From phoenixnewtimes.comOriginally published by Phoenix New Times
November 16, 2000
©2000 New Times, Inc. All rights reserved.
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Snake Killer They call it "Snake Farm." Lawyers like Cal Thur battle
State Farm to protect consumers from their own insurance company.
Moral of the story: Don't have an accident. By Laura Laughlin
It was a long week for Kim Zilisch. The Motorola accountant had spent
three grueling days taking tests at the Phoenix Civic Plaza for her
CPA license. On Friday night, she finally got to relax. Her fiancé,
Jeff Rosinski, picked her up downtown and drove her to the inaugural
concert at Blockbuster Desert Sky Pavilion.
Zilisch, 23, was excited. Tall, lanky Rosinski, 27, was so sweet: He
had surprised her with tickets to the Billy Joel show. She loved the
"Piano Man" and looked forward to a night out with her fiancé after
the grind of her exams.
Following a memorable, unseasonably warm evening under the stars,
Rosinski and Zilisch headed back to Mesa. Content and exhausted,
Zilisch dozed off while Rosinski drove.
It was a merciful slumber.
When she awoke two days later in a hospital bed, her body ached. One
of her fingers wouldn't move. She couldn't open her left eye. When she
asked about Rosinski, a hospital staffer told her he was dead.
After exiting at the Price Road off ramp from the Superstition
Freeway, Rosinski's car had been demolished by a teenage drag-racer
who had sped through two red lights before T-boning the driver's side
of the Pontiac Grand Am. The violent crash peeled off the roof of
Rosinski's car like a lid on a can of tuna. The dashboard
disintegrated, the console rammed into Zilisch's left leg and the
right side of her head was slammed against the passenger window.
Rosinski was killed instantly. Zilisch, unconscious, had to be cut out
of the car.
A decade after the accident, most of Zilisch's wounds have healed. She
has regained the use of her finger. Indentations on her left thigh are
concealed by her clothing. Her eye, which remained shut for nearly a
year, is open. But the lid droops slightly and the pupil is
permanently dilated and fixed. When Zilisch looks straight ahead, she
can see fine (and she looks okay to an observer), but if she tries to
glance in any direction, that left eye doesn't move and she sees
double images.
Zilisch has rebuilt her life. She left Motorola because Rosinski had
worked there, too; it was too painful to stay. She went to graduate
school for an advanced degree and is now in a new job.
Resuming her social life was more difficult. Her eye injury made her
feel ugly, she says. And because her double vision -- and memories of
Rosinski -- kept her from participating in what used to be their
favorite sports, she gained weight. That just added to her low
self-esteem, she says.
She was "a downer" to be around, depressed and prone to crying. Pretty
soon friends stopped including her in their social events.
Going to school again introduced her to new people, but she felt
guilty dating other men. Zilisch says it was four years after the
accident before she was again able to enter into a relationship.
Today, she is seriously involved with a new man.
Recounting the horrific events of November 9, 1990, Zilisch maintains
her composure. It was, she notes, a long time ago.
Only once do her eyes well up. The tears come not when she tells about
the loss of her fiancé or the brutality of the accident. No, her voice
only catches when she recounts what happened afterward, when she had
to fight her own insurance company -- State Farm Mutual Automobile
Insurance Co. -- to give her the underinsured motorist coverage she
had purchased.
She tells of being subjected to interview after interview as new
claims investigators were assigned to her case and having to visit
five doctors for examinations of her eye. State Farm refused to accept
the fact that her disfiguring eye injury was indeed permanent. She
says the physician State Farm sent her to yanked her face from side to
side to gauge the lack of movement in her rigid orb. Recounting this
episode, Zilisch almost cries. Then she regains her composure.
"I just wanted the money, the coverage, that I had paid for," she
says. "There's nothing wrong with that."
___________________________________
What was wrong, according to a Maricopa County Superior Court jury
that eventually awarded her $1 million, was how State Farm treated
Zilisch. The Arizona Court of Appeals as well as the state Supreme
Court agreed.
The state's highest court noted in its March ruling that there was
evidence that State Farm had purposely dragged out Zilisch's case,
ignored repeated opinions that her injury was permanent, and acted
according to its "deliberate practice of underpaying claims
nationwide."
A six-month New Times examination of Arizona cases involving State
Farm, as well as an Internet-assisted search of court records of
similar cases in other states, supports the conclusion that the
treatment Kim Zilisch received from her own insurance company was no
accident. In numerous courtrooms around the country and in state
investigations, a pattern has emerged showing that State Farm -- the
industry giant that insures one in every five vehicles on the road and
one in four homes -- employs company policies aimed specifically at
screwing its own policyholders for the sake of higher profits.
Among the business practices uncovered:
The company routinely tried to "lowball" its own policyholders who
filed claims with them -- particularly those who were most vulnerable
-- by offering them settlement amounts less than what the claims were
actually worth.
For decades State Farm rewarded agents who were successful at this,
even sponsoring contests to see who could most effectively chisel
claims filed by the company's own clients.
While it is impossible to tell how many claimants simply accept a
payment that is less than they are entitled to, those who dare to
challenge State Farm find their cases intentionally dragged out in an
effort to wear them down.
And anyone brave enough to stand up to the company in court faces a
brawny legal department notorious for its oppressive tactics.
State Farm has denied any wrongdoing in Zilisch's case, says it always
pays what is owed on claims and, despite internal documents to the
contrary, denies ever rewarding its employees for arbitrarily cutting
claim payments.
"We wouldn't be where we are today," says company spokesperson Ana
Compain-Romero, "if we had shoddy business practices."
Zilisch would beg to disagree. And after proving that State Farm had
mistreated her in court, Zilisch learned what other "successful"
litigants across the country have found: that a jury verdict against
State Farm is a hollow victory, only setting the stage for lengthy
appeals.
Furthermore, a large punitive-damage judgment -- intended to punish
the company in hopes of deterring such future conduct -- doesn't
necessarily make any difference to State Farm.
Perhaps the most remarkable finding of the New Times probe is that a
review of court testimony and judicial rulings in several cases
suggests that State Farm is such an industry giant that it is, for all
practical purposes, beyond the reach of judge and jury.
Plaintiffs' lawyers routinely argue for punitive damages as a way to
"send a message" to defendants that certain types of behavior simply
are not acceptable. But in State Farm cases, multimillion-dollar sums
jurors think will lead to reforms are meaningless to a firm that has
67 million policies in effect and tens of billions of dollars in
reserve.
