Two months after having his locally filed suit transferred to federal court, the plaintiff filed a nearly identical suit in Jefferson County District Court.
As previously reported, Arizona resident Mark Gaudio, claiming it was a “gigantic mistake” to start his career as a State Farm scratch agent, filed suit against the insurance company and James Campbell on Jan. 23 in Jefferson County District Court, alleging the company oversold him on the position.
Court records show State Farm filed a notice of filing removal on Feb. 28, removing the case to U.S. District Court for the Eastern District of Texas, Beaumont Division.
A federal case search revealed that Gaudio filed a motion to dismiss on April 15. The case was subsequently voluntarily terminated on May 8.
However, Gaudio's complaint didn’t exactly die.
Court records show Gaudio filed a second lawsuit April 26 in Jefferson County District Court against Laurie Bauer-Warner and State Farm General Insurance Co.
According to both lawsuits, in 2005 Gaudio worked for Cowboy Harley-Davidson in Beaumont when a State Farm recruiter approached him.
“Plaintiff became interested after hearing defendant’s sales pitch,” the suit states. “Becoming a State Farm agent appeared to be a promising new career.”
Gaudio joined State Farm’s scratch agent program and was required to provide capital of at least $50,000 for his new agency. The program allows a new agent to start up his or her own agency rather than first becoming a producer under another agency owner.
“Defendant helped plaintiff significantly formulate his business plan with inflated, unrealistic numbers,” the suit states. “Plaintiff, completely new to State Farm, thought these numbers were realistic.”
After completing the program, Gaudio was transferred to Arizona.
“Plaintiff eventually realized that this was a gigantic mistake,” the suit states.
“The numbers simply never added up like defendant’s projections suggested. Plaintiff ended up putting over $200,000 dollars into his new agency just to keep his agency afloat. Plaintiff would have never considered this opportunity if he was expected to pony up more than triple the amount initially required to run a ‘successful agency.’”
The suit further accuses State Farm of fraud, negligent misrepresentation and breach of fiduciary duty.
On top of exemplary damages, Gaudio is suing for loss of earnings, mental anguish, emotional pain, inconvenience and attorney’s fees.
He is represented by Beaumont attorney Matthew Matheny of the Provost Umphrey Law Firm.
Judge Milton Shuffield, 136th District Court, is presiding.
Current Jefferson County case No. D194-281
Man re-files suit against State Farm over ‘scratch agency’ program after transfer to federal court
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