Insurer Accuses Texas Owner of Drowned Bugatti of Fraud

The insurer of a $1.2 million sports car that plunged into a Galveston Bay lagoon two years ago says the owner deliberately drove into the marsh to collect on a $2.2 million insurance policy.

No trial date has been set in the federal lawsuit that Philadelphia Indemnity Insurance Co. filed against Lufkin auto dealer Andy House, the Houston Chronicle reported. The lawsuit accuses House of intentionally driving his Bugatti Veyron EB into 3 feet of salt water in La Marque, 36 miles southeast of Houston.

House, who sells exotic cars, denies the allegations. He has countersued the insurer, saying the company failed to pay as promised. His attorney was not available for comment, the newspaper said.

The Chronicle reported that the lawsuit also alleges House ran the car engine for 15 minutes after the November 2009 splashdown, furthering damaging the engine.

House told police that car, with its 1,000-horsepower engine capable of reaching 253 mph, ended up in the lagoon when he swerved to avoid a seagull. He also said he delayed turning the engine off because of an attack of mosquitoes, according to the lawsuit, filed in June 2010 in federal court in Galveston.

However, a video of the incident taken by a passing motorist and posted on YouTube showed no seagull and no attempt to brake as the Italian sports car swerved into the water, the insurance company claims.

Furthermore, a confidential informant told company investigators that House had offered to pay the informant to steal and burn the car so House could collect on his policy, according to the lawsuit. The informant told investigators that House business associate Lloyd Gillespie, who is also a defendant in the lawsuit, loaned the money to buy the car and is listed on the policy as payee, the lawsuit said.

Gillespie has denied the allegations in court filings. His attorney declined to comment to the newspaper.