RICO lawsuit filed in Louisiana staged crash scheme
September 4, 2020
A New Orleans-based attorney and two men convicted of participating in a scheme to stage crashes with commercial vehicles are being sued by a Louisiana trucking company in a federal Racketeer Influenced and Corrupt Organizations Act civil lawsuit.
The RICO lawsuit was filed by attorneys on behalf of Southeastern Motor Freight Inc., a Jefferson, La.-based carrier. According to the Federal Motor Carrier Safety Administration, Southeastern Motor Freight has 16 power units and 16 drivers hauling general freight and intermodal. The lawsuit seeks to recoup damages and attorney fees paid out in settling personal injury litigation filed as a result of 2017 crash, which the trucking company claims was staged as part of an elaborate fraud scheme.
The three defendants are: Damian K. LaBeaud and Mario Solomon, both of New Orleans, and attorney Danny Patrick Keating, Jr., with the law firm of Nugent Keating in New Orleans.
Both LaBeaud and Solomon have already pleaded guilty to their involvement in the scheme as part of a federal criminal conspiracy indictment that has seen a total of 18 individuals charged so far. Keating has not been charged in connection with the criminal conspiracy.
The criminal indictment alleges that LaBeaud and an unidentified personal injury attorney in New Orleans devised a scheme by which LaBeaud would be paid “$1,000 per passenger for staged and legitimate accidents with tractor-trailers” and $500 per passenger for staged and legitimate accidents that did not involve tractor-trailers. The indictment alleges that LaBeaud was paid for at least 100 staged tractor-trailer crashes.
Video of the crash
The crash occurred around 11:30 a.m. on June 12, 2017, between the Danziger Bridge and the intersection of Chef Menteur Highway and Downman Road in New Orleans. The crash involved a 2005 Chevy Trailblazer and a tractor-trailer owned by Southeastern Motor Freight and driven by Michael Smith.
According to the lawsuit, dashcam footage from Smith’s tractor-trailer and surveillance footage from a nearby tire store capture the moments before, during and after the crash. At this general location and prior to the intersection. Chef Menteur Highway has three westbound lanes and goes over the Danziger Bridge approaching the intersection.
The videos purportedly show that before the crash Smith was operating his tractor-trailer and entered the highway on the bridge in the far right westbound lane. As he reached the top of the bridge, two vehicles can be seen stopped in the right lane of the bridge – a pickup with its hazard lights on and the Trailblazer used in the criminal conspiracy stopped in front of the pickup.
“There were no other vehicles stopped in front of these vehicles and no traffic to explain why they were stopped on the bridge,” the lawsuit states.
The lawsuit claims Smith changed lanes into the center lane to go around the two vehicles, with the intent of taking a right at the next intersection at Downman to get onto I-10. As Smith was passing, the Trailblazer began moving forward, following Smith’s truck to the next intersection. The lawsuit claims the video shows it appearing to swerve to the right and rear-end the trailer at a red light. The impact caused damage down the passenger side of the trailer and damaged the driver’s side fender well and side view mirror of the Trailblazer.
The lawsuit alleges a “nearly identical” crash was staged at the same spot nearly a week before, on June 6, 2017. Attorneys for the trucking company also allege that LaBeaud has been a named plaintiff in at least five similar personal injury lawsuits involving sideswipe collisions with tractor-trailers in the past eight years.
Keating’s law firm represented the victims in personal injury lawsuits against Southeastern Motor Freight.
The lawsuit references the subsequent federal criminal indictment alleging a wide-ranging fraud scheme perpetuated on staging crashes with commercial motor vehicles and filing frivolous personal injury lawsuits.
On Aug. 21, federal prosecutors in Louisiana charged 11 more individuals in connection with the conspiracy. Seven defendants, including LaBeaud, who prosecutors say was the “ringleader” of the scheme, had already pleaded guilty.
According to the plea agreement, LaBeaud staged numerous crashes for various attorneys, including at least 40 staged crashes with 18-wheel tractor-trailers with at least one attorney, who would represent the passengers in conjunction with the personal injury claims. LaBeaud was paid $1,000 for every passenger involved in a staged crash with a tractor-trailer.
On the federal criminal case, LaBeaud faces a maximum sentence of five years in prison, as well as up to three years of supervised release and/or a fine of $250,000 or the greater of twice the gross gain to each defendant or twice the gross loss to any person.
Solomon pleaded guilty to one count of conspiracy on May 29. As part of the plea agreement, Solomon admitted to acting as a “spotter” for a co-defendant in both a June 6, 2017, and the June 12, 2017, staged automobile crashes.