Houston Law Firm Claims a Win in Battle Against Insurer

June 4, 2003

Houston-based Hicks Thomas & Lilienstern announced that a Harris County jury found in favor of the firm and awarded $150,000 in attorneys fees it incurred in a dispute with the firm’s insurance carrier, Valley Forge Insurance. This money is in addition to the more than $500,000 the court has previously awarded the firm as damages in the case, which concerned business interruption claims related to Tropical Storm Allison.

“We paid insurance premiums so that we would be covered in the event of a disaster,” says Hicks Thomas Partner John Thomas. “Then, when we suffered just such a disaster, the insurance company didn’t want to pay. In fact, I don’t think Valley Forge has paid any claims as a result of this storm. Maybe this will be a dose of reality for them.”

Thomas says the case dates back to 2001 and the flooding Houston experienced in the aftermath of Tropical Storm Allison. Floodwaters destroyed the electrical system in the Bank of America building, where Hick Thomas had its offices on the 17th floor. The building remained closed for nearly a month, during which time Hicks Thomas had to pay several thousand dollars for temporary offices. Between these and other damages, as well as loss of income, the firm’s losses amounted to hundreds of thousands of dollars.

But when Hicks Thomas filed a claim against its business interruption policy with Valley Forge, the insurance carrier denied coverage on the basis the damage was the result of flooding, and was therefore exempt. Hicks Thomas sued Valley Forge and won the case on summary judgment. It then asked for attorneys’ fees, which the jury awarded June 2.

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