Legal Ethics
State Farm, Lawyers Trade Barbs in Whistle-Blower Suit
Posted Apr 29, 2008, 10:23 am CDT
By Debra Cassens Weiss
A team of lawyers representing two sisters who claim State Farm defrauded the federal government are fighting to stay on the case.
State Farm says the lawyers should be disqualified because of “improper and unlawful conduct” that includes accessing protected computer data, according to a press release. The insurer claims that Todd Graves, the former U.S. Attorney for the Western District of Missouri, was present at a meeting where sisters Cori and Kerri Rigsby accessed State Farm databases on a laptop, the Associated Press reports.
The law firm of Graves Bartle & Marcus denied the accusation in a federal court filing in Mississippi on Monday, the AP story says. "These are outright lies told by an arrogant and corrupt organization that has little regard for the truth or the reputations of the [lawyers] it attacks," the law firm said.
Plaintiffs lawyer Richard “Dickie” Scruggs initially filed the lawsuit on behalf of Cori and Kerri Rigsby after they gave him thousands of pages of copied State Farm documents. The suit claimed the insurer defrauded the federal government by shifting responsibility for shareholders’ Hurricane Katrina claims to the National Flood Insurance Program.
Scruggs has since pleaded guilty to conspiring to bribe a judge in an unrelated case. Scruggs has withdrawn from the litigation, but Graves Bartle remains on the case for the plaintiffs along with the law firm Bartimus, Frickleton, Robertson & Gorny. Scruggs has also withdrawn from policyholders’ lawsuits against State Farm.
State Farm has filed a counterclaim against the Rigsbys that claims the women conspired with Scruggs to steal confidential data, the Biloxi Sun-Herald reports. Lawyers for the women say the information wasn’t confidential because it exposed “a criminal enterprise and rampant fraud against the United States taxpayer.”
The insurer claims the women have found no evidence of wrongdoing and their charges of fraud are false.
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