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Texas law firms implicated in suit alleging scheming of Sandy victims

SOUTHEAST TEXAS RECORD

Thursday, November 21, 2024

Texas law firms implicated in suit alleging scheming of Sandy victims

Voss

Voss

A pair of Texas law firms were recently named in a New Jersey class action lawsuit, which accuses the defendants of improperly soliciting and billing Superstorm Sandy victims.

Individually and on behalf of others similarly situated, Pierce Frauenheim filed a first amended class action complaint against The Voss Law Firm and The Posey Law Firm on Dec. 18 in the Superior Court of New Jersey, Ocean County – Law Division.

Other defendants named in the complaint include William Voss, Scott Hunziker, Jake Posey, Harbatkin & Levasseur, Audwin Levasseur, Daniel Hogan, Stephenson Claims Service, Mark Lindoerfer and 10 additional John Does.

In October 2012, Sandy decimated the New Jersey and New York coastlines, killing hundreds and causing more than $68 billion in damages.

“This action arises from a fraud perpetrated by the defendants being those who sought to take advantage of Hurricane Sandy’s victims during some of their most difficult hours,” the suit states.

“The defendant law firms and lawyers together with the defendant public adjusting companies and its principals … conspired to collect from the persons they represented in insurance claims related to Hurricane Sandy improper referral fees commonly referred to as fees paid to ‘runners.’”

Case runners solicit business for law firms – a form of barratry, more commonly called ambulance chasing, which is illegal.

According to the lawsuit, the defendants worked together to collect from the persons they represented in Sandy insurance claims improper expert fees, doing so by taking the loss report prepared by the firm that received the “runner” fee and having a second public adjuster copy that report and present it on its letterhead and thereafter charge the clients an “outrageous” expert fee.

“This case is brought to put an end to these egregious practices now and recover for Plaintiff and the putative Class the improper charges paid by the defendant law firms to the defendant public adjusters and their firms as damages,” the suit states.

This is not the first time defendants Voss, Hunziker and Levasseur have been singled out for questionable behavior in Sandy litigation.

In January 2015, a New Jersey federal judge sanctioned the attorneys for their apparent apathy toward a motion to dismiss a suit against an insurer and indifference to the judge’s order to show causation, according to a Law360 article.

The three men were representing Lighthouse Point Marina & Yacht Club in a Sandy lawsuit against Atlantic Specialty Insurance. The suit had been dismissed in November 2014 because of the marina’s repeated failure to allow for a re-inspection of the damaged property, the article states.

As previously reported, another Texas law firm, the Mostyn Law Firm, was accused in a recent lawsuit of inflating the damages of a commercial property marred by Hurricane Ike by millions.

Firm founder Steve Mostyn allegedly ditched his client when the insurer called the bluff, possibly leaving the plaintiff on the hook for the defendant’s legal bills, which total more than $1 million.

In the New Jersey complaint, Frauenheim (the plaintiff) seeks to represent class members who were represented by the defendant law firms – firms that purportedly paid fees out the clients’ insurance settlements to public adjusters and expert witnesses and pocketed the remaining balance.

In all, Frauenheim seeks to represent members who:

- Were improperly charged at least one fee of approximately $250 paid by The Voss Law Firm to Daniel Hogan and/or the John Does representing either an improper “runner” fee paid for directing clients to the firm or an improper charging of ordinary law office overhead expenses to a client;

- Were improperly charged at least one fee in excess of $1,000 allegedly paid by The Voss Law Firm to a public adjuster as an expert acting on plaintiff’s behalf when no such representation actually happened or was duplicative of the alleged expert services provided by other alleged expert witnesses for which the Plaintiff and all others similarly situated were also charged;

- Were improperly charged at least one fee in excess of $2,000 paid by The Voss Law Firm to alleged experts acting on plaintiff’s behalf when no such representation actually happened or was duplicative of the alleged expert services provided by other individuals and/or companies; and

- Entered into a contingency fee agreement with the defendant law firms without first having advised of the right and afforded the opportunity to retain the attorneys under an arrangement for compensation on the basis of the reasonable value of the services.

“Those defendants engaged in a scheme designed to improperly charge the plaintiff and class members fees and costs associated with the handling of their Hurricane Sandy related insurance claims, including fees paid to “runners,’” the suit states.

A contract of legal employment is attached to the suit as Exhibit A.

The contract states that the agreement is for representation by The Voss Law and shows Frauenheim’s signature but lacks an attorney’s signature.

Over the years, the Record has reported on the numerous insurance lawsuits filed through The Voss Law Firm, which specializes in insurance litigation.

The defendants are accused of violating New Jersey’s Consumer Fraud Act, breach of good faith and fair dealing, breach of contract and common law fraud.

The plaintiff is demanding punitive and compensatory damages, plus attorney’s fees.

New Jersey attorney Gregg Trautmann of Trautmann & Associates is representing the plaintiff.

Docket No. OCN-L-3470-15

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