Mistrial declared in Houston attorney's silica kickback case
The trial against a Houston attorney accused of using bribery to settle silica lawsuits ended in mistrial when jurors deadlocked after two days of deliberations.
Warren Todd Hoeffner, 44, a Houston plaintiffs' attorney, was indicted in June 2007 with two former The Hartford Insurance Co. employees on 14 felony counts of conspiracy, fraud and money laundering.
Hoeffner's trial began Aug. 24 in the court of Senior U.S. District Judge David Hittner. After seven weeks of testimony, Hittner had to declare a mistrial Oct. 3 after the jury was unable to reach a unanimous decision.
Prosecutors claim Hoeffner and Hartford employees Rachel Rossow and John Prestage forced The Hartford to pay a $34 million settlement to Hoeffner's clients. Hoeffner then allegedly gave a $3 million kickback to Rossow and Prestage.
Rossow and Prestage, both residents of Connecticut, will have separate trials.
Hoeffner represented clients who brought claims and civil actions against The Hartford and other insurance companies claiming damages for silica-related diseases.
According to court papers, Rossow, 41, was a supervisor in the Claims and Legal Management Services department of The Hartford, and Prestage, 38, was a subordinate.
They were assigned to handle claims and civil actions against companies insured by The Hartford. Their duties included managing and settling claims and recommending to The Hartford the appropriate amounts of the settlements.
A Houston grand jury charged that all three of the defendants induced The Hartford to pay more than $34 million in settlement funds knowing that more than $3 million of those funds would instead be funneled by Hoeffner to pay bribes and kickbacks to Rossow and Prestage.
From the settlements, Hoeffner allegedly received around $5.3 million in attorney's fees, while Rossow took in about $2.6 million and Prestage more than $750,000.
Prosecutors allege that Hoeffner, Rossow and Prestage conspired to meet in various places, including Laguna Beach, Calif.; New York; Palm Beach, Fla.; and Nashville, Tenn., while negotiating the settlement of the claims of Hoeffner's clients.
Rossow and Prestage were said to have received incentives including, luxury cars, spa treatments and entertainment at "gentlemen's clubs."
During the trial, Hoeffner's lawyers claimed he had been coerced by Rossow and Prestage. According to an article in the Houston Chronicle, Hoeffner said he could not complaint about the threat because Rossow's boss was also her boyfriend, and supposedly knew about the coercion plot.
Hoeffner also faces civil lawsuits from clients and The Hartford. He also filed a counterclaim against The Hartford.