In 2013, two whistleblowers won in a trial against State Farm Insurance for activities dating back to Hurricane Katrina.  A jury sitting in the Federal Court in Gulfport ruled that State Farm defrauded the federal flood program by paying flood policy limits on a claim in which wind was responsible for the loss.  According to the plaintiff’s theory, by charging the National Flood Insurance Program for the loss stemming from Hurricane Katrina, State Farm was able to minimize what it owed for wind damage.

The whistleblower suit began in 2006 when sisters Cori and Karri Rigsby of Ocean Springs, Mississippi filed a qui tam suit against State Farm.  The sisters worked for an Alabama contractor that was hired by State Farm to provide damage assessments after Hurricane Katrina.  The sisters claimed in the suit that State Farm ignored or minimized wind damages to avoid payments.  The sisters presented thousands of documents related to State Farm’s alleged fraudulent activities, including evidence that the insurance company manipulated engineer’s reports to minimize damage.  They claim the fraud was widespread across the Mississippi coast after the 2005 hurricane.

The initial qui tam action included a number of policyholders, but a federal judge allowed just one State Farm claim to be heard.  The claim involves a family who lost their home in the hurricane.  The whistleblowing sisters have firsthand knowledge of how this claim was handled.

State Farm has consistently claimed it did nothing wrong and adjusted the claims correctly.  The family in question was paid $250,000 in flood damages from the national fund, but just $36,000 in wind damages on a policy that included damages up to $500,000.

The federal jury accepted the whistleblower’s allegations of wrongdoing and the judge ordered State Farm pay $750,000 in damages to the U.S. government.  The Rigsby sisters will each receive 15 percent of this award.  The judge also awarded $2.6 million to the Rigsby’s attorneys plus expenses exceeding 300,000.

State Farm appealed this order that it pay over $3 million in legal fees and damages related to the whistleblower lawsuit.  Now, the 5th U.S. Circuit Court of Appeals is scheduled to hear oral arguments on the appeal on February 5 in New Orleans.  State Farm is seeking a reversal of the verdict and dismissal of the Rigsby sister’s claims.

This important whistleblower case has captured much media attention as it involves a major corporation and serious allegations of wrongdoing.    The sisters involved in the claim have no doubt experienced much hardship bringing the action to completion, but will be awarded financially and, beyond that, morally for their willingness to shed light on the wrongful actions of a major corporation.

Barrett Law PLLC:  Mississippi Whistleblower Attorneys Bringing Qui Tam Suits   

            Qui tam lawsuits serve a vital function in our society, exposing fraud and protecting not just the government but American taxpayers as well.  Becoming a whistleblower can be a frightening experience, but with the assistance of an experienced qui tam attorney you can ensure your rights are protected and your action is prosecuted to the fullest.  The Mississippi Whistleblower Attorneys at Barrett Law PLLC have assisted countless brave whistleblowers across the state.  We will help you every step of the way in bringing your action, from the initial filing to that final day in court.  We will also ensure you do not become the subject of retaliation for your whistleblowing actions.  With our assistance, you can expose fraud and obtain a financial award for doing so.  Call Barrett Law PLLC today at 1 (800) 707-9577 to schedule your free consultation with one of our exemplary whistleblower attorneys today.