2000) (citing Corley v. Rosewood Care Center, Inc., 142 F.3d 1041, 1058 (7th Cir. 1998)) (“Payment of the sanction does not moot the appeal because the appellate court can fashion effective relief to the appellant by ordering that the sum paid in satisfaction of the sanction be returned”)…
That interesting piece of information comes from a footnote in the 11th Circuit ruling vacating Judge Acker’s Order.
The 11th U.S. Circuit Court of Appeals has overturned a federal judge who cited then-attorney Dickie Scruggs for contempt of court…Acker held both Scruggs and the adjusters, sisters Cori and Kerri Rigsby, in contempt of court when the records were not returned to the Rigsbys employer, independent adjusting firm E.A. Renfroe. Acker levied a $65,000 fine to compensate Renfroe’s attorney’s fees in pursuing the records.
Scruggs paid the fine into a holding account and appealed Acker’s decision.
Renfroe, which supplied adjusters to State Farm after Katrina, had sued the Rigsbys in the company’s home state of Alabama for breach of contract. The appellate court held that Scruggs was not a party to the Renfroe vs. Rigsby lawsuit and, therefore, could not be held in contempt. The appellate judges also removed Acker from any further proceedings in the case.
The 11th Circuit ruling has Acker eating his own words: