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Archive for the ‘Lawsuits’ Category

Do you happen to remember the LouisianaVoice STORY of April 2014 in which Jeff Mercer, owner of a defunct Mangham construction company, claimed in a lawsuit that the state owed him more than $11 million that was withheld after he resisted shakedown efforts from a Department of Transportation and Development (DOTD) inspector who demanded that Mercer “put some green” in his hand and that he could “make things difficult for Mercer?”

Or do you happen to remember the follow up LouisianaVoice STORY of December 2015 in which the inspector, Willis Jenkins, admitted during the trial that he did indeed say he “wanted green,” but that he was only joking. Or that because money Mercer said he was entitled to was withheld, he eventually had to shutter his construction company?

Apparently Mercer possessed sufficient proof that a 12-person jury, after a grueling, 30-day trial, unanimously awarded him $20 million. Not only did the jury hold DOTD liable for damages, but it also held four individual DOTD employees—Willis Jenkins, Michael Murphy, Barry Lacy, and John Eason—personally liable.

Employed by the jury in arriving at its verdict was such benign nomenclature as “collusion,” “bribery,” “extortion,” “conspiracy,” and “corruption.”

But that wasn’t good enough for the Chief Judge of the Second Circuit Court of Appeal, a judge with a spotty legal record of his own—and a judge with ties sufficiently close to DOTD that he probably should never have touched this case in the first place—not even with the proverbial 10-foot pole.

Mercer’s award was not just reduced, but obliterated, when it was overturned in its entirety, showing again how subtle nuances of the legal system allow for gross injustice to be perpetrated against those lacking the right connections or campaign cash.

There was a similar case in Calcasieu Parish involving contractor Billy Broussard, a gravity drainage district, and a contract to clean hurricane debris out of a local bayou. Broussard was instructed to clean out pre-storm debris, to be paid by FEMA. FEMA refused to pay for the unauthorized cleanup, and the gravity drainage district has refused to honor its obligations, costing Broussard millions of dollars.

And the legal system has been irresponsible in protecting the rights of first Broussard and now Mercer, leaving one to wonder with some justification: “What happens when I need the protection of the courts?”

It’s interesting that in our society, we tend to put a lot of faith in robes. But a black robe and a gavel do not endow a person with wisdom, or even knowledge. They are merely symbolic. Yet, when we walk into a courtroom, we are expected—required—to be reverent, attentive, and respectful and to never, under any circumstances, question the authority of the man or woman on the raised bench clad in that black robe and holding that gavel.

Of course there must be decorum in an environment of dispute resolution. Otherwise, events quickly descend into chaos. But that certainly does not mean that the presiding officer of the court is infallible. Far from it.

And that seems to be the one fact that some judges tend to forget—all too often.

Judge Henry N. Brown, as Chief Judge of the Second Circuit, has the responsibility of assigning cases. In Mercer’s case, he somewhat incredibly chose to assign it to himself—and wrote the decision.

The problem with that? Oh, not much…except that Brown’s father was a civil engineer for DOTD for 44 years, thus creating what could be perceived as an instant conflict of interest. Nor, apparently, did he ever once see the need to inform Mercer or his attorney—or anyone else, for that matter—of this inconvenient little fact.

Mercer’s attorney, David Doughty of Rayville, is understandably upset. “Mercer has a constitutional right to a fair trial before an impartial judge,” he says in his MEMORANDUM in Support of Application for Rehearing and his Motion to Recuse and Vacate the Panel’s Opinion.

“Only after the June 7 decision (by the Second Circuit) did plaintiff (Mercer)/appellee learn that Chief Judge Henry Brown, Jr. failed to disclose the critical fact that his father, Henry N. Brown, Sr., had been a civil engineer for the State of Louisiana in the Shreveport area for 44 years,” the memorandum says.

Doughty cited a case in which a West Virginia judge refused to recuse himself and the state Supreme Court subsequently found “that the risk of perceived bias was so great that due process requires recusal.”

“Judge Brown’s failure to recuse himself from the case or even disclose this huge potential bias undermines the very fabric of our people’s faith in the judicial integrity of the Second Circuit Court of Appeal,” the memorandum says. “This failure erodes public confidence in the integrity or capacity of this judiciary.”

