We’re back at the fork of the road and continuing with the second part of Forked! “Bifurcation for Dummies”… Our first source document is the 53 pages of correspondence between State Farm’s Butler-Snow attorneys Bob Galloway and Jeffrey Walker and August Matteis attorney for the Rigsby sisters, exhibits from State Farm’s 420-page Motion to Compel.

In the first of this two-part post, we learned State Farm translates “bifurcation” as we go our way and you go both ways” and Matteis takes Judge Senter as a man of his word.   In the remaining two letters, Jeffery Walker fills in for Galloway.  Although no small feat considering the size of Galloway’s e-pistol, Wright condenses Galloway’s points into four pages and fattens the straw man. Clearly, State Farm refuses to bifurcate Scruggs while Matteis presses on with his insistence the first trial is all about the McIntosh claim.

Matteis is so consistent with his fidelity to the Court’s direction that we will also take a look at the Relators’ Expedited Motion to Compel Haag Engineering Co. to Produce Documents and Answer Interrogatories Prior to the Depositions of Tim Marshall and Paul O’Connor and the role roles played by Haag’s counsel, Larry Canada – but first, Continue reading “Forked!”

An outside look at the False Claims Act cases: Holding State Farm Accountable (Why McIntosh is Evidence of Fraud)

Occasional slabbed commenter James Barbieri was kind enough to share his May 2009 law school thesis which thoroughly analyzes the 2 False Claims Act cases against Team Insurance Inc and concludes, as this post title indicates, that the McIntosh adjustment is evidence of fraud against the US Government. For anyone interested in this topic it is an excellent read. Given the recent GAO report on continued financial management problems in the National Flood Insurance Program that Nowdy recently profiled and its implications for the previously completed MID State Fram Market Conduct Study and the Department of Homeland Security OIG’s report I was immediately attracted to this passage which shows that people do get it:

……..OIG and the Mississippi Insurance Department (“MID”) have already conducted sufficient post-Katrina claims analysis to warrant reopening all Katrina files.

OIG published results of an audit of 131 combined wind and flood claims. In the Executive Summary, OIG “concluded that the NFIP did not pay for wind damage for structures included in our sample.” But on page six of the same report, OIG provides evidence of NFIP paying for wind damage:

“Based on the review of files in our sample, we did not find material evidence that the NFIP paid for wind damage. Although 44 out of 131 cases (34%) included errors that related to cause of damage resulting in some degree of duplication, e.g. flood and homeowners policies paying for the same type of damage…, only two (1.5%) of these cases clearly identified wind as the preponderant cause of damage, thus resulting in an improper payment by NFIP in the amount of $432,600.”

It is contradictory for OIG to conclude: “we did not find material evidence that the NFIP paid for wind damage” and then reveal “an improper payment by NFIP in the amount of $432,600” in a sample of 131 cases. Extrapolation to the total population of 209,404 Katrina flood claims (on which the Federal Government paid $15,850,563,024) would yield in excess of $600 million in improper NFIP overcharges. Continue reading “An outside look at the False Claims Act cases: Holding State Farm Accountable (Why McIntosh is Evidence of Fraud)”