A federal jury in Mississippi finds State Farm committed fraud against the government's National Flood Insurance Program by submitting a fraudulent flood claim following Hurricane Katrina.

The eight-member jury reportedly deliberated for about three hours to decide the whistleblower lawsuit filed 7 years ago by former independent insurance adjusters Cori and Kerri Rigsby against State Farm under the False Claims Act.

The case was limited to the home of Thomas and Pamela McIntosh of North Biloxi, Miss., because a judge had previously ruled it was the only home in which the Rigsbys had firsthand knowledge of the alleged fraud by State Farm.

According to court documents, the jury found that State Farm overcharged the NFIP $250,000, which the carrier will have to repay. That amount—the full flood policy limit—was paid to the McIntoshes, along with $36,000 for wind damages covered by their State Farm homeowners policy.

Undetermined damages, to which the Rigsbys are entitled as filers of the suit, could also be awarded.

District Court Judge Halil Suleyman Ozerden had ruled the Rigsbys did not present enough evidence to prove State Farm conspired with two engineering firms to defraud the NFIP.

In a statement emailed to PC360, State Farm says, “We disagree with the jury's decision. This verdict defies the clear evidence we presented at trial over the past two weeks. We are reviewing our legal options.”

The Rigsbys' attorney, August J. Matteis, Jr., tells PC360 the verdict “is a testament to [the Rigsbys'] fortitude and perseverance.”

“When the Rigsbys blew the whistle on State Farm in 2006, they never could have imagined how long and difficult their path was going to be,” he adds.

Indeed, the high-profile case has been a roller coaster since the insurance-adjusting sisters stole State Farm documents after Katrina and handed them to state and federal officials, as well as once-prominent plaintiffs' attorney Richard “Dickie” Scruggs—who has since been convicted on unrelated charges he bribed a state judge. He is serving time in federal prison.

It was also found that Scruggs illegally paid the Rigsbys as consultants.

The Rigsbys appeared on national television with Scruggs with allegations State Farm doctored engineering reports to shift covered wind losses to uncovered flood losses, paid by the federal government's NFIP.

State Farm is still trying to get back the thousands of documents taken by the Rigsbys.

The years following the lawsuit filing has been marked by more than 1,000 entries to the case docket pre-trial motions to dismiss the case, limit its scope, and disqualify potential witnesses. And since the case was filed, its original presiding judge, the well-known Senior District Judge L.T. Senter, died.

During trial, one engineer testified that he thought wind destroyed the McIntosh home. According to testimony, State Farm sought to fire the engineering firm but backed off when the firm agreed to send another engineer to the house. He concluded water destroyed the structure.

State Farm called David Maurstad, NFIP administrator for 4 years beginning in June 2004, in its defense. Maurstad says he does not believe State Farm committed fraud while adjusting claims after Katrina.

Maurstad and Jim Shortley, a former NFIP claims manager, say they consulted with State Farm and other insurers to come up with a plan to streamline NFIP's claims-handling process following Katrina.

Following the massive hurricane, NFIP decided claims adjusters could forego line-by-line estimates for each piece of a damaged home when it was clear the damage exceeded policy limits.

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