Thursday, October 09, 2014

DHECC - Louis Freeh: Trojan stalking horse

...yes I'm mixing metaphors, deal with it

An interesting document landed on my desk recently and I wanted to share it with AZ readers.

Memo to Louis Freeh and Pat Juneau from Plaintiff Steering Committee regarding policy on fraudulent claims

There is so much right and wrong with this letter, I don't know where to begin.

Let's start with what's right about it.  The PSC is correct in that BP did agree to the current terms of the settlement and originally showed little concern for the potential of numerous fraudulent claims being filed under the agreed upon parameters.  They are correct that recently the number of claims being paid has dwindled to a miserable number due to the overly zealous scrutiny of the Freeh group attempting to justify and expand their multi-gazillion dollar contract with the Claims Office.  They are also correct in fighting for the claimants to get their claims paid in a reasonable time frame.

What's wrong about it?

- They suggest that when fraud is alleged or suspected the claimant be notified and given a chance to (a) withdraw the Claim, (b) do nothing, or (c) attempt to respond with an explanation, clarification and/or additional documentation.

Was Casey Thonn given this option?  Obviously the more powerful Page 60 (of Louis Freeh's first report), PSC law firm was given the option considering we've seen nothing come of that.  Recently Louis Freeh filed a memo claiming shrimper Jason Zirlott of Alabama filed a fraudulent seafood claim but only mentioned Zirlott's law firm in an attachment.  Why was the law firm that filed the claim for Zirlott not run up the flag pole by Louis Freeh like the AndryLerner firm was with the Thonn claim?

Even more so than a claimant, if a law firm has knowingly filed a fraudulent claim they should be censured in some way, not simply ignored or covered up like the Page 60 PSC firm has been.  The public deserves to know who is gaming the system especially considering at least one of the firms gaming it was a PSC firm entrusted to represent the entire class.  I suspect it's the same firm that drafted this letter.

- The memo suggests that Louis Freeh was brought into the settlement to "enforce a broad array of local, state or federal statutes, ordinances, requirements or regulations."  It follows with "The purpose is not to 'catch' people, but to validate legitimate settlement program claims."

Uhhh...no.  Freeh was brought in to investigate corruption and potential issues of fraud...that's exactly why he, a former director of the FBI, was chosen.  Of course once he got his foot in the door he kicked it down, redefining and greatly expanding his role in the DHECC.  Freeh has now filled the office with his own employees whose sole goal seems to be to grind the settlement to a screeching halt and minimize BP's financial burden. The trojan horse is empty and the Freeh battalion has now conquered Troy.

It's also my personal opinion that Freeh was introduced to the Court by a member of the PSC and this specific attorney handed him the evidence he used to "prosecute" the Thonn claim.  I believe this was done for two reasons, one is that it was a personal vendetta by this specific attorney for past dealings with the Andrys and secondly I believe Thonn, AndryLerner, Lionel Sutton and Christine Reitano were offered up to BP as a red herring to pacify BP's cries of fraud at the time.

It's rather karmic that the PSC, who have continually whined about BP's "buyer's remorse", now appear to have buyer's remorse with their chosen stalking horse, Louis Freeh.  I suspect Judge Barbier also shares that sentiment.  But I'm sure they're not too upset considering they already got their own claims paid.

    

38 comments:

Kevin said...


It is nice of Class Counsel to ask Freeh to offer class members the same "due process" he gave to Cunningham Bounds, whose partner, Robert T. Cunningham, is a PSC Member and Economic Benefit Class Counsel.

Anonymous said...

Your final paragraph does a good job of summing up the predicament that the PSC, CA and Court currently find themselves in. I agree that Freeh was brought in to offer up Andry, Lerner, Sutton and Reitano as a red herring, but I believe his real marching orders were to protect Juneau at all costs. BP sued Juneau in January 2013 and their attacks on him have continued ever since. Freeh's past professions and current law firm contacts made him the perfect Trojan horse, but as the Penn State Board of Supervisors learned, he is a horse not easily tamed. The program has certainly ground to a halt, and that has certainly benefited BP, but the real reason legitimate claims are not being timely paid is due to one man's fear that his legacy as CA of the largest settlement in the history of the US was being unfairly tarnished.

Dambala - Jason Brad Berry said...

Something tells me Juneau is morphing from the ship captain to the ship anchor. And I guarantee you if the anchor chain gets wrapped around the Judge's neck he will cut that sucker loose than Steve Herman's claims got paid.

