Last week, lame-duck State District Judge Bret Griffin ordered State Sen. Larry Taylor to testify in a lawsuit brought by the Brownsville Independent School District against the Texas Windstorm Insurance Association. The school district is represented by trial lawyer Steve Mostyn, a prolific donor to the Democratic Party. Gilad Edelman and Eli Okun reported on the ruling in the Texas Tribune:
A state senator will have to testify in response to allegations that he exerted improper political pressure on the state windstorm insurance agency, a judge ruled Thursday.
Sen. Larry Taylor, R-Friendswood, has denied accusations that he pressured the Texas Windstorm Insurance Association to fight more insurance claims cases in court in order to avoid paying large settlement sums to trial lawyers who often donate to Democratic politicians. Taylor vowed to appeal the decision.
Sen. Taylor issued a scathing response to the decision, pointing out that Judge Griffin should have recused himself from the case after Taylor was instrumental in defeating him in the March GOP primary.
SEN. TAYLOR DENOUNCES BIASED RULING
– Defeated Judge Rules in Favor of Democrat Mega Donor Steve Mostyn –
Sen. Larry Taylor
AUSTIN, TEXAS (July 7, 2014) . . . State Senator Larry Taylor (R – Friendswood) denounced a preliminary ruling issued late Friday by State District Judge Bret Griffin allowing plaintiff attorney and Democratic Party mega donor Steve Mostyn to take Taylor’s deposition in a lawsuit against the Texas Windstorm Insurance Association (TWIA). Taylor, who is not a party to the Mostyn case in question, opposed the motion, along with Attorney General Greg Abbott. Taylor has indicated an appeal of Griffin’s decision will be immediate.
Senator Taylor said, “Bret Griffin’s ruling is the latest installment of Steve Mostyn’s political harassment and intimidation campaign. I will not stand by and tolerate the trial lawyers’ agenda to trump transparent government and their attempt to misrepresent the truth to the policyholders of TWIA or the constituents of my district. Griffin’s decision to grant Mostyn’s request represents nothing more than political favoritism and a permission slip for an unwarranted fishing expedition.”
Earlier this year, Senator Taylor conveyed his strong opposition to Griffin’s gubernatorial appointment to the bench due to Griffin’s close ties to Democrat trial lawyers including Steve Mostyn and Tony Buzbee. Taylor expressed his dissatisfaction during the appointment process in his official role as a Texas Senator and publically endorsed Griffin’s opponent during the 2014 GOP primary. Griffin was defeated shortly after his appointment in the recent Republican primary run-off in Galveston County last month by conservative GOP attorney Pat Grady. Taylor added, “Due to the relevant circumstances of a disputed appointment and recent election defeat, any reputable jurist would have recused themselves from choosing to hear this motion.”
Personal injury trial lawyers who have traditionally been the single biggest source of funding for the Democrat Party, including former Galveston County Democrat Party Chair Tony Buzbee, have largely financed Griffin’s political campaigns. Buzbee and Mostyn have worked together on lawsuits against TWIA and have collected millions of dollars in attorney fees from those lawsuits.
According to campaign finance reports, Steve Mostyn contributed over $10 million in 2012 to democratic campaigns and causes. He is one of the largest contributors to the various political efforts of Barack Obama, Hillary Clinton and Wendy Davis. In recent years, Mostyn has also spent over $2,000,000 in his unsuccessful attempts to defeat Senator Taylor through funding “Trojan Horse” political opponents, direct mail pieces, billboards, robocalls and with negative smear campaigns.
“Over the past five low-activity storms seasons (2009-2013), hundreds of millions of dollars that should have been set aside for future storms has instead been used to pay excessive legal fees,” Taylor said. According to the consulting firm of Alvarez and Marsal, the most active plaintiff law firms, including Steve Mostyn, have earned an estimated $250 million suing TWIA.
Senator Taylor said, “If a TWIA policyholder has a legitimate covered claim, that person deserves to be paid fairly and promptly. Over the last five legislative sessions, I have filed bills to reform and replace TWIA with a better structure to ensure a fair process and prompt payment of legitimate claims. I’m trying to protect my constituents who deserve to know their TWIA premium dollars will be there to pay for losses in the event of a storm. That is the job I was elected to do and I will continue to look out for the citizens of Senate District 11.”
