exZachly what’s going in Oxford?

Oxford Eagle reporter Alyssa Schnugg has the lastest story of Zach Scruggs confinement in the Lafayette County jail, complete with comments from Scruggs’ attorney Cal Mayo.  (h/t for illustration Kiss My Big Blue Butt )
Several Oxford residents contacted The EAGLE saying they had seen Zach Scruggs “out and about” on the Square during lunch on Tuesday

On the day he was being transferred from Forrest City to the Community Corrections re-entry facility in Tupelo, Zach Scruggs was spotted around Oxford.

At the time, the Bureau of Prisons said it was “unlikely” Scruggs was spotted in Oxford because he was to report directly to the facility in Tupelo.

The Bureau of Prisons had allowed Scruggs to get a ride to the Tupelo facility instead of being escorted there by prison officials. He apparently stopped at the Square to have lunch with his family, which, according to his attorney, Cal Mayo, was consistent with, and not in violation of, his furlough. Continue reading “exZachly what’s going in Oxford?”

Katrina insurance litigation – selected Nationwide and State Farm cases

Early in the month I began a somewhat regular “sweep” of Katrina insurance cases in the federal court with new docket entries.    In a single day recently, docket entries were made on approximately 75 different cases.  It would be impossible to estimate exactly how many different cases had one or more docket entry during the month of February; but, I’m willing to guess hundreds.

Obviously, someone has to read every one of those new documents.  I’m not the one.  In this short and busy month, it has been difficult at times  to “sweep” my kitchen, much less the case files – so much so, in fact, this could be called a “lick and a promise” post about cases that caught my eye.

Nationwide, you may recall, is the carrier that prompted Judge Senter’s memorable “illusionary coverage” remark.  At this point, it appears the “illusion” morphed into a  “delusion” with Nationwide thinking he would eventually see things their way.  While he has been “on their side” at times, I’ve seen Judge Senter issue an order in several Nationwide cases that I don’t recall seeing elsewhere.  Consequently, I’ve also seen another first, Notice of Private Mediation:

Pursuant to the Court’s January 12, 2009 Order for Mediation, counsel for Defendants Nationwide Mutual Fire Insurance Company, Ntionwide Mutual Insurance Company, and Nationwide Property and Casualty Insurance Company, on behalf of both parties, hereby advises the Court that the parties will hold a private mediation on or before March 19, 2009, in lieu of participating in the Court-supervised mediation program.

Since I don’t want to commit the logical fallacy of suggesting correlation proves causation, I will simply point out I noted a number of Nationwide cases were settled this week.

However, other Nationwide cases I pulled do not appear to be moving in that direction.  Politz v Nationwide , for example, is a dispute about the plaintiff’s private coverage with Nationwide – although you might think  otherwise.  Nationwide focused on NFIP and other disaster assistance the Politz received and did so in a way that its conduct appears contrary to the NFIP Litigation Philosophy: Continue reading “Katrina insurance litigation – selected Nationwide and State Farm cases”

Treading Water – claims handling in Texas following Hurricane Ike

While the National Insurance Law Forum waited a bit longer than most to ask Hurricane Ike Insurance Litigation: Will it be as bad as Katrina?,  the November 17, 2007 post also suggested the answer.

It didn’t take long for the first bad faith suits arising from Hurricane Ike to be filed in Texas. Last week, the first two Ike bad faith lawsuits that I am aware of were filed in Galveston and Ft. Bend Counties…These are first of several thousand Ike lawsuits expected to be filed across Southeast Texas over the next several years…

The big question being asked by carriers across the country is whether Hurricane Ike will generate the type and volume of litigation generated by Hurricane Katrina. In the three years since Hurricane Katrina, it has been estimated that between 27,000 and 30,000 hurricane insurance suits were filed in southern Louisiana alone. Of the 12,565 suits filed in federal court, only slightly more than half — 7,837 — cases, have gone to judgment or settled.

The seventh edition of the Hurricane Ike Insurance Newsbrief (January 26, 2009) quotes the Texas Department of Insurance reporting that in the three months after Hurricane Ike… over 730,000 insurance claims have been filed and the number continues to rise.

From the policyholder’s perspective, the numbers indicate a mixed blessing.  The longer it takes for a case to get to court the more likely it is that new case law will replace Leonard and other of the 5th Circuit’s poorly reasoned opinions on Katrina litigation.  Chip Merlin’s post on the 5th’s decision in Leonard, Fifth Circuit got it wrong,  points out where the Court’s reasoning failed.