A State Farm administrator testified in Zilisch's case that he would
not bother to notify his supervisors of damages under $100 million, an
almost unheard-of figure in punitive judgments.
In one case, an Idaho judge who found State Farm's treatment of its
insured "outrageous, intentional, harmful and an extreme deviation
from reasonable conduct" countered the company's protests about a $9.5
million punitive-damage award by noting that it amounted to less than
two days' profit.
The judge said the award "could be recovered by lunchtime on the
second day."
While some of State Farm's most questionable practices have been in
place for decades, court records show it is only recently that judges,
juries and regulatory authorities have begun to call the firm on its
methods. A Fortune 500 company also named one of the most admired in
the industry, State Farm is appealing two record-setting
punitive-damage verdicts while its business practices are being
investigated by insurance commissioners across the nation. Arizona's
regulators are taking an active role in the probe.
Zilisch had no inkling of State Farm's business practices when she was
involved in the accident 10 years ago. But what she learned at her
trial, she says, "made your jaw drop."
___________________________________
Zilisch's case added insult to injury, literally. She had lost her
fiancé and the use of one eye. She had every reason to expect that
State Farm -- a company she had always trusted since her early days
growing up 30 miles from company headquarters in Bloomington, Illinois
-- would pay the benefits she deserved. With a $100,000 underinsured
motorist policy in addition to traditional coverage, Zilisch had
purchased far more than the legally required auto insurance. She did
that just to be safe and she always paid her premiums on time.
In the beginning, as the months dragged on after the accident while
State Farm investigated her claim, Zilisch thought the delays were
merely because hers was an extra-complicated case. She didn't really
have a lot of time to spend analyzing the situation. Between repeated
medical examinations of her eye, physical therapy for other injuries,
counseling for her emotional trauma and trying -- sometimes
unsuccessfully -- to hold herself together at work, the young woman
had no stamina for an audit of her insurance company. Besides, Zilisch
had a lawyer watching out for her.
A Tempe police officer recommended to her parents just after the
accident that she hire an attorney. Zilisch asked around at her church
and found Gene Gulinson, who helped her secure a $145,000 settlement
from the drag-racers' insurance companies. But State Farm balked at
paying her own $100,000 policy limits, instead offering her various
amounts ranging from nothing to $55,000. (An arbitration panel later
valued her claim at nearly $400,000 to compensate Zilisch for her
injuries, medical bills, loss of earning capacity and the very real
diminishment of her life's potential because of her crippled eye and
the death of her fiancé.)
State Farm sent her to what appeared to be a never-ending parade of
"new" claims investigators while she continued to see doctors. The
fifth physician she visited, a specialist in San Francisco, had
examined Zilisch and concluded that, yes, the injury was permanent and
that no surgery would help it. But while that doctor had talked with
State Farm claims investigators on the telephone, he didn't prepare a
full written report on the examination. The Arizona Supreme Court
later chastised State Farm for delaying the evaluation and settlement
of the claim for 10 months while it insisted on seeing that doctor's
written report. The court noted that it had written reports from four
other doctors agreeing on the permanency of the injury as well as the
verbal agreement from the California doctor.
"State Farm's insistence on seeing a non-existent report was a pretext
to drag out the claims process," justices wrote.
During the lengthy negotiations with State Farm, Zilisch says her
attorney began to mutter things like "this is typical."
Gulinson says he believed Zilisch's case clearly should have been
settled early on for the policy limits. "They were attempting to find
excuses not to pay for it," he says.
Zilisch finally realized that there was nothing unusual or complex
about her case. She simply was being jacked around so State Farm could
save money -- in fact, an insignificant amount for the behemoth
company.
"I felt betrayed," she says. "My insurance company is supposed to be
there for me. What happens to those 'good neighbors' when you have a
fire or you've been in an accident? They beat you up. You feel like
you're a victim of your own insurance company."
More than two years after the accident, faced with Zilisch's
unrelenting resolve, State Farm finally wrote a check for $100,000.
But a higher court later ruled that payment didn't excuse the
company's behavior.
Hoping to make State Farm accountable for putting Zilisch through the
wringer, Gulinson referred her to Cal Thur, a Scottsdale attorney who
has spent much of his career fighting insurance companies. He
specializes in "bad faith" cases, litigation which seeks to prove
companies have intentionally treated policyholders unfairly, breaching
their contractual promise to look after clients.
It was Thur who in 1981 tried the first successful bad-faith case in
Arizona in which an insurance company was found to have purposely
mistreated its own policyholder. (Before that, Arizona courts didn't
recognize that such a thing could occur -- that an insurance company
could intentionally abuse its own client.) In nearly 20 years of
specializing in nothing but bad-faith insurance cases, Thur has taken
30 cases to trial. Six were against State Farm, more than any other
single insurance company. He won five of those.
Thur, who worked for two years as a claims adjuster for Fireman's Fund
after moving to Arizona in 1959, has earned a reputation as the go-to
guy when other attorneys believe they have taken an insurance dispute
as far as they can. And many people -- both consumers and attorneys --
call his office and ask for help with complaints against insurance
companies.
"We can't handle all the calls we get," he says.
Taking a bad-faith case to trial involves an incredible amount of
preparation. And, Thur says, an attorney can only handle one or two
State Farm bad-faith cases at a time because the company's lawyers
deliberately tie you up with so much legal paperwork, you can't do
much else.
A State Farm lawyer once described this as a "mad dog defense" during
a "Trial Preparation Seminar" held at a divisional claims
superintendents' conference at the home office. In the 1986 training
video, Guy Kornblum, described as the company's "top guy," advised
going on the offensive right after being sued.
"And we keep plaintiffs tied up in law and motions for months," he
said. "Now it's the old mad dog defense tactic, but it works."
Today, State Farm denies employing such tactics, but says the company
does vigorously defend cases when it feels it must to prevent
frivolous lawsuits.
Zilisch's lawsuit was filed on April 7, 1993. Her case went to trial
three years later.
In court, Zilisch listened to former and current State Farm employees
describe how the company bullied the "weakest of the herd," inviting
disgruntled elderly or female clients to challenge them in court
because State Farm assumed it could overpower them. She heard
testimony that showed the company had a policy of stringing
policyholders along, offering them settlements lower than what they
deserved, and rewarding employees who could pay out the lowest claims
by finagling auto repair estimates.
Then, testimony showed, if those policyholders dared to challenge
State Farm, they faced the "mad dog" defense, intended to wear them
down with legal wranglings.
In March, the Arizona Supreme Court found in Zilisch's case there was
evidence that "State Farm engaged in a deliberate practice of
underpaying claims nationwide," that the company set arbitrary claim
payment goals for its personnel and rewarded them for reaching those
goals so it could have "the most profitable claims service in the
industry." The court noted evidence that the company subjected Zilisch
to unreasonable delays, made her an "outrageous" settlement offer of
$55,000 and treated her in a way "consistent with the way it did
business across the country."
The justices said the fact that State Farm ultimately paid Zilisch her
$100,000 policy limits is not an absolute defense to the bad-faith
claim:
"The carrier has an obligation to immediately conduct an adequate
investigation, act reasonably in evaluating the claim, and act
promptly in paying a legitimate claim. . . . It should not force an
insured to go through needless adversarial hoops to achieve its rights
under the policy. It cannot lowball claims or delay claims hoping that
the insured will settle for less."
Despite the Supreme Court decision, the case was not resolved. As
Zilisch learned at her trial, the company has an arrogant attitude
toward such rulings. Verdicts that jurors might deem big enough to
issue a wake-up call to State Farm don't even register on the
corporate giant's radar screen, evidence showed.
Manuel Mendoza, who was claims counsel for the company's 11-state
region that includes Arizona, testified at Zilisch's trial that he
wouldn't bother to tell superiors about a jury verdict in a bad-faith
case or punitive-damages assessment unless it reached a threshold of
$100 million. A lesser judgment did not merit notice.
Mendoza also said State Farm did not change its claims-handling
practices as a result of punitive-damage verdicts. Other employees
testified that they were not informed of decisions in bad-faith cases,
although juries that assess punitive damages are led to believe they
are sending a message to State Farm that the company should change its
unfair practices.
Cal Thur says because regulation of insurance companies has been
"wholly inadequate," the legal system is the best hope for industry
reforms. He says juries assessing punitive damages against insurance
companies with bad claims practices can help change those practices --
except when the company is State Farm.
"They are so large, nothing has stopped them yet," he says.
Compain-Romero of State Farm says State Farm reevaluates its practices
as a result of policyholders' concerns in ongoing efforts to provide
the best customer service, with or without jury verdicts. "It doesn't
take punitive damages to get our attention," she says.
Jurors in Zilisch's case believed Mendoza. They told attorneys they
wanted to give her $100 million so that State Farm would hear about
their verdict. But the group feared Zilisch would likely have to wait
through years of appeals to see any of that. Jurors agreed on the $1
million amount ($460,000 in compensatory and $540,000 in punitive
damages) -- a token amount for the huge company -- hoping the insurer
would simply write her a check.
The jurors' hopes were misplaced.
The teenager who crippled Kim Zilisch and killed her fiancé was out of
prison and starting a new life after six months.
But 10 years after the crash, after arbitration in her favor, the jury
trial in which she prevailed, after the Arizona Court of Appeals and
the state Supreme Court rendered decisions on her side, Zilisch still
is waiting for State Farm, her own insurance company, to settle up
with her.
___________________________________
Attorney Cal Thur confirms a report that some lawyers have a nasty
nickname for State Farm: They call it "Snake Farm."
Company officials have steadfastly denied any wrongdoing over the
years, claiming the firm's primary goal is to treat its policyholders
fairly and pay what is owed. But those who have tangled with the
company disagree. The "good neighbor" can be downright vicious, they
believe.
Thur claims State Farm's practices are "among the most egregious in
the industry." And he says State Farm's behavior has a trickle-down
effect. Because it is the biggest by far, other insurance companies
tend to mimic its practices to remain competitive, he says.
Ina De Long, a California insurance consultant who worked for State
Farm for nearly 25 years before quitting in protest of what she
considered deceitful policies, believes her former employer is,
indeed, the greatest offender in the business.
"State Farm is the very, very best at being bad," she says. For the
last 10 years, in addition to working on consumer education and
insurance reform, De Long has traveled the country testifying as a
witness against insurance companies. "About 80 percent of the trials
are against State Farm," she says. "In most of the litigation, the
really despicable stuff out there is done by State Farm."
The attorneys who take on State Farm are a special breed. They readily
admit that their numbers are few because it just takes too much time
and money to fight State Farm. And because the company has a
reputation -- documented in court records -- for destroying evidence
and asking that cases be sealed, those attorneys and others dedicated
to insurance reform have little in the way of public record to
document patterns of abuse.
But a review by New Times of numerous cases across the country found a
litany of common allegations against State Farm lodged by its own
policyholders. The company is routinely accused of making low
settlement offers or dragging out cases just to wear down its own
clients. Critics decry State Farm's practice of incorporating generic
or used parts in auto repair estimates to drive down the costs of
claims. And questions have begun to surface over the company's use of
what those in the industry call a "paper review" process in which an
outside firm is asked to examine medical documents to make sure a
person's injury is really related to an accident. Skeptics believe --
and one judge has found -- that State Farm employs that process as a
method to routinely cut or refuse payment of medical bills.
There is a universal theme to such cases: State Farm uses various
techniques to drive down the amount of claims the company pays out to
its own policyholders.
Last year, a record jury verdict resulted in a $1.2 billion judgment
against State Farm in an Illinois class-action lawsuit after the jury
found the company was defrauding its clients by utilizing generic
parts -- made by someone other than the original auto manufacturer
--in its repairs. Plaintiffs had alleged, and a judge found, that the
cheaper, generic parts are substandard and not as safe as original
parts.
The jury and judge ruled the parts -- which are sometimes used without
the car owners' knowledge -- are not of "like kind and quality" to
restore a damaged vehicle to its "pre-loss condition" -- promises made
in State Farm's policies.
An earlier Consumer Reports investigation had found that generic parts
are inferior to name-brand parts in both fit and protection.
Researchers tested fenders and bumpers in their study, but noted one
instance in which one car's hood suddenly flew off while its driver
was passing another vehicle. The hood was an example of "offshore tin"
-- a repair shop nickname for inferior foreign-made parts, the
magazine noted.
The company has appealed the verdict (which includes $730 million in
punitive damages), and stands by its use of generic -- sometimes
called "after market" -- parts.
Company spokesperson Ana Compain-Romero says the ruling was "a major
setback for State Farm policyholders and all consumers" that will
serve to drive up rates if left to stand. The company has quit using
generic parts pending the appeal, but says it remains "confident of
the quality of these parts." And it says it will fix or replace for
free any parts that are causing any problems.
