Collapse of an Evil Empire! PART IV–A Case Study

Until proven true, accusations referenced in this series of articles are only allegations made by various parties including the Florida Bar in its petition to suspend Scot Strems license to practice law. (Read Part I here, Part II here, and Part III here)

To get a sense of how these alleged activities harm both clients and the general administration of justice, I looked through the 700 pages of the Bar’s complaint and found what I think is the most instructive case study of what’s been going on in the litigation known as McEkron vs. Security First (McEkron). In fact, it consumes over 400 pages of the Bar’s documentation and though it’s already been to trial, the parties in McEkron are still arguing over attorney fees—for good reason, as you’ll see.

Judges Barbas and Holder painted an ugly picture of The Strems Firm in part by sharing their first-hand experiences with its’ litigation manager John Drake. I said in Part II:  “Especially damning was their assertion that other judges were also aware the Strems firm violates the Rules of Professional Responsibility in… virtually every case where he and his firm enter an appearance.”

Frankly, I found the two judges highly credible.  So, too, did referee Judge Dawn Denaro in upholding the Bar’s petition.  But, I believe there’s much more to be learned by looking deeper at what exactly takes place in at least one illuminating case. To me and many others, McEkron pulls the curtain back on why the legislature needs to act quickly on tort reform. (See NOTE #1 below)

Facts of the Case…Carlton and Monnette McEkron (plaintiffs) vs. Security First Insurance Company (defendants):

1. A water loss occurred on December 4, 2015.
2. The insured went to Home Depot, bought a blue tarp and placed it on the roof to prevent further interior damage.
3. On December 7, 2015, the insureds reported to Security First that leaks to their roof caused interior damage to their home. A water mitigation firm hired by Security First arrived on site late in the day on December 7, 2015.
4. A field adjuster inspected the property on December 9, 2015 and took a recorded statement from the McEkron’s.
5. The McEkron’s were informed on January 8, 2016 that the estimate for the interior damage was $4,326.44. A check was mailed on the same date for $1,452.77 (damages minus depreciation and a $2,500 AOP deductible). Insureds were informed that Security First would not pay to repair the roof because the leaks were caused by wear and tear.
6. A second damage estimate by a second contractor for $3,831.89 was disregarded by Security First because it was LOWER. The loss was settled on the basis of the higher estimate.

The insured was, apparently, unhappy with the settlement so here’s what happened next…

1. The Strems Law Firm was contacted sometime in January 2016.
2. Guillermo Saavedra of Contender Claims Consultants (CCC) inspected the loss on February 12, 2016 and estimated interior damages of $22,500 with no consideration for wear and tear to the roof. Interestingly, CCC performs the work “pro-bono” stating it did so due to the volume of work it did with Strems.
3. Nothing happens for the next 13 months.
4. Scot Strems studies the case and drafts a complaint on March 15, 2017. The lawsuit is served on Security First on March 30, 2017, over a year after the McEkron’s suffered a loss. Scott Strems time studying the case was included in an itemized fee statement presented later, under oath, as part of the post-trial fee proceedings.
5. There follows 24 months of discovery during which The Strems Law Firm is sanctioned several times for discovery delays. Also, there are two mediations and Security First makes seven different settlement offers. During this two years’ worth of discovery The Strems Law Firm produced an expert prepared to testify that covered interior damages totaled $32,952.88. At the last mediation in February 2019, the Strems attorney stated they would not settle the case for anything less than $365,000. That meant that The Strems Law Firm was seeking over $330,000 in fees for this case before going to trial.
6. The last of seven offers made to the McEkron’s by Security First was $53,000 on February 14, 2019, prior to the trial. As part of the offer, Security First offered to pay reasonable attorney fees in addition to the $53,000 offered to the McEkron’s.
7. The Jury trial was held in Miami from March 27, 2019 to March 29, 2019. The jury awarded the McEkron’s $10,000 in damages. The award was for the interior damages only and the jury did not consider the roof damage, nor did the Strems attorneys request it to.

After the trial, attorneys for both sides began arguing over legal fees…

1. Because the McEkron’s received a jury award that was less than the proposal for settlement (PFS), they owe Security First’s legal fees subsequent to the PFS. Strems argues that the PFS was not valid because it was “exclusive” (it excluded their fees) rather than “inclusive” (which would include their fees). Strems believes that the only valid PFS in Florida requires attorney fees to be included. See Part II regarding global settlements and this protected source email from a trial lawyer. (See NOTE #3 below)
2. Because the McEkron’s were awarded something by a jury, Strems argues that the McEkron’s “prevailed” in the case which would trigger the one-way attorney fee statute and Security First must, therefore, pay Strems fees and costs. NOTE: Security First made seven offers of settlement that exceeded the expert hired by Strems. All were rejected.
3. So, for this claim with damages of only $4,000 and a jury award of $10,000 which is less than the Strems own experts estimate of $32,952.88, Strems presented a sworn statement demanding fees of $308,928.50 plus costs of $12,851.32 for a total demand of $321,779.82.
4. On June 22, 2020, Security First filed a motion to strike the demand for fees because a) the bill was proven to be inflated (hence a false statement to the court), and; b) according to Security First, after the jury rendered its’ verdict the Strems attorney, Orlando Romero, admitted in sworn deposition testimony to destroying evidence of the actual time spent on the case.
5. If Security First’s motion is granted, the case will be appealed by Strems and the litigation will continue. NOTE: there is a case pending in the 3^rd DCA (Safepoint v. Jannie Williams) which argues that failing to get an award for at least 75% of the PFS means the plaintiff hasn’t “prevailed” and the one-way attorney fee statute should not apply.
6. This December will be the fifth anniversary of the McEkron claim.

