January 11th, 2007

State Farm to Pay Punitive Damages. Again.

State Farm has done it again. Some years back they made quite a bit of law in a case called State Farm v. Campbell that went up to the U.S. Supreme Court on the issue of punitive damages that they had to pay for their conduct.

Now they got smacked again by a jury, this time for $2.5M in a case they offered to settle for $20K. This time, it was people victimized once by Katrina, before State Farm got to them for a second go-round:

Jan. 11 (Bloomberg) — State Farm Mutual Automobile Insurance Co. must pay a Mississippi couple $2.7 million for the loss of their property, a judge and jury ruled in a test case over how much Hurricane Katrina damage is covered by insurance.

The judge, deciding actual damages without the jury, awarded $223,000 for the home and belongings of Norman and Genevieve Broussard of Biloxi, Mississippi. The jury awarded punitive damages of $2.5 million for State Farm’s improper conduct in processing the claim…

The Broussards argued their house had been destroyed by wind or a tornado, a type of damage covered by insurance. State Farm, which is owned by policy holders, argued at trial that the loss stemmed from flooding, which the company’s policy didn’t cover.
…

[U.S. District Judge L.T. ] Senter called the company’s handling of the claim “impermissible,” saying it offered the couple no choice except to sue over their claim.

“I find the defendant did not have any legal or arguable reason for refusing to pay,” Senter said today in federal court.
…

Senter ruled today that Bloomington, Illinois-based State Farm, the largest U.S. auto and home insurer, failed to present enough evidence for the jury to be able to find that the policy terms didn’t cover the damage.
…

The Broussards‘ attorney Bill Walker told the jury that his clients had been needlessly wronged by State Farm.

“Did they act like a good neighbor?” he asked, referring to the company’s famous slogan. “No, they acted like a cheat. They acted like a chiseler.”

January 9th, 2007

Port Authority Cancels Geico Contract for GWB

I posted just two days ago about the dangerous agreement that the Port Authority made with Geico to put billboards and other ads on the George Washington Bridge. Dangerous because the main focus of the $3.2M agreement was to divert the attention of drivers in a toll plaza away from the cars around them and toward the ads. Where they saw money, I saw danger and liability.

And just as suddenly as it was announced, the deal is now cancelled, as per this article in today’s New York Times. As much as I would love to claim credit that my injury warnings from this tiny corner of cyberspace had something to do with it the article doesn’t cite safety as any of the reasons.

January 7th, 2007

Geico and New York’s Port Authority: Making Life More Dangerous

You really can’t beat the irony. New York’s Port Authority wants to let Geico put giant billboards up at it’s George Washington Bridge toll booths touting “safety” according to a New York Times story late last week (sub req.)

Why irony? Because the billboards will intentionally distract drivers as they approach the tolls. That is, after all, the basic idea a billboard — a distraction from driving to read the sign. This will be done in a spot with lots of stop-and-go traffic and lane-changing. According to the article, the signs:

will include the posting of a huge billboard on top of the toll plaza in Fort Lee, N.J., that says “Geico Drive Safely.” Drivers will also see Geico signs with the company’s mascot, a gecko, on the tollbooths and electronic signs on the approach roads.

Busy toll plazas are undoubtedly one of the more accident-prone pieces of roadway. I bet the toll workers and policemen that need to constantly walk that area are thrilled to have more distractions for the drivers.

Geico will pay $3.2M for two years for the ads. So I guess money trumps safety for the insurance company and the Port Authority that operates the bridge. The more things change in this world, the more they stay the same.

[Addendum: One day after this blog entry, the Port Authority cancelled the agreement , though the New York Times article said nothing about safety issues.)

January 5th, 2007

Did New York Courts Exceed their Authority With New Advertisng Rules?

I posted earlier today regarding the new ethics rules regulating attorney advertising in New York, and the prohibition from soliciting clients for 30 days. These Disciplinary Rules that were created by the presiding judges of each of the four appellate divisions not only apply to plaintiffs lawyers but to defendants as well. And to insurance companies. But can the courts legally do that? Part (a) is for plaintiffs, and part (b) is for defendants:

DR 7-111 (22 NYCRR 1200.41-a) Communication After Incidents Involving Personal Injury or Wrongful Death

(a) In the event of an incident involving potential claims for personal injury or wrongful death, no unsolicited communication shall be made to an individual injured in the incident or to a family member or legal representative of such an individual, by a lawyer or law firm, or by any associate, agent, employee or other representative of a lawyer or law firm, seeking to represent the injured individual or legal representative thereof in potential litigation or in a proceeding arising out of the incident before the 30th day after the date of the incident, unless a filing must be made within 30 days of the incident as a legal prerequisite to the particular claim, in which case no unsolicited communication shall be made before the 15th day after the date of the incident.

(b) This provision limiting contact with an injured individual or the legal representative theoreof applies as well to lawyers or law firms or any associate, agent, employee or other representative of a lawyer or law firm who represent actual or potential defendants or entities that may defend and/or indemnify said defendants.

And so an interesting question on the new rules has immediately arisen: Can the New York courts regulate what the insurance companies do?

January 5th, 2007

New Attorney Advertising Rules (Is This Blog an Advertisement?)

New rules were announced in New York yesterday by the Office of Court Administration after months of debate regarding attorney advertising. The rules can be found here, courtesy of the New York State Bar Association. Two things of note, first on the reason for the rules and second on how they are applied.

The rule changes were prompted in part, I believe, by a number of attorneys rushing ads into the Staten Island Advance after the Staten Island Ferry disaster of October 2003, killing ten people.

Many ads appeared in the Advance the very next day, having been submitted the day of the accident before all the survivors had even been evacuated. It was not the finest hour of the New York bar.

The original rules suggested last year that there be a 30 day prohibition of such advertising for mass disaster. A problem with that was that the same rule didn’t apply to defense lawyers and their agents rushing in to try and settle cases before the injured had a chance to fairly evaluate their rights (or even to contemplate their future).

The new rules apply to all personal injury cases (not just mass disaster) and apply also to defense counsel. So if there must be change, at least now it won’t be to the detriment of those injured.

But this also leads to the second part, and that is defining attorney advertising. A web site clearly qualifies as an ad in the rules and must be so noted with the words “attorney advertising.” In fact, my own web site on personal injury law already has this comment in place:

This website is the firm’s electronic brochure, its sole form of attorney advertising. You found this site only because you looked for us. We do not engage in television, radio, print, mail or spam email advertising campaigns of any kind. Frankly, we find many of them somewhat offensive.

Throughout this site you will see examples of cases we have handled. Since all cases are different, and legal authority may change from year to year, it is important to remember that prior results cannot and do not guarantee or predict similar outcomes with respect to any future matter, including yours, in which any lawyer or law firm may be retained.

But what of web logs and their ever-changing content? If I link to my own web site, as I just did above, does this blog now become an advertisement? I also have this paragraph at my web site:

The Turkewitz Law Firm also sponsors the New York Personal Injury Law Blog to discuss issues of New York personal injury law, medical malpractice, cases of interest in the press, and public policy regarding the justice system. To the extent that it may discuss past cases the firm has handled for illustrative purposes, or in any way mentions the the firm or its services, the New York courts may deem this to be attorney advertising.

Will our web logs be considered advertising? Comments welcome on that one…

[Addendum: The front page article on attorney advertising in the New York Law Journal is now available at Law.com at this link.]