An emerging area of concern focuses upon State Farm's review of
medical documents. The insurance industry giant has drawn attention to
its practice of turning medical paperwork over to an outside company
for fraud review. Critics charge the process is a sham, and, in a
recent ruling, an Idaho judge labeled one such subcontractor "bogus,"
which, in turn, sparked the Arizona Department of Insurance to begin
an investigation into State Farm this past spring. Although there were
no similar complaints about State Farm in Arizona this year, the state
agency said the findings in the Idaho case were serious enough to
warrant a local probe.
State Farm says it contracts with outside companies in a small
percentage of cases in which the claim and medical bills seems
disproportionate to the injury received. It says the second layer of
scrutiny -- just a review of documents by a physician -- is useful in
helping to detect insurance fraud.
But after Dateline NBC reported this summer that two medical
consulting companies were used by State Farm only to cut -- not truly
evaluate -- medical claims, a national investigation into the
company's medical document review practice began. Arizona became one
of 11 states lending an investigator to that ongoing probe.
Other recent cases have yielded jury verdicts and court rulings
ripping State Farm for its treatment of some of its own policyholders.
In Campbell v. State Farm, an elderly Utah man was led to believe by
the company that he would prevail in the civil trial stemming from a
1981 fatal car accident. Records show State Farm refused to settle the
case for Campbell's $50,000 policy limits, destroyed evidence that
would show Campbell's real liability and told Campbell to "put a 'for
sale' sign on your place" when a jury returned with a $254,000 verdict
against him.
A subsequent bad-faith trial in 1996 resulted in a $145 million
punitive and $2.6 million compensatory damages verdict against State
Farm in the Campbell case. In a ruling two years later, the judge said
he would cut the punitive damages to $25 million. He also found
evidence that not only had State Farm hurt Campbell, now aged 82, but
that nationally, "a considerable percentage of policyholders are
victimized by a wrongful denial of benefits, oftentimes when these
policyholders are the most vulnerable." The judge said there was
"ample evidence" that the company made a "deliberate and wrongful
effort to enhance corporate profits" at the expense of policyholders
and that for the past 20 years, State Farm had "resorted to a variety
of wrongful means to attempt to evade detection of, and liability for,
its unlawful profit scheme."
That case is still on appeal, underscoring what former State Farm
employee Ina De Long contends is the company's purposeful practice of
dragging cases out rather than pay what it owes. "Mr. Campbell is very
old, very sick and he's spent the last 20 years of his life fighting
State Farm," she says.
In Castillo v. State Farm, a 1991 appellate court case from
California, a jury ordered the company to pay $250,000 in compensatory
and $6 million in punitive damages for making consistently low offers
to a California policyholder who requested her $15,000 policy limits
for injuries in a rear-end car accident. There was evidence Castillo
was targeted because she was a minority and that State Farm had asked
a doctor to change his report because it supported Castillo's claims
of permanent injuries.
In another California case, Gourley v. State Farm, an appellate court
found in 1990 the company intentionally made "grossly insufficient"
settlement offers, and cited "substantial evidence" that State Farm
used a "stonewall" or "see you in court" attitude. Gourley won a
bad-faith judgment of nearly $16,000 in compensatory and $1.5 million
in punitive damages.
In Holmgren v. State Farm, the Ninth U.S. Circuit Court of Appeals in
1992 discussed State Farm's practice of settling claims for far below
their value as "a game of the strong against the weak" and talked
about how the company "squeezed out" its policyholder, rendering her
nearly homeless and destitute. State Farm had paid only $45,000 on a
$95,000 claim.
While building his own cases against State Farm over the last two
decades, Scottsdale attorney Thur monitored other litigation. He came
to believe that State Farm kept damning information out of its files,
refused to give incriminating evidence to plaintiffs' attorneys and
asked judges to seal from public view records in cases it settles. (In
one case, which was eventually opened, even the case number was
removed from the courthouse docket.)
Thur's diligence was rewarded seven years ago.
He was in Southern California testifying in a bad-faith lawsuit
against State Farm. The case involved the company's refusal to pay one
of its policyholders $30,000 in uninsured motorist coverage. As the
case unfolded, Thur says, the judge began to suspect that the
insurance company hadn't turned over all the documents the plaintiff
had requested before trial.
When the judge ordered the company to come clean, State Farm produced
only some of its material. Defying the court, State Farm continued to
keep other papers locked, oddly enough, in a car, behavior that
prompted the judge to cite the company for contempt, Thur says.
During the trial, Thur wore a path to a downstairs copy machine
reproducing documents as they became available. He loaded his pickup
truck with hundreds of thousands of pages of internal State Farm
records.
Fearing that the case would settle and State Farm would ask that all
the documents be sealed, he made hurried trips back and forth across
the desert that summer, delivering the goods back to his Scottsdale
office as they became available.
The case did settle -- for $30 million. And while State Farm asked
that all its corporate paperwork be returned, the judge refused that
request.
Back home, Thur went through the files. He found ammunition in State
Farm's internal documents revealing that the company used a program
called Performance Planning and Review (PP&R) to base employees'
salaries and promotions on a formula meant to cut the amount paid out,
including the amount paid out to its own policyholders.
Thur also found a training manual in which the company's head of
claims said State Farm's goal was to have the most profitable claims
center in the industry.
State Farm maintains that statement is taken out of context, that the
point was everyone needed to handle claims efficiently and
effectively.
Thur and consumer watchdog Ina De Long argue that the claims
department should not be a profit center. Insurance companies' profit
should come from underwriting -- actually selling policies to folks --
not from trying to limit how much the company pays out to its own
clients. Those amounts, whether they stem from a car accident or a
fire or an earthquake, are entirely dependent on how much damage was
done and how much is needed to compensate for the loss. While State
Farm needs to protect itself against fraud from spurious demands for
payouts, Thur maintains that the drive to turn the claims department
into a profit center exposes State Farm's policyholders to brutal
business practices.
According to State Farm's own documents, claims agents were instructed
to meet certain formulas when they wrote damage estimates -- formulas
that specified how much of a car repair estimate should be
attributable to prior damage, for example, and what percentage of the
job should require generic or used parts. And, the documents showed,
agents would be rewarded or promoted for meeting those goals and
reducing the amounts they paid out.
State Farm says it no longer uses the PP&Rs. The judge in Utah,
however, found two years ago that the company merely replaced that
manual with verbal policies that essentially do the same thing.
