When Dealing With an Unlicensed Crop Insurance Agent, Recent Court Ruling Finds Agent Did Not Violat
Updated: Jul 2, 2020
This post is not a substitute for legal advice.
Recently, the U.S. Fifth Circuit Court of Appeals upheld the dismissal of a farming couple’s complaint against their unlicensed crop insurance agent. The Shannons, the producers in this case, had filed a lawsuit in federal court seeking damages against their crop insurance agent. The Shannons sought damages under the Racketeer Influenced and Corrupt Organizations Act (RICO). A federal district court dismissed the Shannons’ RICO claims, saying those claims did not cause the Shannons’ injuries. To the court, the mishandling of the Shannons’ claims was more likely due to other causes than to the crop insurance agent being unlicensed.
Before we discuss the case, let’s talk about RICO, the act the Shannons claimed their crop insurance agent violated. RICO was passed in 1970 to combat organized crime and provide criminal and civil liabilities for racketeering activities. The “racketeering activity” we are concerned about is mail and wire fraud, or depriving someone of honest services through fraudulent services through the mail or wire services. That was the focus of the Shannons’ RICO claims.
Looking at the RICO claims, the Shannons needed to show the RICO offense (mail and wire fraud) was the proximate cause of their injury. Remember that proximate cause is when an event is related to a legally recognized injury considered the cause of the damage. For an overview of proximate cause, see my previous post (http://bit.ly/1I3BHEl).
In the court’s eyes, the Shannons had failed to prove proximate cause. According to the record, the crop insurance agent had been unlicensed for seven years, starting when