Cyrus Dugger

When Insurance Companies Link Their Employees’ Pay To Reduced Claims Payouts - We Should Know

From Trial Lawyers for Public Justice

Trial Lawyers for Public Justice has just won a unanimous Colorado Supreme Court decision overturning an outrageous secrecy order sealing already-public documents in Jessee v. Farmers Insurance Exchange. The documents, obtained by a crash victim charging her claim was denied in bad faith, show that Farmers Insurance linked its adjusters' compensation to the amount they saved the company on claims. The secrecy order would have made this key evidence secret, even though it was already public and the crash victim's attorney obtained it from another case against Farmer's where it was not sealed.

Jessee was filed in Colorado state court against Farmers Insurance for breach of contract, bad faith, and unfair and deceptive trade practices. Plaintiff Ruth Jessee, who was badly injured in a car accident, seeks damages for the company's refusal to pay uninsured motorist coverage under her insurance policy. The complaint alleges, among other things, that Farmers Insurance trains its adjusters to limit the amount of compensation awarded on claims and links the adjusters' compensation to how much money they save the company on claims.

Jessee's trial attorney, Randal R. Kelly of Denver's Irwin & Boesen, P.C., had obtained key documents relating to Farmers' practices after they were produced by Farmers Insurance without any protective order in a separate, out-of-state case, and from an expert on insurance. When he began using them in the Jessee case, however, the trial judge -- on the company's motion -- issued an extraordinary protective order at Farmer's request. The order required Kelly to identify all documents in his possession relating to the subject matter of the case -- and permitted the insurance company to label those documents "confidential" regardless of their source. It also required that any court records containing or referring to those documents be filed under seal. Finally, it required Jessee and her attorney to return all "confidential" documents to Farmer's at the end of the case. TLPJ and Kelly successfully petitioned the Colorado Supreme Court to reach down and take the case directly from the trial court.

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Posted at 1:19 PM, Nov 22, 2006 in
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