Jury awards $2.5 million in punitive damagesJan 11, 2007 | www.sunherald.com
A jury awarded a Mississippi couple $2.5 million in punitive damages in their case against State Farm Fire and Casualty on Thursday afternoon. Today's ruling is considered a sweeping decision for policyholiders along the Coast but State Farm doesn't see it that way.
State Farm has indicated it will not be handling its other claims any differently because of the situation and have another case set for trial shortly.
Earlier in the day, U.S. District Court Judge L.T. Senter Jr. ordered State Farm Fire and Casualty Co. to pay policy limits to a Biloxi policyholder because the company failed to prove how much damage was caused by Hurricane Katrina's storm surge.
Senter also denied State Farm's motion to dismiss the possibility of punitive damages against the company. Although attorneys for the Broussards were only able to establish that wind may have damaged the property and State Farm conceded there could have been wind damage to the roof, the Broussards will be able to argue State Farm should be punished for not meeting its obligation to fully investigate what was owed under the policy.
State Farm attorneys retired to a conference room where they're discussing what happened.
About an hour after the decision, State Farm released this statement: "We are surprised and disappointed by the court's ruling. The expert testimony supported a different result. After the conclusion of this case, we will evaluate our next steps."
State Farm's own expert said Wednesday there was a 75 percent chance the wind had caused anywhere from no damage to 35 percent damage to the roof shingles. State Farm told the jury Wednesday the company was unable to determine what the cost of wind damage might have been.
It was State Farm's burden to show what portion of damage it could attribute to storm surge.
Everyone appeared surprised by the sweeping decision in a case that was being closely monitored by attorneys for both sides but did not appear to be going well for the policyholders.
Policyholders' attorneys expected the sweeping decision to affect not only cases against State Farm but also against other insurance companies.
About 1,000 cases are pending in U.S. district court.