Update on the Rigsby / EA Renfroe Whistleblower case- Will the KLG get dismissed on cases? Link to Cori Rigsby’s deposition

January 11, 2008

I promised earlier this week to get to an update on the Rigsby whistleblower case where a whirlwind of litigation is being filed to remove and substitute attorneys on some of the cases. It is mind boggling what is going on with these Katrina cases. Much of the activity is on the MacIntosh case. I have been trying to keep up with all of the court filings via google alerts but they are coming out so fast and furious I have decided its virtually impossible with limited time for blogging while attempting to keep up with ClaimSmentor classes and staffing needs. Thus, for excellent updates regarding the Scruggs bribery indictment activity and all of the motions being filed to dismiss, disengage and substitute attorneys representing many in the group, I would defer you to outstanding blogs at The Insurance Coverage Blog  for daily updates by Attorney David Rossmiller who seems to have a great handle on the issue and some often interesting commentaryover at another blog at www.folo.wordpress.com on this also. Wall Street Journal even got in the act this past week and here’s a link to their recent blog commentary on the attorney musical chairs and possible future additional indictments,etc found at: http://blogs.wsj.com/law/2008/01/10/report-monday-to-be-big-day-in-laffaire-scruggs/.

I’m going to concentrate my attention to the activities actually involving the claims folks that I can find in the news. There is so much of that is being reported on blogs and forums but not with much detail from the claim side of things where I am the  most concerned and have the most understanding as a former claim manager. That is what I have been wanting to know- how their data dump weekend could ever have been done under a good claim manager’s watchful eye. Well, rather than throw too many links at you, I’m going to try to limit this update to two of the most important things that explained the situation to me and I think will help you also understand what is alleged to have happened on this case. First, we’ll go over the November 2007 deposition we found a link to from Cori Rigsby’s deposition then a January 4, 2008 court document filed by an attorney for EA Renfroe which is an outstanding detailed chronological list of what has happened here in their opinion. I think that is much better than guessing at the facts. They are the parties involved and these two documents are from their statements and records.

You might want to print out these links if you are truly interested in knowing their sides of the story as the deposition I believe was 127 pages and the document filed 1/4/08 with the court is 36 pages. There are so many other links we have to other stories popping up in the news but these two provide the best total summaries from beginning to this point that I have found.

Here’s the link to Cori’s deposition : http://www.insurancecoverageblog.com/McIntosh,%20November%2019%20Cori%20Rigsby%20deposition.pdf

I’d like to read one of Kerri Rigsby’s also but have yet to find an online link to one. Cori’s linked to above was taken in November 2007 as she is deposed by an attorney for State Farm first then an attorney for EA Renfroe. She outlines the timeline of events from her  first concern about “irregularities” within 2 weeks of arriving on assignment for Katrina all the way through some current information she is asked about as to how many hours per week they are working on the cases with the Scruggs (now Katrina Litigation Group_renamed from the Scruggs Katrina group) which you will see is very little. The deposition answers the question if they are still being paid which she states they are- that their verbal agreement is for $150K at over 6K biweekly since July 1, 2006 and she says when July 2007 rolled around they have continued to receive these funds. She also indicates all of their attorney fees are being covered by Scruggs so they have no worries there either. This salary is a hard pill to swallow for most adjusters who are out of work as carriers use more staff than independents plus the lack of hurricanes the past two years. More about that when you get to the EA Renfroe recent court document. There are many other things you will want to read in her deposition to form your own opinion about the Breach of Contract and violation of Confidentiality agreements such as the fact they actually began copying documents as far back as October 2005, had off site meetings with Scruggs and others involved with the documents where they brought their carrier issued laptop to meetings offsite while still working for EA Renfroe and State Farm and shared info on the system, where she emailed carrier documents to Zach Scruggs, and some really damaging information about an affair her sister had with a State Farm manager which I think most would agree is against carrier policies (sexual harassment policies and the person named in her testimony she says was a State Farm manager I think during Ivan that they worked with) for staff and for independent managers. I’ll provide a link to some motions just about that issue shortly. She admits the data dump weekend took place off carrier or adjusting firm premises with their(CARRIER) laptops being used with friends to run a list of documents they turned over to the AG and US Attorneys office the very next morning. There is so much information in the deposition you just need to read it yourself as it is hard to keep the entire story committed to memory. She does admit that they NEVER gave EA Renfroe any notice of their concerns of irregularity on the engineer reports alleging they were trying to “protect” them from involvement in the data dump weekend. Gee- what a favor- now they’ve been subject to untold number of cases with litigation you’ll see in the next document. It is particularly amazing to me the testimony about Glamour magazine running them in a story I believe it was in June 2007 as heroes. Read it for yourself. Heroes of what sort? I have not tried to link yet to that magazine issue. She also admits that she tried to make no contact with the Renfroes until right before the 20/20 news story ran. I could go on and on about the things stated in this deposition but I”ll leave that for now and you can read it for yourself on the link above. The reasons given for not telling them and their interpretation of violating their code of conduct make no sense to me but read her reasons and you decide as an adjuster. Other interesting information covered is that she tried to access her mom’s claim, Trent Lott’s claim,etc and that the carrier apparently must have had tracking records on that as they asked about numerous dates that they tried to access records on files under her alias id. It makes no sense also the statement that all files they copied they allege they took off a pirated copy of the carriers Engineer Roster assignment list yet there seems to be some implication in the questions during her deposition that they seem to align right up with a list of insureds involved in the MacFarland case I think it was (it’s mentioned in the depo questions). So did they really use the Engineer assignment list or was there more to it than that such as having been given a list from another case? I don’t know for sure what the questions meant.

