Transcript of State Farm v. Hood hearing

OK, y’all have been waiting to see this, and here it is. Here’s a transcript of the February 6 and 7 hearing in State Farm v. Hood — lots of fine reading here, knock yourself out.  I’ve looked through it at some key places, but at present I don’t have time to write a bunch about this.  However, it’s an important document and I wanted to get it before the public as soon as I could.  I’ll have more to say later.

UPDATE: I’ve been looking under the Hood of the transcript, reading and considering, talking to various folks with various points of view, and I’ll post Sunday February 10 with more thoughts on the transcript and the settlement.



Filed under Industry Developments

23 Responses to Transcript of State Farm v. Hood hearing

  1. Butch Morton

    The more one looks into these insurance blogs and others like it, the uglier this thing becomes . They all seem to work toward the interests of insurance companies and not for the honest concerns of policy holders. These are people that have not suffered so much as a paper-cut from Katrina, did not gut their personal home, was not denied a Katrina claim, doesn’t pay three premiums’ (for wind, fire and water), and have never been dropped by an insurance company for living in the wrong place at the wrong time. In other words, they are like the majority of fans and readers, unaffected and not empathetic to the dire circumstances that many have endured since August 29th. The greater fraud of Katrina is not Dickie Scruggs or Jim Hood but the very corrupt manner in which policyholders were denied claims en masse. This ethic is as dishonest as the insurance policy language that is written to deny protection from actual catastrophe. If readers feel like they have been ‘over-lawyered’ then they need to look squarely at the fact that insurance attorneys write more language to deny claims than to take care of their own customers. Insurance policies that looked toward the National Flood Insurance Program to off load billions in losses. Deceptive polices that have wrought so much pain for thousands of policy holders who lost everything. This is what Jim Hood is investigating and probably for very good reasons. Until these bloggers and readers have been denied claim from a catastrophic event and circumstance, I would suggest that they be more suspect of those who support the slam dunk of attorney generals and trial attorneys. Ultimately they are hurting the families who had to sue their own insurance company for payment. It has everything to do with money and insurance companies are far more powerful than a handful of very wealthy trial attorneys. Just ask yourself, “How is it that insurance companies walked away from Katrina nearly unscathed from this nations worst natural tragedy?” Many readers and bloggers are very uncomfortable with this fact and choose to ignore it entirely.
    The Scruggs debacle has become a sideshow to a far more serious criminal investigation of State Farm, All State and a host of others. Many here would rather witness the public hanging of a trial attorney than dig deeper. Because what is truly being forgotten in this lop-sided debate are the thousands upon thousands who have been denied claims from an industry that has itself been ‘over-lawyered’. People that Dickie Scruggs and Jim Hood were out to protect. The Rigsby sisters must be a genuine threat to insurance ‘business as usual’ because billions are at stake and it seems that insurance companies are going after Katrina defense attorneys with a peculiar vengeance.To somehow win back every nickel from asbestos, tobacco and Katrina settlements. To settle the score.The end game seems to be to take Scruggs and Hood down at all possible costs. But who does this help except for the insurance companies? It certainly does not help the little guy with a gutted his house and was denied a claim . If you want to get a grip of what is going on, pick up a hammer and go down to New Orleans or the Gulf Coast and help someone. Help someone that has had to hire a lawyer on contingency to collect a claim. Listen to them first and foremost because these people are the ones that so many have forgotten entirely.

  2. Bill Martin

    Walked away unscathed? How many billions does unscathed equal? Yes, we all realize Katrina was a tragedy. So were the tornadoes that ripped through the south earlier this week. It all comes down to a contract. Some things are covered and some are not. You can’t retroactively change the policy to fit the circumstances and expect the insurance companies to sit on the sidelines. And why would anyone want to do business in that sort of environment?
    To hold up Scruggs and Hood as the victims is really sad.

  3. also a lawyer

    Butch, don’t be so presumptuous. I am one who loves this blog and I live in Pass Christian, had 14 feet of water through my house, etc, etc. and State Farm was GREAT to me! I think Scruggs and Hood are out to line their pockets–they don’t give a cr@p about you or me or any policyholders, so don’t get your violin out for them. People are just finally figuring out the scam they’re running. Guess you’re still behind the curve.

