Notorious Florida Plaintiffs’ Company Data files For Individual bankruptcy. Will Strems Get His $36 Million?

The successor to a legislation organization that was recognised as “public enemy selection one” by Florida’s residence insurance policy business immediately after it submitted countless numbers of needless lawsuits – quite a few of them on the very same assert – has slipped into individual bankruptcy, putting a deep purple line under an high priced and aggravating chapter in the state’s coverage litigation crisis.

“I see it as a fitting finish to this full tale,” reported Scott Johnson, a Florida coverage guide and educator who has penned extensively about the Scot Strems saga over the very last 6 a long time.

Strems is the Coral Gables plaintiffs’ attorney who was disbarred in 2022 for several Bar rule and ethical violations. He had become the poster boy or girl for Florida attorneys who reportedly took advantage of the state’s a person-way legal professional rate statutes and led the explosion of promises litigation in modern decades – a important factor driving escalating premiums and a dozen insurance provider insolvencies in Florida, insurance advocates have mentioned.

“Strems was emblematic of the Florida litigation problem, in that litigation became a lot more about the attorney’s fee than about the claim,” stated Matt Lavisky, a Tampa insurance policy defense law firm with the Butler law firm.

This was ambulance chasing on steroids. – Florida CFO Jimmy Patronis in a letter to the Florida Bar.

Soon prior to his disbarment, the Strems Legislation Organization was reconstituted as The House Advocates. Strems remaining the company and sold his desire for $40 million, to be paid in yearly installments until finally a balloon payment was because of in 2030, according to courtroom files.

In spite of clear charges from the multitude of lawsuits, The Property Advocates, recognised as TPA, was unable to pay back its debts, which includes the payments on the be aware to Strems and cash owed to other attorneys at the firm.

“They experienced to shell out on their own instead, it appears to be like like,” Johnson mentioned.

Strems has alleged, in his personal lawsuit in opposition to The Home Advocates, that the firm dispersed practically $30 million to shareholders at the agency and compensated him just a number of million towards the take note.

The heads of the new business “steered TPA on a route toward insolvency and destruction developed to enrich on their own and their mates and depart behind only a carcass of what was once an exceedingly successful legislation firm…” Strems’ 2023 criticism contends.


Strems is stated as the top creditor in the firm’s Chapter 11 individual bankruptcy petition, filed Aug. 25, with about $36 million owed to him, in accordance to a promissory observe he and the company signed in 2020. The greatest problem for the U.S. personal bankruptcy judge in the situation may perhaps be irrespective of whether the disbarred Strems, who acknowledged that he can not find the authentic promissory observe, will be thought of a secured creditor, placed at the head of the line for payments from the company.

Individual bankruptcy authorities contacted by Coverage Journal reported that courts generally take into account promissory notes to have precedence in Chapter 11 payment schedules. On the other hand, in a movement filed with the courtroom, The House Advocates has argued that Strems’ “purported lien” was hardly ever perfected by the submitting of a Florida Uniform Industrial Code financing assertion, an omission that could confirm lethal to Strems’ calls for for the $36 million, bankruptcy legal professionals stated.

“The Debtor’s motion is in no way an admission that Scot Strems has a legitimate claim in opposition to the Debtor or a appropriately perfected stability desire in the Debtor’s house,” the firm wrote in its motion to use cash on hand to maintain the organization in procedure. “The Debtor specially reserves its legal rights to contest the validity of such alleged credit card debt and protection passions that may be asserted.”

For now, the personal bankruptcy decide has permitted TPA to use the dollars but granted Strems write-up-petition fascination towards the funds collateral.

It’s unclear at this position how a lot the company would be equipped to sooner or later spend on its money owed, even secured money owed. The Chapter 11 petition shows that the regulation firm has less than $10 million in property but as much as $50 million in liabilities. To place that in standpoint, in 2020, the Strems Legislation Company experienced a documented guide value of additional than $20 million, in accordance to revealed experiences.

Apart from Strems, TPA claims it owes disputed amounts to other legal professionals once linked with the business. These include things like extra than $665,000 to Michael Patrick, now with the Morgan & Morgan injuries law business and $230,000 to Gregory Saldamando, now with Initially End Legal.

Saldamando in June filed his very own fit from The Assets Advocates, charging that the agency experienced breached its employment arrangement with him and failed to pay back thousands of bucks in legal professional charges. The case is pending in Miami-Dade Circuit Court docket but will probable be put on hold although the individual bankruptcy proceedings continue.


An show in Saldamando’s complaint gives a glimpse into Strems’ point out of brain as his organization embarked on filing as many as 10,000 lawsuits in opposition to insurance policies businesses over home statements. In a 2018 email despatched when Saldamando was employed, Strems wrote: “Greg, phrases are confirmed. Planet domination!”

But like some others who have tried to conquer the planet, the hard work appeared to overwhelm the legislation organization and was marked by disorganization, mismanagement and the fomentation of bitter enemies. In the conclusion, it collapsed in disgrace, according to court docket files.

Strems Law Firm’s “inadequate staffing and deficiency of enough business office strategies resulted in client neglect, situation dismissals, pissed off judges, and pricey sanctions on a close to weekly foundation,” the Florida Supreme Courtroom wrote in its December 2022 disbarment purchase.

Strems, Saldamando and Hunter Patterson, the president of The Residence Advocates, could not be reached for comment for this post. Strems can apply for readmission to the Bar in 2027.

Strems’ steps and his quantity of litigation ended up so extensive and so infuriating to the Florida insurance policies industry that Johnson blogged about it on a regular basis by means of the many years and has now written a e-book about it all, compiling new details to go with his blog reviews from his web-site. “Collapse of an Evil Empire” is owing out afterwards this month.

In the conclude, Strems and his law firms’ too much litigation expense insurers appreciably in reduction adjustment costs and heartburn. Citizens House Insurance policies Corp., the point out-made insurance company of very last vacation resort, went so much as to sue Strems in excess of allegations of fraud, racketeering, submitting wrong invoices and negative religion. The insurance company settled for $1 million in 2022, considerably less than it experienced originally claimed in damages.

The lawyer’s steps had some thing of a silver lining. By placing a facial area to the statements litigation crisis, it helped Florida lawmakers move sweeping laws in late 2022 that ended a person-way attorney charges and assignments-of-benefit agreements, and clamped other restrictions on litigation, all of which have aided change the tide on the distressed industry in the Sunshine State, Johnson and others in the field have stated.

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