Farmers Beats Back Ballard

In a Dec. 19 decision, the 3rd Court of Appeals severely reduced the $32 million judgement awarded last year to Melinda Ballard in her mold case against Farmers Insurance Group, knocking down the award to $4 million and change.

According to the appeals court, there was sufficient evidence to uphold the Travis Co. jury's finding that Farmers "breached its duty of good faith and fair dealings toward Ballard" and that they had violated the state's Deceptive Trade Practices Act. But they also ruled that there was insufficient evidence to support the finding that Farmers had "knowingly" breached good faith and fair dealings -- a requirement to uphold the portion of award for punitive damages and Ballard's mental anguish claim. In the end, the court left Ballard's judgement at just over $4 million plus attorneys fees in an amount to be decided by the district court.

Ballard says the case was never about money for her, but about justice, which she said this decision supplants. "I look at this in a much bigger picture," she says. "What they've done is flung open the doors for insurance companies to commit bad faith and know that they can get away with it." Over the course of her case, she says, Farmers continually claimed the large judgement in her case would cause a spike in insurance rates for Texas homeowners. Now that the judgement has been reduced, she says, she hasn't heard a word about Farmers' intentions to lower rates. "So two things have occurred, neither of which helps Texas homeowners," she says. "Rates will not go down ... and anyone who bought that line will be sorely disappointed. And now they've flung open the gates of bad faith. For that I feel very badly for the people of Texas."

Both Ballard and Farmers are expected to appeal the decision.