Gospel for Asia Suing Insurance Company over Attorney Fees in RICO Case

Gospel for Asia has retained Locke Lord to defend them against the allegations of fraud by Garland and Phyllis Murphy. One of their attorneys is Harriet Miers, former White House counsel to President George W. Bush. Furthermore, GFA has to pay the costs of a Special Master since they were sanctioned by federal judge Timothy Brooks. No doubt the costs are high for all of that.

According to a suit filed by GFA in March, GFA’s leaders (K.P. Yohannan, David Carroll, Pat Emerick, etc.)  hoped to recover those legal fees via an insurance claim with Philadelphia Indemnity Insurance Company. Although details are sealed, it appears the insurance company declined to fully pay GFA’s claim. Here is a brief statement of the dispute from a recent court document.

1.1 GFA Parties bring this action for Philadelphia’s breaches of its common law duty of good faith and fair dealing and the Texas Insurance Code for unfair settlement practices and for failing to promptly pay covered claims as a result of its wrongful denials and/or wrongful delays in providing defenses in lawsuits against them.

1.2. Philadelphia denies that any reasonable defense fees or expenses remain unpaid and contends that, accordingly, this case should be dismissed. Additionally, Philadelphia denies that it breached its common law duty of good faith and fair dealing or the Texas Insurance Code. Philadelphia contends that it had a reasonable basis for the coverage positions that it has taken and liability was not reasonably clear.

For more detail, see GFA’s original petition.

One crucial court document is sealed and Philadelphia Insurance declined to speak to me. In plain language, it appears that the insurance company has found a reason why they believe they are not liable to pay the claim GFA made. It may be that Locke Lord’s fees are beyond reasonable or that Philadelphia believes GFA is at fault in some way. In any case, the trial is to be by jury in late 2019, probably after the RICO trial.

GFA and Lawsuits

For a Christian ministry, GFA here and abroad, is involved in many legal battles. Aside from the RICO suit, and now the action against their insurance company, GFA has sued the Church of South India for defamation. Back in 2015, GFA threatened Patheos with legal action when I published audio of a staff meeting. I wonder how many donor designate their funds for the legal defense fund.

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Image Fair use, GFA Facebook page