Despite what is clearly shown in several of State Farm's own
documents, public information officer Compain-Romero says employees
were never rewarded or promoted for reducing claims. And she says the
company never required set percentages on certain types of repairs,
but only suggested those numbers as guidelines. "We've never had a
policy to settle claims for anything less than what is owed,"
Compain-Romero says.
De Long, who testified in Kim Zilisch's case, said after decades in
the underwriting, claims and disaster department of State Farm Fire
and Casualty Co., she was familiar with the motive of the company to
make money in the claims departments. She said adjusters were given
monthly updates as to the average claims paid and were encouraged to
cut those.
De Long told jurors "claims profit" was the amount reached by
subtracting the amount paid out on a claim from the amount the claim
was really worth. She said she was uncomfortable even using the two
words together.
"That's totally inappropriate," she told jurors in Zilisch's trial.
"An insurance company should have underwriting profit, not claims
profit. That's like 'honest crook.'"
Included in the documents turned over in the 1993 case were stacks of
PP&R assessments for individual employees, revealing that they were
rewarded -- and even encouraged to participate in contests -- for
meeting those arbitrary goals when they evaluated claims.
Thur says the papers obtained in 1993 not only provided the smoking
gun for something attorneys had heard about for years, but also
specifically helped prove bad faith in the next two State Farm cases
he took to trial. One was Kim Zilisch's case. The other involved a
claim by a Scottsdale woman named Betty Olson.
An industry claims expert says those two trials were only the fourth
and fifth time jurors anywhere in America have been able to hear of
State Farm's practice of performance-based compensation for agents.
In four of those cases, jurors found that State Farm had acted in bad
faith and assessed millions of dollars in punitive damages. In
addition to the Zilisch case, which resulted in a $1 million verdict,
and the Olson case, which yielded a $6 million verdict, State Farm was
hit with a $1.2 million punitive-damages verdict in Weiford v. State
Farm (later overturned in 1992), a case involving an Alaska motorist,
as well as the $145 million verdict in Campbell v. State Farm, the
Utah case that is on appeal.
In the fifth case -- Singh v. State Farm in Los Angeles, which led to
the incriminating documents being released -- the company paid a $30
million settlement.
___________________________________
When Kim Zilisch embarked on her decadelong dispute with State Farm,
she had youth on her side. Betty Olson did not.
In the Maricopa County Superior Court trial that resulted from Olson's
dispute with State Farm, former State Farm employee Ina De Long
revealed that the insurance company banks on the fact that older folks
won't have the resources, the strength or, frankly, the years to
invest in a protracted fight against State Farm.
De Long was asked what claims adjusters were told to tell unhappy
clients who threatened to get a lawyer.
"What I was trained was to tell them to go ahead and get one, we had
more money than they did," she said, later explaining: "We knew that
the chances were really, really great that we would win, because we
had a good idea of which people to push into litigation . . . the
weakest of the herd."
De Long said several types of people fit this description, including
senior citizens, women (who might be unfamiliar with auto or home
repair standards) or anyone who might not make a favorable impression
in front of a jury.
If, in fact, State Farm believed Olson was one of those weaklings, it
was wrong. On paper, she would appear to fit into the herd. When her
newly leased 1993 Cadillac was severely smashed in a Phoenix accident,
Olson was 68 years old and caring for a handicapped husband and a
disabled grown daughter. Her real estate business had provided minimal
income to her in the two years since relocating to Arizona because of
her caretaker duties. She had no experience in litigation or insurance
claims.
But Olson was anything but a little old lady too inexperienced, poor
or busy to question the way State Farm handled her claim. Even today,
a few weeks shy of her 75th birthday, she looks many years younger.
And she still displays the passion that helped her win a $6.7 million
payoff from State Farm.
Instead of being worn down as her dispute with State Farm dragged on
for years, she says, "I kept getting angrier about it."
She was determined to teach State Farm a lesson.
"I could have lost everything," she says. "But I wasn't afraid of
that. I was more concerned about people being treated right."
Jurors in her 1998 bad-faith trial in Maricopa County Superior Court
determined that Olson hadn't been treated right at all. They awarded
her $1 million from State Farm in compensatory damages and $5 million
in punitive damages (although a judge later cut the $1 million award
in half).
This summer, she received a $6.7 million check (which included
interest and attorneys' fees awarded) just months after an Arizona
Court of Appeals decision affirmed the jury's award.
In March, the court wrote that the substantial evidence of State
Farm's questionable claims practices was enough to lead a jury to
decide they were the product of an "evil mind" (one of the tests of
conduct warranting punitive damages). In addition, the appellate panel
said evidence of State Farm's conduct in other states was rightly
admitted into evidence because it demonstrated "State Farm's improper
motive of indiscriminately manipulating claims to increase profits."
The verdict, and the ultimate payout, was a stunning Arizona victory
against State Farm, particularly because it involved only damaged
property, not loss of life or serious injury, for which damages are
generally higher.
Indeed, Olson was not even in her car in the early morning hours of
September 26, 1993, when a drunken driver ran a red light and slammed
into the Cadillac at 32nd Street and McDowell Road. Her 33-year-old
son, Michael, was driving.
But the Cadillac, a $42,000 vehicle Olson had leased to drive around
her real estate clients, was in bad shape. At her trial, one expert
testified that the car "clearly looked like it was in a train wreck."
He noted that the front end and pieces of the engine "had actually
been sheared off." Olson testified that when she saw the Cadillac, it
was "unrecognizable."
Although Olson herself was not injured in the wreck, the way she was
treated by her own insurance company was a nightmare all its own.
According to trial testimony, a tow-truck driver, of all people,
determined the morning of the wreck that the car was repairable,
rather than a total loss. He took it to one of State Farm's preferred
repair facilities, one which Olson's attorneys argued had a standard
agreement to keep the insured out of the loop when it came to deciding
on repairs.
Olson said she began to get suspicious about two months after the
wreck. No one had contacted her about the vehicle or her coverage. She
or her husband always had to initiate contact. And then what she got
was the runaround. Estimates for repair and the time needed to fix the
car kept changing. She was told the car would take six to eight weeks,
then seven months, to fix. She was told a critical, expensive part
would take six months to obtain, then just a matter of weeks. Court
records show the repair job ended up taking seven months and costing
$31,000.
