The Scruggs Katrina Group filed a federal lawsuit in Mississippi today accusing State Farm, an engineering firm and an adjusting concern of a racketeering conspiracy it alleges had defrauded a group of coastal homeowners out of $3.97 million.

Their action followed a court move by State Farm yesterday, which asked a judge to have attorney Richard Scruggs and Scruggs Katrina Group thrown off a Hurricane Katrina claims case for ethical violations.

A State Farm spokesman, Fraser Engerman, said the new suit is “Scruggs using one of the oldest tricks in the books–if you're attacked, deflect. He said last summer, 'If you don't win it, you spin it.”'

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