Lloyd's of London Gets a Dose of Loser Pays in Katrina Insurance Coverage Case

Earlier this year I wrote about a Plaintiff verdict in a Hurricane Katrina wind vs. water trial against Lloyd's of London here, here and here.

The plaintiff was allowed to recover attorney's fees in the case because the Court found that Lloyd's had no arguable basis to deny the claim. On December 21 Judge Sul Ozerden awarded the plaintiffs the following extra-contractual damages:

  • $1,922,487.25 in attorney's fees
  • $234,800.73 in expenses
  • $954,245.31 in pre-judgment interest.

The total extra-contractual damages were $3,111,533.29 (plus post-judgment interest).

Here is Judge Ozerden's 40–page opinion on the attorney's fee issue. The Court awarded a rate for Don Barrett of $375 per hour ($475 hr. requested) and David McMullan's of $300 per hour ($345 requested). From my knowledge of hourly rates in Mississippi, both the rates requested and the rates awarded were in the range of reasonableness when compared to premium rates charged by top litigation attorneys in the state.  

Lloyd's took an interesting approach in opposing the requested rates by identifying the rates of its trial attorneys: $285–hr. for Paul Fields from Atlanta and $200–hr. for Whit Johnson from Currie Johnson in Flowood. Lloyd's should be ashamed that it was paying Whit Johnson only $200–hr. Whit is one of the top defense lawyers in the state and could justify a rate double what Lloyd's was paying him.

Judge Ozerden also reduced the compensatory damages award to $1,832,602.20 based on the policy's coinsurance condition and windstorm or hail deductible. Here is that opinion

My Take:

Judge Ozerden's opinions were thorough and well-reasoned.

Don't look for Lloyd's to be lobbying for loser-pays legislation when the State Legislature convenes this week.   

Defense Verdict in Hinds County Med-Mal Trial and Other News from the Weekend

Hinds County Defense Verdict

There was a defense verdict returned on Friday in a Hinds County medical malpractice trial. I do not know the names of the parties or the facts of the case. The vote was 11-1.

Heber Simmons of Ridgeland represented the plaintiff. Mildred Morris of Watkins Eager in Jackson represented the defendant. Stuart Harmon of Jackson represented a defendant who was dismissed via a directed verdict. Judge William Gowan presided in the case.

Wall Street Journal Article on Dr. Adam Lewis

Saturday's Wall Street Journal had a long front-page article about Jackson neurosurgeon Dr. Adam Lewis. Anderson writes about the article here. The article focuses on the death of a 48 year old patient who died hours after back surgery in April.

The WSJ had the man's medical records reviewed by nationally preeminent surgeons, who said that the man was not a candidate for surgery.

Lewis has a high rate of surgeries on his patients and owns part of the company that sells the devices that he implants. Anderson states:

So many doctors cannot rest content making a good living from being doctors; they have to own their own MRI, or their own specialty clinic, or their own medical-device company.

The article (which is behind a pay wall) heavily quotes Lewis' attorney, Whit Johnson with Currie Johnson in Flowood. Dr. Lewis gets sued a lot and is a controversial figure in the Jackson medical community. I don't think that Jackson doctors are surprised by the allegation that Dr. Lewis operates on too many patients. I reported a verdict from earlier this year here.

Kingfish quotes much of the WSJ article here.

Sun-Herald Article on Former Miss. Supreme Court Justice Joel Blass

The Sun-Herald ran this article over the weekend on former Supreme Court Justice Joel Blass of Pass Christian. Blass bucked the racist norm in the Mississippi Legislature in the 1950's and was highly respected in the legal community. The article quotes current Supreme Court Justice Jess Dickinson:

Jess Dickinson, a presiding State Supreme Court Justice, practiced law with Blass in Gulfport in the early 1990s.

“The practice of law today really needs a dose of professionalism,” he said. “The lawyers have gotten so strident and aggressive. They do so in an attempt to represent their clients, but professionalism has seemed to drift away from this profession.

“Joel Blass exhibited the epitome of professionalism. He is a gentleman’s gentleman, a lawyer’s lawyer, a scholar, and a mentor to every lawyer, whether they were in his firm or not. You could always trust him.”

Justice Dickinson's comments are consistent with everything that I've heard about Blass.

$553,000 Jury Verdict in Hinds County Medical Malpractice Trial

The Clarion-Ledger reported last week on a $553,000 jury verdict in a Hinds County medical malpractice trial against Jackson neurosurgeon Dr. Adam Lewis. The article provided a good description of the plaintiff's allegations:

Joanne Hartwig's negligence lawsuit in Hinds County Circuit Court said Dr. Adam Lewis' surgery on Aug. 1, 2005, left a plate in her back in the wrong position and one of the screws to fuse the lumbar spine bones together floating, not attached to bone.

Hartwig said the problem was discovered after she sought a second opinion because her condition continued to worsen under Lewis' care.

On Nov. 28, 2005, Hartwig said she had to undergo another surgery via her abdomen for the removal of the hardware.

"Ms. Hartwig sustained painful, debilitating injuries of a permanent nature, as well as the pain and suffering associated with having to undergo multiple surgeries and procedures," her lawsuit has said.