Meanwhile, evidence showed, she and her husband were practically
begging State Farm to total the car. This would have paid them
$45,000, enough to reimburse the leasing company for the car while
leaving enough to apply toward a new vehicle. It also would have
triggered something called gap insurance, which would have limited her
exposure to the General Motors Acceptance Corporation, the agency that
financed her lease, to just her $500 policy deductible. Instead, GMAC
repossessed the car, sold it at auction and charged her for the
difference between its original value and its auction price, plus
interest and attorneys' fees, an amount totaling about $20,000.
While her car was still in the shop, Olson was expected to continue to
pay her insurance premiums and lease payments on a car she hadn't seen
for months. She was continuing to care for her disabled family
members. She used a rental car provided by the at-fault driver's
insurance company for six months, then was without a vehicle for
another six months.
Unable to work as a real estate agent, she and her husband were living
largely on social security checks.
In 1996, Olson was referred to Cal Thur.
At trial two years later, after Olson rejected a $10,000 settlement
offer requiring her to give up her bad-faith allegations, Thur and his
co-counsel were able to prove that what happened to Olson was not an
aberration. Jurors were shown a video in which a State Farm auto
claims attorney recounted a story of one policyholder's car being in a
body shop for five years. And they heard a State Farm official testify
that five years was not an unreasonable length of time for a car to be
in the shop. He also said the length of time needed to repair a car
was not a factor to be used in determining whether to total it.
The jury heard about State Farm's goal of increasing claims profit. It
learned about the practice of promoting claims handlers who could cut
their average paid claims or who could meet set percentages of things
like after-market parts, which Olson's attorneys pointedly refer to as
"salvage" or "junkyard" parts. It heard that factoring those cheaper
parts into an estimate would drive a repair bill down, so that State
Farm could avoid the cost of totaling a vehicle.
At trial, and during subsequent appeals and cross appeals, State Farm
argued it had treated Olson fairly. It discounted as unrelated or
unreliable reports of the company intentionally mistreating its
clients. It said the car was repairable.
Through it all, Olson persevered.
She says when she heard from the witness stand that State Farm would
willingly litigate against its own policyholders if the company
thought the clients were the "weakest of the herd," "I was just
floored. . . . I thought, 'Well somebody should stand up and be
counted.'"
___________________________________
Even when faced with tangible evidence that the company has employed
practices that are unfair to its own customers, State Farm
representatives deny any wrongdoing. During trials, the insurance
company's witnesses seem baffled by State Farm directives they claim
never to have seen. While they verify that, sure, those appear to be
official documents dictating a certain practice -- say, requiring a
percentage of each claim to be composed of salvage -- they testify
they've never seen anything like that particular policy manual,
document or memo.
Some of these denials border on the ridiculous.
Jim Adcock, a State Farm supervisor, repeatedly refused to call a
contest a contest when questioned in the Olson trial. He was shown
documents referring to a competition in Arizona among estimators to
see who could include the most salvage parts on their estimates.
"Well, there was an awareness campaign . . ." he said.
"It was a competition, wasn't it?" Adcock was asked.
"Well, some may characterize it as a competition. It was actually an
awareness campaign," he replied.
Later, Adcock was confronted with a document with his name on it that
read "Good luck on the contest and keep up the great work!" Another
document congratulated an estimator that won the "contest," noting he
"finished with a whopping 33.1 percent" of used parts. Still, Adcock
says he didn't know that there was a contest and denied it was
national in scope. "It was an awareness campaign."
In another deposition given in a California case, a State Farm claims
specialist gave new meaning to the word "evasive."
During tedious questioning recounted in an appellate court ruling,
Toni Hotzel didn't recognize her own signature on two State Farm
documents or her voice in a two-party telephone conversation in which
she identified herself at the outside of the phone call.
She wouldn't say the signature was hers.
"I write my name a lot of different ways," argued Hotzel.
Asked to identify the cursive name above the typed words "Toni
Hotzel," she answered, "I'm not sure." Pressed to try to read it, she
said, "Hmmm, I don't know. Could be many things." Later, she claimed
the last word could be "hotel," as in "Toni Hotel."
After listening to the tape, she gave vague answers to a series of
questions, then said she couldn't say if it was her voice. "I don't
know how I sound to other people. I don't know."
Plaintiffs attorneys who have sued State Farm claim this is no
accident. In various trials, including the Olson trial and the
Campbell case in Utah, several witnesses -- usually former State Farm
employees -- have revealed orders to destroy evidence, withhold
paperwork requested in litigation, alter claim files or forge
documents to suit State Farm's purposes and be as evasive as possible
when called to testify.
One former claims specialist, Amy Zuniga, testified in a California
case that she was instructed "not to provide certain relevant
information at my depositions" and was coached "on how to give up as
little information as possible" while under oath. Samantha Bird,
another past State Farm employee, provided evidence at the Campbell
and Olson trials about the firm's orders in 1990 to destroy all memos,
manuals and documents that "could be asked for in bad-faith suits."
Another State Farm 1995 memo asked all its outside attorneys to
destroy or return any potentially damaging documents.
Other former employees have testified about their practice of
rewriting entries in claims files and taking out documents that
wouldn't help State Farm's case. De Long told the Olson jury she had
done all this, but soon learned to build a file with this goal in
mind: "You would only put in the right comments and the right
documents and the right self-serving memos to start with."
The judge who upheld the Campbell verdict, William Bohling, called
these practices the final step of State Farm's fraudulent scheme. He
noted that few victims will even realize they've been wronged, that
fewer still will sue, a small fraction of those will be able to
"weather the years of litigation needed to reach trial." Those who do,
Bohling says, will have a tough time arguing against the "honest
mistake" defense, in light of State Farm's "body of evidence that has
been systematically sanitized, padded, purged, concealed, destroyed or
rehearsed."
State Farm denies it asked anyone to destroy records; in fact, it says
it has a formal records retention policy to make sure case files are
complete.
___________________________________
Cal Thur and others would be hard-pressed to build their cases without
the documents they've been able to flush out and the former employees
who have stepped forward to expose policies they say they couldn't
support.
During trial, State Farm usually tries to undermine the credibility or
relevance of these witnesses.
At the front of this pack of former employees is De Long, who Thur
calls "a true hero."
De Long, 57, quit State Farm in August 1990, saying she couldn't stay
and participate in the unethical things she was being asked to do as
disaster supervisor after the Loma Prieta earthquake. She says the
company's practice of underpaying claims after the Bay Area earthquake
in 1989 took on a dangerous meaning.
"It isn't about dollars anymore, it's about sliding off a hill. I
mean, we left people in unsafe homes," she says.
