Double Vision – Rigsbys and State Farm each file Notices citing Branch as “Intervening Authority”

So much for my thinking the next item listed on the Rigsby qui tam docket would be one of the two remaining motions argued at the recent Status Hearing.  State Farm filed its first Notice of Intervening Authority before the ink was dry on Judge Vance’s order dismissing the Branch qui tam case; and, when Judge Vance filed an Amended Judgment, State Farm filed a second Notice. (Notices in scribd format follow)

The Rigsbys legal team obviously differed with State Farm’s take on case and Friday they, too, filed a Notice of Intervening Authority citing the Branch decision (Notice in scribd format follows):

[T]he Rigsbys believe that the latest Branch decision again supports their motion to reconsider the scope of the current litigation. The Branch court’s ruling recognized that “a relator need not be an original source of the actual false claims made by the defendants to the government,” as long as the relator is “an original source of a certain core of information, such as the basic modus operandi of the fraud.” Thus, this most recent opinion reinforces the Branch court’s prior ruling, which held that original-source knowledge would have “entitle[d] [the Branch relator] to discovery on all the alleged instances of fraud in the loss-shifting scheme, even those outside the examples in the First Amended Complaint.”

State Farm incorrectly contends that the Branch decision suggests that the “threshold issue in this litigation” is the McIntosh claim rather than State Farm’s scheme to defraud the government. Continue reading “Double Vision – Rigsbys and State Farm each file Notices citing Branch as “Intervening Authority””

Judge Vance issues a series of Orders – and Reasons “you should know but…” (a Branch qui tam update)

“The Court has issued a number of decisions in this matter, and knowledge of the relevant background will be presumed.”

Either Judge Vance has a dry wit or I’ve gone as slap-happy as the Three Stooges trying to clear my “drafts file” of posts.  Whatever.   Strike up the band provided SLABBED readers with “knowledge of  the relevant background” presumed – and, that said, we take a look at the series of  Orders recently added to the Branch qui tam docket:

Order and Reasons re: defendant American National Property And Casualty Company’s (“ANPAC’s”) motion to review the Magistrate Judge’s order granting in part realtor Branch Consultants, LLC’s (“Branch’s”) motion to compel discovery…[and]…ANPAC’s motion to review the Magistrate Judge’s order granting in part Branch’s motion for protective order.

The Court has issued a number of decisions in this matter, and knowledge of the relevant background will be presumed…

The question now before the Court is simply whether Branch may obtain discovery as to properties for which an ANPAC subsidiary, rather than ANPAC itself, wrote the insurance policy. Contrary to ANPAC’s assertions, this question is not jurisdictional.

ANPAC also objects to the Magistrate Judge’s order granting a protective order to Branch as to certain tax and payment records.

Perhaps ANPAC has a sense of humor, too, as IMO, both matters the Company brought before the Court fall into the “you’ve got to be kidding” category.  Nonetheless, Judge Vance patiently responded to both and explained: Continue reading “Judge Vance issues a series of Orders – and Reasons “you should know but…” (a Branch qui tam update)”

Branch Consultants file Rock(well) solid opposition to Protective Order – explain why Walker’s Order won’t protect State Farm’s a$$ in Rigsby qui tam

Defendants argue that the Court should adopt Judge Senter’s interpretation of Rockwell and require Branch to prevail at a trial limited to the 27 Exemplar Properties before allowing Branch to obtain discovery concerning other properties…No court has ever interpreted Rockwell to mean that a relator who alleges a long-running scheme has to have direct and independent knowledge of every individual instance of that scheme…

The Branch Opposition alone is 58-pages and there is much more to cover about Rockwell along with a little scienter, a lot about the NFIP, and a  ding-a-ling of an idea for a “bellwether trial”

By definition, a bellwether is an indicator of trends. The term originated from the practice of tying a bell around the neck of a wether (a castrated male sheep) to induce other sheep in a flock to follow the belled-wether…Courts utilize a bellwether approach when large numbers of plaintiffs are proceeding on the same theory or claim and there is no other feasible way for the courts to handle the enormous caseload.

Not only is there is a feasible way to handle the Branch qui tam case – the statistical sampling proposed by Branch that is the litigation standard for identifying fraud in federally funded insurance programs – there’s something slightly creepy about proposing a bifurcation procedure involving a wether to Magistrate Shushan.

