Federal Judge Separates Whistle-blower Lawsuit From State Farm Counterclaim
A federal judge has elected to separate State Farm’s counterclaim against two sisters who filed a whistle-blower lawsuit against the insurer following Hurricane Katrina, and the sisters’ lawsuit will be tried first.
According to court documents, Judge L.T. Senter, sitting in U.S. District Court in Southern Mississippi, said the whistle-blower lawsuit brought by former insurance adjusters Kerri and Cori Rigsby will be heard separately from State Farm’s counterclaim because “a single proceeding is likely to hopelessly confuse the jury on the merits of both claims.”
The Rigsby sisters worked for private claims adjusting firm, E.A. Renfroe & Co., hired by State Farm after the storm in 2005. The sisters’ accusations led to the filing of a landmark case by Mississippi couple Thomas and Pamela McIntosh. At the side of then-prominent attorney Richard “Dickie” Scruggs, the sisters accused State Farm of fraud for allegedly changing the reports of engineers in order to shift payments to the National Flood Insurance Program. The sisters allegedly took and handed to Scruggs, who paid the sisters as “consultants,” thousands of claims documents they say support the charges, which State Farm has denied.
State Farm has filed a counterclaim seeking damages. The insurer alleges the Rigsbys “schemed to abuse and exploit their access to State Farm’s confidential computer systems and policyholder records,” court records say.
Insurance News Net
9/28/9
Magnolia Tribune