Doughty wrote that the Second Circuit’s decision should be vacated “especially in the wake of a unanimous 12-person jury verdict finding that the plaintiff had proven governmental corruption and conspiracy.”

Brown won a close race for reelection as district attorney in 1984 over then State Rep. Bruce Bolin of Minden. In that campaign, Bolin accused Brown of having dropped charges against 230 suspects. Some of those charges, Bolin said, included rape, narcotics violations and DWI. Bolin, in what must be considered campaign rhetoric, also said Brown had not adequately prosecuted murder cases.

But Brown was known for his dogged prosecution of murder cases as a district attorney. Sending five defendants to the electric chair, he was featured on CBS’s 60 Minutes and the Fox Channel’s The Reporters. He was called “The Deadliest Prosecutor” by one publication.

At least one of Brown’s high-profile prosecutions, however, was overturned by the Louisiana Supreme Court.

In 1986, he was the district attorney in the prosecution of James M. Monds of Keithville in Caddo Parish. Monds, at the time a surgical technician at Barksdale AFB, was convicted of the murder of a woman who was raped, assaulted, and mutilate in a high school parking lot. Despite his denial that he had ever met the victim and that he had no knowledge of her death, he was convicted. In 1994, the Louisiana Supreme Court ruled that insufficient evidence, most of it of a circumstantial nature, existed to continue to incarcerate Monds. He was subsequently released after serving nearly nine years in prison.

Doughty said it is a “matter of common sense that someone whose family is so deeply connected to the DOTD should not hear the case out of fundamental fairness” and that the decision to do so constituted violations of CANONS 2 and 3 of the Code of Judicial Conduct.

So, bottom line: There is often little correlation between law and justice.

And people like Jeff Mercer and Billy Broussard end up nailed to the wall by a perverted legal system that is grotesquely unfair, to say the least.

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You just gotta love Louisiana politics.

No, really. It’s probably the only institution where one can set up his own little fiefdom, reward those in positions to promote his career, get caught up in multiple scandals, be forced to resign and be commended, appreciated, and otherwise recognized for his years of “dedicated and distinguished” service.

Take, for instance, Senate Concurrent Resolution 122, hereafter referred to as SCR 122, by State Senate President John Alario (R-Westwego), which commended, expressed appreciation and otherwise praised former State Police Superintendent Mike Edmonson. It passed by a 27-0 vote with 11 members either absent or not voting.

The resolution, which runs on for three full pages when a single paragraph would’ve sufficed, concludes with:

“BE IT RESOLVED that the Legislature of Louisiana does hereby commend and express appreciation to Superintendent of Louisiana State Police Colonel Michael David Edmonson on his retirement after thirty-six years of dedicated and distinguished service in law enforcement, including nine years as superintendent, and does hereby extend to him and his family full measures of continued success and happiness in their future endeavors.

BE IT FURTHER RESOLVED that a copy of this Resolution be transmitted to Mike Edmonson.”

It seems entirely fitting that this resolution would have been authored by Alario. After all, his son John W. Alario, serves as the $115,000 a year director of the DPS Liquefied Petroleum Gas Commission. That’s in the Department of Public Safety, where Edmonson also served as Deputy Secretary until his resignation.

LouisianaVoice also reported in September 2014 that John W. Alario’s wife, Dionne Alario, was hired in November 2013 at a salary of $56,300 to work out of her Westwego home supervising state police personnel in Baton Rouge—something of a logistics problem, to say the least. Well today, she is still there and now pulls down $58,500 per year. And she still works from home.

We were perfectly willing to let go of the Edmonson story after he resigned. But Sen. Alario’s resolution, however, compels us to review some of the highlights of Edmonson’s tenure as Superintendent of State Police.

Our first encounter with Edmonson came at the end of the 2014 legislative session when we learned that Charles Dupuy, who would rise to the rank of Lieutenant Colonel, conspired, along with State Sen. Neil Riser (R-Columbia) and Gov. Bobby Jindal, to sneak the amendment to Senate Bill 294 during the closing minutes of the session that allowed Mike Edmonson a “do-over” on his decision to enter the state’s Deferred Retirement Option Plan (DROP) which froze his retirement at his pay at that time of his decision to participate in DROP.