In their rationale…the 5th Circuit provides a less than stellar (okay really absurd) example of non-coverage that virtually all insurance companies issuing an all-risk policy would heretofore pay. After finding that the anti-concurrent causation language was not ambiguous, Judge Edith Jones went too far and provided the following:

If, for example, a policyholder’s roof is blown off in a storm, and rain enters through the opening, the damage is covered. Only if storm-surge flooding – an excluded peril – then inundates the same area that the rain damaged is the ensuing loss excluded because the loss was caused concurrently or in sequence by the action of a covered and an excluded peril…

Where did that come from? Virtually every adjuster and claims manager I have ever deposed with that similar hypothetical situation in a Katrina loss has said coverage would be granted under the all-risk policy for the full amount of the loss…From a practical standpoint, where is there going to be any coverage if the flood policy has the typical exclusions regarding pre-existing loss or “roof leaks or wind-driven rain” as found in the National Flood Policy?

That seems to be one of the big questions in Texas following Ike, according to Thousands waiting for windstorm payments, the article from the Galveston County Daily. h/t Dimechimes. Continue reading “Treading Water – claims handling in Texas following Hurricane Ike”

ABA throws up recommendations for flood insurance reform

Rebecca Mowbray’s usual fine writing wasn’t enough to keep me from seeing Pepto Bismol pinks as I read American Bar Association recommends flood insurance reform after picking up the link posted with this suggestion on a finance message board:

This Tulane Law professor needs to teach a course in securities fraud, or better yet take one, maybe at the Reinsurance University of Bermuda!

However,  this “Tulane Law professor” turns out to be the former Dean of the Law School, not just a professor – a fact that does nothing to improve the recommendations but better explains the how they came about.

Edward Sherman served as Dean of Tulane Law School from July 1996 through June 2001…Professor Sherman is an expert on civil procedure, complex litigation, and dispute resolution and is co-author of widely-used casebooks and treatises on those subjects… He has been…active as an arbitrator and mediator.

Before I say more, take a look at Mowbray’s story (emphasis added).

The American Bar Association recommends that insurers offer customers the option of buying insurance policies that cover flooding from storm surge to help cut down on legal disputes after events like Hurricane Katrina.

The suggestion is part of a set of recommendations issued by the ABA’s tort, trial and insurance practice section after a year and a half of study.

“The insurance industry needs to get creative in offering all kinds of policies, rather than just saying, ‘No, we don’t cover it,'” said Ed Sherman, a professor at Tulane Law School who served on the task force and helped draft the proposals.

The majority of the 25-person task force represented an insurance company perspective.

As such, the report includes a number of proposals that companies have advocated, such as seeking a greater federal role in insurance regulation and giving insurers incentives to build catastrophe reserves over multiple years. Continue reading “ABA throws up recommendations for flood insurance reform”

Adjusting the adjuster defendants in Katrina qui tam litigation…

While the 5th Circuit reinstated the Branch Consultant’s qui tam claim reasoning Rigsby was no longer the “first to file” after dismissing a defendant named in both suits, I see a clearer distinction in the two cases based on the composition of the group of named defendants in each.

The Rigsby sisters, for example, cite only their employing adjuster, E.A. Renfroe; but, include a group of engineering firms associated in the claims handling process:

Defendant Structures Group, Rimkus Consulting Group, Inc, Haag Engineering Company, Jade Engineering, Exponent Failure Analysis, Forensic Analysis Engineering Corporation are all collectively referred to herein as “Engineering Defendants.”

Earlier this year, Judge Senter granted the Relators’ motions…to dismiss this action as to Rimkus Consulting Group, Inc.; Jade Engineering; Exponent, Inc.; and Structures Group – leaving only Haag and Forensic as named “Engineering Defendants” as the case moves forward.

The qui tam claim filed by the Branch Consultants, on the other hand, names no “engineering defendants” but has a named group of “adjuster defendants”:

Defendant Pilot Catastrophe Services, Inc…Defendant Crawford & Company…Defendant NCA Group, Inc…Defendant Simsol Insurance Services, Inc…Defendant Allied Claims, Inc…Together, these are the adjuster defendants.

Colonial Claims Corp., the sixth of the named defendants was cited by the 5th in the footnote listing of Appellees; as was Allied Claims, an adjuster defendant dismissed by Branch in October 2007 [a]fter due diligence investigation and discussions with Allied.

What little I know about the group of Plaintiff adjusters is a patchwork centered with this information from their qui tam claim.

Branch Consultants is an insurance and construction consulting firm that has been retained by numerous insureds to re-examine adjustments done by the WYO insurers’ in-house adjusters or other adjuster agencies employed by them following Hurricane Katrina. The principals and consultants of Branch Consultants include experienced adjuster and construction personnel with many decades of construction and construction-estimating experience.