So, was the Strems fee demand accurate or inflated as Security First contends? Frankly, The Florida Bar may want to look deep into the McEkron case, especially the information in Security First’s deposition of Strems former litigation manager, Christopher Aguirre, Esq.

When he was with the firm Aguirre was tasked with “Keeping the firm as efficient as possible, moving cases in the most efficient way [he] could.”  He presented Scot Strems with a plan to reduce the number of times the firm was sanctioned, as it was numerous times in the McEkron case, and was promoted to Managing Partner of the firm.

When asked about billable hours attributed to “monthly case status meetings” Aguirre stated under oath that such meetings did not happen.  And, clarified further:

I am here because I’ve been asked to tell the truth, and I take my obligations to the bar and to my license to what I’ve dedicated my life to very seriously, and in all honesty it pains me to have to answer this question and  the way I have to answer it, but, again, my obligation to being an ethical attorney, an ethical person and really to our profession I have to answer your question as follows: Yes, I’m putting my right hand up and I have to say that these meetings didn’t happen. “

In one instance, according to Aguirre, Scot Strems billing sheet showed two meetings of 2.5 billable hours each, both with a Ms. Aponte, one on September 29^th, 2017.  Aguirre’s sworn testimony indicates that neither meeting took place and the second one could not have happened because it was on a Friday when he and Scot Strems spent the day together driving to Gainesville for a Gator football game. Ms. Aponte, according to Aguirre, was not in the car. (See NOTE #2 below)

Again, all of Aguirre’s testimony, though under oath, is part of pending litigation which has not yet been fully adjudicated. This article attempts to provide you with the facts as I have come across them, up to this point.

But if the allegations are true, what’s going on out there is truly disgraceful.  It’s disgraceful, not only because of what’s happening to the thousands of clients of attorneys who behave similarly and the millions of policyholders paying the highest homeowners premiums in America, but…because Florida’s lawmakers can put a stop to it and so far have chosen not to.

Our elected leaders need to stop protecting about 25 wealthy plaintiff firms and work instead to protect over 6 million premium payers by implementing meaningful and comprehensive tort reform.

Stay tuned for PART V  “Collapse of an Evil Empire!” where I’ll look at Florida’s top plaintiff firms and offer some recommendations on what can be done to stop this massive consumer rip off!

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NOTE #1: I’m not a lawyer, but…the information above is publicly available from the legal briefs and deposition testimony filed in the Strems case and in the McEkron case, particularly Security Firsts’ Motion to Strike the Fee Claim of the Strems Firm.  Since it’s 453 pages long, including exhibits it’s stored offsite from my online library at Box.com here.  Also stored offsite from my online library are the following: Strems Final Order Granting Dismissal & Sanctions, Rodriguez vs. Geovera. Strems 2^nd Motion For Sanctions Rodriquez vs. Geovera, and Defendants Second Motion to Dismiss for Fraud, Rodriguez vs. Geovera.

NOTE #2: The deposition transcript of Christopher Aguirre is 167 pages long but, quite instructive and, at times, entertaining.  He was deposed by Hope Zellinger representing Security First and cross examined by Melissa Giasi on behalf of the Strems firm. He stated under oath that: 1) the times on the billing records were just estimates, 2) they billed for meetings that never occurred, 3) they billed for memos that were never written, 4) the bills were padded with extra hours for depositions and mediations as the transcripts were inconsistent with hours billed.  Read about false billing for lunch meetings; line 24, p.48. Read about emails Aguirre received from Strems firm after leaving the firm; line 17, p.52-56. Ms. Giasi’s cross examination begins on line 14, p.79 and gets a bit contentious as a result of Aguirre’s testimony alleging “professional misconduct.” Read Aguirre’s closing statement that his “…deposition testimony needs to be reported to the Florida Bar.”; line 16, p.113.  BTW, my sources tell me that Aguirre has filed his own formal complaint with the Bar.

NOTE # 3: Keep in mind what Strems associate, Greg Saldamando, was alleged to be doing. According to the Bar’s Complaint against him he never advised his client of a $157,000 global settlement offer from American Integrity before accepting it.  Then, he kept the entire “additional” amount above the indemnity of $100,000 for himself and/or his firm.  That’s the allegation. Saldamando stated, in writing, that this was standard practice for the entire firm.  Read more in paragraph 9 of Part I.

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