Mealey's Insurance Insolvency
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February 21, 2019
Insolvent Insurer’s Liquidator Requests Court Approval Of Notices Of Determinations
HARRISBURG, Pa. — A Pennsylvania court was asked by the liquidator for Reliance Insurance Co. on Feb. 5 to approve final omnibus notices of determinations (NODs) that have been issued to guaranty associations (GAs) to resolve all the claims submitted by those individual GAs (In re: Reliance Insurance Co. in liquidation, No. 1 REL 2001, Pa. Cmwlth.).
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February 19, 2019
Banks Seek Judgment On Damages In Insurers’ Special Deputy Receiver’s Lawsuit
ST. LOUIS — Two banks assert in a Feb. 14 reply brief that a Missouri federal court should grant their motion for partial judgment on claims for certain alleged categories of damages in a dispute filed by a special deputy receiver and state insurance guaranty associations regarding allegations over the mishandling of insolvent funeral insurers’ funds (Jo Ann Howard & Associates P.C., et al. v. J. Douglas Cassity, et al., No. 09-01252, E.D. Mo.).
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February 15, 2019
Driver Sues New Jersey Insurance Guaranty Association For Injuries
PATERSON, N.J. — A New Jersey resident and the New Jersey Property-Liability Insurance Guaranty Association (NJPLIGA) were named as defendants in a personal injury lawsuit filed Feb. 13 in state court (Maria Rodriguez v. Shamira Tirado, et al., No. PAS-L-000485-19, N.J. Super., Passaic Co.).
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February 14, 2019
Justice Appoints Referee To Hear Disputes In Insurer’s Liquidation
WHITE PLAINS, N.Y. — A New York justice on Feb. 5 appointed a referee to hear disputes regarding claim determinations made in the liquidation proceeding of Touchstone Health HMO Inc. and approved the procedure for the liquidator’s adjudication of claims (In the matter of the liquidation of Touchstone Health HMO Inc., No. 54964/2018, N.Y. Sup., Westchester Co.).
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February 14, 2019
Hedge Fund Liquidators: Specific Allegations Exist In Fraud, Conspiracy Case
NEW YORK — In their fraud and conspiracy lawsuit, liquidators for two hedge funds tell a New York federal court in a Feb. 11 brief that they have asserted specific allegations to withstand motions to dismiss their amended complaint claiming that funds with a net asset value of nearly $1 billion turned out not only to be insolvent but also to have liabilities between $400 million and $800 million (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
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February 14, 2019
Mediation Ordered In Breach Of Contract Case Over Trust’s Role For Insolvent Insurer
COLUMBIA, S.C. — In a breach of contract and breach of fiduciary duty lawsuit against a bank sued for its role as trustee of a reinsurance trust for an insolvent insurer, a federal magistrate judge in South Carolina on Feb. 12 ordered all parties to conduct mediation (Accident Insurance Company Inc. v. U.S. Bank National Association, et al., No. 16-2621, D. S.C.).
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February 14, 2019
Justice Closes Ancillary Receivership For Guarantee Insurance Company
NEW YORK — A New York justice on Feb. 1 closed the ancillary receivership proceeding for Guarantee Insurance Co. (In the matter of the ancillary receivership of Guarantee Insurance Co., No. 453158/2017, N.Y. Sup., New York Co.).
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February 13, 2019
Insurer Responds To Home Liquidator’s Settlement With Religious Organization
CONCORD, N.H. — Regarding a mutually insured religious organization, an insurer tells a New Hampshire trial court in a Feb. 11 response that a $2.5 million settlement agreement reached between the insured and the liquidator of The Home Insurance Co. does not affect any contribution or subrogation the insurer may have in the future against the estate (In the matter of the liquidation of The Home Insurance Co., No. 03-E-0106, N.H. Super., Merrimack Co.).
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February 11, 2019
Virgin Islands Insurance Commissioner Seeks Ancillary Receivership
ST. THOMAS, Virgin Islands — A Virgin Islands insurance commissioner in a Feb. 6 petition asks a Virgin Islands federal court to appoint him and successors as Real Legacy Assurance Company Inc.’s ancillary receiver (Tregenza A. Roach v. Real Legacy Assurance Company Inc., No. 19-00007, D. Virgin Islands).
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February 7, 2019
Investors Seek Dismissal Of Fraud, Conspiracy Case From Hedge Fund Liquidators
NEW YORK — In 11 motions filed Feb. 4, parties argue under a theory of impermissible group pleading that a New York federal court should dismiss a fraud and conspiracy lawsuit filed by liquidators for two hedge funds over allegations that the funds with a net asset value of nearly $1 billion turned out not only to be insolvent but also to have liabilities between $400 million and $800 million (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
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February 7, 2019
ACA Insurers Seek High Court Review Of Risk-Corridor Cases
WASHINGTON, D.C. — Congress’ promise to cover Patient Protection and Affordable Care Act (ACA) risk-corridor liabilities only to revoke that duty in vaguely worded appropriations riders is a “bait-and-switch” tactic that leaves the government completely unaccountable, a quartet of insurers tell the U.S. Supreme Court in a trio of Feb. 4 petitions (Land of Lincoln Mutual Health Insurance Co. v. United States, No. N/A, Moda Health Plan Inc. v. United States, No. 18-1028, Blue Cross and Blue Shield of North Carolina v. United States, No. 17-2154, Maine Community Health Options v. United States, No. 18-1023, U.S. Sup.).
