Berkley Insurance Co. is asking a federal judge to find it is not responsible for the attorneys' fees of St. James Parish President Timmy Roussel and two other parish officials indicted on malfeasance counts in the fall of 2016.
Berkley Insurance, which provided liability coverage for the parish and its officials at the time, alleges it is not responsible for the nearly three years of legal fees because parish officials filed their claims for reimbursement too late.
Roussel had been facing six counts of malfeasance in office over accusations he directed parish workers to do work on private property.
But, on July 15, a state appellate court in Gretna threw out the charges after finding prosecutors violated grand jury secrecy rules in the lead-up to the September 2016 indictments.
Three days after the appellate ruling, Berkley filed its suit in U.S. District Court in New Orleans, as its risk of possibly having to pay Roussel's legal bills became more imminent.
The suit names parish government, Roussel and the other two indicted St. James Parish officials, Director of Operations Blaise Gravois and Assistant Operations Director Ashley Poche, as defendants.
Parish government paid $461,000 for the one-year liability policy in effect at the time of the indictments, according to Berkley's suit. Under the policy, Roussel and other parish officials have coverage for so-called wrongful acts done in the course of their duties but not if they are indicted or convicted of a crime.
If they are later acquitted or the charges are dropped, however, Berkley told parish officials in a May 2018 letter, they could be reimbursed for reasonable legal expenses.
However, the company also said then it would limit its potential reimbursement to $150,000, after a $25,000 per claim deductible, for the costs of all three parish officials combined. Berkley cited an "aggregate sublimit" in the policy that otherwise has a combined limit of $2 million.
Lawyers for Roussel and Gravois were disputing that reading of the policy earlier this year, according to a letter attached with Berkley's suit.
Berkley is the same $13 billion publicly traded insurer that has refused to cover the attorney's fees of Kenny Matassa, the parish president of neighboring Ascension Parish, in a corruption case for which he was acquitted a year ago.
About a month before Berkley sued St. James Parish, Matassa and Ascension Parish government sued Berkley and a local insurance consultant in state court in Gonzales.
Matassa and Ascension Parish government are trying to recoup legal fees and penalties totaling about $545,000 after months of the Berkley's refusal to pay, according to that suit.
Berkley hasn't responded yet to the suit, which was filed June 18.
In St. James, it was not immediately clear how much Roussel, Gravois or Poche have run up in legal fees, but both Roussel and Gravois have employed leading criminal defense firms out of New Orleans to mount an aggressive pretrial strategy challenging the prosecutors as well as to pursue higher court appeals.
Roussel, a two-term parish president who is not seeking reelection this fall, declined to say how much he has spent in his own defense.
Neither St. James Parish government nor any of the officials named in the suit had filed a formal response as of Tuesday, but Roussel said Monday that parish government has not paid for the defense costs of any of the officials so far. Under state law, parish government can tap taxpayer funds to reimburse the legal defense costs of public officials charged with a crime and later exonerated.
Since the state's 5th Circuit Court of Appeal ruling in Roussel's case, prosecutors in St. James Parish have said they are considering an appeal and may refile charges against him.
Gravois' and Poche's charges are pending, but Poche entered District Attorney Ricky Babin's pretrial diversion program on Aug. 1. Poche could have her charges dismissed by Oct. 1 if she finishes the program and pays restitution, parish clerk of court records say.
Unlike Gravois, whose charges were tied to virtually the same factual allegations as Roussel's charges, Poche was accused of using her work cellphone and other parish electronic equipment for personal use while she was then the assistant finance director.
Karen Horvath, spokeswoman for Berkley Insurance, declined to comment on the St. James suit, citing a company policy against speaking about pending litigation.
But, in the suit, Berkley makes similar claims against St. James as it did in the Ascension case. The company alleges that St. James officials failed to file a formal notification about the Sept. 28, 2016, indictments before the annual policy renewed in the following March.
St. James parish officials didn't file their claim notification until June 15, 2017, the suit alleges.
Berkley said the parish could have extended the existing policy for extra cost — in addition to an annual renewal — and had longer to file a claim but didn't.
In the Ascension case, parish officials contended their insurance claim was timely because they had to wait until after Matassa was acquitted last July. The policy wouldn't have covered Matassa while he was under indictment, they contend.
In a letter to the parish before Ascension's lawsuit was filed, Berkley officials said Ascension still should have notified the company soon after Matassa's indictment in March 2017, pending the resolution of his case.
Roussel said St. James Parish government is still trying to find lawyers to represent it in the Berkley lawsuit due to legal conflicts arising from the suit and the criminal cases, but he said he and other officials have been informed they will have to have their own attorneys in the Berkley lawsuit.
The parish attorney, Cody Martin, is an assistant district attorney working for District Attorney Babin and has a conflict. Other lawyers in Babin's office led the prosecutions of Roussel and the other officials.
A spokesman for Babin declined to comment Monday.