The Legal Intelligencer's Peter Hall wrote an article that can be found here concerning the rising tensions inside the Luzerne County Courthouse over the expanded investigation into uninsured and under insured motorist cases(UM/UIM).
The FBI subpoenaed about 80 case files April 2 from the Luzerne County Courthouse as part of the agency's investigation into allegations regarding a possible scheme to inflate uninsured motorist/underinsured motorist arbitration awards by having plaintiff-friendly neutral arbitrators assigned to their cases.
Judge Peter Paul Olszewski Jr. handled 12 of the neutral arbitrator appointments -- more than any of the other nine judges on the list except Conahan and Toole.
Of the remaining 27 cases, nine were handled by former judge Ann H. Lokuta, who was removed from the bench by the Pennsylvania Court of Judicial Discipline last year for reasons unrelated to any criminal investigation; seven were handled by Judge Hugh F. Mundy; six by Judge Joseph M. Augello; two by Judge David Lupas; and one each by Judge Thomas F. Burke and President Judge Chester B. Muroski. One case on the list did not include the name of a judge assigned to handle it.
The Law Weekly first reported rumors that federal authorities were investigating alleged case fixing in UM/UIM arbitration cases in February. In the wake of that story, Muroski launched a review of the court's procedures to appoint neutral arbitrators.
Sources later confirmed the FBI's investigation was ongoing.
Well, you know you can click on the link to read the entire article. However let me highlight the following:
According to court records examined by the Law Weekly involving a selected group of 10 major auto insurance companies, plaintiffs lawyers filed petitions to appoint neutral arbitrators on 43 occasions between 1995 and 2008.
In 29 of those cases, the same six law firms represented the plaintiffs. In 13 of the 43 cases, attorneys from the same six firms, all of which market themselves as plaintiffs firms, were also appointed as neutral arbitrators. Twice, there were no records for plaintiffs attorneys. The names of the appointed arbitrators were not recorded in seven cases.
In 22 of the 43 cases, the judge was either Conahan or Ciavarella. There was no record of a judge in two of those cases.
The outcome of arbitration in which the lawyers named participated is not a public record. There is no evidence to suggest that the result of arbitration in the cases examined was improper. Nor is there anything to suggest plaintiffs law firms did anything improper to be appointed neutral arbitrators. Ciavarella and Conahan have not been charged with anything related to allegations of fixing UM/UIM cases.
Showing posts with label insurance fraud. Show all posts
Showing posts with label insurance fraud. Show all posts
Monday, April 13, 2009
Saturday, March 14, 2009
More Information On Alleged Case-Fixing That May Be Target of Luzerne County Probe
As I stated the Legal Intelligencer has more than their ear to the ground on the Luzerne County corruption probe. Here is more information from their outstanding reporting about suspected case-fixing that makes for very interesting reading.
One insurance defense lawyer who works in-house for a major insurance carrier in Luzerne County said the effort to control the appointment of neutral arbitrators was more regimented. He claimed to recall that in about 2003 an order was printed in the Luzerne County Register, a weekly publication of the Luzerne County Law and Library Association, that directed all petitions to appoint neutral arbitrators to be brought before Conahan, who was then president judge. Later, a similar order was allegedly published directing such petitions to Ciavarella, who was elected president judge in 2006.
"If I knew what I know now, I should have saved those and bronzed them," the attorney said.
Leo Strupczewski and Peter Hall of The Legal Intelligencer took a closer look at the docket.
According to court records examined by The Legal Intelligencer involving a selected group of 10 major auto insurance companies, plaintiffs lawyers filed petitions to appoint neutral arbitrators on 43 occasions between 1995 and 2008.
In 29 of those cases, the same six law firms represented the plaintiffs. In 13 of the 43 cases, attorneys from the same six firms, all of which market themselves as plaintiffs firms, were also appointed as neutral arbitrators. Twice, there were no records for plaintiffs attorneys. The names of the appointed arbitrators were not recorded in seven cases.
In 22 of the 43 cases, the judge was either Conahan or Ciavarella. There was no record of a judge in two of those cases.