Dambala - Jason Brad Berry said...

..quicker...sic

Anonymous said...

His legacy? How about greed? The Louisiana Record reported that Juneau earns $300,000 per month and at the current rate, it would take over 12 more years to process the remaining claims.

Anonymous said...

Who was Thonn's accounting firm?

Anonymous said...

I think Andry/Lerner was named because of a kickback and the fraudulent claim was just an incidental finding. The lawyer only mentioned in the memo hadn't made headlines?

Anonymous said...

"Why was the law firm that filed the claim for Zirlott not run up the flag pole by Louis Freeh like the AndryLerner firm was with the Thonn claim?"

Freeh's motion says Zirlott's lawyer withdrew from the representation, right? The inference is that he did so after learning that he had been duped by his client, who had provided bad financial data to justify the claim. If so, and/or if the lawyer's withdrawal was the red flag that drew Freeh's attention to the issue in the first place, why would or should he run that lawyer "up the flagpole"?

Dambala - Jason Brad Berry said...

"The inference is that he did so after learning that he had been duped by his client, who had provided bad financial data to justify the claim"

That's your assumption, I didn't glean that from the motion.

Anonymous said...

I'm sure that because Zirlott was represented by a PSC firm, they were contacted and given an opportunity to defend the claim or pay it back prior to the claw back motion. I believe the process was significantly different for the AndryLerner clients.

Anonymous said...

"That's your assumption, I didn't glean that from the motion."

I took another look. It's a motion for an order directing repayment of a claim. It says that on 10/3/14 the lawyer repaid his fee and withdrew. What additional remedy do you think Freeh might have considered asking Barbier to order with respect to that lawyer?

Dambala - Jason Brad Berry said...

Oh...let's say he handle the matter the same way he handled the Thonn claim and suggest criminal charges be brought up against both the claimant and the law firm? I suppose it's too much too ask for justice to be consistent and not selectively prosecute people.

But then that's what this whole post is about. It's the PSC asking Freeh to ignore the criminal aspect of filing fraudulent claims and just allow folks to sweep it under the rug. I wonder why that memo was submitted now....what do you think prompted it at this point in the game? I've got a pretty good idea and I'll be expounding on that soon.

Why do you think it was submitted to only Freeh and Juneau but not Barbier? Perhaps because it would be asinine to ask a federal judge to overlook criminal activity?

The duplicity in Freeh's "investigation" is ridiculous. The cover up by Judge Barbier is even worse.

Cunningham should be facing the same scrutiny AndryLerner did....anything less is selective prosecution by Freeh and the Court.

Anonymous said...

Isn't it great that the PSC, CA along with the court vendors are cheering the success of the settlement. But isn't it the responsibility of the PSC to represent the class members.

What about these victims !!!!!

From today's stats.

3100 claims eligible with no payment ( over paid by GCCF)
4806 claimants now excluded by new policies
4424 denied for causation
11,117 denied for other reasons
41,359 incomplete denials

60,706 claims that BP won't pay.
Vs.
38,228 unique claimants paid.

(38,228 is the actual number, seafood has their own settlement and the VoO was a bonus excluded by the GCCF release)

Now out of the 38,228 payments, 25,378 went to condo owners with coastal claims that represents 67% of the payments.

I wonder if the coastal claimants are happy with the PSC?
See in order to receive your $2,500 payment you had to sign a release,but now as you file your BEL claim for your loss rental income the terms of the settlement has changed by 495.

Was the coastal category used to produce claim stats or to trap these into the terms that now have a material difference????

So PSC what are you going to do for your 60,706 class members ?
I'm sure these numbers will continue to grow If the settlement stands.

Maybe it's time to admit this settlement sucks just read the stats.

IN-HALE

Anonymous said...

Claim forms language :

Seafood claim form: page 27

I certify and declare under penalty of perjury pursuant to 28 U.S.C. Section 1746 that the information provided in this Claim Form is true and accurate to the best of my knowledge, and that supporting documents attached to or submitted in connection with this form and the information contained therein are true, accurate, and complete to the best of my knowledge, and I understand that false statements or claims made in connection with this Claim Form may result in fines, imprisonment, and/or any other remedy available by law to the Federal Government, and that suspicious claims will be forwarded to federal, state, and local law enforcement agencies for possible investigation and prosecution.

By submitting this Claim Form, I consent to the use and disclosure by the Claims Administrator and those assisting the Claims Administrator of any information about me that they believe necessary and/or helpful to process my claim for compensation and any payment resulting from that claim.

