Notorious Fraudster Sues Insurance Company for Reporting Fraud to Authorities

 

October 23, 2017

 

Last week, the United States District Court for the Western District of Washington ruled on a case that a notorious Washington State fraudster who pleaded guilty to insurance fraud and subsequently sought damages from the insurer who reported his fraud to the authorities. The case is Cook v. Federated Mut. Ins. Co., No. C17-5795 RBL, 2017 U.S. Dist. LEXIS 170915 (W.D. Wash. Oct. 16, 2017).

 

In October 2016, David Cook pleaded guilty in Pierce County Superior Court of attempted third-degree theft. Cook was involved in an auto collision in August of 2013 with a commercial truck owned by a plumbing business. The commercial vehicle's driver ran a red light and Cook, who had the right of way, collided with the vehicle. Cook filed a claim for loss of wages with the plumbing company's insurer using falsified documents and information. The insurer and the detectives assigned to the case could not find any evidence that the company Cook claimed he worked for existed. Cook's nephew claimed he was a passenger in Cook's vehicle. Cook failed to appear in court in July and was placed on Kreidler's insurance fraud most wanted list. He was arrested by detectives on August 8, 2016 and pleaded guilty in court in October 2016.

 

Fast forward to 2017 when David Cook filed a complaint in court claiming that Federated Mutual Insurance Company (FMIC) owed him $15 million in damages. Cook claims that FMIC was responsible for instigating criminal charges against him after learning that Cook had submitted false insurance claims. Cook alleges that

 

“due to defendant's brutal, unconscionable, exceedingly evil and wicked, false accusation, and fallacy of a witch hunt, Plaintiff's life has become a series of agony, apprehension, skepticism, and misery. He is unable to exist normally in the bounds of society, overcome with a guishe life is basically a barrage of painful misadventure linked together on all sides and defendant is responsible and liable:”

 

Cook seeks a total of $15 million in damages from FMIC, essentially claiming that FMIC is responsible for his past four years of misfortune because they reported his fraudulent insurance claims to the relevant authorities. Cook's complaint seeks $10 million in punitive damages for pain and suffering resulting from the death of his wife and mother-in-law who died in a car accident in 2015. Cook's complaint fails to articulate any plausible theory as to how FMIC's reporting of his fraudulent insurance claims, to which Cook pled guilty, makes FMIC liable for the tragic but completely unrelated deaths of Cook's family members in a car accident.

 

The court concluded that Cook's complaint was frivolous because it had no legal or factual substance and no reasonable inference that FMIC is liable for the conduct that Cook alleges.

 

Editor's Note:

Cook was involved in a car accident and lied to the insurance company in order to get more compensation than he deserved. He was subpoenaed, failed to appear in court, and later arrested for insurance fraud. He pleaded guilty to insurance fraud for lying to the insurance company in an attempt to steal from them. Subsequently, he filed a complaint against that insurance company for reporting his fraud to the authorities. This is a classic frivolous bad faith lawsuit, the defense of which cost all parties more money than should have been shelled out in the first place. Cook might have thought that an insurer would rather settle out of court than pay to fight the suit in court. Cases of a notorious fraudster suing the insurance company for reporting his fraud are unheard of, for good reason. It is not an actionable offense.