Before I move on- here’s the link to a news story this week about legal activity taking place about the alleged affair. I hope adjusters reading this will take your ethics seriously and stay away from such activities with other storm members on cat at your adjusting firm or carrier level. I don’t know of any carriers that condone relationships between independents and staff as most hold very high standards for staff and independent managers to comply with sexual harassment policies. I don’t know what rules were for them on this cat but you can clearly see that it won’t remain a private affair if litigation as ugly as this whole thing  takes place so why even take the chance:


This article is about other issues concerning the insureds desire that info on the bribery not come out in their case but here is the excerpt about the affair in the last paragraph of the article:

“The couple’s attorneys also asked Senter to block jurors from hearing any testimony that Kerri Rigsby had romantic relationships with a State Farm employee and with a co-worker who also helped State Farm adjust Katrina claims.”

Next is the important court document filed January 4, 2008 by an attorney for EA Renfroe. Here is the link:


You need to also read this 36 or so page document filed requesting dismissal of the rest of the Katrina Litigation group due to the payment of fees to the Rigsby’s when they are potential witnesses and due to the bribery charges. Most interesting in this document is that it takes you through the entire situation and shows you the reasons they think they should be removed from the case. The retaliation (if it is that as Renfroe’s attorney alleges) based on motions to add them to hundreds of cases is a real nightmare. It makes you even more disgusted with the reasons given by Cori in her deposition as to why she didn’t tell the Renfroes especially when she has testified she didn’t initially think the Renfroes had done anything wrong  only that they failed to tell them as they didn’t think they could influence the carrier decision (see deposition testimony for exact comments made). There was a 1/4/08 article at www.chron.com saying the carrier also wanted them dismissed but I can’t get the link to work today.

I have a few if not many questions. First don’t you find it strange that the Merlin Law Group calls their group the Katrina Lawyers group – here’s their site then the Scruggs group who continues to use the Scruggs Katrina Group website according to footnotes in the EA Renfroe document but now has changed their group name for the remaining partners to Katrina Litigation Group. Geez- is that confusing or what? I’d be curious how the Merlin group feels about that. They(Katrina Lawyers- Merlin’s group) also recently settled something like 22 cases with this carrier according to news articles. Here is a link to one of them and to the Katrina Group’s website:



Merlin’s site interestingly enough has posted a link to my adjuster information blog here. I had read about them as they were part of the reports to the Citizens FL Task force committee and Chip Merlin was very upfront with them giving them heads up information about problems they experienced with claims handing and recommendations for improvement to the task force. Their site at the Merlin main website also has an interesting article I’ve linked to for training about Bad Faith as I was very interested in his comments about carrier requirements to train their adjusters. Anyway- getting off topic there but Katrina Lawyers and Katrina Litigation Group as the leftover Scruggs group is called can become very confusing!

So what is next? More twists and turns no doubt. Again as with everything about this case…it leaves you with more questions than answers. The very sad part is where are the insureds left on this with the changes in lawyers, law firms,etc. I cannot even begin to imagine what they are going through and who will ultimately pay all of attorney fee bills generated by such magnatude of activity. The same goes for the EA Renfroe group. I previously posted a link to Jana Renfroe’s Deposition in a recent blog where she testified at the point of that deposition that they’d already incurred approximately half a million in legal fees. Unbelievable and unfair to a firm who even the Rigsby’s admits did nothing wrong with the engineer reorts. Read on in her deposition how they went to the State Farm manager to “see her reaction” back I think in Sept 05 or some such comments and how late in the game they put the manager’s carrier boss on notice in June 06- AFTER they had already had their data dump weekend. No chance given for anyone to look into the alleged “irregularities” yet the carrier and adjusting firm have quite a nightmare on their hands trying to straighten this out. If someone was truly trying to protect policyholders as she says they were trying to do, why would they continue to work there and “collect” documents from October 2005- June 2006 and not try to report it to someone at the carrier or adjusting firm to investigate what happened versus saying nothing? I sure can’t figure it out. They only left their assignment in June 2006 AFTER they mass copied the documents in June and went on Scruggs payroll allegedly in July 2006. Did you also know she had a Scruggs cellphone for a period of time yet doesn’t know the number but if I recall correctly her mother is one of the folks who called her on the number. Another interesting development is she alleges her hard drive or computer broke along the way and she cannot retrieve any email documents they were asking to be produced if I read it correctly.

