About 13 million consumers nationwide will soon receive compensation for excessive fees paid to their insurance provider. Some have been waiting for more than a decade.
In October, a major insurance company agreed to pay $455 million to settle a class action suit that claimed that the insurance management firm charged excessive management service fees to policy holders. While the company says that the claims are without basis, they agreed to settle in order to end the seven-year case.
Thomas V. Girardi of Los Angeles law firm Girardi | Keese, helped negotiate the settlement, and says that qualifying class members are expected to receive around $35 each.
The class action’s lead plaintiff bought policies from three individual health insurance exchanges, which are cooperatives that contract with private insurers. The exchanges take a percentage of the premiums they receive, and use it to pay management fees to the insurance company. The plaintiff accused the company of engaging in unfair business practices, breaching its legal duty, and committing fraud.
The insurance company’s corporate parent company is paying the settlement to resolve claims stemming from as far back as 1999. The corporate parent company will also pay for the legal fees associated with the litigation.
In response to the case and settlement, the corporate parent company will be offering additional disclosures to exchange policy holder subscribers. Agents and employees will also receive subscription agreement and procedure training.
“One of the key reasons that a resolution was achieved is due to the mediation efforts of Judge Daniel Weinstein, a retired Superior Court judge,” Girardi says. “He was persuasive with both the higher-ups at the company, and persuasive with us, too, in terms of working with our expectations.”
Girardi calls his opposing counsel “spectacular” and says that that the case was complex and challenging.
Girardi had no time to rest after this settlement. He was asked to assist in a case involving a small Missouri town that began seeing a rise in cancer and brain tumors among residents. The increase is believed to be related to fertilizer that is used on surrounding farms that contains significant levels of chromium 6, a known carcinogen.
“We had the leading chromium expert in the world come and evaluate the area, and he found unbelievable amounts of chromium in the community,” Girardi says.
A local tannery has provided the fertilizer free of charge to local farmers since 1983.
“After the story hit the newsstands, the company’s leadership instructed staff to destroy certain company documents, but one employee became nervous and notified the authorities,” Girardi says.
A document was discovered that showed that the company saved money by mixing chromium with fertilizer and giving it to the farmers rather than paying for it to be disposed of off site, Girardi says.
The Missouri case is still in progress.
Girardi made headlines after securing a $333 million settlement for 650 California residents in a toxic tort case made famous by the film Erin Brokovich. Similar to the Missouri case, a company knowingly dumped millions of gallons of chromium 6 to save money. The chemical poisoned the groundwater and led to sickness and death among residents.
Girardi secured the first million-dollar verdict in a medical malpractice case in California. It was the second million-dollar verdict in California and the first million-dollar verdict in a malpractice case. Girardi says that’s he is especially proud of the team he has built over the years.
“Our firm has a good reputation for decency. If the other side doesn’t do something that they should be doing, such as providing documents, you can file a motion to get the documents and then you can also file a motion to give sanctions against the other side,” Girardi says. “Our law firm has never asked for monetary sanctions. There aren’t too many law firms that can say that.”
Girardi must be doing something right because employee turn-over is next to nothing. He has only had two secretaries in 44-years of practice.
“Two of our secretaries started here when they were just 18, and now they’re 42,” he says. “Once you join our firm, you’re here for life.”
For more info go to www.law.com/socalbest
–Ashley Cisneros
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Ashley Cisneros is a co-founder of Chatter Buzz Media, an Orlando Internet marketing firm that helps companies and organizations engage with their target markets through inbound marketing via the Internet. Chatter Buzz Media, which won the Social Madness competition for the Orlando small business market, is a full-service digital marketing firm specializing in website design, search engine optimization (SEO), social media marketing and content creation. Prior to founding Chatter Buzz, Ashley worked as a newspaper reporter, magazine editor, technical writer, marketing manager, public relations practitioner and freelance journalist. To see Ashley’s content writing, visit www.ashleycisneros.com. You can also reach Ashley on her Google profile.
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