Scruggs updates, Part V: “Trailer Lawyers”

August 25, 2008, 3:30 PM UTC
Fortune

[This is part of a series. The introduction is here.]

The last bit of computer funny business alleged in these cases involves the so-called “Trailer Lawyers,” so dubbed by blogger and Scruggs chronicler David Rossmiller . The term refers to Scruggs’s co-counsel on the federal whistleblower suit that Scruggs filed for the Rigsbys in April 2006.

In that case, remember, the Rigsbys were alleging that State Farm had defrauded the National Flood Insurance Program by mischaracterizing wind damage as flood damage. Under the terms of the whistleblower law, the Rigsbys, if successful, stood to receive at least 15% to 25% of the hundreds of millions of dollars that they were alleging the government had fraudulently paid for wind-damage that should have been covered by private insurers. (Under his retainer agreement, Scruggs and his co-counsel would get 40% of the Rigsbys’s take.)

In April 2006, shortly before the whistleblower suit was filed, Scruggs and his co-counsel met with the Rigsbys in a trailer Scruggs owned, which was then parked on or near the property of Scruggs’s brother-in-law, then-Senator Trent Lott. Cori brought her State Farm laptop to one of the meetings, according to a deposition she gave in November 2007. At the meeting, Cori testified, “I let him in the computer, and I can’t speak after that.” By “him” Cori meant attorney Anthony L. DeWitt, who is an associate with Bartimus, Frickleton, Robertson & Gorny, a Jefferson City, Missouri, firm that was assisting Scruggs in the whistleblower case. When State Farm lawyers tried to inquire further of Cori about what she meant, a Scruggs lawyer present at her deposition (Sid Backstrom, later convicted as a co-defendant of Scruggs in the federal bribery prosecution) instructed her not to answer, citing attorney work-product privilege. State Farm was left with the impression that DeWitt and, perhaps, other lawyers present had asked Cori to log-in to the confidential State Farm database, and had then scooted in front of the monitor to have an illicit look around. Such a scenario, State Farm has argued, would violate federal law.

In April 2008, DeWitt submitted this affidavit saying that’s not what happened. According to him, Cori told the attorneys she had collected some e-mails pertinent to State Farm’s alleged fraud which she had previously set aside and stored on the hard drive of her State Farm laptop. Since there was no printer available, DeWitt inserted a USB drive (i.e., flash drive or memory stick) into the computer and then dragged the documents Cori was referring to into his USB drive. This procedure would not have involved his actively breaking into State Farm’s computer database or instructing her to do so; it would have simply involved receiving pertinent documents that the whistleblower had previously copied on her own initiative, believing that she was furthering the laudable goal of exposing fraud.

In recent months, the Scruggs law firm did turn over a group of internal State Farm e-mails that appear to have been printed out under a heading consisting of the initials “ALD” or, in one instance, “ALDewitt.” You can inspect them yourself here.

Although questions can be raised about whether these documents should have been turned over earlier — in response to Judge William Acker’s order of December 2006 requiring the Rigsbys and their “attorneys” and “agents” to turn over confidential documents they’d taken — I’m not sure that these documents otherwise add anything to what was already known. They strike me as consistent with DeWitt’s innocuous account of what happened — i.e., that he didn’t break into the computer network, but simply received some previously downloaded e-mails by dragging them into his flash drive.

On the other hand, he wasn’t dragging them from Cori’s home computer, but from her State Farm laptop. Should that make any difference?

I’m sure many readers have greater computer expertise than I do. What do readers think about this?

[Correction: Originally, I misidentified the state where DeWitt’s firm is based. Correct state is Missouri. Regret the error.]