The components of the jury's verdict were:

  • $178,000– economic damages
  • $375,000– non-economic damages.

The article states that Dr. Lewis will appeal.

Precious Martin of Jackson represented the plaintiff. Whit Johnson of Currie Johnson in Flowood represented Dr. Lewis. Judge Winston Kidd was the presiding judge.

Not Much New to Report on Latest Katrina Wind vs. Water Verdict

Two weeks ago I reported in this post on a $2 million verdict in a Katrina wind vs. water trial. I have not heard anything new about the case other than what I've read on Pacer.

Here is the original Complaint, filed in 2007 and signed by Sid Backstrom of the Scruggs Law Firm. The Complaint appears to be a product of the now infamous Scruggs Katrina Group. It looks like the Barrett law firm ended up trying the case. The Scruggs lawyers were—presumably—unavailable for trial.

The defense team appeared to involve a cast of thousands with lawyers from Atlanta and New Orleans. Whit Johnson from Currie Johnson in Flowood is also listed down in the ranks of defense lawyers. I don't know who did what at trial.  

The Pre-trial order is not available on Pacer. Judge Ozerden ordered the plaintiff to to file a motion for attorney fees before March 17, 2011. An award of attorney fees could substantially increase the defendant's exposure.   

$1.17 Million Verdict in Hancock County Katrina Bad-Faith Trial

On October 26, 2010 a Hancock County jury awarded $1,170,000 to Coastal Hardware Store in a bad faith case against Lloyds of London. Coastal Hardware was destroyed by Hurricane Katrina. Lloyds refused to pay the claim despite accepting premiums for the insurance. The verdict is one of the largest—if not the largest—in the history of Hancock County.

Coastal Hardware is located in “the” Kiln. An earlier trial in August resulted in a mistrial due to the acoustically challenged Hancock County courtroom. I am not sure if the retrial was moved to Gulfport or relocated to a different courtroom in Hancock County.

The case involved an interesting twist. Two days before Katrina, Lloyds mailed the policy to the Kiln post office. Being the U.S. Postal Service, the policy did not arrive before Katrina. The Kiln post office was destroyed in Katrina, so Coastal Hardware never received the policy.

Circuit Judge Lisa Dodson ruled that the governing contract consisted of quote sheets provided before Katrina.

Coastal Hardware thought that it had a strong punitive damages case, but the jury voted to not award punitives by a 9–3 margin. Hancock County is very conservative. My guess is that the jury thought that over a million in damages was enough.

Former U.S. Attorney Brad Pigott of Pigott Reeves & Johnson in Jackson represented Coastal Hardware. Whit Johnson of Currie Johnson in Flowood represented Lloyds.

 

Legal Sector Losing Jobs in Down Economy Nationally and in Mississippi

According to Law.com the legal sector lost 5,800 jobs in October with more layoffs at large firms than at any time in the last 30 years. The blogs Above the Law and Law Shucks also track the carnage on a weekly basis. Law Shucks states:

The National Law Journal has put out its 2009 survey of the largest firms in the US, and the numbers are just about as awful as would be expected. Headcount is down pretty much across the board, with the total number of lawyers employed by the 250 largest firms back at 2005 levels, wiping out three years’ growth.

In our view, the data support what we’ve been saying all along: firms are grossly underreporting layoffs and stealth layoffs are running rampant.

 In the Jackson area Currie Johnson recently laid off five associates and McGlinchey laid off two in its Jackson office. These numbers may not sound like a lot until you compute the percentage of lawyers in these offices who were let go.

The down economy for law firms in Mississippi started around 2004 with the Mississippi Supreme Court's opinion in Janssen v. Armond, which eliminated joinder of large numbers of plaintiffs in mass tort cases. This caused a huge hit to many defense firms who had a large presence in mass tort litigation. Mississippi firms slowly began to lose attorneys as natural attrition and stealth layoffs led to a reduction of the associate ranks.

Today many Mississippi firms look top heavy, with a lot more partners than associates. That's how firms looked in the early 1990's. The litigation boom of the late 1990's and early 2000's allowed firms to become leveraged by adding associates, of-counsel and paralegals. That meant more jobs for associates and more income for partners.

Ironically, associates in Mississippi who were forced to find new jobs several years ago turned out to be lucky. The economy was fine and it was usually not that hard to find another job. While finding another job often required leaving the state, some would say that is a positive. Today, it is much harder to find a job.

I do not expect the job market to significantly recover with the economy. Corporations and insurance companies are in a trend of bringing more legal work in-house. This is resulting in more lawyers going in-house from private practice. But since most of those types of jobs are outside Mississippi, the trend is a negative for Mississippi attorneys.

I'm not sure what will happen to the legal industry over the next 100 years. I hope a hundred years from now there are more lawyers who are practicing because they want to help resolve disputes and less who are practicing because they thought that it would be a path to making a lot of money.

There are too many well paid but unhappy lawyers who don't like the practice but are dependent on the income. I would like to see a leaner profession where most lawyers like the practice and do not attribute income with happiness.  It may take fewer lawyers and less money to make this dream a reality.