Renfroe continues to seek criminal contempt sanction against Scruggs

You may recall the lawsuit by E.A. Renfroe & Co., a business that assists State Farm in claims adjustment and processing, against the "whistleblower" Rigsby sisters, Cori and Kerri.  The two were employed by Renfroe and copied either 5,000 or 15,000 pages of documents — they have given varying accounts during the litigation — and then gave them to policyholder attorney Dickie Scruggs, who hired them to one-year consultant contracts at $150,000 each.  These documents purportedly show nefarious claims adjusting procedures by State Farm in Katrina cases.

The two had signed confidentiality agreements with Renfroe, as you would expect in jobs with access to a lot of people’s sensitive claims data, and Renfroe sued them for allegedly breaching these agreements.  I don’t know all the facts of this case, but from a distance, taking 5,000 to 15,000 pages of documents from your employer and turning them over to a lawyer suing State Farm so he can use them to sue State Farm arguably even better, and netting 150 large to boot, presents a fairly compelling argument for breach of confidentiality. As I’ve written about before, Renfroe has also sought a contempt sanction against Dickie Scruggs for allegedly violating a court order requiring him to return the documents and not to make use of them.  In a show cause hearing in March (a show cause hearing requires one to show cause why he should not be held in contempt, or otherwise sanctioned, or whatever), it looked as though federal district court Judge William Acker was not inclined to consider criminal contempt as a sanction, although it appeared he was taking a hard look at civil contempt.  He asked Renfroe to give some intense thought to whether it wants to pursue criminal contempt. 

Well, Renfroe thought it over, and Renfroe is not backing down.  I looked at the docket for this case yesterday, and here is a pdf of Renfroe’s brief in support of its motion to hold Scruggs in criminal contempt, filed about a week ago.  Then on Friday, Renfroe filed a supplemental brief, saying it had just found new evidence of a violation of the injunction, namely an ad the Scruggs Group has been running featuring Kerri Rigsby talking about "changing engineering reports," which Renfroe says amounts to a prohibited use of the documents to drum up more coverage litigation.  To me, the first brief seemed stronger than the second.

For those with a strong interest in this story, here’s some more pdf’s I ripped from the docket. 

Judge Acker’s protective order issued preventing State Farm employee Alexis King from being deposed in this case.  She has asserted the Fifth Amendment when deposed before, on advice of counsel, and indicated she planned to do so again.  

Various documents reflecting a hullabaloo over whether Renfroe could depose some other people who were present when the Rigsby sisters copied the Renfroe documents: a motion to quash by the attorney for the Rigsbies (if that is the correct plural); Renfroe’s response; and Judge Acker’s order denying the motion to quash.

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One Response to Renfroe continues to seek criminal contempt sanction against Scruggs

  1. Dickie Scruggs contempt hearing over Rigsby sisters’ documents

    David Rossmiller continues to have good coverage of E.A. Renfroe & Co.’s seeking criminal contempt charges against Scruggs for his violation of a protective order….