The outcome of arbitration in which the lawyers named participated is not a public record. There is no evidence to suggest that the result of arbitration in the cases examined was improper. Nor is there anything to suggest plaintiffs law firms did anything improper to be appointed neutral arbitrators. Ciavarella and Conahan have not been charged with anything related to allegations of case fixing UM/UIM cases.
In one of the cases reassigned from Lokuta to Ciavarella, Pockevich v. Lindstrom, a jury returned a $352,500 verdict that included no economic damages. The verdict included $250,000 for past and future emotional distress, $75,000 for loss of life's pleasures and $27,500 for pain and suffering. The verdict came after Ciavarella granted a plaintiff's motion to preclude a defense psychiatric expert from testifying.
The lawyer with the Philadelphia defense firm said he often perceived the appointment of neutral arbitrators to be predetermined, even when he had a chance to weigh in.
"I've submitted lists of 25 to 30 names of extraordinarily qualified judges and lawyers as arbitrators," he said. "They'd all be rejected."
The in-house lawyer said he has also grown accustomed to reasonable suggestions being rejected.
"I've recommended [former] Supreme Court Justice [Russell M.] Nigro and they've rejected him," he said. "I've recommended these guys who are fairer than the day is long and they've rejected them."
"It's beyond coincidence that these guys constantly got each other as neutrals," the lawyer said.
If there have been improprieties in the conduct of Luzerne County insurance arbitration, it would be very difficult to prove, the lawyer with the Philadelphia firm said.
One insurance defense lawyer who works in-house for a major insurance carrier in Luzerne County said the effort to control the appointment of neutral arbitrators was more regimented. He claimed to recall that in about 2003 an order was printed in the Luzerne County Register, a weekly publication of the Luzerne County Law and Library Association, that directed all petitions to appoint neutral arbitrators to be brought before Conahan, who was then president judge. Later, a similar order was allegedly published directing such petitions to Ciavarella, who was elected president judge in 2006.
"If I knew what I know now, I should have saved those and bronzed them," the attorney said.
Leo Strupczewski and Peter Hall of The Legal Intelligencer took a closer look at the docket.
According to court records examined by The Legal Intelligencer involving a selected group of 10 major auto insurance companies, plaintiffs lawyers filed petitions to appoint neutral arbitrators on 43 occasions between 1995 and 2008.
In 29 of those cases, the same six law firms represented the plaintiffs. In 13 of the 43 cases, attorneys from the same six firms, all of which market themselves as plaintiffs firms, were also appointed as neutral arbitrators. Twice, there were no records for plaintiffs attorneys. The names of the appointed arbitrators were not recorded in seven cases.
In 22 of the 43 cases, the judge was either Conahan or Ciavarella. There was no record of a judge in two of those cases.
The outcome of arbitration in which the lawyers named participated is not a public record. There is no evidence to suggest that the result of arbitration in the cases examined was improper. Nor is there anything to suggest plaintiffs law firms did anything improper to be appointed neutral arbitrators. Ciavarella and Conahan have not been charged with anything related to allegations of case fixing UM/UIM cases.
In one of the cases reassigned from Lokuta to Ciavarella, Pockevich v. Lindstrom, a jury returned a $352,500 verdict that included no economic damages. The verdict included $250,000 for past and future emotional distress, $75,000 for loss of life's pleasures and $27,500 for pain and suffering. The verdict came after Ciavarella granted a plaintiff's motion to preclude a defense psychiatric expert from testifying.
The lawyer with the Philadelphia defense firm said he often perceived the appointment of neutral arbitrators to be predetermined, even when he had a chance to weigh in.
"I've submitted lists of 25 to 30 names of extraordinarily qualified judges and lawyers as arbitrators," he said. "They'd all be rejected."
The in-house lawyer said he has also grown accustomed to reasonable suggestions being rejected.
"I've recommended [former] Supreme Court Justice [Russell M.] Nigro and they've rejected him," he said. "I've recommended these guys who are fairer than the day is long and they've rejected them."