One source added there are four unidentified adjusters known as the Branch Consultants; another referred to them as former adjusters; and a third indicated they were retired.  A group of Zorro-wannabe plaintiff adjusters might bear more scrutiny if I weren’t so interested in the  capacity of the remaining five “adjuster defendants”. Continue reading “Adjusting the adjuster defendants in Katrina qui tam litigation…”

Big Mac is Back! Senter issues Order in Rigsby Qui Tam – holds the fries

I believe it is appropriate to conduct a hearing on the pending motions to allow the parties to present evidence concerning the question whether the payment of the flood insurance limits in the McIntosh case was justified, as a matter of law.

No one following Katrina insurance cases would have expected Judge Senter to issue a Burger King have-it-your-way order.

Took the case straight to the extra value meal of Big Mac; he surely did, but, you can’t blame him.  Who hasn’t wanted to take a  bite since the most peculiar settlement of any to date?

IMO, you really can’t fault him, either,  for hitting the drive-thru window instead of parking and going in – not when he clearly put a lot of work and thought into his Order.

My reading of the Amended Complaint and the documents submitted in connection with the pending motions leads me to the following conclusions:

1. The merits of this action depend on evidence that the defendants, acting in concert, systematically submitted false flood insurance claims to the United States, claims that were not valid under the terms of the Standard Flood Insurance Policy (SFIP) used in the National Flood Insurance Program (NFIP).

2. It is the amount of the flood insurance claims that the Relators allege to be false, i.e. the allegation is that the defendants acted in concert to submit flood insurance claims in an amount greater than the flood damage that actually occurred. Continue reading “Big Mac is Back! Senter issues Order in Rigsby Qui Tam – holds the fries”

Aye, Aye Admiral – Judge Bridges awards additional $500K in Lisanby v USAA

Short and sweet as, like Sop, I’m pressed for time this morning – but not so short that I can’t post what has been all too rare – good news from a court to the Plaintiff in a Katrina insurance case.

A couple awarded more than $900,000 last year in Jackson County’s first Hurricane Katrina insurance trial was granted $500,000 this month to compensate for legal costs and fees associated with the case, according to court documents.

At the final judgment hearing, special Judge Billy Bridges decided that Adm. James and Gladys Kemp Lisanby should receive an additional $302,920.44 for lawyers’ fees and $211,069.41 in litigation expenses.

That brought to about $1.42 million their total award from their insurance company, United States Automobile Association.

For readers interested in background information, Slabbed has a number of posts on the case as this site search indicates.  Now, for the rest of the story: Continue reading “Aye, Aye Admiral – Judge Bridges awards additional $500K in Lisanby v USAA”

Judge Walker picks up the drum and issues new marching order in Gagne v State Farm

Yesterday, Judge Walker issued an Order passing on Judge Senter’s marching order to Gagne as Judge Senter intended.  Walker indicated he would consider the need for a similar pass along to State Farm once he reviewed Gagne’s response.

…In the Order, the Court directed the undersigned to reconsider Plaintiff’s request for certain documents and information. The Court further suggested that an in camera review of documents might serve to resolve the issues surrounding the underlying…Motion to Compel and…Motion for Review.

To this end, the Court directs Plaintiff to identify which documents he would like for the undersigned to consider for in camera inspection. In so doing, Plaintiff should identify with as much specificity as possible those documents to which he feels he is entitled but which are being withheld by Defendant.

The Court will then consider which, if any, of these requested documents should be produced byDefendant for in camera inspection. Continue reading “Judge Walker picks up the drum and issues new marching order in Gagne v State Farm”

Hurricane damage claims score before start of today’s Bills v Patriots game

A windstorm playing in today’s game between the Buffalo Bills and New England Patriots provides data on wind damage at various speeds without any associated hurricane bias.

Winds gusting up to 75 mph tore a strip off the Bills’ practice fieldhouse and tilted both goal posts inside Ralph Wilson Stadium prior to Buffalo’s game against the New England Patriots on Sunday.

Though the blustery conditions aren’t expected to delay the start of the 1 p.m. game, work crews used ropes and a forklift to re-secure and re-center the goal posts, which shook heavily in the wind.

Very strong gusts occurred at about 8:30 a.m., when they tore a strip 2 feet wide and more than 50 feet long off the metal roof of the 12-story fieldhouse across the parking lot from the stadium. There was damage reported inside the facility, but no one was injured. Pregame events inside the fieldhouse were canceled.

The winds also tore off part of a goal post on the Bills’ outdoor practice field next to the fieldhouse…

(emphasis added)

Advocates for putting the Saffir-Simpson Scale to rest will, no doubt, find more reliable data from windstorm damage reports – mindful, of course, that scientifically speaking, windstorms are wind-only winter-weather events.

A recent article in the Houston Chronicle noted support by some scientists to replace the Saffir-Simpson Hurricane Scale with other more accurate measures of hurricane destructiveness. It is about time. Continue reading “Hurricane damage claims score before start of today’s Bills v Patriots game”