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The outcome of this case could have far reaching ramifications for those of us on the coast. If Mostyn, et. al., are successful in continuing to drain TWIA’s resources, there will be nothing left to pay homeowners in case another storm hits.
AUSTIN, TEXAS (October 29, 2012) – Since Hurricane Ike struck the Texas Gulf Coast over 4 years ago, the Texas Windstorm Insurance Association (TWIA) has paid out over $1.2 billion dollars on individually litigated claims related to the disaster. The information released today by Rep. Larry Taylor (R – Friendswood) reveals troubling legal settlement patterns and staggering litigation expenses on the part of TWIA. Rep. Taylor requested the information from the Texas Department of Insurance (TDI) in preparation for an upcoming hearing of the TWIA Legislative Oversight Board on November 1, 2012.
The information provided by TDI reveals an additional $1.2 billion dollars spent on Hurricane Ike litigated claims since the previously reported class action settlement for slab claims. Although this figure represents almost half of the total $2.5 billion in estimated losses, it is for only 10{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of the 93,000 total claims. Rep. Taylor, the Co-Chairman of the Oversight Board, said, “September 13, 2012 marked the 4 year anniversary of Hurricane Ike, yet TWIA continues to pay out tens of millions of dollars and plaintiff attorneys continue to solicit additional lawsuits. Coastal residents deserve to know how their dollars are being spent. I intend to get answers at the upcoming hearing because this natural disaster has turned into a man-made disaster with serious repercussions.”
To add insult to injury, on October 26, 2012, TWIA management announced a reduction in their expected contribution to the reserve fund by $100 million dollars due to ongoing lawsuits associated with Hurricane Ike. This announcement leaves TWIA with only $25 million dollars to be deposited into the Association’s reserve fund to pay future catastrophic claims.
The records also reveal a troubling and problematic settlement pattern between TWIA and the plaintiff attorneys involved in the litigation. There are extremely high settlement amounts above and beyond prior payouts made by TWIA for claims resulting in litigation. For example, TWIA paid out on average 7.2 {997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of all policy limits on the initial claims by policyholders. But, after litigation, TWIA paid out an additional 43{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of policy limits on average. This represents a combined average payout of 50{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of policy limits on the 10{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of claims that were litigated. In addition, TWIA has spent approximately $70 million dollars on defense costs since 2008, an additional $69 million on expense costs and $1.3 million on mediation related to Hurricane Ike settlements.
A summary of the Top 10 Plaintiff Law Firms handling TWIA litigation reveals an astounding settlement payout over $600 million dollars. There are over 300 plaintiff law firms with Hurricane Ike litigation claims in Texas, but a small cadre of 10 law firms has handled over 74{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of TWIA litigated claims. These firms are on track to handle over 800 additional claims in the coming months. Last session, the Texas Legislature passed legislation to reform the claims settlement process and litigation practices of TWIA. However, the legislation affects future events, not past events like Hurricane Ike.
Rep. Taylor added, “the bleeding of TWIA ratepayers has got to stop and it’s time TWIA management explain exactly how they’ve been running their business since Hurricane Ike devastated Texas. The payout patterns don’t make sense, the exorbitant costs are atrocious and the abuse of the public trust is at an end.”
Looks like there might be areas still needing tort reform. This chart from the link above caught my eye:
Looks like Rep. Craig Eiland has been busy while living in Austin. Sued and settled $40,000,000 worth of claims. So far. Remember this question and answer?
15. Should a person who has oversight responsibilities in the legislature be taking TWIA legal cases or handling TWIA policies?
Eiland: The TWIA Oversight Committee was created in 2009 by House Bill 4409. I have never been on the TWIA Oversight Committee, I specifically asked not to be put on that Committee. I accepted my first Ike case for a local respected businessman after the 2009 session was completed. Because of TWIA and other insurance companies’ treatment of storm victims I represented may people and business for Hurricane Ike damage. When I returned to the legislature I asked for and received a favorable House ethics opinion before voting on any property insurance issues. Doctors, farmers and CPAs and even insurance agents and lawyers tend to be on committees where their expertise is best utilized.
Heh, “expertise best utilized”. Apparently utilizing it well. No wonder he can afford a jet to hop down to Galveston every once in a while.