"It's beyond coincidence that these guys constantly got each other as neutrals," the lawyer said.
If there have been improprieties in the conduct of Luzerne County insurance arbitration, it would be very difficult to prove, the lawyer with the Philadelphia firm said.
FBI Probe Expands To Lackawanna County
According to the Legal Intelligencer the FBI probe appears to take on new proportions in the scope of its probe. Yesterday's Citizens Voice article shined a little light on the subject.
Federal investigators have subpoenaed at least one insurance company to testify about uninsured/underinsured motorist arbitrations in Luzerne and Lackawanna counties in Pennsylvania before a grand jury, The Legal Intelligencer has learned, indicating for the first time that the corruption probe has expanded geographically.
According to the Citizens' Voice article, Toole presided over two cases in 2005 -- including one that resulted in a $2 million settlement for the plaintiffs -- handled by John Nardone, even though he listed the Law Office of John Nardone as a source of income on financial disclosure forms for 2004 and 2005.
In speaking with several white-collar lawyers, it appears that if the Citizens' Voice article is accurate, the U.S. Attorney's Office for the Middle District of Pennsylvania may wind up investigating Toole for possible honest services fraud. There is no evidence that Nardone did anything wrong.
When asked, in light of the article, if federal investigators might pursue that angle, one white-collar attorney replied: "Absolutely. It appears to be a problem if he didn't disclose to counsel the financial relationship. It's not enough to disclose on the form. I think they [U.S. Attorney's Office] absolutely will be investigating it. They almost have to. They probably will interview opposing counsel."
Nardone did not return a call seeking comment. Neither did Toole. A call to an attorney rumored to be representing Toole was not returned. A call to Martin C. Carlson, the U.S. Attorney for the Middle District of Pennsylvania, was not returned.
While what is publicly known about the ongoing corruption probe in Luzerne County has been focused on the courthouse there, a subpoena obtained by The Legal Intelligencer is the first indication that federal officials are broadening their investigation to include neighboring Lackawanna County.
The subpoena requires officials from Harleysville Insurance to contact Assistant U.S. Attorney William S. Houser to "discuss compliance" and appear before a federal grand jury in Scranton, Pa., with a bevy of documents on March 24.
Read the particulars of the subpoena by clicking here.
Federal investigators have subpoenaed at least one insurance company to testify about uninsured/underinsured motorist arbitrations in Luzerne and Lackawanna counties in Pennsylvania before a grand jury, The Legal Intelligencer has learned, indicating for the first time that the corruption probe has expanded geographically.
According to the Citizens' Voice article, Toole presided over two cases in 2005 -- including one that resulted in a $2 million settlement for the plaintiffs -- handled by John Nardone, even though he listed the Law Office of John Nardone as a source of income on financial disclosure forms for 2004 and 2005.
In speaking with several white-collar lawyers, it appears that if the Citizens' Voice article is accurate, the U.S. Attorney's Office for the Middle District of Pennsylvania may wind up investigating Toole for possible honest services fraud. There is no evidence that Nardone did anything wrong.
When asked, in light of the article, if federal investigators might pursue that angle, one white-collar attorney replied: "Absolutely. It appears to be a problem if he didn't disclose to counsel the financial relationship. It's not enough to disclose on the form. I think they [U.S. Attorney's Office] absolutely will be investigating it. They almost have to. They probably will interview opposing counsel."
Nardone did not return a call seeking comment. Neither did Toole. A call to an attorney rumored to be representing Toole was not returned. A call to Martin C. Carlson, the U.S. Attorney for the Middle District of Pennsylvania, was not returned.
While what is publicly known about the ongoing corruption probe in Luzerne County has been focused on the courthouse there, a subpoena obtained by The Legal Intelligencer is the first indication that federal officials are broadening their investigation to include neighboring Lackawanna County.
The subpoena requires officials from Harleysville Insurance to contact Assistant U.S. Attorney William S. Houser to "discuss compliance" and appear before a federal grand jury in Scranton, Pa., with a bevy of documents on March 24.
Read the particulars of the subpoena by clicking here.
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