Sitting in her mobile home in Santa Rosa, California, De Long, a
mother and grandmother who has been honored by the California
Legislature and a consumers attorney group for her work, doesn't look
like a rebel. And the videotape she begins playing doesn't seem like
anything incendiary.
A training film she made to try to help adjusters adequately assess
the damage caused by the earthquake that struck during the 1989 World
Series, it's an amateur effort. She is behind the camera, asking
questions into the microphone while she walks around, following a
contractor who explores damaged homes, pointing out cracks in the
walls, problems with the soil underneath the houses, and illustrates
ways to see if a foundation had been dangerously shaken.
De Long says she bought the camcorder and made the video to try to
help a bevy of inexperienced claims representatives learn how to
assess damage. In addition, she purchased levels, flashlights and a
soils probe to assist them -- replacing the marbles that were
sometimes rolled on a floor to see if it was slanted. In some cases,
pool tables were leveled or cracks merely caulked when, in fact, the
homes were off their foundations, she says.
Her superiors confiscated the video and the tools and chastised her
for her efforts.
De Long had secretly made a copy of the video before turning over the
original to them. Then, she quit, refusing to be a part of a company
she believed put profit ahead of its duty to keep customers safe and
treat them fairly.
Before she left, she made copies of documents backing up her
allegations that claimants had been shortchanged, evidence that
surfaced in subsequent media reports. They showed that policyholders
who trusted their "good neighbor" to adequately reimburse them for
earthquake damage received an average of $8,480 per claim. Those whose
cases were evaluated by outside experts were paid an average of
$20,000.
De Long testified in the Olson trial that State Farm was able to save
$175 million by underevaluating those claims.
___________________________________
While the effort is piecemeal, State Farm is also being scrutinized
outside of courtrooms.
A number of state attorneys general, insurance departments and a
coalition of agents as well as some congressional leaders are
questioning many of the company's practices. Among the developments:
EUR Two weeks ago, the Texas attorney general, in a dispute over
claims practices, extracted $3.1 million from State Farm, which will
be distributed to 30,000 auto insurance policyholders. Officials
claimed the company engaged in auto accident claims practices that
increased costs to consumers and made policyholders responsible for
them.
EUR Former State Farm agents have alleged that the company engages in
de facto "redlining," which involves not writing policies in areas
with high crime or large minority populations. (State Farm rejects
this allegation and says it actually encourages business in urban
areas underserved by other insurance companies.)
EUR State Farm was accused of defrauding policyholders after the 1994
Northridge, California, earthquake. Insurance department investigators
recently found that State Farm underpaid customers, providing them
inadequate estimates and low settlement offers. And a recent state
audit of the former California insurance commissioner Charles
Quackenbush reports that State Farm, and other companies, escaped huge
fines for underpaying its earthquake claims by donating much smaller
sums to a fund set up by the commissioner to further his political
career. Quackenbush resigned this summer
EUR In Washington, D.C., a few congressional leaders, including
Arizona Senator John McCain and Louisiana Representative Billy Tauzin,
have called for an investigation into State Farm's medical paperwork
review practices. Tauzin, who chairs the House subcommittee on
consumer protection, wanted to hold hearings on the issue, but got
sidetracked by the Firestone tire controversy. Ken Johnson, spokesman
for the lawmaker, says Tauzin is gathering information about the
allegations and plans investigational hearings next year.
"The fact that non-medical personnel are reviewing medical decisions
has certainly raised some eyebrows on Capitol Hill," Johnson says. He
adds that while states do have the power to regulate the insurance
industry, "There are a few things we could do," declining to tip off
State Farm by explaining what those things are.
EUR The National Association of Insurance Commissioners (NAIC) is
coordinating a countrywide study of State Farm's medical documents
review policies.
Investigators want to see whether there is evidence that the company
has used outside review companies not to prevent fraud, as officials
maintain, but to shortchange policyholders. The investigation -- like
the calls for a Congressional inquiry -- was spurred after the
Dateline NBC report this summer.
The television show, and subsequent reports, revealed the outside
firms employed by State Farm used college students and others with no
medical training who looked at the claims files, then routinely
concluded that the injuries were not related to the car accident under
review. In some cases, unlicensed physicians signed off on those
reports. In others, actual doctors said their reports had been altered
after they had signed them, in ways that would minimize the injuries
and support a lower claims payout.
When the program aired, Arizona insurance regulators were already
looking into State Farm following the ruling in an Idaho case in which
a jury awarded $9.5 million in punitive damages to a woman who claimed
State Farm used the paper review process to prevent her from
collecting $25,000 in medical coverage.
In that case, Cindy Robinson alleged State Farm delayed her case three
years -- and used an outside review firm -- to keep from paying for
back surgery she says was necessitated by her car accident. State Farm
paid $1,600 worth of pre-surgical bills but balked at covering the
cost of the operation.
A judge in that case said the company used by State Farm to bolster
its claim that the surgery wasn't necessary was "completely bogus." He
said the system used "cookie cutter" reports generated on a computer
without any examination of medical records by doctors. The judge said
the scheme, which resulted in deliberately false and misleading
reports, "permeated to the very top levels of State Farm at the
national level."
While the NAIC investigation into State Farm's medical document review
is the most comprehensive of the national probes into the company,
Thur is not optimistic about the outcome.
The insurance industry was able to effectively deregulate the business
in the 1940s, points out Thur, by getting legislation passed that
removes any real federal jurisdiction over insurance companies. State
regulations and legislative efforts have been "wholly inadequate," he
says, leaving consumers "pretty much to themselves in taking on their
insurance company."
Oversight is, practically speaking, a local matter.
Arizona Department of Insurance deputy chief Sara Begley and
spokesperson Don Harris said investigators here were prompted by the
allegations in the Idaho case to look into the company's handling of
medical documents.
State Farm, however, has a good record with regulators here in
Arizona. A listing of complaints per policy provided by the Department
of Insurance shows State Farm's auto insurance division receiving only
102 complaints out of 531,563 policies in 1999. (Its closest
competitor, Farmers Insurance Co. of Arizona, had a nearly identical
complaint ratio.) Officials say the department does check up on every
complaint.
But Cal Thur says those investigations are almost meaningless, usually
involving nothing more than sending a form letter to State Farm. When
the insurance company writes back justifying its behavior, that ends
the discussion, he says. If a complainant still is unhappy, the
department tells them to seek legal advice.
Betty Olson says she did contact the Department of Insurance, which
gave her valuable advice that led her to consult a lawyer.