Suggesting such a proposed bifurcation models Judge Senter’s decision in Rigsby is really over the top – so is Fidelity’s claim there was no scienter involved in the Company’s adjustment of the Exemplary Property at 2625 & 2627 General Pershing. Continue reading “Branch Consultants file Rock(well) solid opposition to Protective Order – explain why Walker’s Order won’t protect State Farm’s a$$ in Rigsby qui tam”

State Farm’s Protective Orders are Dispositive Motions in disguise – more games scheduled for the qui tam Olympics

Companies will soon learn that the best protection and defense against a potentially serious and morale lessening whistleblower suit is to have in place a corporate culture that emphasizes ethical conduct by all involved in the company.

In contrast to the opinion expressed in a lecture at the Brookings Institute, the dockets of Katrina litigation provide ample evidence that the corporate culture of State Farm is one that, instead, views a protective order as the Company’s best protection and defense.  At SLABBED we call the tactic gutting a case to settlement.  However, by any name,  the process begins with a protective order that consistently ends up disposing of so much evidence it effectively disposes of most plaintiffs’ Constitutional right to a jury trial and, in turn, either disposes of the case itself or forces settlement,.

SLABBED has published numerous posts documenting how the routine protective orders granted State Farm have repeatedly been used to shield damaging evidence of State Farm’s claims handling following Katrina. One such post quoted a plaintiff’s attorney who wrote:

It is black-letter law that a litigant who might be embarrassed, incriminated, or exposed to litigation through dissemination of materials is not, without more, entitled to the Court’s protection. Stated otherwise, those types of harm do not constitute “good cause” for entry of a protective order under the Rules…

State Farm has not right to an automatic protection from the public being granted access to evidence of its misconduct in the arena of responding to Hurricane Katrina claims in Mississippi.

Discovery in a qui tam case, more than any other, should be transparent for the Relators stand in the place of the USA which in turn represents the public interest.  We the people, therefore, have a concomitant right to know.  Nonetheless, as SLABBED recently reported in Qui Tam Olympics – the protection game: ex rel Rigsby v State Farm, State Farm filed for a Protective Order seeking to limit the Rigsbys’ discovery. Counsel for the Rigsbys has now filed the Relators’ Response in Opposition :

State Farm asserts that the contested discovery requests “do not pertain to the McIntosh flood claim and amount to mere speculation by the Rigsbys of the type that has been condemned by this Court.” State Farm’s Motion at 6. In fact, the Relators have tailored carefully their discovery requests based on this Court’s August 10, 2009 Order…and  this Court’s related rulings in individual policyholder cases. Accordingly, all of the discovery sought by the Relators seeks information that may lead to admissible evidence regarding whether the Defendants submitted a false claim with respect the McIntosh flood claim. Continue reading “State Farm’s Protective Orders are Dispositive Motions in disguise – more games scheduled for the qui tam Olympics”

New GAO report pulls juggling act from qui tam Olympics – puts Rigsby and Branch in the lead!

With this week’s GAO release of Financial Management: Improvements Needed in National Flood Insurance Program’s Financial Controls and Oversight, there is no longer a need for a juggling act to find the truth of claims made in earlier reports and the evidence policyholders present the courts – and, in the interest of judicial economy, the qui tam defendants should just kiss their arguments goodbye:

FEMA’s Bureau and Statistical Agent (BSA) serves as a liaison between the government and WYO insurance companies. GAO identified weaknesses at three levels of the NFIP transaction accountability and financial reporting process.

  • First, at the WYO level, our internal control testing of a statistical sample determined that almost 71 percent of WYO company claims loss files did not have the necessary documents to support the claims, or reports were filed late.
  • Second, incomplete BSA-level premium data files (lacking key information such as insureds’ names and addresses) prevented an assessment of the reliability of reported NFIP premium amounts. Further, BSA-level internal control activities were ineffective in verifying the accuracy of WYO-submitted data.
  • Lastly, FEMA’s financial reporting process uses summary data that is overly reliant on error-prone manual data entry.

Apparently, the Branch Defendants decided no one would notice the OIG only examined .0062% of total claims and decided they would try and pass off Hurricane Katrina: Wind versus Flood Issues (Exhibit A, Response to the Branch Proposed Discovery Plan) as a statistically reliable report and sell it to Judge Vance: Continue reading “New GAO report pulls juggling act from qui tam Olympics – puts Rigsby and Branch in the lead!”