State Farm continues quest for KLG disqualification

John O'Brien Feb. 15, 2008, 2:41pm

Don Barrett


GULFPORT, Miss. - Not surprisingly, the attorneys for State Farm Insurance Cos. say the Katrina Litigation Group got it all wrong.

In the ongoing battle over disqualification of the KLG, formerly the Scruggs Katrina Group, State Farm says it is making an entirely different case than the one that was previously rejected by a federal judge.

"State Farm is well aware that this Court found that State Farm had waived its right to seek disqualification based on ethical violations arising out of Cori and Kerri Rigsbys' theft of State Farm confidential documents and their subsequent 'consulting' relationship with Richard F. Scruggs and the Scruggs Katrina Group," the company wrote Thursday.

"This motion seeks disqualification based on the fact that SKG attorneys -- including those who are still in this case -- offered a different State Farm 'insider' and material fact witness in this case, engineer Brian Ford, thousands of dollars a month to 'consult' for them."

State Farm is seeking to disqualify each firm that makes up the KLG, formerly known as the Scruggs Katrina Group. Scruggs withdrew the Scruggs Law Firm from the group after he was indicted on federal charges that he attempted to bribe a state judge in a dispute over at least $26.5 million in attorneys fees earned in Katrina settlements.

The company has reasoned in the case McIntosh v. State Farm that the SKG's decision to pay the Rigsby sisters, Kerri and Cori Rigsby Moran, $150,000 salaries as litigation consultants constitutes bribery. The Rigsby sisters copied 15,000 pages of State Farm confidential documents while working at E.A. Renfroe and Co. and turned them over to Scruggs, who then gave them the jobs.

In State Farm's reply to the response from the KLG, the company says the focal point of its argument is Ford.

Ford is a former engineer at Forensic Analysis and Engineering Corp. who performed the analysis of the McIntoshes' home and kept a journal that has been submitted as an exhibit. Scruggs offered Ford indemnity, a $10,000 monthly retainer and a percentage of each settlement work for the SKG to become a "fact witness" and "consultant" on a case, State Farm alleges.

"Plaintiffs concede that State Farm did not learn of the SKG's attempt to recruit Brian Ford until he was desposed on Oct. 10, 2007, and that State Farm's deposition of former Mississippi Deputy Commissioner of Insurance David Lee Harrell did not occur until Oct. 31, 2007," the reply says.

"Quite obviously, these events happened after the Court ruled on State Farm's First Motion. Contrary to Plaintiffs' suggestion, the fact that State Farm filed a petition for a writ of mandamus does not magically expand the record that was before this Court."

Three firms (The Lovelace Law Firm, Barrett Law Office and Nutt & McAlister) took over all the Scruggs cases and renamed themselves the Katrina Litigation Group. Former state Attorney General Mike Moore withdrew from representing the McIntoshes.

The KLG represents 1,100 Mississippi claims and more than 450 involving State Farm and had harsh words for State Farm in its response.

"State Farm's and its counsel's dishonest personal attacks on Plaintiffs' chosen attorneys have crossed the line that separates aggressive advocacy from improper and vexatious litigation tactics," wrote Dewitt Lovelace Jan. 28.

"State Farm's Counsel have abused their roles as Officers of the Court by cobbling together gossip, out-of-context quotes and innuendo to poison the jury pool, confuse, the facts and distort the law."

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