Shall we dance? Magistrate Shushan invites Allstate and Pilot adjusting to the party – Order grants in-part Motion to Amend Complaint REVISED AND CORRECTED

Oops!  With an apology to Judge Vance and another to SLABBED readers, I have corrected my error and appropriately attributed the Order discussed in this post to Magistrate Shushan.

Magistrate Shushan’s autopsy-Order on the 2nd Amended Complaint filed by the Branch Consultants poses a new and entirely different challenge for reporting on an order issued in Branch –  turning a technical manual into a non-fiction novel.  In that context, Allstate is somewhat of a MacGuffin, “a plot element that catches the viewers’ attention…Commonly, though not always, the MacGuffin is the central focus of the film in the first act, and later declines in importance as the struggles and motivations of characters play out”.

Although Allstate is certain to be the “central focus” of public interest in the Order, it is important to note the Magistrate doesn’t know how this character will play out and her Order” is stayed until the District Judge resolves any appeal of the order”.   In that regard, a footnote in the Order is telling of the story at this point:

In support of it motion for leave to amend, Branch states:

To be clear, whether Allstate is entitled to immunity under the first-to-file provision of the False Claims Act is not at issue in this motion (for leave to amend), and Branch has not attempted to fully brief the issue here. Rather, what is at issue is merely whether Branch may amend its complaint to attempt to state a claim against Allstate.

The story of claims handling following Hurricane Katrina is more of a thriller than a typical mystery.  However, the Magistrate’s dénouement of the plot missed important clues and I momentarily digress from the discussion of Allstate’s role to examine her conclusion and related denial of the proposed incorporation of an inflated-revenue scheme.  Branch alleged a loss-shifting scheme in both the original and first amended complaint.

In her Order, Magistrate Shushan declared, “The loss-shifting and inflated-revenue motives create two entirely different schemes”.  I contend otherwise and suggest her decision indicates knowledge of the law can not overcome lack of experience with what “po’ folks” call “getting by” else she, too, would recognize the two are one in the same. 

On a much larger scale, the situation insurance companies faced after Katrina was similar.  Like those who can’t meet their obligations when faced with an unexpected cost, insurers employed strategies that delay payment of thousands of policyholder claims and made partial payment on thousands more in the guise of mediated settlements. However, they also engaged in a “broad scheme” to “get by” for reasons that have been well documented since Katrina such as investments that were worth less or worthless.  Continue reading “Shall we dance? Magistrate Shushan invites Allstate and Pilot adjusting to the party – Order grants in-part Motion to Amend Complaint REVISED AND CORRECTED”