Hood says State Farm settlement should stay sealed

John O'Brien May 11, 2009, 5:57pm


JACKSON, Miss. (Legal Newsline) - Mississippi Attorney General Jim Hood says he has no choice but to object to a political Web site's request to unseal his settlement with State Farm Insurance Cos.

Hood wrote in a response filed Monday that he has no opposition to Jackson New Media, the producer of Y'all Politics, intervening but must, as an officer of the court, remind U.S. District Judge David Bramlette that he does not have the ability to grant JNM's request.

Hood says the Fifth Circuit has already concluded that a judge can't grant a motion to intervene in a case that is over.

"We affirm the Court's dismissal of Belth's motion because there is no case in which Belth can intervene," the Fifth Circuit wrote.

"A prerequisite of an intervention (which is an ancillary proceeding in an already instituted suit) is an existing suit within the Court's jurisdiction."

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.

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.

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

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