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February 6, 2019
Man Sues New Jersey Insurance Guaranty Association For Damages
PATERSON, N.J. — A New Jersey man seeks damages in a Feb. 1 complaint filed in a New Jersey court from New Jersey Property Liability Insurance Guaranty Association (NJPLIGA) for injuries suffered in a motor vehicle accident (Charles McQueen v. New Jersey Property Liability Insurance Guaranty Association, No. PAS-L-000353-19, N.J. Super., Passaic Co.).
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February 5, 2019
Judge Denies Default Judgment To Insurer’s Special Deputy Receiver
ANDERSON, S.C. — A request for default judgment by a special deputy receiver for a multiple-employer self-insured health plan was denied by a South Carolina federal judge on Jan. 28 (Michael J. FitzGibbons, et al. v. Alton Atkinson, et al., No. 17-2092, D. S.C., 2019 Ga. LEXIS 69).
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February 5, 2019
Banks: Affirmative Defenses Are Sufficient In Insurers’ Funds Mishandling Case
ST. LOUIS — In a dispute over the mishandling of funds belonging to insolvent funeral insurers, banks argue in a Feb. 1 motion filed in a Missouri federal court that their investment adviser, authorization and an in pari delicto defenses are supported by the law and the evidence in the case (Jo Ann Howard & Associates P.C., et al. v. J. Douglas Cassity, et al., No. 09-01252, E.D. Mo.).
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February 5, 2019
Georgia High Court: Official Immunity Provision Does Not Apply To Insurer’s Liquidator
ATLANTA — An official immunity provision does not apply to claims for a “surcharge” and attorney fees against an insurance commissioner and two employees, all in official capacities as liquidator and deputies for an insurer, and against a private company involved in the liquidation, the Georgia Supreme Court held Feb. 4 (Georgia, et al. v. International Indemnity Co., et al., No. S18G0493; Regulatory Technologies Inc. v. Georgia, et al., No. S18G0499, Ga. Sup., 2019 Ga. LEXIS 69).
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February 4, 2019
Government: No Error In Criminal Action Over Auditor’s Role In Insurer’s Liquidation
NEW ORLEANS — The government argues in a Feb. 1 brief that there was no abuse of discretion by a lower court in a criminal action over an auditor’s role in the liquidation of an insolvent insurer and that, instead, the Fifth Circuit U.S. Court of Appeals should affirm the lower court’s ruling denying the auditor’s motion for a certificate of innocence for a conviction for money laundering (United States v. Michael H. O’Keefe Sr., No. 18-31033, 5th Cir.).
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February 1, 2019
Reinsurer Seeks Partial Dismissal Of Run-Off Insurer’s $320M Mismanagement Case
NEW YORK — A reinsurer and its entities argue in a Jan. 29 reply brief that a run-off insurer fails to assert claims for breach of fiduciary duty and fraud in a New York federal court dispute over the alleged mismanagement and misuse of $320 million (Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-6658, S.D. N.Y.).
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January 31, 2019
Assessment From Workers’ Comp Self-Insurer Guaranty Was Invalid, Panel Finds
JACKSON, Miss. — An assessment by the Workers’ Compensation Group Self-Insurer Guaranty Association (GGA) was invalid because the guaranty fund’s balance never declined to a level that allows for additional assessments, a Mississippi appeals panel ruled Jan. 29 (Mississippi Manufacturers Association Workers’ Compensation Group v. Mississippi Workers’ Compensation Group Self-Insurer Guaranty Association, No. 2015-WC-01695-COA c/w No. 2017-WC-01680-COA c/w No. 2017-WC-01678-COA, Miss. App., 2019 Miss. App. LEXIS 45).
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January 31, 2019
Funeral Insurers’ Receiver Says Bank Committed Breaches As Funds’ Trustee
ST. LOUIS — In a Missouri federal court case over the mishandling of insolvent funeral insurers’ funds, a special deputy receiver and state insurance guaranty associations say in a Jan. 28 response that a bank “committed multiple and systemic breaches of trust throughout its six-year tenure as trustee” (Jo Ann Howard & Associates P.C., et al. v. J. Douglas Cassity, et al., No. 09-01252, E.D. Mo.).
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January 30, 2019
Bankruptcy Judge Uncertain Over Reinsurance Firm’s Delay Of Reimbursement
WILMINGTON, Del. — In a Chapter 11 proceeding, a Delaware bankruptcy judge on Jan. 25 indicated uncertainty about whether a reinsurance firm is able to delay a $1.25 million payment as reimbursement owed to a stalking horse bidder that did not win an auction for the bankruptcy sale of the company (In re Scottish Holdings Inc., et al., No. 18-10160, D. Del. Bkcy.).