Law firm faces up to $328,000 in sanctions
Partner William Huye of the McClenny, Moseley and Associates law firm, from a video via Facebook.
A federal judge in Louisiana has made clear that he’s caught-on to the questionable practices employed by a plaintiff insurance attorney firm operating there, threatening them with sanctions for filing batches of hundreds of hurricane lawsuits. US District Court Judge James Cain Jr. ordered McClenny, Moseley and Associates to submit physical signed copies of all retention and engagement contracts in the 1,642 lawsuits the firm filed for alleged damages from the 2020 Hurricanes Laura and Delta. He’s threatened to fine the Houston-based law firm $200 for each duplicate or baseless lawsuit he finds.
The judge issued an order in late October outlining what he found already: duplicate lawsuits, lawsuits for claims already settled, and lawsuits regarding property outside the range of the hurricanes’ damage. The order prohibits any lawsuits from being “mass mediated, litigated or settled.”
Steven Badger, Partner, Zelle LLP
“These lawyers were clearly banking on insurance companies agreeing to bulk mediations and settlements,” insurance defense lawyer Steven Badger, a partner with the Zelle law firm in Dallas told the Claims Journal. “They didn’t plan to litigate thousands of lawsuits. With this order, they have no choice but to litigate each individual matter.”
Aggravating matters, was a video posted on Facebook by restoration contractor Disaster Solutions, who sponsored an August event in New Orleans to bring the McClenny Moseley firm together with contractors eager for claims work. In the video, partner William Huye brags that the firm filed 1,700 lawsuits in a four-day span.
Badger, who has been very active in leading the insurance industry’s response to fraud and other abuses in Texas CAT litigation, was kind enough to share a list of the judge’s sometimes scathing comments in court:
— You have wasted judicial resources having to deal with your mess because you didn’t do your job on the front end.
— So I’m really here to try to help you guys learn this is not the way to do business, this not the way to practice law.
— So you may go try to pull this stunt in Florida because I’ve already seen y’all’s advertisements. Shame on you. Shame on you for trying to prey on people.
— I’m telling you y’all got to tighten up. And if you don’t tighten up, I’m going to tighten it up for you.
— I’m going to tell you if your firm’s business practice and your business model is to do it this way, if I was you two I’d go find a different firm to work for because this is not the way to do it.
— [Y]ou’re not charging 40 percent. That’s a ridiculous fee. I practiced law for 30 years and I only charged 40 percent in two types of cases, medical malpractice and products liability. That was it. I think most lawyers in this community are charging 25 percent if the case settles….But if you’re settling these pre-suit like this, there’s no way in a hurricane situation you should charge people 40 percent. That’s highway robbery and I’m not going to allow it.
— I saw — somebody sent me the video off a Facebook page from some company called Disaster Solutions. I don’t know if you’re in it, but you’re in it….did not appreciate your cavalier comments in that video about my court, we broke the system, we filed, we set a record….To me you’re not doing the profession of practicing law any favors, not doing yourself any favors, popping out on Facebook about how you’re doing it. It doesn’t look good.
— And the way it appears on the surface, y’all are coming in at the bottom and just trying to scoop up the bottom of the barrel like a bunch of bottom feeders. I’m going to be honest with you. That’s the way it looks. You can take issue with it. I’m not saying that’s — I’m just telling you the way it looks on the surface. It doesn’t look good because it’s sloppy.
— I’m telling you don’t ever come back to my court. God forbid we ever have another hurricane, but I do not ever want to see this again. Hear me. Tell your partners in Houston stay the frick out of my court with this kind of trash.
— Let me tell you, you ever call my chambers again and tell them you can’t show up for a hearing, Marshall Gallow, she’s your Uber. She will be coming to New Orleans and dragging you out of whatever you’re in and driving you over here. It’ll be the worst Uber ride of your life probably. Don’t ever do that again.
— Listen, just hear me now. If you think you’re going to play games, you play them but just remember one very important thing: I make the rules. Okay. So go forth, clean this mess up.
Thank you for sharing this story with us Steve! Forewarned is forearmed. Keep up the great work!
LMA Newsletter of 11-7-22