The claimant must sign this Claim Form personally. No one can sign on behalf of the claimant unless the claimant is a business or is deceased, a Minor, or Incompetent. If the claimant is a business, an authorized business representative may sign. If the claimant is deceased, a Minor, or Incompetent, an authorized Representative may sign.

Request to withdraw as primary counsel form:

Use this Form to withdraw representation of a claimant in the Deepwater Horizon Economic and Property Damages Settlement Program. If you filed a lawsuit regarding the Spill on the claimant’s behalf, do not use this Form. Instead, you must follow local law and receive Court permission before withdrawing representation.

You must: (1) provide the Claims Administrator with a copy of the notice of withdrawal that you sent to the claimant, whether that notice was a letter sent to the claimant’s last known address or a declaration signed by both you and the claimant; (2) send your notice of withdrawal to Class Counsel; and (3) provide the Claims Administrator with a copy of the notice you sent to Class Counsel.

Anonymous said...

Hey, PSC and everyone arguing to save a failed settlement!

Why are you begging to save this with these numbers?

BP has complained in several courts that the company is being forced to pay hundreds of millions of dollars for claims it never intended to be covered by the settlement.

Let's start with the individual claims, they weren't affected by the injunction.
Using today's stats 10/11/14

IEL Claims filed 44,039
Payments made 4,999 or 11.5%

BEL Claims filed 104'147
Payments made 11,795 or 11.3%

Start ups Claims filed 5,701
Payments made 501 or 8.7%

Failed business Claims filed 3,880
Payments made 25 or .65% less than 1%

Claims BP intended to pay and the winners are!

Coastal Claims filed 36,987
Payments made 25,397 or 69%

Real Property Loss Claims filed 1683
Payments made 733 or 45%

VoO non class members true ups.
Claims filed 8,770
Payments made 6,956 or 79%

Anonymous said...

"Why are you begging to save this with these numbers?"
I can think of 660,000,000 reasons.

Dambala - Jason Brad Berry said...

^^^^ And that's just it. That's the only reason.

Anonymous said...

The Freeh Group has been delaying claims for a year. Why is the PSC only complaining now?

Dambala - Jason Brad Berry said...

Because they don't give a shit, they already got their client's claims pushed through at the beginning....pre-495.

I think the reason for this letter is because some of the PSC attorneys still have pending seafood claims and I'm betting Freeh is now requesting additional information on those pending claims from them. I suspect if they do provide the additional information there will a clear pattern of fraud revealed so this letter is essentially asking for a hall pass. If Freeh agrees to this request then they'll simply provide all the information and take their chances but if he refuses and tells them he will recommend criminal charges, as the law demands, I'll be my ass you're going to start seeing a shitload of seafood claims withdrawn.

I don't think this letter is so much about what's best for the class, I don't think these fuckers care what happens to the class. This letter is about covering their own asses. The question will be did the claimants whose claims were fraudulent know the firms were fudging numbers for them. If they didn't know and they are forced to withdraw the claims I can foresee some serious malpractice suits unfolding.

Dambala - Jason Brad Berry said...

^^^ Disclaimer: the above is my OPINION. I am not stating that as factual reporting, I am telling you what I believe is happening under the surface. It's an educated opinion but opinion nonetheless.

Anonymous said...

11What are your thoughts on BEL claims moving forward? Is implementing 495 really taking that long? From what I can gather only claims $200k or less are being paid at a snails pace. I wish I could have been in the batch expedited by the PSC.

Anonymous said...

After processing hundreds of claims for a few law firms for nearly 4 years I can tell you exactly what's happening.

Once we have all the documents it takes roughly 3-4 days for us to calculate a loss on a claim.

I believe most of the clams submitted have been calculated by the court vendors.
Paj is on record as to providing cost projections to BP in the neighborhood of 19 billion although BP has only reported estimates of 9.8 billion. BP is also on record complaining about the cost of administration at $10,000 per claim.

Objective vs Subjective Reality

The objectives of policy 495 was to reduce the impact to BP's exposure and overwhelm the claim center with the implementation of the claims process.

Their has been a collective effort to pass policies, hold back offers or add additional requirements to reduce the over all cost.

Example Policy 495
This policy was created after the settlement by the data captured by the court vendors.
The 7 identified trigger points generated by the algorithms was designed to maximize the impact to as many claims as possible.

It also destroyed all the work product produced by the outside accounting firms making it virtually impossible to defend a claim offer if received in an appeal.

