False Claims Act Case Study

The consequences on the firm and the individual.

Although Yarushka’s family saw victory, It is hard to decipher just who won the case due to the fact that most False Claims Act cases are settled out of court before ever going to trial in order to avoid the severe consequences that may be imposed under the statute (Enstrom 2016). The penalty can range up to 11,000 per false claim and possibly triple the damages (Enstrom 2016).

State Farm Insurance State Farm insurance company was founded in 1922 by retired farmer George Jacob “G.J. Mecherle (State farm, 2017). By building a trust worthy brand and becoming well known for “being there” for their customer State farm has grown to rank number 41 on the Fortune 500 hundred list (State farm, 2017). However according to Rigsby State Farm slogan “Like a good neighbor State farm is there” is questionable in this case.
State Farm and Casualty Vs U.S ex rel Rigsby
Unusually the government covers flood damage claims but not wind damage and the privet insurance companies cover wind damage not flood damage. State Farm and Casualty Co was one of the companies that was supposed to adhere to these polices in the Gul Coast area (Oyez, 2016). However, according to Cori Rigsby this was not the case. Rigsby sued State farm under the False Claims Act for conducting unethical practices during Hurricane Katrina(Oyez, 2016). The allegation consists of misclassifying wind damage claims as flood damage put liability onto the government (Oyez,