If you never read it, go back and read my blog on “Will someone lose the infamous sticky note”. Here is a link. You’ll see it has come up quite a bit again in recent weeks- even in the link to the 1/4/08 document where it says that Scruggs says the originals were given to him (Cori ‘s deposition says she only saw the engineer’s report with the yellow sticky ..ie..a copy)…I point this out again as a reminder that the only place for file activity notes is in the file- in the activity log- not on yellow sticky notes. That one note has created lots of doubt and insinuation on Katrina cases and even made it to ABC news and I think it was even several blogs…all for something so simply avoided by just doing the right thing and posting it on a blog. That is adjuster 101 training not something that ever should of come up by an experienced person handling a file.

From the claim side of things, another interesting thing that came out in Cori’s deposition was the fact due to space shortage that the staff were in one office and the independents had seperate office trailers by firm from the cat flood and wind offices. Maybe we should all learn from this and not segregate the independent and staff adjusters and managers they report to so they can have an opportunity to be more observant. I’d also be very leary of handing out company laptops to folks to take off site after the meetings these whistleblowers had offsite. I know the reality that it is virtually impossible not to do so as they use the systems for estimates in the field,etc when the carrier provides the laptops and access to their systems. So what is the answer? Carriers think it is no longer using independents but what would prevent an employee from doing the same thing (other than loss of salary and benefits of course!). Many experienced managers and adjusters think that this will lead to more limited assignments for independents where they may farm out the inspection and have inside adjusters enter the scope and handle all other aspects of the claim so there wouldnt be a need for independents to access forms and endorsements or have system needs to access data and they can simply go through a staff adjuster for anything they need to reduce the exposure to the carrier systems.

I hear the problem from both sides, carriers staffing up as they don’t want to take chances on independents and really who can blame them after this fiasco BUT that isn’t the answer. Independents will always be necessary on major storms like Katrina. By carriers avoiding their use due to a small percentage of poor independents, they are avoiding the opportunity for training with independents so they can properly handle claims. Listen folks, the independents aren’t happy about what poor performing independents are doing to their potential to work. We are all in this together to properly serve the policyholders, we just need to work harder at making the relationship work and to protect policyholder confidential information. Everything in the news is far from anyone’s intentions but the entire stories are feeding upon each other and we are all trying to understand what happened here as others like me find this all beyond our wildest imagination in a normally routine claims industry.

 I hope one day to find links to other depositions such as for those from the carrier side (although many news reports claim the 5th was plead by some carrier folks) to see what they have to say. Suffice it right now with a copy of this link to a recent filing by the Carrier for a request for documents they want to see on communications with everyone involved. You’ll recognize many of the names from Cori’s deposition:

Here is the order where the carrier requested the Rigsby’s phone records (I’ve got a link to a similar request also for their email records in another link) and Judge’s order on it:


Here’s a link to another Sunherald document on the State Farm request for production of a very large number of documents and communications between parties who have been involved in this:


I’ll continue to provide updates as more develops involving the carrier, the adjusting firm, or the adjusters or managers but will leave all the attorney musical chairs and indictment information up to those who understand those aspects of these cases better. For now I’ll leave you with this last link ( I knew it would be hard to limit this to 2 links!) which discusses the new attorney’s request for a one month delay and discussing the new order for Scrugg’s deposition to ferret out the relationships due to the fact the Rigsby’s were witnesses and employees and questions as to privileged or not documents:


Here’s links to our prior blogs here on the topics mentioned above:

Jana Renfroe’s Deposition: https://dimechimes.wordpress.com/2007/12/18/renfroes-deposition-in-the-rigsby-whistleblower-case-interesting-look-into-their-thoughts-on-the-case/

Another blog on “Just when you think things couldn’t get worse”:


New Developments on these cases


Scruggs Contempt case (3 of 3 blogs):


Special Prosecutors on the case:


Will someone lose the infamous sticky note blog:


Do you REALLY know what your Errors and Omissions Coverage covers?

January 10, 2008

We continue to be concerned for adjusters and adjusting firms regarding Errors and Omissions coverage due to the increased litigation in the aftermath of Katrina where numerous adjusters and adjusting firms have been named in many lawsuits.

ClaimSmentor  has discussed this issue with Dale Moore and Michael Hale- President of Claims Professional Liability Insurance Company at www.CPLIC.net who are both members of ClaimSmentor. You will also note that NAIIA and NACA both endorse their program by providing links to their E and O program on their sites.

We have set up a Q and A session with Dale Moore -Director of Client Services for CPLIC and Michael Hale- President of CPLIC to host a Q and A session for all ClaimSmentor participants. All information was mass emailed out to our participants with the instructions for submitting your written questions about E and O coverage . They will then prepare written answers to the submitted questions we will be posting in our forums (no names will be released with the questions). This will be followed by an open Chat sessions online for our members to join in a LIVE discussion which Mr Moore and Mr Hale will moderate on January 22, 2008 at 6pm CST.

This should be informative to all participants as there are many questions everyone has such as ….Should you blindly accept the E and O coverage of the adjusting firm you are working claims for if they provide coverage or should you also have your own policy? Who covers your attorney fees if you are named in a lawsuit as many have been since Katrina? If your attorney fees are covered…is that over and above your limits or does it reduce your limits?