U.S. District Court Judge L.T. Senter Jr. threw a monkey wrench into the controversial State Farm settlement of Hurricane Katrina claims on Friday. Among his many complaints was that plaintiff attorneys hit the jackpot with as much as $20 million in fees. But while this is a setback, I don't think either side wants the deal to collapse altogether, and expect a modified program to be agreed upon fairly quickly, if only because going back to court is not an alternative for the embattled carrier.
Indeed, as reported by our own Dan Hays in today's NU Daily e-newsletter, all the parties involved seem eager to address any objections raised by the judge and get the settlement back on track.
I am no fan of this deal, but I can appreciate the pressure State Farm is under to make it happen. After all, not only did the carrier get hit with a $2.5 million punitive damage award on the first of many water-related claims against it, but Mississippi Attorney General Jim Hood had convened a grand jury to pursue possible criminal charges against the carrier. That's an awfully big hammer to ignore.
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