Type Size  -  +
August 25, 2008, 7:30 am

Scruggs updates, Part III: Was there a third insider?

By rparloff

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

The newly available Tammy Hardison and Dana Lee depositions also shed light on an arcane question that I have posted on before, and that State Farm has been aggressively trying to answer: was there a third insider? The question stems from an isolated interview Scruggs gave to a Bloomberg reporter on March 30, 2006, in which he claimed to have made a trip to Bloomington, Illinois (State Farm’s headquarters) where he met with an insider and picked up a trove of incriminating documents that he was about to turn over to attorney general Hood. Scruggs never again referenced a Bloomington insider, leaving Scruggs-ologists to wonder: Had he just made this story up out of whole cloth and, if so, why?

Hardison and Lee said that, according to the Rigsbys and Lobrano at least, Scruggs did fabricate the story, and that he did so, indeed, with a gusto that even jaundiced Scruggs-watchers might not have imagined.

By March, Hardison said, colleagues at the Gulfport cat office were beginning to suspect the Rigsbys of being moles for either Scruggs or attorney general Hood. Accordingly, Hardison testified, Scruggs wanted to “throw suspicion off” the Rigsbys and send it, instead, to State Farm’s central office in Bloomington. Here’s what he allegedly did:

“So he either flew a jet, flew his jet out there,” Hardison testified, “hired some guy to meet him at the airport, called Bloomington and tipped them off and said that Dickie is there to meet somebody. And Pat [Lobrano] kept going, he loves all this. . . . And I was going, what was in the package? They were, like, oh, probably nothing. . . . They were laughing about it. . . . He loves cloak and dagger, you know.”

In an interview with me, Lobrano says she remembers “the whole Bloomington thing” but not any specifics of what was said. “I don’t know if [Scruggs] did that, if it was true. If he did, he would’ve been trying to protect the girls and we would’ve appreciated that.”

CNNMoney.com Comment Policy: CNNMoney.com encourages you to add a comment to this discussion. You may not post any unlawful, threatening, libelous, defamatory, obscene, pornographic or other material that would violate the law. Please note that CNNMoney.com may edit comments for clarity or to keep out questionable or off-topic material. All comments should be relevant to the post and remain respectful of other authors and commenters. By submitting your comment, you hereby give CNNMoney.com the right, but not the obligation, to post, air, edit, exhibit, telecast, cablecast, webcast, re-use, publish, reproduce, use, license, print, distribute or otherwise use your comment(s) and accompanying personal identifying information via all forms of media now known or hereafter devised, worldwide, in perpetuity. CNNMoney.com Privacy Statement.
Roger ParloffThis blog is about legal issues that matter to business people, and it's geared for nonlawyers and lawyers alike. Roger Parloff is Fortune magazine's senior editor (legal affairs). He practiced law for five years in Manhattan before becoming a full-time journalist.
* : Time reflects local markets trading time.† - Intraday data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges.• Disclaimer
Powered by WordPress.com VIP.