Recent Katrina-Related Coverage Developments

This decision by Judge L.T. Senter, Jr., Tejedor v. State Farm, is more interesting than it sounds.  As this story points out, the essence of the ruling is that Judge Senter said the plaintiff, Richard Tejedor, already collected $200,000 from a flood insurance policy and can only recover from State Farm the difference between that amount and $285,000, the value of his home.  Tejedor’s Mississippi home was reduced to a slab by Hurricane Katrina.

Senter granted State Farm’s motion for partial summary judgment regarding claims of breach of fiduciary duty and misrepresentations in the procurement of Tejedor’s insurance policy.  He reserved a ruling, however, on State Farm’s request for summary judgment on extra-contractual and punitive damages. 

I notice this case has some sharp edges that aren’t present in many of Senter’s prior Katrina decisions.  He made a point to note that, attached to State Farm’s motion as an exhibit, was a copy of an insurance policy, "but not the one issued specifically to Plaintiff." Usually, a copy certified by the insurance company to be the exact policy issued is submitted as evidence, not a policy exemplar.  He also noted that Tejedor’s claims that his home was destroyed by wind, not flood, is belied by his acceptance of $200,000 from a flood policy, and said that, although Tejedor’s residence was "apparently" reduced to a slab, "it takes a lot of reading to reach that conclusion."  Neither party was probably satisfied with this decision: Senter said that the focus of the parties’ briefing was whether punitive damages were appropriate, but he neither granted nor denied summary judgment on this question.  

Also of note is that the first scheduled Katrina trials have been postponed. After U.S. Magistrate Judge Robert Walker rebuffed attempts by lawyers for hundreds of policyholders to consolidate trials, each plaintiff had to sue separately.  To give some kind of benchmark for the remaining cases, six test cases with simple issues were to proceed against insurers State Farm, Nationwide and Allstate.  The first case tried was to be McFarland v. State Farm, on January 29, 2007, which Senter delayed at State Farm’s request, after McFarland amended his lawsuit to include claims that State Farm engaged in a calculated scheme to deceive and defraud policyholders with rigged claims procedures.

In delaying the start of the case, Senter said he doesn’t want to limit policyholders’ remedies, but "[a]t the same time, the court has no interest in watching or umpiring a pleadings game that is played for a particular moment’s tactical purpose without regard to the overall goal of a just, speedy and inexpensive determination of every action."

Here is a link to Senter’s October 25 decision denying plaintiffs’ objections to Walker’s order that joinder of Katrina cases was not proper under the Federal Rules of Civil Procedure.  Talk about sharp edges.  In a sentence directed to the Scruggs family of plaintiff attorneys, Senter wrote: "It is worth observing that the prospect of a ruling contrary to one’s position should not call for the alternative threats of an interlocutory appeal (without any citation of authority supporting one) or forum shopping by requesting the Court to enter a dismissal order . . . so that Plaintiffs can inundate the state court system, if they so choose." 

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