Then it provided a series of tools to the court vendors to delay and deny more claims just look at the spike in incomplete and causation denials.

If 495 is not amended or repealed it's over BP wins and the once uncapped settlement comes in on or below the 9.8 billion that BP intended to pay.

IN-HALE

Anonymous said...

If anyone thinks that this was not the plan from the beginning, ask yourself why the 6% attorneys fee awarded to the PSC was set at $600,000. If the total settlement was $7.5B as BP initially stated, they overpaid. If it was $19B as PAJ estimated, then the PSC was underpaid.

Anonymous said...

$600,000,000

Anonymous said...

We the victims are at war !
Just review the war of 1812.

BP has hired the best war games strategist Ted Olsen while we are represented by the keystone cops, the three stooges and yes maybe even a Benedict Arnold from the prior war.

And let's not forget about the court vendors the trained assassins with multiple kills laughing all the way to the bank on BP's dime. The ones that are in sheep's clothing given the responsibility in sec 4.3.7 - 4.3.8 to render the greatest possible offer allow under the terms of the settlement language.

Well the war ended in The Battle of New Orleans hopefully one of the 15 will stand up and be an American hero and kick some RED COATS ASS !!!!!!!!

Anonymous said...

Well the PSC filed their Brief in Opposition to SCOTUS.

On page 17 they site the objective causation test guarantees no recovery for 2840 BEL class members.

This is not accurate the BEL class consist of three claim types BEL, Start Ups & Failed Businesses.

Using today's stats the true number is 4,328 denied for causation .

Take it a step further and add all the claim offers and denials.

The three BEL claim categories offers made 15,278

Add up the eligible with no payment, excluded, causation, other and incomplete denials the number jumps to 20,044

BP has never mentioned this benefit in any of their ads!

Anonymous said...

Anon said: "On page 17 they [PSC] [c]ite the objective causation test guarantees no recovery for 2840 BEL class members. This is not accurate the BEL class consist of three claim types BEL, Start Ups & Failed Businesses. Using today's stats the true number is 4,328 denied for causation."

First, there's a footnote in the PSC's brief to show the source of the referenced number, and that same number (2,840) was also referenced by the Claims Administrator in footnote 3 of his SCOTUS brief (saying it came from his 10/2013 status report to the district court).

Besides, whatever the accurate number of causation-related BEL denials might be on any particular day, the obvious point being made is that if causation is being ignored for BEL claims, as BP argues, then there wouldn't be thousands of denials based on failure to prove causation.

Dambala - Jason Brad Berry said...

"Besides, whatever the accurate number of causation-related BEL denials might be on any particular day, the obvious point being made is that if causation is being ignored for BEL claims, as BP argues, then there wouldn't be thousands of denials based on failure to prove causation. "

The argument being, "BP's wrong...this settlement totally sucks now!" :)

Not trying to pick a fight I just couldn't help but notice the irony that the CA and PSC are now arguing the point that the settlement is, indeed, denying a record number of claimants in order to keep it intact.

Anonymous said...

PSC wake up and smell the coffee.

Your responsibility is to the whole class.

Out of the 35,322 notices to the BEL group only 42% or 15,278 received an offer
that's 58% of your BEL class that received a denial.

Take the total amount of claims filed for the BEL group of 113,744 less the 15,278 BEL claimants that received an offer and that only equals 13.4% either way these numbers don't support your arguments to save the settlement.

Oh by the way another 3,074 took the final payment offered by GCCF after you stated that virtually all claimants would receive a greater payment under this settlement than under GCCF.




Anonymous said...

Irony or not, I suppose they'd probably respond that the purpose of their SCOTUS briefs is to support the settlement that BP is attacking, and if that means pointing out that 2,840 BEL claims were denied for lack of causation as of 10/13 (i.e., there IS a causation filter), so be it.

Anonymous said...

More losers than winners!

20. DUTIES OF ECONOMIC CLASS COUNSEL.


20.1. Interim Class Counsel and Proposed Economic Class Counsel acknowledge that under applicable law their duty is to the (entire) Economic Class, to act in the best interest of the Economic Class as a whole, with respect to promoting, supporting, and effectuating, as fair, adequate and reasonable, the approval, implementation, and administration of the Settlement embodied in this Agreement, and that their professional responsibilities as attorneys are to be viewed in this light, under the ongoing supervision and jurisdiction of the Court that appoints them to represent the interests of the Economic Class.

