Mostyn Law Firm loses first hail claim trial in Hidalgo County

By David Yates | Mar 4, 2015

The first trial to arise from the thousands of lawsuits filed after a hailstorm struck McAllen three years ago ended in a loss for the Houston-based Mostyn Law Firm on Monday evening.

The firm’s founder, Steve Mostyn, made a name for himself after Hurricane Ike pummeled the Texas coast, reaping hundreds of millions in attorney’s fees by representing storm victims in suits against insurers.

His firm represents plaintiffs Andrea and Martin Amaro in their suit against National Lloyds Insurance.

The hailstorm stuck McAllen on March 29, 2012, causing $250 million in damages. The subsequent lawsuits that followed in the storm’s wake drove the cost up to $600 million, according to the Insurance Council of Texas.

The case of Amaro v National Lloyds was the first trial of the 6,700 hailstorm lawsuits filed in Hidalgo County District Court.

According to the charge of the court, the jury found National Lloyds complied with the terms of the Amaros’ insurance policy and did not engage in any deceptive trade practices.

“This is a big victory for insurance companies who respond quickly after storms, and resolve their policyholders' claims fairly and promptly,” said Mark Hanna, spokesperson for the Insurance Council of Texas.

“This decision by the citizens of Hidalgo County was a loud and clear message that frivolous lawsuits from McAllen’s hailstorm won’t be tolerated.”

Hanna says that on average, 2 percent of insurance claims become lawsuits. But in the McAllen storm, the number jumped to 22 percent.

“It was a runner’s frenzy in getting homeowners to sign up to file lawsuits … many of the claims had already been paid with new roofs on their house,” said Hanna. “The industry had never seen anything like it before. The same lawyers are now trying to chase every hailstorm that hits Texas with the same tactics.”

From hurricanes to hailstorms, Mostyn has chased after every major storm disaster to strike Texas in the past decade.

For example, on May 28, 2013, a massive hailstorm pounded the Texas panhandle region, resulting in $500 million in insured losses, according to the Insurance Council of Texas.

Soon after, Mostyn set up shop in Amarillo. On his website, Mostyn even dedicated a page for attracting victims affected by the hailstorm.

However, Texas’ vast borders don’t restrict Mostyn’s operation.

On Wednesday, Mostyn led the way in settling 160 Hurricane Sandy claims with FEMA. More than 1,500 New York and New Jersey residents filed suit against their insurers following the storm.

Mostyn refuses to comment on articles produced by the Record.

The Hidalgo County civil case was tried in Texas’ 389th District Court.

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