Federal court districts in Louisiana have led the nation in processing litigated property insurance claims in recent years, with about one-third of such claims being filed in the Western District and Eastern District of Louisiana, a new study found.
The 2024 Insurance Litigation Report, published by legal services company Lex Machina, details insurance claims trends in federal and appellate courts over the three-year period from 2021 to 2023. The Eastern District had the highest number of such cases at 8,528, or 16.7% of the total nationwide, while the Western District was a close second with 8,313 cases, or 16.3%, according to the report.
A significant number of those cases were related to hurricanes or were homeowners policy cases, according to Lex Machina. Among the most active judges dealing with these insurance cases, James Cain Jr. of the Western District was by far the busiest, handling 6,923 insurance claims, or seven times the number of cases assigned to the second-busiest judge, Lance Africk of the Eastern District. The remaining eight most active judges were in the Eastern District.
“While the bulk of insurance cases terminated in the last three years were either settled or resolved on procedural grounds, of those that were resolved on substantive grounds, claim defendants won five times as often as claimants,” the report says.
Among the most active law firms handling such cases, the McClenny, Mosley & Associates firm in Houston was No. 1, having filed 2,673 cases during the three-year period. The MMA firm filed the bulk of its cases – 2,549 – in 2022. The law firm was later sanctioned by federal judges in Louisiana because some of the claims were filed without the clients’ consent, were duplicative or contained major errors. All this led the state Department of Insurance to impose a $2 million fine against the law firm.
“(The) filing of insurance cases in the three Louisiana federal courts peaked in 2022 (8,531 cases), declined somewhat in 2023 (6,422) and slowed substantially in 2024 (672 to date),” a Lex Machina representative told the Louisiana Record in an email. “These filings are largely the result of the three major hurricanes that struck Louisiana in 2020 and 2021 as property owners sought to recover losses from their insurers.”
The MMA cases may have inflated the 2022 case counts to some extent, but most of the claims arising from hurricane damage in 2020 and 2021 were filed by the end of 2023, according to Lex Machina.
After MMA, the next most active law firms handling insurance claims were the Law Office of Bruce C. Betzer of Metairie and the Law Office of Claude F. Reynaud II of New Orleans.
Though Louisiana’s share of the nation’s federal insurance claims remains high compared to its population, the study found that the number of insurance cases filed in federal courts last year (17,654) declined 6% compared to the previous year.
Lawsuits initiated by businesses, however, have been on the rise, according to the report. Business liability insurance case filings shot up 28% last year compared to the previous year, and business-interruption cases spiked 60% in 2023, according to Lex Machina.
“Insurance companies dominated the lists of the most active plaintiffs and the most active defendants,” a summary of the report states.