The major problem with that little plan is that it left other state troopers and state employees who similarly opted to enter DROP and then received significant promotions or raises out in the cold because the amendment did not afford the same opportunity for them. Before it was revealed by LouisianaVoice and before State Sen. Dan Claitor successfully filed a lawsuit to prevent the move, Edmonson was in line for a whopping pension increase estimated as high as $100,000 per year when the raises to state police were factored into the equation. (Claitor, incidentally, was one of those voting in favor of Alario’s SCR 122 demonstrating, we suppose, that he does not hold grudges.)

Here are some other Edmonson actions we wrote about in 2014:

  • “Consultant” Kathleen Sill, placed on the state payroll and being paid $437,000 plus $12,900 in air travel for 21 flights for her between Baton Rouge and her Columbia, S.C. home.
  • DPS Undersecretary Jill Boudreaux’s taking a $46,000 cash payout incentive to retire early from her $92,000 per year salary as Deputy Undersecretary, plus about $13,000 in payment for 300 hours of accrued annual leave and then re-hiring herself two days later—with a promotion to Undersecretary and at a higher salary of $118,600—while keeping the incentive payment and annual leave payment. Then-Commissioner of Administration Angele Davis ordered her to repay the money but Davis resigned before she could follow through on her instructions. Under her successor, Paul Rainwater, the matter was quietly forgotten.
  • Boudreaux’s son-in-law Matthew Guthrie who, while employed in an offshore job, was simultaneously on the payroll for seven months (from April 2, 2012 to Nov. 9, 2012) as a $25 per hour “specialist” for the State Police Oil Spill Commission.
  • Danielle Rainwater, daughter of former Commissioner of Administration Paul Rainwater, who worked as a “specialist” for State Police.

And then there are the spouses brought into the fold.

  • Jason Starnes benefitted from two quick promotions from 2009 to 2014 as his salary jumped from $59,800 to $81,250, an increase. Three years later, he makes $150,750 an overall increase of 152 percent.
  • As if that were not enough, his then-wife Tammy was brought in from another agency as an Audit Manager at a salary of $92,900. Today, she makes $96.600. So not only did make nearly $11,700 a year more than her husband initially (until he was promoted to Lieutenant Colonel), she also was in charge of monitoring the agency’s financial transactions, including those of her husband.
  • In January of 2008, just before Edmonson was named Superintendent of State Police by Gov. Bobby Jindal, State Trooper Charles Dupuy was pulling down $80,500. Today, the one-time Edmonson Chief of Staff makes $161,300, a bump of more than 100 percent.
  • Kelly McNamara and Dupuy, both troopers, met at work and eventually married and Kelly Dupuy’s star began ascending almost immediately. Her salary has gone from $65,000 in 2009 to $117,000 today
  • On Sept. 7, 2011, Mike Edmonson’s brother Paul was promoted from lieutenant to Captain, filling the spot previously held by Scott Reggio. On Oct. 10, 2013, Paul Edmonson was again promoted, this time to the rank of major. This time however, he was promoted into a spot in which there was no incumbent, indicating that the position was created especially for his benefit.
  • His rise has been nothing less than meteoric. Since December 2006, he has gone from the rank of sergeant to lieutenant to captain to major at warp speed and his pay rose accordingly, from $57,500 to $136,800 a year, a 138 percent increase—all under the watchful eye of his brother.

Doesn’t it give you a warm fuzzy to know that the good folks like Alario and Riser (who also, of course, voted for SCR 122) are looking out for us?

And isn’t it interesting, by the way, to know that Angele Davis, who tried to get Jill Boudreaux to repay her ill-gotten gains from her pseudo-early retirement, is pitted against Riser, who tried to sneak that illegal pension boost for Edmonson, in the upcoming election to succeed John Kennedy as State Treasurer?

As our late friend C.B. Forgotston would say if he were with us: You can’t make this stuff up.

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It’s been nearly a year since we’ve written anything about the Louisiana State Board of Dentistry and while there appears to be little going on with the board, there is quite a bit of activity going on beneath that veneer of tranquility, including, apparently, an ongoing FBI audit of the board.

