Quote of the Day - Katrina could reach category-one hurricane strength before the center reaches the southeastern coast of Florida.
MIPTC promised a follow-up on this story right after Hurricane Katrina hit, and the first of the lawsuit results are starting to trickle in. State Farm got hit with a $2.5 million punitive damages judgment for its failure to pay a claim submitted by one family it insured. They had sought $5 million in punitives.
The family claimed that their home was damaged by a tornado that hit during the hurricane, and State Farm their losses were caused by storm surge, an exclusion in the policy.
Update on January 31, 2007: Ruling on State Farm's motion to reduce punitive damages, Judge L.T. Senter reduced the punitive damages award to $1million from the $2.5 awarded by the jury. Judge Senter said even though "clear and convincing evidence supports a finding that Defendant acted in such a grossly negligent way as to evince willful, wanton, or reckless disregard for the rights of the Plaintiffs," the jury's award is almost 12 times the amount of compensatory damages. Fortunately, Plaintiffs only suffered an economic injury. It is my determination that a more appropriate punitive assessment against Defendant is the sum of $1,000,000.00, which is between 4 and 5 times the contractual/compensatory damages of $211,222.00," he said in ruling on the motion.