Md. families sue FEMA over Isabel The $2 billion lawsuit alleges that officials
fraudulently low-balled insurance claims.
THE BALTIMORE SUN
June 10, 2005
Dozens of Maryland
families whose homes were damaged or destroyed when Tropical Storm
Isabel lashed the state in September 2003 filed a $2 billion lawsuit
this week alleging that federal flood officials deliberately and
fraudulently low-balled their insurance claims.
that Isabel victims in Virginia will seek similar legal action soon,
said Martin H. Freeman, the attorney who filed the Maryland
is a lot of activity in Virginia, particularly in the Tidewater
area," Freeman said. "I think it's a safe bet that another lawsuit
will be filed in the near future."
The Maryland lawsuit,
filed in U.S. District Court in Greenbelt, claims widespread abuses
by the National Flood Insurance Program, which the families say was
supposed to make them whole after flood waters soaked their
As a result of inadequate reimbursements, the claim
says, the families have been forced to raid their savings to
rebuild, live in cramped government-supplied trailers or subsist in
homes contaminated by sewage and mold.
"They believe that
they have been financially and emotionally raped," said Freeman,
whose law firm represents the 141 plaintiffs from 71 families. "They
also believe that the people who have done this to them are
invulnerable and are going to get away with this. They're so
trampled down it makes me heartsick."
The Maryland lawsuit
names the Federal Emergency Management Agency, NFIP subcontractor
Computer Sciences Corp., and various insurance companies and
adjusters among 57 defendants. It singles out Homeland Security
Undersecretary Michael D. Brown and acting federal insurance
administrator David Maurstad, among others.
whose home in Seaford was damaged by the storm, said she has heard
about the Maryland lawsuit and would like to file one against FEMA
in Virginia. Stelyn, who testified at a Congressional hearing in
April, said she only received a portion of the money due to her
under her flood insurance policy.
"What I see them doing
claim-to-claim is taking a little bit off the top of everybody,"
said Stelyn, adding that four days after she testified to Congress,
the government offered to give her more insurance money. "There is
fraud left and right with FEMA."
The Maryland suit seeks
compensatory and punitive damages for each
Spokesmen for both FEMA and for CSC said they had
not seen the suit and could not comment.
In testimony before
Congress in April, Maurstad said "there is a fundamental
misunderstanding" of the National Flood Insurance Program, which was
"never intended to restore policyholders to pre-flood condition. It
was designed to help them recover."
Maurstad's statements are
misleading, said Steve Kanstoroom, who manages an Internet site, http://www.femainfo.us/, that
catalogues complaints against FEMA.
"Regardless of FEMA's
current interpretation of its regulations, they continue to train
sales agents to tell victims they will be restored to their
pre-flood condition, while simultaneously training and directing
claims adjusters to allow for only narrowly defined coverage in
limited amounts," he said.
Kanstoroom lauded Rep. Jo Ann
Davis, R-Gloucester, whose concerns about FEMA's handling of
hurricane victims were cited in the Maryland
Families in the lawsuit allege that defendants
worked to violate their due process rights and deprive them "of
their health and homes" by selling policies under a promise that
full payment would be made if disaster struck while training
adjusters to authorize far less.
FEMA officials knew what was
happening but did nothing to fix the problems, according to the
It also alleges two forms of conspiracy to commit
fraud, as well as contract interference and breach of
Freeman said his clients' struggle to regain what
they lost has led to broken marriages, illnesses and financial
As of Wednesday, 85 Maryland families still were
living in trailers, according to FEMA. As of today, FEMA projected
that 49 families in Virginia were still living in
Daily Press reporter Dave Schleck and the
Associated Press contributed to this report.