Despite the efforts of State Sen. Daniel Martiny (R-Metairie) who, in 2014 passed legislation to move the board’s headquarters from New Orleans to Baton Rouge, the board has continued to resist the move from its posh high-rent offices on Canal Street.

Our last story about the LSBD was last July. https://louisianavoice.com/2016/07/18/case-of-slidell-dentist-illustrates-unbridled-power-of-dentistry-board-to-destroy-careers-for-sake-of-money/

Apparently the FBI has taken an interest in the LSBD.

The AGENDA for a special March 10 meeting (a Friday, no less) of the board caught the eye of one of our regular readers, a dentist who was put through the board’s mill and ground into so much fodder a few years ago.

Buried on page three of the agenda, under the heading “New Business and any other business which may properly come before the board,” was item IX which said, “Discussion of FBI audit results (p. 50).”

We had no prior knowledge of any FBI audit, although we have been aware that the board’s former attorney is awaiting a disciplinary hearing before the Louisiana Attorney Disciplinary Board. https://louisianavoice.com/2015/11/16/dentistry-board-facing-difficult-future-because-of-policies-contracts-with-attorney-private-investigator-are-cancelled/

At the very bottom of page 3 was a call for an executive session “for the purpose of discussing investigations, adjudications, litigation and professional competency of individuals and staff; because discussion of these topics would have a detrimental effect on the bargaining and litigation position of the Louisiana State of Dentistry.”

It was unclear if the proposed closed-door session was related to the FBI audit or not.

LouisianaVoice will be making a public records request for that FBI audit report and we will publish our findings.

Meanwhile in his farewell address in the winter 2014 LSBD BULLETIN, outgoing President Dr. Wilton Guillory said, “Legislation was recently passed to move the Board’s domicile to Baton Rouge. If that legislation is not changed in the upcoming legislature as I hope, then the Board, who self generates its funds, will have to raise the license fees to fund the move. We have been able to prevent this in years past but will have no choice. We are working with the LDA (Louisiana Dentists Association) and legislators to try to prevent this unnecessary move.”

That self-generation of funds has been a bone of contention between the board and the dentists its disciplines. Because the board sets itself up as accuser, prosecutor and judge, dentists who appear on the board’s radar have little chance of prevailing in disputes.

That is, if they choose to dispute the board—and that’s a big “if” that carries high risks, as in high dollar risks. Often a token fine, if disputed, quickly becomes a five- or even a six-figure fine and more than one dentist has been run out of business by the sheer cost of defending himself from the board’s kangaroo court.

That’s why Martiny, when his own dentist fell into disfavor for a minor offense, took it upon himself to rein in the board by moving it from its Taj Mahal to more modest headquarters in Baton Rouge.

Thanks to State Reps. Robert Johnson (D-Marksville) and Frank Hoffman (R-West Monroe), Martiny’s efforts may be overturned before the move can even be implemented.

House Bill 521 by Johnson and Hoffman has been reported out of committee and is scheduled to be taken up for debate before the full House tomorrow (Wednesday, May 17). Simply put, the bill would amend Act 866 by Martiny, effectively negating that action, and allow the board to remain in either New Orleans or Jefferson Parish.

Hoffman has received $3000 from the Louisiana Dental Political Action Committee since 2011, $500 from Appel Dental, LLC in 2007, and an additional $500 from two individual dentists in 2007 and 2011.

Johnson, meanwhile, has received $6,250 from the Louisiana Dental PAC since 2011, and $500 from the Kid’s Dental Zone of Alexandria, LLC in 2015. He also received $500 each from the same two individual dentists as Hoffman.

We have documented several cases of the board’s heavy-handedness in dealing with dentists, its unscrupulous investigative methods, its dictatorial dealings with dentists and its exorbitant system of fines imposed in order to pay the rent on its office space and to pay its contract private investigator and attorney. We have also written about the legal troubles of that investigator.

