New Panel in State Farm Rate Case
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From an article in yesterday's Houston Chronicle:
Five years after Texas insurance regulators ordered State Farm to cut homeowners' rates by 12 percent, the insurance company's legal battle to avoid the reduction continues to languish.
The latest delay came this week, when nearly three years after the case was submitted to a three-judge panel of the Third Court of Appeals, it was assigned to a new panel.
Chief Justice Kenneth Law [pictured] said the reassignment was rare but was done so that the same judges will hear the 2003 rate case and two later appeals involving rate disputes between State Farm and the Texas Department of Insurance.
"In this case, it is to make sure those three opinions are consistent by assigning them to very similar or the same panel," said Law, who was a member of the previous panel and remains on the new panel. The other two panelists are different.
He said the court may decide to rule on all three appeals at one time and does not expect the assignment to a new panel to cause a significant delay.
But the six justices at the Third Court are already struggling to reduce the biggest case backlog of any of the 14 intermediate appeals courts. Law said it is taking the court so long to resolve appeals because of judicial turnover, budget cuts and the complicated administrative law cases that make up a significant part of the Austin-based court's workload.
State Farm won a district court ruling that part of a 2003 law that allows for immediate refunds was unconstitutional because it didn't give the company due process. The Insurance Department appealed to the Third Court.
The other appeals are related to the initial dispute and involve questions of whether State Farm is charging excessive rates and whether Insurance Commissioner Mike Geeslin had evidence and authority to require the company to get prior approval before raising rates. . . .
The lead case is Commissioner of Insurance v. State Farm Lloyds (No. 03-05-00067-CV). The reassignment order does not appear on the court's released orders list.
I practice in the Third Court and am mostly sympathetic to the explanation Chief Justice Law gave for the slow-moving docket. Four of the court's six seats were on the ballot during the 2006 election cycle, The Chief is up in November, and he has drawn a strong opponent in former Justice Woodie Jones. The judges must campaign in a large and diverse 24-county district. If they want to keep their jobs, they have to spend a lot of time away from the court's day-to-day business.
But to change two of the three judges three years after the initial panel heard argument? I'm not sure I see the point in that. The other two cases were filed after No. 03-05-00067-CV. One of them was argued nine months after the lead case, and the other was argued six months later (seven months ago). Is the case going to be re-argued before the new panel? Without a compelling reason, and with an already slow-moving docket, it is difficult to see the benefit to this move.
