NU Online News Service

Attorneys for a Houston engineering firm and State Farm insurance said they will not appeal a Mississippi judge's ruling denying most of their requests to restrict a criminal probe into the handling of Hurricane Katrina insurance claims.

Circuit Judge Stephen B. Simpson in Gulfport, Miss. issued his ruling April 4 after Rimkus Consulting Group and State Farm brought actions seeking to limit a grand jury investigation mounted by Mississippi Attorney General Jim Hood.

Mr. Hood and the Harrison County District Attorney Cono Caranna are examining allegations that engineering reports may have been altered to minimize wind damage.

Dave Ward, an attorney for Rimkus in Houston, said today, "We don't believe at this point we will further seek to limit the subpoena by the attorney general or Judge Simpson's order.

He said the firm intends to speak with representatives of the attorney general's office about the information they are seeking and how best to comply."

Mr. Ward said "There is a potentially large amount of documentation."

The subpoena, according to the judge's order, originally sought confidential documents related to insurance carriers or other entities that are "neither targets nor subjects of a grand jury investigation."

It sought all engineering reports prepared for all insurance companies as a result of Hurricane Katrina in Hancock, Harrison and Jackson Counties.

Judge Simpson found the request was too broad-based and ordered that the attorney general limit the request to specific insurers and adjusters.

He gave Rimkus 30 days to produce the engineering reports once the attorney general's office names the companies it wants.

The judge also ordered that procedures to maintain confidentiality that he established for production of State Farm documents be used for the Rimkus reports.

In Jackson, Miss., Robert C. Galloway of the Butler, Snow, O'Mara Stevens & Cannada law firm representing State Farm, said Thursday there were no further legal proceedings scheduled on the matter for State Farm.

According to the Mississippi SunHerald, Mr. Galloway said the insurer had a concern that the attorney general would share records with Richard Scruggs and other attorneys pursuing Hurricane claims cases.

Both Mr. Hood and Mr. Scruggs have brought actions arguing that insurers should have to pay homeowners' windstorm damage claims for water damage caused by storm surge propelled by hurricane gusts.

Insurers have rejected such claims arguing that they are not covered because of flood exclusion language in policies.

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State Farm Won't Contest Subpoena Ruling

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