Katrina victims' lawyers withdraw from proposal
as posted at www.chron.com
by ZACHARY R. MIDER
Mississippi lawyers negotiating on behalf of as many as 36,000 Hurricane Katrina victims pulled out of a proposed settlement with State Farm Mutual Automobile Insurance Co., citing a judge's reluctance to approve it.
Lawyers led by Richard Scruggs withdrew their settlement motion this week, telling U.S. District Judge L.T. Senter of Gulfport, Miss., in court papers that they hoped a new one could be filed "once the court's concerns are more fully understood."
State Farm, the state's largest home insurer, said the attorneys acted unilaterally.
The accord would require State Farm to reconsider claims in three Mississippi counties, paying policyholders at least $50 million more for the 2005 Gulf Coast storm. Senter refused to grant preliminary approval in January, saying it didn't guarantee enough policyholders would receive money.
The Scruggs group said it was also unclear whether State Farm was "genuinely amenable" to addressing Senter's concerns, however they may be interpreted. The "stalemate" makes them more focused on the hundreds of individual cases against State Farm and other insurers, the attorneys said.
"State Farm is still hopeful that a resolution can be reached to help in the rebuilding of southern Mississippi," said Fraser Engerman, a spokesman for Bloomington, Ill.-based State Farm. "We're waiting on the judge to render some kind of an opinion."
Scruggs did not return a phone call seeking comment.
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