In Kim Zilisch's case, Thur says, he decided lodging a complaint with
the state insurance department would be "a waste of time."
Thur says part of the reason is economic. While Arizona's Department
of Insurance does help protect consumers by keeping tabs on
financially insecure insurance companies, it doesn't have the money or
manpower to really investigate a company as big as State Farm, Thur
says.
A recent national study by the Consumer Foundation of America shows
Arizona has woefully inadequate resources to regulate insurance
companies. In 1998, the most recent year studied, Arizona had the
lowest per capita insurance department budget of any state except
Indiana. The study showed Arizona spends $1.03 per resident regulating
insurance companies, almost a fourth of the amount spent by California
and less than half of what is spent in Texas. And the study gave
Arizona an "F" grade in the category of what percentage of an
insurance department's revenue is actually spent on regulation.
When the NAIC decided to get involved in the paper review probe of
State Farm and coordinate some parallel state investigations,
Arizona's Department of Insurance contributed a full-time investigator
to the effort, something only 10 other states have done.
Maryellen Waggoner of the Colorado Department of Insurance, a
spokesperson for the national probe, says investigators hope to
complete a physical review of claims files at State Farm's
headquarters in Illinois by the end of the year. After that, she says,
investigators will go into the company's regional offices to take a
closer look at the company's files.
State Farm's Ana Compain-Romero says the company welcomes the probe
and is cooperating fully. She says the Dateline NBC report gave a
false impression of the way State Farm handles claims, and she
believes the NAIC investigation will show that.
"We're convinced they'll see we've been doing things right and we're
handling claims fairly," she says.
Compain-Romero says State Farm has completed its own probe of its
medical review companies, reaccrediting its vendors and mailing out
checks to hundreds of policyholders it believes were affected by
questionable practices of five companies.
Waggoner says it is conceivable the investigation could expand into
other areas of alleged wrongdoing, depending on what turns up.
But if the company is found to be in violation of consumer fraud laws
or state regulations, it will face no coordinated national punishment.
Only states have authority to discipline insurance companies. And in
Arizona, that translates into fines of up to a maximum of $60,000 for
breaking the law, barely a brush on the wrist for a company that
brought in more than $41 billion in sales last year.
If serious wrongdoing is suspected, the state Attorney General's
Office could be called in to take further criminal or civil action.
But in the past, the state has taken little action against State Farm.
Requests of the state Department of Insurance and the Attorney
General's Office for any instances of official action against the
company yielded only two cases:
In 1983, the Attorney General's Office sued State Farm after a "market
conduct examination" --a routine review of the company -- showed it
had underpaid motorists' claims. The firm promised to end the practice
in a consent order, which includes no mention of penalties.
Insurance officials oversaw another review of State Farm from 1989 to
1994. That probe uncovered the company's failure to pay one person
$5,000 in medical coverage and showed it continued to employ the same
practices that were the subject of the 1983 judgment. This study found
State Farm shortchanged 106 policyholders the cost of taxes and fees
when it reimbursed them for their totaled vehicles. And the punishment
for a company that says it isn't fazed by judgments under $100
million: a requirement that it pay $12,000 to cover those costs, plus
interest, and a civil penalty of $8,900.
Thur says such actions are negligible to the company. And he says such
market studies are too superficial to really turn up anything
substantial, given State Farm's reputation for sanitizing claims
files.
___________________________________
Every once in a while, Kim Zilisch will catch one of those warm, fuzzy
TV commercials about insurance representatives getting right to a
disaster scene and doling out checks. She doesn't change the channel.
She takes it all in.
Zilisch is moving forward. An auburn-haired sports enthusiast, she has
had to abandon some of her favorite pastimes, like mountain-biking and
softball, because seeing double doesn't permit her to participate. But
she has trained herself to be able to play volleyball by learning to
recognize which of the two balls she sees coming at her is the real
one.
She was heartened by the two decisions this year --from the Arizona
Court of Appeals and the state Supreme Court -- supporting her case
against State Farm.
She was heartened, but she has yet to see her money.
Despite the judgments in her favor, Zilisch's case is still
unresolved.
"I can wait," says Zilisch, now 33. "I've waited 10 years, I can wait
longer."
Others who have been fighting State Farm for years are just as
determined to keep up their efforts.
Ina De Long says that after a decade of fighting and traveling around
the country, she's getting tired. But she's not ready to give up, even
though her crusade is more difficult these days.
In May, she was in an auto accident. Her motor home -- which she used
to travel around the country -- was run off the highway near Barstow,
California, by a semi-truck. She suffers from chronic pain and must
use a cane to walk. So far, De Long says, State Farm has been good
about paying her medical bills satisfactorily. But her motor home has
yet to be repaired.
Weary of the battles to reform State Farm through industry legislation
or courtroom rulings, she nonetheless remains optimistic. She welcomes
the national investigation by NAIC into State Farm's paper review
practices and other individual state investigations but says they are
too narrow in focus -- each addressing only one part of the company's
behavior.
Still, De Long hopes such probes will lead to a more general
investigation into what she believes is a widespread pattern of
hurting consumers for the sake of profit, whether it's in earthquake
coverage, auto repair or medical claims.
"Every time somebody comes out doing an investigation, I always have
high hopes that this is the one," De Long says. "One of these days, I
might have to say, 'It's just not going to happen.' But I'm not
willing to admit that just yet."
Nor is the local snake killer. Cal Thur is pleased with this year's
rulings in the Zilisch and Olson cases. He doubts that any meaningful
reforms will come out of the NAIC investigation or congressional
promises to investigate State Farm's medical documents review
practices.
A spokesman for California's Foundation for Taxpayer and Consumer
Rights, which calls itself the leading insurance watchdog group in the
country, agrees. Doug Heller says he doesn't expect much to come from
the NAIC investigation, calling it a toothless group that is proposing
less, rather than more, regulation of the industry.
Thur believes the legal system might eventually have an impact on
State Farm. He hopes the Zilisch and Olson cases help in future
litigation and lead to State Farm reforming its business practices.
Someday, he says, a judge might see fit to sanction State Farm with a
sum large enough to make a difference.
He's not holding his breath.
Sitting in the conference room of his law office, facing a framed copy
of a newspaper editorial cartoon skewering State Farm for using
generic parts in auto repairs, Thur notes that he will turn 69 early
next year.
Ever the capable attorney, he anticipates the next logical question.
It remains unspoken, but he answers it anyway: "I do not plan to
retire."
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