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When a company’s tough legal strategy becomes the object of media scrutiny, even the most adept attorneys can be caught off balance. Hardball may win in the courtroom, but it can play badly on TV. That’s the situation UnumProvident Corp. and its litigation chief, Christopher Collins, find themselves in now. Last fall both NBC’s “Dateline” and CBS’s “60 Minutes” aired stories alleging that the company — the country’s largest disability insurer — had systematically denied claims in order to boost profits. The press scrutiny hasn’t abated since, and UnumProvident’s stock price has plunged in the wake of a new wave of suits by policyholders. The Chattanooga, Tenn.-based insurer, however, is sticking with its approach — and with Collins. He has spent his entire career at UnumProvident, and currently serves as senior vice president and deputy GC. Defense and plaintiffs counsel, as well as former colleagues, describe the 44-year-old attorney as smart, rigidly loyal, and belligerent. These qualities may benefit his employer in the legal context. But in the current glare of publicity, Collins’s tough tactics make the company look like the heartless monolith its attackers claim it to be. “SCORCHED EARTH” TACTICS The irony is that Collins’ litigation strategy has worked well in the past, at least in keeping UnumProvident out of court. He estimates that the insurer settles 90 percent of suits against it (interviews with former employees support this claim). “We don’t take any joy in having the company in litigation,” says Collins. But he adds that of the roughly 2.5 percent of the suits that go to trial, the company wins three out of four. These are cases in which the plaintiff wants too much, the deputy GC maintains. The company then turns to what he calls “scorched-earth” tactics — “otherwise, [these cases] will foster even more litigation.” While Collins won’t reveal the size of UnumProvident’s docket, he notes the company, which holds 46 percent of the disability insurance market, is a big target. The number of new individual disability insurance suits (the type highlighted in the “60 Minutes” and “Dateline” stories) is “trending downward,” he says. But the total number of cases filed against the company in federal court — including other types of actions, such as ERISA suits — has surged, from none in 1998 to 407 last year (as of Dec. 15). Given the small size of the disability insurance bar, few attorneys are willing to speak on the record about Collins. But in interviews with a half dozen plaintiffs and defense counsel and former colleagues, he is described as a reflexively combative lawyer unable to see the big picture. “For some reason, Collins thinks he’s at war,” says Robert Scott, managing partner of an eponymous firm in Newport Beach, Calif., that has sued UnumProvident multiple times. A California-based defense practitioner who has known Collins for years says that the deputy GC has “a siege mentality.” Yet another attorney says: “If [a company's counsel is] arrogant and obnoxious, it makes the plaintiff’s decision to try the case very easy.” 80s POLICIES, 90s PROBLEMS Collins comes out swinging at these critics: “If you tell me who it was, I’ll tell you worse stories about them.” He also maintains that the recent avalanche of media attention was set off by a handful of plaintiffs lawyers who regularly sue UnumProvident. They were the ones who directed reporters to “rare, sensational cases,” he says. “You just wouldn’t find [these cases] without someone drawing them specifically to your attention.” He also blames the media, saying that company officials refused to do an on-camera interview with “60 Minutes” after they decided that the show was putting together a one-sided report. But UnumProvident’s problems aren’t as isolated as Collins suggests. The company has been in a bind for several years because of long-term disability policies that it sold widely in the 1980s, when interest rates were high. When rates later dropped, the insurer was stuck with policies that one 1994 internal memo, released in discovery, called “poorly underwritten and underpriced.” Plaintiffs lawyers say UnumProvident has since tried to wriggle out of its commitments by denying millions of dollars in disability payments. Despite the overall success of Collins’ litigation strategy, UnumProvident has taken a few hits. In the biggest verdict against the company to date, a jury awarded $36.7 million to an eye surgeon disabled by Parkinson’s disease. (The case, which was the subject of the “60 Minutes” report, has since been settled.) And last November, U.S. magistrate James Larson ruled that the insurer had engaged in unfair business practices. It was the first time UnumProvident has received such a rebuke. Larson upheld a $7.67 million verdict awarded to Joan Hangarter, a former chiropractor who began collecting disability payments in 1997, only to see them terminated 18 months later. In a stinging, 62-page order, the magistrate wrote that the insurer had used biased medical examiners, targeted categories of claimants for review, and destroyed medical records. Hangarter’s lawyer, Raymond Bourhis of San Francisco’s Bourhis & Wolfson, says that he tried to settle the case for about $1.2 million because his client was desperate. When UnumProvident countered with $500,000, Bourhis decided to go to trial. Collins and UnumProvident are still fighting the Hangarter case. After Larson’s ruling, the company issued a three-page, point-by-point rebuttal of specific findings, and announced its intention to file an appeal with the 9th U.S. Circuit Court of Appeals. Bourhis, who says that his client has yet to receive any payments from UnumProvident, professes amazement at the company’s continuing obstinacy. “You’d expect any insurance company to say they’d take the injunction very seriously, find out what went wrong, and correct it,” says Bourhis. “Instead they hired three public relations firms and attacked the lawyers, the judge’s decision, and the press.” Maybe next time, UnumProvident will hire those PR firms a little earlier.

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