Perhaps legislators might like to refresh their memories about the board before they vote on Wednesday. Here are links to just a few of our stories:

https://louisianavoice.com/2016/03/18/like-dental-board-louisiana-board-of-medical-examiners-survives-on-fines-and-incentive-to-punish/

https://louisianavoice.com/2015/04/16/13976/

https://louisianavoice.com/2016/07/07/dentistry-board-member-was-witness-in-earlier-case-now-he-also-decides-insurance-claims-benefits-paid-to-other-dentists/

https://louisianavoice.com/2015/04/15/remarks-by-former-head-of-state-dentistry-board-on-suit-dismissal-reopens-louisianavoice-investigation-of-tactics/

https://louisianavoice.com/2014/03/23/appeal-court-slams-lsdb-tactics-in-reversing-kangaroo-court-license-revocation-board-attorney-rules-on-his-own-objection/

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Iberia Parish Sheriff Louis Ackal’s travails (largely of his own making) continue with the filing of yet another in a series of legal actions, this one a federal LAWSUIT filed by a former female deputy.

As is usually the case, no matter how the trial (or settlement, which is more likely) eventually turns out, the real winners will be the attorneys who will have managed to drag out legal proceedings for a minimum of 18 months, barring any further delays in the trial tentatively set for June 4, 2018.

If the case follows the all-too-common trend, however, there is almost certain to be unforeseen delays and continuances that will push that date back even further as attorneys (and there is a gaggle of those) continue to rack up billable hours.

Candace Rayburn, a deputy sheriff for more than five years, claims she was unceremoniously and summarily terminated after she spoke up in the defense of a female co-worker filed an EEOC sexual harassment charge against a male deputy.

Rayburn’s is another in a string of lawsuits filed against Ackal, who was recently acquitted in Shreveport federal court of criminal charges of abusing black prisoners of his jail. Those charges included beatings of prisoners and turning a police dog on a helpless prisoner, a gruesome scene that was captured on video and posted by LouisianaVoice earlier.

Ackal is also being sued for wrongful termination by another former deputy and by the family of a prisoner who died of a gunshot wound while handcuffed and in the custody of Iberia Parish Sheriff’s deputies. The official coroner’s ruling was that the prisoner, Victor White, died of a self-inflicted wound.

The sheriff is also indirectly involved in the manslaughter arrest of a man instrumental in starting a recall of Ackal over the White shooting. https://louisianavoice.com/2017/03/21/man-indicted-for-manslaughter-after-he-is-rear-ended-by-man-later-killed-in-separate-accident-his-sin-was-recall-of-sheriff/

Rayburn initially named both Ackal and the Iberia Parish Sheriff’s Office as defendants but recently amended her petition to include Ackal as the only defendant.

Ackal, who paid premium fees in his criminal defense, in a classic case of fiscal overkill, has opened up the parish bank in hiring not one, not two, not three, not four, but five defense attorneys, all from the same law firm.

That’s right. Because he’s being sued in his official capacity as sheriff, Iberia Parish taxpayers will pick up the tab for his legal bills—all of them.

Rayburn, who was employed as a Sheriff’s Deputy for IPSO from July 21, 2008 to November

15, 2013, says she received “overwhelmingly positive reviews from her Supervisors” and was even named “Employee of the Year” in 2012.

But when Deputy Laura Segura filed a sexual harassment complaint against Chief Deputy Bert Berry, she voiced her support of Segura. Within two weeks, she says, she was brought before the department’s disciplinary board which recommended a one-year probationary period and that she be offered remedial training. Instead, she claims in her suit, Ackal fired her for “multiple (uncited) policy violations,” actions she claims were committed “with malice.”

Rayburn is claiming loss of pay, loss of benefits, loss of earning capacity, emotional distress, and loss of enjoyment of life.

She is seeking reinstatement, as well as compensatory and punitive damages.

To say Ackal has lawyered up would be an understatement. He has retained half the Lafayette law firm of Borne, Wilkes & Rabalais: Allison McDade Ackal, Homer Edward Barousse, III, Kyle Nicholas Choate, Joy C Rabalais, and Taylor Reppond Stover.

Rayburn is represented by Justin Roy Mueller, also of Lafayette.

The calendar, rules, and SCHEDULE set forth by the court are simply mind-boggling and serve to illustrate why our courts are so backed up—and why justice is only for those who can afford it.

The court, invoking something called Rule 30(a)(2)(A), placed a limit of 10 on the number of depositions that may be taken in the case, limiting each to one seven-hour day—absent written stipulation of parties to the suit or of a court order.

