Insurance Law

Recent Cori Rigsby deposition: hoped to remain anonymous, continue adjusting for rest of life

By David Rossmiller

The Rigsby sisters better hope that False Claims Act lawsuit pays off, they are just about out of meal tickets.

Here is a copy of the latest Cori Rigsby deposition.  It was taken in January 2008 in the Renfroe v. Rigsby lawsuit, and unfortunately a great many sections were removed -- apparently these sections are sealed because the documents the sisters took from State Farm were being discussed.  So some of the really good stuff is missing, probably the stuff that got the prosecutors in the criminal contempt of court proceedings against Dickie Scruggs in Alabama so excited.

What is left, a lot of it we knew already.  But surprisingly to me, it appears she actually had a notion that she was going to funnel these documents to Scruggs, remain anonymous, and continue adjusting for State Farm for the rest of her life.  Wow.  This begs the question of why you would want to continue adjusting for a company you claim engaged in fraudulent practices, but that issue aside, if she believed she would not be found out, she was either naive or duped.

In reading the transcript, she confirms that the Scruggs(less) Katrina Group, now known as the Katrina Litigation Group, cut the Rigsby sisters loose from their $150,000 a year "consulting agreements," citing lack of money to pay them. (Could just be an excuse, some in the SKG were against hiring the sisters in the first place).  Scruggs, you remember, wanted them hired, allegedly to take care of them after people at State Farm and Renfroe began to figure out they were spies for Scruggs.  But, the transcript says, when the KLG said adios to the sisters, he didn't step up and agree to continue paying them.  I wonder what they are going to do now -- not much chance of getting back into claims adjusting.  I felt kind of sorry for Cori when, during the deposition, her phone rang and it was her realtor -- she is selling her house. 

It was interesting that she continued to deny having spoken with Scruggs about taking documents from State Farm prior to February 2006.  The date is significant because in December of 2005, according to a deposition in the same case of Lee Harrell, Mississippi deputy commissioner of insurance, Scruggs had a meeting with then-Commissioner George Dale where Scruggs came in with some grandiose scheme that frankly sounds like Scruggs' intellectual train had left the rails, wherein Dale was supposed to support Scruggs' move to extort some $500 million from State Farm for a Katrina compensation fund over which Scruggs would preside, throwing out some shekels to the people while no doubt making a few dollars for himself.  Dale refused.  Think about this for a moment -- Himself wanted to set himself up as some kind of autocrat, some Katrina Czar.  It just sounds so utterly -- what's the word I'm looking for here -- nuts!

But also in that meeting, according to the Harrell deposition, Scruggs claimed to have insiders at State Farm that had access to documents, just like in the tobacco litigation.  Why did Scruggs say this if he had not talked to the Rigsby sisters until two months later?  We know Scruggs represented the sisters' mother in her insurance claim, and it may be that based on conversations between the two, he had reason to believe he would have the sisters' cooperation.  For example, their mother could have told him the sisters were extremely troubled by certain documents, and even related what the contents of those documents were. 

Go ahead and read through it yourself.  When I read these Rigsby sisters depositions, one thing sticks out time and time again, and that is the sheer audacity of hiring material witnesses, that were testifying in civil cases and before grand juries, as "consultants" of a law firm.  Being paid by someone doesn't necessarily buy your testimony -- if you work for a company and continue to draw your check, that doesn't mean if you give testimony favorable to them it's a bribe.  But you worked there already.  This is completely different. They take documents to support Scruggs' litigation, quit the place where the took the documents from and then he hires them at a very high fee for jobs at which they have no set duties and no set hours, and at a time when they are to offer testimony against the party from whom they took the documents.

Looking back over this, I wonder, would they do it again? 

Full post as published by Insurance Coverage Law Blog on March 28, 2008 (boomark / email).