Lawyers USA Your Business Partner

A Texas jury has unanimously handed down a $70 million verdict against an insurance company and its claims adjuster, finding that they recklessly failed to timely pay workers’ compensation benefits to a man who was severely injured in a fall on the job.

"The decision to deny the claim was not based on what the law was supposed to be," said Tom Rhodes, one of the lead plaintiff’s attorneys. "It was based on the agenda the insurance company had."

Charles Tate, a 52-year-old maintenance supervisor at an apartment complex, was severely injured after falling while using a chain saw on a ladder 30 feet in the air. He suffered injuries to his neck, shoulder and leg.

After the fall, Tate sought benefits, which would have totaled roughly $1,600 a week under the Texas workers’ compensation statute. The statute requires, among other things, that an applicant be "actively engaged in the search for work" or in a rehabilitative or work training program.

At the time, Tate was training to become a real estate agent.

Tate applied for benefits on a quarterly basis, and each time the request was denied by the insurance company after the claims adjuster disputed Tate’s eligibility.

Each time, the denial was reviewed by a mediator, who ruled in Tate’s favor, his attorney said. The insurer then appealed the ruling to a panel of the Texas Department of Insurance, Division of Workers’ Compensation. The DWC panel ruled each time that Tate was entitled to receive benefits.

The insurance company eventually paid the benefits after months of delays for each quarter.

In the meantime, Tate suffered economic hardship and mental anguish, his attorney said.

"He had gone more than four months with no income whatsoever," Rhodes noted. "He didn’t know where his next paycheck would come from."

When Tate didn’t pass his real estate exam, the insurance company took an ever harder stance, despite the fact he’d been so badly injured, Rhodes said.

"They didn’t like that," he said. "They wanted him to be out looking for a job as a busboy or something."

After repeated benefits denials, Tate eventually filed suit against the insurance company and claims adjuster under a Texas unfair and deceptive trade practices statute.

Crucial evidence and key witness

At trial, Rhodes said he presented evidence that included an internal memo submitted by the claim adjuster to the insurance company while the company was appealing several of the intermediate rulings.

"The memo in the file said, ‘Just go ahead and pay him this quarter,’" Rhodes recounted. "‘That will look better for" the DWC panel.

Rhodes sought to introduce evidence of past allegations of mishandled claims by the adjuster.

The evidence was initially excluded on a motion in limine . But later, the defendants’ attorneys made a move that helped the plaintiff.

"They asked about the allegations," Rhodes said. After the defendants opened the door, the judge allowed the evidence to be heard by the jury.

While several witnesses took the stand, including a representative from the insurance company who testified that the decision to deny the claims was wrong, it was Tate himself who provided the most important testimony.

"He was a really good witness, and explained how he’d never done anything but work hard all of his life," Rhodes said.

During the trial the defendants made only one settlement offer: $25,000.

"We had more confidence in the jury, and we felt we had a very strong case," so the plaintiffs’ team rejected the offer, Rhodes said.

In the end the jury unanimously found that the insurer and claims adjuster knowingly and recklessly violated the state statute, and awarded Tate $30 million in statutory damages, $20 million for past and future mental anguish and $20 million for him to pay his attorney fees.

There was also an additional award for interest and future attorney fees, since the defendants have indicated that they will appeal the verdict.

Messages left with the attorneys who represented the insurance company, Discover Property & Casualty, and the claims adjuster, JI Specialty Services, were not returned.

At-a-glance:

Verdict : $30 million in statutory damages, $20 million for past and future mental anguish and $20 million for the plaintiff to use to pay his attorney fees.

State : Texas

Type of case : unfair and deceptive trade practices

Status : No change.

Case name : Tate v. Discover Property & Casualty Co.

Date : Dec. 1, 2009

Plaintiff’s attorney : Tom Rhodes and Mark D. Wolfe of the Tom Rhodes Law Firm in San Antonio, Texas; Ethan L. Shaw of  Moore Landrey in Austin, Texas; Joe K. Longley, Attorney at Law, Austin, Texas.

Defense attorneys : Denton, Navarro, Rocha & Bernal, P.C, in San Antonio, Texas.

Questions or comments can be directed to the writer at: kimberly.atkins@lawyersusaonline.com

Close this Window Bookmark and Share This Page

Save to Browser Favorites / Bookmarks

Print RSS Feed Ask backflip blinklist BlogBookmark Bloglines BlogMarks Blogsvine BuddyMarks BUMPzee! CiteULike co.mments

Connotea del.icio.us Digg diigo DotNetKicks DropJack dzone Facebook Fark Faves Feed Me Links Friendsite folkd.com

Furl Google Hugg Jeqq Kaboodle kirtsy linkaGoGo linkedin LinksMarker Ma.gnolia Mister Wong Mixx MySpace

MyWeb Netvouz Newsvine oneview OnlyWire PlugIM Propeller Reddit Rojo Segnalo Shoutwire Simpy Slashdot

Sphere Sphinn Spurl Squidoo StumbleUpon Technorati ThisNext Tumblr Twitter Webride Windows Live Yahoo!

Email This to a Friend

Copy HTML: 

 If you like this then please subscribe to the RSS Feed.

More »