  4. MSlawyer

    Have you seen this article, linked by JackBurden, a commenter at Y’all Politics?

  5. bellesouth

    I thought State Farm admitted to only covering wind, 0% for wind/water. They negotiated with Hood to re-evaluate the claims that they systematically did away with at first. State Farm claims that they have now, as a result of their agreement with Hood, paid out $75 million. I don’t think they would have done that if Hood hadn’t pressured them, but they agreed to it. I think I read today they have re-evaluated 5000 claims. Way to go, Hood!!! They say they have paid 99% of the claims but they don’t say that that is 99% of the claims they approved to pay. It doesn’t mean 99% of 5000 claims.

  6. doug

    We need to remember that the State Departments of Insurance write and approve the basic policy language most company’s use. The individual company’s might tweak the policies for competitive purposes but overall it is the Dept of Insurance that approves the policies and practices of insurance companies. The real problem is (once again) the environment(political and economic) that insurance companies have to operate in. As some one who lives in the midwest I don’t want my premiums subsidizing people who continue to live in flood and hurricane prone areas. You know the risk so accept it. As humans we can’t change the weather so we have to either accept it and the dangers it sends our way or move somewhere else.

  7. sampson

    It seems to me the insurance companies have paid a good bit but there are still folks who are hurting. I know there are bunches of folks on the coast who have sued and unless their cases are settled first, they will get their day in Court. My bet is we won’t hear of insurance companies conspiring to bribe a judge unless you are reading a John Grishum novel.

  8. AmazedinMS

    It seems that some people are joining in on this situation late in the game and don’t have all of the facts just right. Bottom line, a contract is a contract. The people on the coast suffered a tremendous loss and very few of them had Flood insurance. The trial lawyers (SKG) made $26 million in fees. To hold these people up as heros is ridiculous. They did not turn around and share those proceeds with people on the coast that didn’t have Flood insurance. They didn’t donate that money to help rebuild. They put it directly into their personal accounts. In fact, the greed involved and attempts to keep the money for themselves is what landed Scruggs, et al in the mess they are in now. Hood is no hero either. You know what they say about birds of a feather. Time will tell how involved he is or isn’t in the corruption that is unfolding. These people are only out to help themselves. That is crystal clear.

  9. David Rossmiller

    I have just a few minutes to write here, but responding to MSLawyer, yes I heard about Roger Parloff’s piece this afternoon, looking forward to reading it but haven’t done so yet.

  10. ‘Rossmiller’, you have shown us your true color. Green. For you it is not about the labyrinth of legalese and layers of lawyering that forced policy holders to sue their own insurance companies. For you it is all about envy. Have you ever considered offering your own legal counsel to the people of Mississippi? Have you taken the Mississippi Bar exam and picked up 3000 claimants pro bono? Until you walk the walk do not type the talk.
    ‘Sampson’, funeral insurance covers the cost of a casket, premiums remain constant and their is a 100 percent chance that you will die one day. This is the perfect no risk policy for you. Double down because other insurance policies take on greater risks.
    ‘Amazed’, are you not amazed by the fact that we are two and half years out from Katrina and people haven’t gotten their insurance money? These are not slip and falls and hot coffee cases that require ‘A day in court’ These are insurance policies.
    Look up the meaning of the word Insurance and be amazed all over again of how shabbily the people of Mississippi have been mistreated by the very people that were hired to protect them from loss.
    ‘MS Lawyer’, I am delighted to hear that you were treated GREAT by State Farm.
    Pass Christian was destroyed and you are certainly entitled to your insurance claim. Why don’t you come forward and reveal yourself to your neighbors that were not treated so GREAT! Show these plaintiffs your claim and check stub, publish this truth in the same manner that you publish your opinion. Help someone with this information.
    ‘Also Lawyer’, what kind of lawyer are you in the first place? There is not a substantive official record showing that Insurance companies paid out billions. There are press releases stating so but if you have ever had the pleasure of walking the debris piles of Louisiana and Mississippi you will note that this money must be invisible.Time for a new CLE.
    May I suggest that all readers read this Bloomberg article entitled ‘The Insurance Hoax. Property insurers use secret tactics to cheat customers out of payments–as profits break records.’ This article is a good start toward becoming wiser to the actual practices of insurance companies.
    Iintelligence is the ability to hold two opposing ideas in mind at the same time.

