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Robert Trigaux

Dallas insurer sues Fla. insurance chief for 'vendetta' tied to St. Pete scandal in '90s



kevinmccartyoir.jpgWake up and good morning. Here's a new legal spat with soap opera potential. And it all began in St. Petersburg.

A Texas insurer last week sued Florida insurance commissioner Kevin McCarty (photo, left), claiming he's trying to keep the company from offering worker's compensation insurance in Florida because he has a personal vendetta against its owner. Oral arguments in that right-to-do business in Florida case have been scheduled for today, Jan. 11. Here's more details from the Insurance Journal, the AP and the Palm Beach Post.

Filed on Jan. 7 in the U.S. District Court for Northern Florida, the lawsuit claims McCarty held a "deeply embittered" grudge against Charles David Wood Jr., the owner of Dallas National Insurance Co., because he planned to do business with Bankers Insurance Co. of St. Petersburg. Here's the actual lawsuit. Here's a brief history of Dallas National Insurance.

For those with a long memory, Bankers Insurance admitted to spying on McCarty in 1995 because it disliked his scrutiny of the company. And the spying? It included tapping the phone of McCarty who back then was industry coordinator with the state's Office of Insurance Regulation (then run by Bill Nelson, now a U.S. senator), which McCarty now heads. Bankers Insurance also hired private investigator Peter Rayner who reportedly focused on McCarty's "romantic relationship with other men" in hopes of finding "information of a scandalous nature that would justify firing him," according to the lawsuit. As the investigation progressed, the St. Petersburg Times reported,  Bankers Insurance's general counsel at the time, G. Kris Delano, ordered that the spying be intensified and okayed the use of videotape or photographs. Delano would later be banned from the company in an agreement by Bankers with the state.

McCarty sued Bankers, which paid him $2.55 million to settle the case in 2000. Here are details from that settlement. Bankers also had to pay a $1 million fine and remove its chairman, Robert Menke, for three years, the Insurance Journal reported.

The new lawsuit claims McCarty, motivated by "a deep hunger for revenge," is trying to settle a score against Dallas National owner Wood because the Texan had loaned $5 million to Bankers Insurance after Bankers conducted the illegal investigation of McCarty.

The suit claims McCarty violated Wood's constitutional right to do business in Florida through his company and accuses the commissioner of using defamation, coercion and abuse of administrative procedure. It seeks unspecified damages for defamation, alleging the commissioner labeled Wood as "untrustworthy."

 The Better Business Bureau has given Dallas National an F, its lowest grade.

-- Robert Trigaux, Times Business Columnist

[Last modified: Tuesday, January 11, 2011 7:38am]


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