Residents of Devastated Town Say Insurers|& Appraisers Gang Up To Cheat Them

TULSA (CN) - Insurance companies and appraisers are abusing their power over homeowners in Picher, a town devastated by years of toxic lead mining and cave-ins, then driven to the verge of extinction by tornadoes last year, 33 families say in Tulsa County Court. Residents say appraisers for Cinnabar Service Co. and Van Tuyl and Associates also violate open meetings law by holding secret meetings with the state-funded Lead-Impacted Communities Relocation Assistance Trust.

Plaintiffs say residents of Picher and surrounding areas of Ottawa County suffered from exposure to toxic lead and subsidence and cave-ins from the mining. The Lead-Impacted Communities Relocation Assistance Trust was set up in 2006 to help town residents. Then on May 10, 2008, a tornado struck Picher, destroying or damaging many homes that were subject to the trust.

Plaintiffs say the Lead-Impacted Communities Relocation Assistance Act was unconstitutionally amended on June 2, 2008, to deduct from their relocation assistance any assistance they got after the tornado, including FEMA assistance.

Plaintiffs say, "The Trust abuses its authority in the expenditure of public taxpayer funds under the Act by undervaluing plaintiffs' property. This is being accomplished through inappropriate appraisals by Cinnabar Service Company and/or review appraisals by Van Tuyl and Associates, representatives of whom routinely violate the Oklahoma Open Meeting Act by going into executive session with Trust members when appraisals of plaintiffs' properties are secretly discussed. ...

"Following the May 10, 2008 tornado and storm ... the defendant insurance companies who provided contracts of homeowner and commercial insurance to plaintiffs were in a unique position to conspire, collude and defraud plaintiff policyholders in light of the Trust's buyout program. Notwithstanding insured plaintiffs paying higher premiums for replacement cost insurance, the carries knew the properties would not be repaired or replaced in light of the buyout and that actual cash value payment was all the policyholders would be paid since the town of Picher is shortly to be virtually nonexistent.

"The defendant insurance carriers individually and in concert embarked on a course of low balling and cheating policyholder plaintiffs on property damages claims."

Defendants include appraiser J.D. Strong and Larry Roberts, State Farm, Allstate, America First Insurance, American Bankers Insurance of Florida, American Modern Home Insurance, National Security Fire and Casualty Co., Oklahoma Farm Bureau Mutual Insurance Co., and Shelter Mutual Insurance.

Plaintiffs are represented by John Wiggins with Wiggins, Sewell and Ogletree of Oklahoma City.

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