  11. Just watching from the outside

    I am a lawyer on the coast who suffered severe damage and was treated fairly by State Farm, recognizing that I was the exception and not the rule. Personally, I think the truth, as always, is somewhere between the two extremes. Whether or not Dickie Scruggs tried to bribe a judge to get a higher share of legal fees has absolutely nothing to do with how State Farm and others insurers have treated the people who pay the premiums and therefore the salaries and fees of the people bashing them in blogs like this. I think the two issues need to be seperated.

  12. David Rossmiller

    Reb, I offer my services to the people of Mississippi through other means. Everyone is free to read or not to read according to the dictates of their will. Speaking of green, my records indicate you haven’t paid your subscription to my blog for this year.

  13. ResIpsaLoquitur

    Rebel Yell, in the interest of providing fair & balanced coverage to your Bloomberg link, let’s see what State Farm has to say about that article.
    I would appreciate it if you could provide ICB readers with a link to Bloomberg’s rebuttal to SF & Mr. Fernandez. Thanks in advance.

  14. AConcernedLurker

    Alsoalawyer is unique unto the world. A book should be written about how he/she got a settlement with SF in Pass Christian. What ever coverage we had (nigh unto one million dollars) was not appropriate “because of the wind pool” or “because it was flood damage” and certainly in Katrina there was “no rain damage” as we all know.
    When two villian (or if you add Hood, three) war then the commoners are the ones who lose.
    Don’t worry all that has been lost in this whole mess is the court system in our democratic government and thousands of houses, but, “oh well, those people choose to live in that hazardous place!”
    It is simply incredible to me that people are being so “academic” about all of this when our constitutional government is being bought and sold by two groups of villains!

  15. MSlawyer

    RebelYell, you need to re-read what I posted. I did not say that State Farm treated me well. You’re so emotional you can’t even think straight. Please calm down before attacking people like me for something you’ve invented.

  16. Oaege

    The Bloomberg article (“Insurance Hoax”) is more of the same trial lawyer, pre-jury selection media-seeding hogwash that we see in many areas of the country…and is complete rubbish. And Bloomberg (usually an even-handed media outlet) should be ashamed of passing it off as “reporting”.

  17. sam

    Rebel Yell needs to say what he/she is really thinking. It’s obvious, that RY’s fire & brimstone comments are directed toward a bunch evil carpetbagging “YANKEE” insurance firms. In truth, RY believes these firms are exploiting just one more available opportunity, against the beaten losers of the “Slaveholders Rebellion,” who took up arms against the United States of America. Now instead of the USA, RY directs his/her anger at State Farm Insurance et al, how sad. RY, will Mississippi never stop burning?

  18. David Rossmiller

    I myself wrote about the Bloomberg story Reb refers to, you can use the blog’s search bar feature using the key words “Bloomberg” and “State Farm” to find it, there won’t be that many posts that come up. When you read the article with an informed perspective about insurance law, it begins to look pretty silly. You know, at some point we have to separate what insurance companies actually do wrong in claims handling from a kind of bull-headed anger that expects that someone owes us something for every misfortune in life no matter what the circumstances or what the contract says.

