Looking Beyond The Obvious

How DT produced a multi-million dollar recovery on a file many considered not even worthy of subrogation.

It All Started With A Flare.

Smithfield Foods, Inc., et. al. v United States of America, No. 13-C-651 (E.D. Wisconsin)

The Situation:

In 2007 a U.S. Marine (now discharged from the Marine Corps), was involved in live-fire training at the Twentynine Palms Base in California…

The ex-marine improperly removed an M-125 cluster flare from the base and took it to his parents’ house in Cudahy, Wisconsin.

Two years later, he and his brother negligently set off the flare. The burning clusters landed on the roof of a Smithfield meat processing plant, causing a massive fire.

Smithfield was insured by a market of carriers, several of whom saw no need for a subrogation investigation as Mr. Popp was uncollectible.

Others didn’t agree and called

DenenbergTuffley.

The DT Subrogation Process:

The firm applied ingenuity, creativity, and open-mindedness as the subrogation team developed and implemented the theory of liability aimed at a recovery.

Finding What Matters
Over the course of our extensive research and investigation, the DT team interviewed multiple civilian and military munitions experts. We learned the flare causing the fire, was a dangerous Grade V munition.
Digging Deeper
DT also determined the reason the flare was removed from Twentynine Palms Base was because the Marine Corps did not follow its own mandatory procedures for searching marines before they left the live-fire training areas.
Confidence In The Facts
Consequently, even though we knew we would face the argument that the fire was a consequence of an unforeseeable criminal act taken by a third person, DT started suit against the United States.

The Litigation:

After much litigation, the United States filed a Motion for Summary Judgment, making (among other things) the unforeseeable criminal act argument.

DT countered with:

Logic
The very reason there are procedures for searching marines before they leave live-fire training areas is because military grade munitions are so dangerous.
Misuse
When these munitions are misused, they can cause a wide range of injury, death, or property damage.
Responsibility
These munitions must be maintained in a controlled environment and kept away from the public at large.

Ultimately, DT argued the criminal act (and its consequences) were indeed foreseeable.

The trial court agreed and denied the motion.

DT delivered a subrogation outcome that substantially Exceeded Its Client’s Financial Expectations

THE OUTCOME:

The parties subsequently reached a settlement regarding liability, which took into consideration a significant reduction for the two brothers that stole and actually set the flare off which caused the fire.

Our insurer clients would receive an agreed to percentage of whatever damages were found by the trial court. A damages only bench trial occurred in November of 2015, but unfortunately the trial judge passed away before issuing a decision.

The case was assigned to a new judge, who ruled on some preliminary damage motions that we thought were in contrast with the first judge’s view of the case. Therefore, we reached a settlement before the second trial on damages.

Our clients will receive $16 million (applying the aforementioned percentage to a base damage number of over $60 million) — on a file several market members did not think was even worthy of a look at subrogation.

Click here to read the Journal Sentinel Story About The case