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Hurricane Katrina 
 
State Farm turns tables, sues AG Hood
Hood
JACKSON, Miss. - Insurance giant State Farm says Mississippi Attorney General Jim Hood is harassing it and recently filed suit against him.

State Farm, one of Hood's post-Hurricane Katrina targets, claim Hood violated a Non-Prosecution Agreement the two sides reached in January when he reopened a criminal investigation into its claims-handling practices in the wake of the storm.

Three grand jury subpoenas were issued to State Farm before the agreement, which included a $5 million payment to Hood for investigative costs. A fourth was sent to State Farm in August.

"Specifically, the Fourth Grand Jury Subpoena seeks a wide array of documents from State Farm concerning State Farm's handling of Hurricane Katrina claims, precisely the same matters that Attorney General Hood agreed would not be investigated or prosecuted pursuant to his Jan. 23 Non-Prosecution Agreement with State Farm," the complaint says.

The complaint also notes a July letter from Hood to federal officials in Alabama that states he is engaged in "an ongoing investigation into what he believes is State Farm's fraudulent conduct, not only toward their own policyholders but also against the National Flood Insurance Program as well." State Farm argues the letter shows Hood's bad faith.

Hood reopened the criminal investigation "for the purpose of harassment," the company concludes.

Just weeks after Katrina, Hood filed suit against five insurance companies. He alleged they misrepresented the amount of damage caused by flood (covered by the federal NFIP) and wind (covered by the insurance company).

State Farm was the first to settle, closing 640 claims. Another agreement to begin an arbitration process to resolve approximately 35,000 claims fell through when a federal judge did not approve it. Since then, State Farm and former Insurance Commissioner George Dale instituted their own procedure to settle those claims, much to Hood's dismay.

He again sued the company in May, this time for not making their rejected settlement work. Had the settlement gone through, trial lawyer Richard Scruggs, who has contributed $44,000 to Hood's campaign and $250,000 to an opponent of Dale, stood to make $20 million.

State Farm filed the suit in September, though it was sealed from public record. On Nov. 2, Judge Michael Parker ordered it unsealed, revealing several motions submitted already by the two sides.

"It is unfortunate that they have publicly revealed the existence of this investigation for political gain," Hood said. "I will continue doing my job in a professional manner and will allow the cases to be resolved by the courts."

On Tuesday, Hood faces Republican challenger Al Hopkins in the state's general election.

State Farm adds that part of the intent of Hood's criminal investigation is revenge over the Rigsby sisters whistleblower case.

"(B)y reopening his criminal investigation of State Farm, Attorney General Hood seeks to chill State Farm's First Amendment rights of speech and association, and to coerce State Farm to participate in Attorney General Hood's attempt to chill the First Amendment right of access to courts exercised by another party, by pursuing a vindictive investigation of State Farm in retaliation for State Farm's refusal to attempt to coerce E.A. Renfroe & Company into dismissing or compromising civil litigation pending in the U.S. District Court for the Northern District of Alabama," the amended complaint says.




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MORE NEWS HEADLINES:
+ Hood says State Farm settlement should stay sealed - 5/11  
+ State Farm, Allstate dismissed from Louisiana Katrina case - 2/19  
+ Gulfport mayor indicted over Katrina claims - 1/28  
+ AG Hood never had authority to bring Katrina suit, judge rules - 1/12  
+ Judges picked for Katrina cases - 10/9  
+ Katrina cases like nothing veteran attorney's ever seen before - 9/23  
+ State Farm's case against Hood over - 2/7  
+ Katrina group fed up with State Farm's attorneys - 2/6  
+ Hood, Scruggs will have to talk - 1/24  
+ Answers wanted from Rigsby sisters - 1/3  


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