  19. Tim

    You know everyone needs to step back, calm down and look at the issues openly. I think David has done excellent job in presenting the issues overall of all the sites I have visited. And no I am not an insurance lawyer, quite the opposite. I had substantial losses both business and personal, some covered and some not. Our business insurance listened, argued and in the end paid reasonably (Zurich). Homeowners evaluated, delayed, but through Ms Insur Depart mediation paid fairly in my opinion (Met Life). I had $300-400k plus uninsured bec no flood insur. I looked at the Bayou every day, but house didn’t get water in Camille, not in flood zone, so no flood insur. No one’s fault but my own I guess. Unfortunately, I do think from examing a number of claims for friends that State Farm and others went out of their way sometimes to push to flood as opposed to wind, but when confronted with evidence of Wind, State Farm and others paid for the most part. In 8 cases I handled I would say 1 was legitimate bad faith, but when State Farm shown the Independent adjuster and Engineer were plain wrong State Farm tendered the limits. So hard to argue. I know Dickie Scruggs personally, I am shocked at the allegations to say the least and I am sadden for him, his son and their families. I am also sadden for the legal profession which must endure this blight by a few if true, while most attorneys and judges do the right thing, I believe. Although when people complain about the system, I usually tell them, the system is working those that have done wrong have been caught and punished and will continue to do so. I have never had to read a rule of ethics to know something was wrong, my heart, mind or gut usually tells me and reference to the Rules merely confirms such. By all accounts what has occurred since Katrina has some wrong in it on all sides. No one comes out of this debacle unscathed. So I for one believe both sides bear responsibility not just the Plaintiffs or their attorneys or vice versa.

  20. snafu

    Those of you that believe that the courts should allow Scruggs and Hood to rewrite these insurance contracts after the fact probably wouldn’t mind if the insurance companies were allowed to rewrite the contract as well right? I mean as long as it’s OK to rewrite a contract after the fact, why shouldn’t the insurance companies be allowed to rewrite the premium portion of the contract as well? Ins Co: “OK, since you’re going to rewrite the contract so that I have to pay for a non-covered loss, I think I’ll go ahead and rewrite the premium for $1,000,000.00” As long as were arguing that it’s OK to rewrite a contract we might as well let everyone in on the fun right?

  21. Flying Cat

    Butch –
    I am so happy for you that you are able to live in la-la land regarding the state of trial lawyers and the judiciary in the state of Mississippi. I wish that I still could; however, having recently been mugged by a corrupt trial lawyer during litigation and being forced to continue on to the appeal level, I don’t have that luxury. A bank – yes, a bank – stole over $200,000 from my husband over four years ago, but due to crooked attorneys they have been able to spit in our face. This isn’t haggling over a contract, but an outright theft. They cashed a third party check made out to my husband’s company to help repay the loans of one of their customers who had stolen the check. Their attorney even admitted it in the trial, but since he also serves as a city judge, our jury did not wish to go against him knowing that they might someday come before him (as judge) on some charge. I call that corrupt.
    The trial lawyers have ruined the legal system in Mississippi and Dickie Scruggs has led the charge. That is a fact that you will have to accept. I believe that he has done just as much if not more than State Farm to injure the clients that he claims to represent. They will end up having to carry the burden of his illegal activities in pursuit of their claims. I am still trying to understand how the documents that the Rigsby sisters “stole” can ever be used in a court of law. Wasn’t it the brilliant Keker who talks about “fruit from the poisonous tree”. If the Rigsby’s actions weren’t poisonous than I don’t know what would be. “Stealing” documents as they admit to doing is illegal. Also, if these documents are so dynamite and damaging to State Farm, why is Scruggs so protective that no one be allowed to see them?
    Remember the poor couple that owned a small pharmacy down by Natchez. Due to corrupt trial lawyers and the judiciary in this state they had people from all over the country suing them over one of those drugs that was in a class-action lawsuit. People who had never been to their pharmacy and couldn’t find it on a map sued them because their lovely trial lawyer told them to. The husband died of a heart attack, not understanding how in America he could be sued for millions of dollars by people who had never been in his shop, much less the state. His wife had to sell out. Talk about the American dream going up in flames. All because of some trial lawyer who learned at Scruggs’ knee.
    I could go on, but Butch, I guess unless you have been mugged by these trial lawyers, i.e. see that Wilson guy that Scruggs screwed out of his fees, then you just can’t believe that such things can and do happen. The judicial system in Mississippi is in need of a major overhaul.
    Also, thanks David for the blog. I appreciate you putting forth all the effort to provide a one-stop place to keep up with this tragedy. Anyone who pays attention would have to admit that you provide the source documents which anyone can read and come to their own conclusions.


    I heard that the 40 federal agents have already left our state. Did they deliver the 52 target letters?

  23. Tim

    FlyingCat. You’re story just doesn’t sound complete for some reason. I for one would like to know more. If you would email me I would listen but can’t offer advice, other than perhaps you should get another lawyer if your facts are correct.