Since the topic is the BEL group I isolated these alone ( BEL, Failed & Start ups ).

If the best interest of the whole is to terminate this deal what stats will it take,

4,340 causation denials.

1,378 other denials.

12,543 Incomplete denials.

18,261 total denials to date for this group alone.

Compared to 11,783 unique claimants paid for the same group.

Anonymous said...

"I just couldn't help but notice the irony that the CA and PSC are now arguing the point that the settlement is, indeed, denying a record number of claimants in order to keep it intact."

Re irony, the PSC's response to BP's motion to dump the CA includes a long list of rulings/interpretations by the CA that favored BP's viewpoint, and were opposed by PSC, to demonstrate that the CA is not anti-BP. (In other words, this guy's killing us, so please don't fire him.)

Anonymous said...

You may be interested in this story.

http://www.sunherald.com/2014/10/14/5855750/scott-walker-and-associates-to.html

Anonymous said...

That last link is to a lawsuit over allegedly unpaid billings to pr consultants tasked with signing up seafood claimants for the DWH. They claim to have signed bout 10,000 claimants up. They cali to be owed 8.5 Million + expenses at the rate of $1,500 per hour. Filing at link.

Anonymous said...

The kind of stuff detailed in that story happens all the time in all large settlements. I think DAs and state bar associations have been dropping the ball on investigating and prosecuting that sort of thing for a long time. That it is happening in the BP settlement shouldn't surprise anyone, but, again, this happens in all settlements like this so its not an instance of corruption unique to this settlement and it doesn't mean BP is or was harmed by it (although as the number if claims increase, so do the chances that among them are some fraudulent claims). This is really about plaintiff attorneys hiring runners, which is a major violation of the rules of professional liability. At least runner situations still result in a lawyer, who has their license on the line, filing the claims. What is more dangerous than those situations are the CPAs and "claims processors"(whatever that is) who are signing up claimants and filing their claims without the involvement of an attorney. How they can claim they aren't practicing law is beyond me.

Anonymous said...

They are represented !!

From the class notice page 18 question 30.

Do I have an attorney in the case?

The Court has appointed Stephen J. Herman (Lead Class Counsel), James Parkerson Roy (Lead Class Counsel), Brian H. Barr, Jeffery A. Breit, Elizabeth J. Cabraser, Philip F. Cossich, Jr., Robert T. Cunningham, Alphonso Michael Espy, Calvin C. Fayard, Jr., Robin L. Greenwald, Ervin A. Gonzalez, Rhon E. Jones, Matthew E. Lundy, Michael C. Palmintier, Joseph F. Rice, Paul M. Sterbcow, Scott Summy, Mikal C. Watts and Conrad S. P. Williams as “Economic & Property Damages Class Counsel” to represent the E&PD Class Members. You will not be charged for these lawyers. If you want to be represented by your own lawyer in this case, you may hire one at your own expense.The Court has appointed Stephen J. Herman (Lead Class Counsel), James Parkerson Roy (Lead Class Counsel), Brian H. Barr, Jeffery A. Breit, Elizabeth J. Cabraser, Philip F. Cossich, Jr., Robert T. Cunningham, Alphonso Michael Espy, Calvin C. Fayard, Jr., Robin L. Greenwald, Ervin A. Gonzalez, Rhon E. Jones, Matthew E. Lundy, Michael C. Palmintier, Joseph F. Rice, Paul M. Sterbcow, Scott Summy, Mikal C. Watts and Conrad S. P. Williams as “Economic & Property Damages Class Counsel” to represent the E&PD Class Members. You will not be charged for these lawyers. If you want to be represented by your own lawyer in this case, you may hire one at your own expense.

I believe this was the same flaw in GCCF but part of the design to have pro se submit documents believing that the intent was the court vendors worked in their best interest.

Unfortunately they have been misled, individuals are fighting trained well funded claim killers.

Just look at the appeals process if you were one of the lucky to receive an offer. BP had an appeal started well before the offer was released " confidentiality order instructed BP to destroy all prepared doc's & records ".

Anonymous said...

"They are represented !!"

Maybe so, but not individually, and regardless of the PSC's involvement, CPAs and "claims processors" are still practicing law without a license if they are representing and advising claimants about their rights in connection with a claim they helped the claimant file in a federal lawsuit settlement. If it quacks like a duck, walks like a duck, etc. You know the rest.

Clay said...

Freeh has been known to accept a bribe, ... Or a $3M house http://t.co/Iit7Yzafn5