Web site motions to make Hood settlement with State Farm public

John O'Brien Apr. 23, 2009, 4:00pm


JACKSON, Miss. (Legal Newsline) - The publisher of a Mississippi political Web site wants court records in State Farm Insurance Cos.' lawsuit against state Attorney General Jim Hood's unsealed.

Jackson New Media, Inc., which produces Y'all Politics, filed the motion Thursday. The lawsuit alleged Hood was unfairly threatening the company with criminal charges to force it to settle the civil suit filed by Hood weeks after 2005's Hurricane Katrina.

Shortly after Hood was forced to take the stand in federal court in Hattiesburg, the two sides reached a confidential settlement in Feb. 2007.

"Hundreds of thousands of Mississippians were adversely affected by Hurricane Katrina," Jackson New Media attorney Andy Taggart said.

"This was a watershed piece of litigation that tens of thousands of homeowners and all Mississippi taxpayers have a stake in. All we ask from the Court is to allow the press and the public their First Amendment right to access to relevant court materials and remove the lingering doubts as to what really happened in this matter."

Hood sued State Farm and four other insurance companies weeks after Katrina, claiming that they intentionally misrepresented to policyholders the amount of damage done by wind (covered by their policies) and water (covered by a federal program).

A proposed settlement with State Farm had the potential to affect more than 35,000 policyholders, but a federal judge did not approve of it for procedural reasons. A separate successful settlement of 640 claims was coupled with a $5 million payment to Hood with the agreement his criminal investigation would cease, the company said.

Hood eventually sued State Farm again for not making the rejected settlement work. State Farm claimed he threatened it with the prospect of another criminal investigation.

U.S. District Court Judge David Bramlette approved the settlement. He is being asked to make it part of the public record.

The two sides disagreed heavily over the circumstances of the settlement. Hood wrote in a column that "allegations lodged against me by this insurer were shown to be false," while his press secretary wrote the only reason the outcome was referred to as a "settlement" is because "the details of the Attorney General's criminal investigation needed to be protected. The case was dismissed because the allegations were false."

Sheila Birnbaum, a State Farm attorney, accidentally sent an e-mail to members of the press that said, "This is so over the top. Can we ask that (Hood) be held in contempt of court for misrepresenting a settlement agreement and order of the court?"

State Farm spokesman Phil Supple said, "The court has taken control of this case and ruled that our contract with the attorney general is valid, unambiguous and enforceable and we are very pleased with that outcome. Given that, we have no problem dismissing the case."

Editorials on Y'all Politics are frequently critical of Hood. The site produced a transcript of Hood's testimony in the case.

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

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