I was interested to read that an insurer is now suing Mississippi AG Hood. While Katrina homeowners suffered terrible losses, some of the tactics used against insurers post Katrina just were not right. I am curious to see how this suit ends.
I was glad to see the Eleventh Circuit affirm the District Court's order requiring two former adjusters, now employed by Dickie Scruggs, to return documents to their former employer, E. A. Renfroe & Co. The Eleventh Circuit reviewed the district court's order only for an abuse of discretion. The court found that the trial court appropriately applied the four factors controlling whether to issue a preliminary injunction. I really look forward to commentary concerning the tactic that was employed to obtain the documents: taking custody of relevant evidence by becoming the attorney and then employer of individuals working for a party with adverse interests. If lawyers will be permitted to follow this strategy, no company will be able to protect the confidentiality of its information.
As Michael Kunzelman noted in Forbes, this week the statute of limitations will run on suits against insurers for Katrina-related claims. It will be interesting to see these remaining suits. Of course, anything is possible, and policyholder lawyers will claim that their clients are victims of egregious misconduct. But, the reality is that policyholder lawyers (like the rest of us) are guided by the law of low-hanging fruit: the strongest cases are the first cases "picked." I will be very surprised if this last group of cases is very strong.
As noted in my June 18, 2007 post, Richard Scruggs’s acquisition of Katrina-related insurance documents from his adversaries raised many ethical questions. Those issues are detailed and explained in an expert declaration supporting a disqualification motion. Look for Scruggs to be disqualified.
The June 13, 2007 NY Times reported that Attorney General Jim Hood sued State Farm and he is not ruling out reopening a criminal investigation against State Farm. Mississippi Attorney General Sues State Farm Over Katrina Claims.
Is it appropriate for Mr. Hood to threaten criminal proceedings? Many states expressly bar attorneys from threatening a criminal investigation to gain an advantage in a civil suit. The Mississippi Rules of Professional Conduct state, in the preamble, state that the law's procedures should not be used to harass or intimidate others.
I want to give full disclosure: some of my partners represent State Farm (though I do not handle any matters for State Farm).
That said, the threat of criminal proceedings here is just wrong.
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