State Farm Pushes to Move Katrina Trial Away from Miss. Coast

October 30, 2006

State Farm Fire & Casualty Co. has filed a motion in federal court in Gulfport, claiming it will get a fairer trial somewhere other than the Mississippi Gulf Coast.

Fifty-two policyholders, along with current and former public officials, have urged federal judges to try the Hurricane Katrina insurance case on the coast instead of in Oxford.

State Farm, in its motion, cites news coverage in The Sun Herald newspaper, “negative” television reports and a “substantial bias” against insurance companies among registered voters surveyed in south Mississippi.

State Farm wants the lawsuit filed by Ed Gemmill, a Biloxi city councilman, moved to federal court in Oxford. If the court agrees to move the trial, lawyers for policyholders said other cases may be tried away from the coast as well.

U.S. Magistrate Robert Walker has not ruled on the State Farm motion. Walker is allowing other attorneys with Katrina cases to comment on the issue.

Mayors A.J. Holloway of Biloxi and Billy Skellie of Long Beach, District Attorney Cono Caranna, Hancock and Harrison County supervisors, Jackson County Sheriff Mike Byrd and The Peoples Bank president Chevis Swetman are among 46 coast residents who have signed statements saying they’ve seen news coverage about State Farm and other insurers and believe insurers can get fair trials in south Mississippi.

Lawyers for homeowners contend Oxford does not have the facilities to support the trials, including public transportation, an airport with direct flights and hotel rooms, particularly during football season.

Federal court personnel have estimated that 1,100 insurance cases are pending. Harrison County Circuit Court has about 300 insurance cases, while Jackson County reports only a handful of lawsuits have been filed. Hancock County courts were unable to say how many insurance cases are pending there.

In the lawsuits, insurers and their policyholders disagree over how much is owed for Hurricane Katrina damage.

U.S. District Judge L.T. Senter Jr. has declared valid the “water” exclusions in insurance policies, meaning the companies are not responsible for covering Katrina’s tidal surge.

Policyholders contend insurers are minimizing or ignoring wind damage to avoid paying claims.

The insurance companies say they are paying what is owed under their policies, pointing out that the federal flood insurance program is responsible for covering Katrina’s unprecedented tidal surge.

According to State Farm’s motion, news coverage has colored opinions of potential jurors in south Mississippi. State Farm said its expert surveyed 3,600 registered voters statewide. In south Mississippi, the survey said, 55 percent of respondents said insurance companies have been unfair, while only 39 percent felt that way in north Mississippi.

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