More on State Farm and Katrina-Related Litigation
There has been a great deal of activity concerning lawsuits pending against State Farm Insurance Co. arising out of Katrina and related matters. The following are two of the more important events.
Company Sues State Farm Whistle Blowers
A company that contracts with State Farm Insurance has now sued two former
employees, the Rigsby sisters, who are helping to build cases against
the insurer for denying claims after Hurricane Katrina. E-A Renfroe and
Company, a Birmingham-based insurance adjusting firm, alleges in its lawsuit
that Cori and Kerri Rigsby broke the law when they turned over reams of internal
State Farm records to lawyers who represent State Farm policyholders.
The Rigsby sisters were assigned by Renfroe to help adjust claims for State
Farm. According to the sisters, the documents show that State Farm manipulated
engineers' reports on storm-damaged homes so that policyholders' claims
could be denied. The sisters have resigned from Renfroe. The Rigsbys
turned over copies of the documents in question to state and federal authorities. Renfroe's
lawsuit, filed earlier this month in a federal court in Birmingham, Alabama,
accuses the sisters of violating the Alabama Trade Secrets Act and breaching
confidentiality agreements with the company.
Lawyers for the policyholder plaintiffs hope to prove that State Farm management elected to deny all policyholder claims where Katrina left only slabs or pilings. In denying slab claims, the company has relied on policy exclusions that say water damage is not covered. State Farm is also claiming that there is no coverage for wind damage when water contributes to the damages. State Farm's officials contended that the company individually investigated each claim and paid for damage covered under its policies. Our firm has a number of Katrina-related cases set to be tried this year.
Source: Associated Press
State Farm Employees Are Targets Of Katrina Probe
State Farm has now confirmed that at least two of its employees are targets
of a criminal investigation of the insurer's handling of policyholders'
claims arising out of Hurricane Katrina. Lawyers for State Farm
had asked a judge to protect four employees, including Alexis "Lecky" King
and Lisa Wachter, from being questioned under oath by lawyers in civil cases
while they are under investigation by Mississippi Attorney General Jim Hood. The
Attorney General's office has now informed a lawyer for both King and Wachter
that these two employees are targets of the investigation.
U.S. Magistrate Judge Robert Walker already has ruled that Drain, King, Wachter,
and a. fourth employee, David Randel, can be questioned under oath by lawyers
representing State Farm policyholders. State Farm has asked Judge Walker
to reconsider his ruling. The company says the employees would risk incriminating
themselves if they are compelled to testify in civil cases while facing possible
criminal probes.
Source: Associated Press