Should the parties participate in the maximum 10 depositions with each one running the full seven hours allowed, that’s 70 hours of legal fees for which the parish must stand good.

Applying an arbitrary rate of $200 per hour (which most likely is considerably less than the hourly rate the parish paid his attorney in his criminal trial), that comes to $14,000—and that doesn’t count the costs of court reporters, expert fees, filing fees and countless other hours the five attorneys will be billing the parish for, or the Segura settlement which reportedly cost the parish in the ballpark of $400,000.

All in all, with all the legal expenses incurred by Ackal and his deputies in all the lawsuits and criminal charges, the folks in Iberia Parish must be asking themselves about now if they can really afford to keep such a financial liability in office.

Some might even call him high maintenance.

Others might call him a genuine physical threat.

By anyone’s definition, though, he is a loose cannon.

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Allstate Insurance only wants its good hands on your wallet.

State Farm isn’t such a good neighbor, after all—especially in your time of greatest need.

Farmers has seen a thing or two and has learned a thing or two—about low-balling claims.

Nationwide isn’t on anyone’s side, no matter what Peyton Manning says.

And lest one think that political grandstanding by some members of Louisiana’s congressional delegation is a viable substitute for effective representation and an avenue to disaster recovery…think again.

U.S. Rep. Garrett Graves, apparently hoping to bolster his 2019 gubernatorial campaign, has issued a series misleading, mistaken and inappropriate claims about the disbursement of recovery funds.

His claim that his House colleagues are questioning what the state did with $438 million in recovery funds was absurd because, simply put, the money had never actually been received.

And he knows it. The claim was grandstanding in its purest form and made only in the interest of political capital to be gained. Flood victims in his district would be far better served by a more positive use of his office.

Sometimes you have to wonder why, when these guys are elected, they can’t just do their damned job.

Of course U.S. Sen. John Kennedy, also said to be casting a solicitous eye toward the governor’s mansion, couldn’t help offering, as is his custom, yet another of his trite homilies when he described the governor’s handling of the flood recovery contract as a “Three Stooges-like performance.” http://www.theadvocate.com/louisiana_flood_2016/article_a41326a0-1326-11e7-8805-574e2f9c803c.html

And the contract to administer the anticipated $1.6 billion in federal recovery funds was a major embarrassment because of the involvement of attorney Larry Bankston in trying to disqualify the low bidder when his son was employed by a firm affiliated with one of the losing bidders. http://www.theadvocate.com/baton_rouge/news/politics/article_aae4b7aa-101f-11e7-924b-037340aec399.html

Edwards must feel as if he’s being pecked to death by a duck.

Greater good could be achieved for all by taking the higher ground to enlightenment (to borrow a phrase employed by The Cincinnati Enquirer in describing a debate between William Howard Taft and former Democratic Secretary of State Richard Olney in the 1904 presidential race between Theodore Roosevelt and Alton B. Parker) instead of acting like a bunch of kids in a schoolyard fight.

People have been suffering for eight months now and they want to get back into their homes. They don’t need cheap campaign rhetoric; they want real answers.

And to compound their frustration, they now know they cannot look to their insurers for relief, either, thanks to lessons learned from Hurricanes Katrina, Rita, Gustav and Ike. http://www.nola.com/environment/index.ssf/2017/03/thousands_to_receive_small_pay.html

Thanks to a tactic affectionately known as Delay, Deny, Defend, introduced to Allstate and State Farm by McKinsey and Co. just in time for Hurricane Katrina, policyholders learned that insurers would rather fight than pay up. For every claimant who stuck it out and won a big award from his insurer, hundreds did just what the companies anticipated: they caved in and took settlements of pennies on the dollar simply because they didn’t have the resources to fight back.

http://www.delaydenydefend.com/excerpt/

Less than a week following the devastation of Katrina, Nationwide, on September 4, 2005, instructed its claims adjusters that “if loss is caused by both flood and wind, there is no coverage,” according to Mississippi Gulf Coast U.S. Rep. Gene Taylor.

Nine days later, on September 13, Taylor said State Farm instructed its adjusters that “where wind acts concurrently with flooding to cause damage to the insured property, coverage for the loss exists only under flood coverage.”

