Another State Farm motion to disqualify Scruggs(less) Katrina Group

Yesterday State Farm filed a motion in the McIntosh v. State Farm case seeking the disqualification of the coalition of law firms formerly called the Scruggs Katrina Group and now known as the Katrina Litigation Group.  You may recall that last month I wrote about a similar motion filed in the Shows v. State Farm case.  Click here to read that earlier post.

Here is a copy of the memorandum in support of the new disqualification motion, which really is more or less the same as the memorandum in the Shows case.  

Apropos of yesterday’s post on the Kerri Rigsby deposition, you may be interested in the memorandum in support of State Farm’s motion last month to compel Kerri and Cori to answer questions they were instructed not to, on privilege grounds, in the November depositions. Here’s a copy of that memorandum. 

Here is a part of the brief I found interesting on the question of whether the presence of the Rigsby sisters’ mother at a meeting with attorneys destroyed the attorney-client privilege (I’ve removed references to the pages of the deposition transcript to make the passage easier to read.  I have also added some explanatory material that is in brackets and italics to distinguish it from other bracketed material in the excerpt):

The Rigsbys freely admit that third persons with no interest in this matter attended some, if not all, of the Rigsbys’ meetings with the SKG in early 2006.  For example, Kerri Rigsby testified that her mother — Pat Labrano — attended one of the SKG meetings in February 2006, one in March 2006, another in April 2006, and still others in early 2006 the timing of which Ms. Rigsby could not precisely recall.  When asked why the presence of a third party did not effect a waiver of the purported privilege now asserted by the Rigsbys, Mr. [Sid] Backstrom [of the Scruggs Law Firm] asserted that the privilege somehow survives because Ms. Labrano "was a client" of the SKG. 

When asked, however, Mr. Backstrom refused to identify even in general terms the nature of the SKG’s representation of Ms. Labrano.  Even more perplexingly, Mr. Taylor [an attorney from another firm hired by Scruggs to defend Kerri Rigsby’s deposition] speculated that Ms. Labrano’s presence at numerous SKG meetings with her daughters did not waive the purported privilege because "she was also playing the role of representative or facilitator [for Cori and Kerri] which," in Mr. Taylor’s view, "would bring her within the privilege."  There is no such thing as a so-called "representative" or "facilitator" privilege that would prevent waiver of the privilege that the Rigsbys attempt to assert here.

But even if there were, Ms. Labrano was not the only third person present at the SKG meetings.  Indeed, Kerri Rigsby testified that Ms. Labrano’s husband — Bill Labrano — also accompanied the sisters at SKG meetings.  It is axiomatic that the sharing of otherwise privileged information with third persons waives any privilege that could attach.  Indeed, "the disclosure of an otherwise privileged communication to a third person . . . eliminates the intent for confidentiality on which the privilege rests.  Martin v. Am. Employers’ Ins. Co., 115 F.R.D. 532, 536, (S.D. Miss. 1987)(finding waiver of the attorney-client privilege)(citations omitted).  Whether or not the SKG may have represented the Labranos in some other matter does not bring them within the fold of the attorney-client or work product privileges here.

It is equally plain that even if both Ms. Labrano and her husband were acting in some sort of inexplicable representative capacity on the Rigsbys’ behalf at the SKG meetings the privilege would still be waived.  Accordingly, even if the information that the Rigsbys most recently seek to withhold was privileged (and it clearly is not), the presence of third parties at the SKG meetings in question would constitute a clear waiver of any claim of privilege.

If I am understanding this correctly, I disagree somewhat with the way it is stated, not to mention the use of the word "clear" to describe something that may not be so clear from the text of the memorandum.  The presence of third parties does not automatically destroy the attorney-client relationship, as long as the communications were made under circumstances that evidence an intent to keep them secret.  Spouses and relatives often attend meetings with attorneys, and this does not destroy the privileged nature of communications as long as their presence was reasonably necessary to accomplish the purpose of the client. 

A court will look at the circumstances and the sophistication of the client to see whether the presence was necessary — if the person was just there as a litigation tourist, to kibitz or to campaign for their own agenda, the privilege could indeed be broken.  Some people, however, are afraid of lawyers — justifiably so if you ask me, because as a class lawyers are far from the most likeable people — and want the experience and comfort of a close family member in certain meetings.  We don’t want to break the privilege every time this happens.  But I suspect that the Rigsby sisters, who styled themselves whistleblowing heroes and came equipped to the meeting with Scruggs with their State Farm laptops, and who after all had each other at the meeting for aid and comfort, are difficult to fit within this category.  And in how many meetings did these women actually need their mother present?     

And here is something new that was also filed yesterday, State Farm’s memorandum in support of its motion to compel the Rigsby sisters to produce documents they have admitted in depositions to having, such as a log of questionable activity at State Farm, but which they denied having in response to written discovery requests. 

No matter what your views of the conduct of insurance companies in Katrina adjusting, or your views on the litigation conduct of Scruggs and company, you have to admit that the turnaround in the litigation posture of the parties in the last few months of Katrina litigation is nothing short of astounding.  Scruggs under indictment, his law firm kicked out of Katrina litigation, Judge Acker swinging a light saber, the SKG looking like Marley’s ghost, FBI agents doing lightning raids of law firms when they’re not tapping telephones and filming covert videos, everyone connected with Scruggs running for the tall grass, State Farm with an injunction against the Attorney General, Jim Hood either scared to or unwilling to open his mouth, the Ride of the Rigsbys over, State Farm on the offensive across the board.  The hunters have become the hunted.    

If you had predicted this turn of the screw a year ago, I wouldn’t have called you crazy, but I definitely would have wanted to check out your track record in Vegas. Remarkable, remarkable events which we are unlikely to see again in our lifetimes.  Which is why, day after day, I continue to give up what free time I have to chronicle them here.

Incidentally, have you seen the Scruggs coverage of Lotus on the folo blog? Some very good stuff, and some very good commenters have congregated there, as they have here.  Interesting post yesterday cataloguing some of the rumors. I hear some of these same things, some I hear turn out to be true, others don’t.  Time, as always, will tell — but sometimes we have to dig a bit to make it tell. 

This is probably it for the posts for the week, have a great weekend.  More next week on the Rigsby depositions, and on Scruggs events, as well as some analysis of some coverage cases I’ve been meaning to get to, at readers’ requests.  But if those rumors turn out to be true, and they turn out to be true tomorrow, maybe I’ll have to write some more.





Filed under Industry Developments

4 Responses to Another State Farm motion to disqualify Scruggs(less) Katrina Group

  1. MS Smitty

    You’ll be on Gallo’s program (SupertalkMS) out here Monday morning?

  2. Sam

    In the disqualification motion, footnote 4 cites to Brown v. David Nutt et al, which allegedly supports continuing unethical behavior by KLG. Have you looked at that pleading? Does Brown relate to Katrina cases? Thanks…

  3. MS Smitty, thanks for the reminder, I just put up another post about the interview. Sam, I’ve written about the Maria Brown case, go the blog’s search bar and type in “Brown” and you’ll find the post, along with a copy of the complaint. If it has something to do with Katrina litigation or Scruggs, odds are I’ve written something about it, so the blog search feature is a good thing to keep in mind.

  4. Sam

    I just saw on Insurance Journal that State Farm settled 22 cases…