Forensic Analysis & Engineering firm settles with Scruggs, to be dismissed from RICO suit

Last we heard from Forensic Analysis & Engineering Corp., a North Carolina outfit that did engineering reports on Katrina damage for State Farm, they were accusing Dickie Scruggs of violating a judicial order not to disseminate information on a computer hard drive Scruggs had obtained from a Forensic employee in July.  Forensic got a federal judge to order that Scruggs keep the information, which Forensic said could include valuable proprietary information, to himself.  However, two days later, the U.S. Attorney subpoenaed the hard drive in relation to an ongoing investigation — Forensic was not amused by the timing, saying it did not appear to be a coincidence and that Scruggs may have tipped off the U.S. Attorney that he held the hard drive. (Click here to see a copy of the subpoena).

Now, says this story in the Sun Herald, Forensic and Scruggs have agreed on a settlement whereby Forensic will be dropped as a defendant in the RICO lawsuit Scruggs filed in June against State Farm and others.  Here’s a pretty good story on the filing of the RICO lawsuit, and here was my take.  Taking Forensic at its word that "coincidence" and "Scruggs" are not compatible concepts, one would ask why Forensic was dismissed and then look for possible answers including this copy of a joint motion to lift the judge’s non-dissemination order.  Question: if Scruggs did indeed violate the judge’s order, would the dissolving of the order wipe the slate clean?  Perhaps not, but in practical terms, it would remove any impediment Scruggs might have had to complying with the subpoena and would also allow him to use the hard drive in the RICO and other lawsuits.  As the saying goes, fortune favors the bold, or if you prefer, as Ralph Waldo Emerson said, when skating on thin ice our safety is in our speed.

Second question: how exactly did Scruggs obtain the hard drive from Forensic employee Nellie Williams?  I don’t recall seeing this addressed anywhere.  Anyone who knows the answer to this question is cordially invited to tell me, confidential-like, if it suits you, in keeping with the cloak-and-dagger nature of this ongoing Katrina soap opera.  And so the world turns.  Here’s a copy of the Notice of Settlement between Scruggs and Forensic. 

UPDATE: Note the comment below regarding the answer to my first question.  I’d also like to mention that another source I consider authoritative agrees with at least the part of the comment that Williams’ hard drive was subpoenaed.  Forensic objected to production of the hard drive, saying that Rule 45 requirements of notice prior to issuing the subpoena had not be met.  Any more specifics than that, and we are probably getting pretty deeply into stuff that no one really cares about.  If you want to look for yourself, it’s public record in the McIntosh v. State Farm case.   

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3 Responses to Forensic Analysis & Engineering firm settles with Scruggs, to be dismissed from RICO suit

  1. seetherealdeal

    Nellie Williams’ computer was subpoenaed in the McIntosh case. Forensics objected. Judge ordered it produced but sealed. Supposedly Zack Scruggs called Darren LaMarka and told him he had it but it was sealed but if he wanted it for the grand jury he would have to subpoena it. Forensics and McIntosh have reached a settlement…

  2. Scruggs, Renfroe, and a bench recused

    David Rossmiller:In yet another of the increasingly bizarre twists and turns in Katrina-spawned litigation, in USA v. Scruggs, the prosecution of Dickie Scruggs for criminal contempt of court, Scruggs filed a motion asking all federal judges in the Nor…