On-site damage assessment by engineer Jerome Quintero of Rimkus Consulting Group, contracted by Allstate to handle claims, said there was “insufficient physical evidence to determine the proportion of wind versus storm surge that destroyed (a) structure.”

That was in June 2006. But on November 4, Quintero’s conclusion of “insufficient physical evidence” was altered to read “Storm surge and waves destroyed the residence” by Rimkus staff who never visited the site. Quintero’s name was signed to the revised report without his knowledge, Taylor said.

So, in just those three examples, we have Nationwide, State Farm and Allstate implicitly telling their adjusters to blame Hurricane Katrina’s damage on water alone, thereby passing an inflated $23 billion bill on to American taxpayers.

Did we say inflated? Well, yes. As if that were not enough, Allstate devised a clever way of enriching itself while passing the cost of those claims on to the taxpayer-funded National Flood Insurance Program (NFIP).

Documents obtained by LouisianaVoice show that Allstate, which had an arrangement with NFIP under which it paid Allstate for handling flood claims, took full advantage of that position to protect its own financial interests.

If Allstate found itself on the hook for wind damages, it would use one formula for paying claimants but if it determined the damages were caused by flooding, a second, separate formula was employed. The difference was eye-opening, to say the least.

The formulae varied, depending upon location and on whether or not Allstate deemed damage to be from wind or flooding.

In one location for which LouisianaVoice was provided documentation, for example, if damage was from wind, Allstate paid 83 cents per foot for removal and replacement of drywall (sheetrock). If it was determined to be flood damage, that same dry wall removal and replacement—paid for by American taxpayers—was $1.53 per foot, a difference of 70 cents per foot. Painting that drywall cost Allstate 35 cents per foot if the damaged was caused by wind but cost NFIP (taxpayers) 58 cents per foot if it was determined to be flood damage.

For an average 2,000-square-foot home, that is an extra cost of $1,747 that’s passed on to taxpayers for the drywall and an additional $1,148 for painting—a total overcharge of $2,895.

Assuming Allstate handled 20 percent of total claims for Katrina and Rita in Louisiana and Wilma in Florida, the company would have handled some 48,000 claims, costing the federal government as much as $645 million in inflated claims costs, including overhead and profit, which are also calculated into each claim.

In Ocean Springs, Mississippi, the costs of removal and replacement of drywall was 50 cents per foot for wind damage and $1.12 per foot for flood damage. Painting was 26 cents per foot for wind and 83 cents for flood.

To remove and replace electrical outlets, the cost difference was even starker. For wind damage, the cost was $45.62 but if the damage was caused by flooding, Allstate reported a cost of $219.27 to NFIP.

Kermith Sonnier of Oberlin, Louisiana, is a public claims adjuster and provides the source of much of the information cited here. Company adjusters work for insurance companies and their work is generally geared toward saving the company every dime they can by low-balling claims or by denying them outright.

A public claims adjuster is independent who works only for claimants and Sonnier has spent hundreds of thousands of dollars of his own money doing just that.

Sonnier, with 38 years’ experience, was once a company adjuster for Farmers Insurance—until he learned a thing or two about the company.

He enjoyed an impeccable reputation in the claims adjustment industry, having worked the Exxon-Valdez claim in 1989, which until the Deepwater Horizon disaster in the Gulf of Mexico in 2010, was the worst oil spill in history.

In 1994, he was hired by Pilot which was under contract to Farmers to work claims stemming from the Northridge earthquake in California that year. But beginning in 1996, he said, Farmers began pressuring him to lower his loss estimates. He refused because he saw no grounds to do so and Farmers terminated him in 1997 despite a spotless work record. It gave as its reasons that it was reducing its work force even though it continued to hire other adjusters.

He sued for wrongful termination and won a stunning $10 million judgment against Farmers.

http://slabbed.org/2010/11/15/adjusters-special-employees-not-contractors-farmers-lost-10-4-million-wrongful-termination-case-filed-by-you-wont-believe-who/

He, along with other experts in the field of insurance claims, will be working closely with LouisianaVoice in the coming weeks as we explore how those goods hands people, those good neighbors and those who purport to know a thing or two and who claim to be on your side will, when the chips are down, will do everything legally possible—and sometimes things not legal—to minimize or even deny your claim altogether.

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