DOI Lassoes a Long Horn Claim
By Robert Warne - September 15, 2003 Even though Insurance Commissioner John Garamendi has been wrangling almost full-time with California legislators since the onset of September, it didn’t stop him from putting the legal spurs into a Texas company, Sept. 5, to settle some unfinished Paula Insurance business.
The suit on behalf of the one-time California carrier that is now in liquidation, seeks $126,000 in unpaid premiums, now due, to the State of California.
The commissioner alleges that G. Boren Services, a temporary employment agency operated by Lubbock City Councilman Gary Boren, was able to cut its work comp costs back in 1998 by misclassifying its temporary laborer job codes.
Once Paula Insurance became aware of the improper coding it reclassified Boren’s employees, which resulted in the unpaid premium amount.
According to the Lubbock Avalanche Journal, Boren disputes the allegations and dismisses the charges as a four-year disagreement.
Boren told the Journal that Paula’s own audit showed that his company didn’t owe anything and he accuses the carrier of arbitrarily changing the codes from headquarters.
A countersuit has been filed on behalf of G. Boren Services for bad faith and misrepresentation.
A Lubbock federal court jury will eventually determine the outcome of the claims, but in the meantime, the commissioner wasn’t going to just stand idly by and let the statute of limitations expire without branding Boren with the California seal.
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