COLUMBIA, S.C. — In a case over a bank’s alleged breach of duties as trustee of a reinsurance trust for an insolvent insurer, a South Carolina federal judge on June 21 excluded evidence related to government investigations but refused to bar evidence concerning bank secrecy act/anti-money laundering compliance (BSA/AML) training (Accident Insurance Company Inc. v. U.S. Bank National Association, et al., No. 16-2621, D. S.C., 2019 U.S. Dist. LEXIS 103923).
WASHINGTON, D.C. — The U.S. Supreme Court on June 24 granted certification to health insurers to decide whether the United States evaded its statutory promise to pay them for losses when the government blocked $12 billion in funding under the Patient Protection and Affordable Care Act (ACA) risk-corridor program (Land of Lincoln Mutual Health Insurance Co. v. United States, No. 18-1038, Moda Health Plan Inc., et al. v. United States, No. 18-1028, Maine Community Health Options v. United States, No. 18-1023, U.S. Sup.).
CONCORD, N.H. — A New Hampshire judge on June 3 approved a $9.5 million settlement between the liquidator of The Home Insurance Co. and one of its insureds regarding alleged liabilities for asbestos bodily injury and environmental exposures (In the matter of the liquidation of The Home Insurance Co., No. 2003-EQ-0106, N.H. Super., Merrimack Co.).
SALT LAKE CITY — Addressing the factors in State Farm Fire & Cas. Co. v. Mhoon, 31 F.3d 979 (10th Cir. 1994), a Utah federal judge on June 3 chose to dismiss a declaratory judgment action, which alleged that an assessment made by a health maintenance organization’s (HMO) liquidator against another HMO is preempted by federal Medicare law (Molina Healthcare of Utah Inc. v. Todd E. Kiser, No. 19-00025, D. Utah, 2019 U.S. Dist. LEXIS 93299).
NEW YORK — In seven separate motions, third-party defendants on June 14 asked a New York federal court to dismiss a runoff insurer’s third-party complaint alleging aiding-and-abetting fraud and breach of fiduciary duty in a “massive fraudulent scheme” for failing to make particularized allegations against them (Melanie L. Cyganowski v. Beechwood Re Ltd., et al., No. 18-12018, S.D. N.Y.).
ANDERSON, S.C. — An insurer’s special deputy receiver in June 14 motions argues that two defendants played a role in an alleged scheme to defraud a multiple-employer self-insured health plan with fraudulent letters of credit (LOC) and, thus, a South Carolina federal court should not dismiss the receiver’s claim under the Racketeer Influenced and Corrupt Organization Act against them (Michael J. FitzGibbons, et al. v. Alton Atkinson, et al., No. 17-2092, D. S.C.).
FRANKFORT, Ky. — In a case over statutory and regulatory violations against state agencies, the Kentucky Supreme Court on June 5 denied discretionary review of a lower court’s ruling that an insolvent self-insured employer’s president was required to request a refund of security with the commissioner for the Kentucky Department of Workers’ Claims (James R. Martin v. Kentucky Individual Self-Insurance Guaranty Fund, et al., No. 2018-SC-000552-D, Ky. Sup., 2019 Ky. LEXIS 258).
CHICAGO — An insolvent insurer’s liquidator argues in a June 7 reply filed in Illinois federal court that a panel exceeded its authority when it issued attorney fees in its $437,000 arbitration award to a reinsurer (Catalina Holdings [Bermuda] Ltd. v. Jennifer Hammer, No. 18-5642, N.D. Ill.).
EL PASO, Texas — A Texas appeals panel on June 12 upheld the entry of summary judgment on negligence claims against insurance agents regarding their procurement of a liquor liability policy from an insolvent insurer and the eventual lack of coverage for two underlying Dram Sham Act lawsuits against a bar establishment (R&M Mixed Beverage Consultants Inc. v. Safe Harbor Benefits Inc., et al., No. 08-17-00054-CV, Texas App., 8th Dist., 2019 Tex. App. LEXIS 4840).
LOS ANGELES — A California federal judge on June 12 ordered insureds to show cause why their breach of contract case against an insolvent insurer should not be dismissed and, instead, handled in the insurer’s liquidation (Yancy Alvarez, et al. v. Access General Insurance Co., No. 18-336, C.D. Calif., 2019 U.S. Dist. LEXIS 98817).
NEW YORK — A New York federal judge on June 10 stayed a lawsuit by the Securities and Exchange Commission that alleges that two individuals “perpetrated multiple schemes to defraud their advisory clients, which were insurance companies and reinsurance trusts” (Securities and Exchange Commission v. Alexander C. Burns, et al., No. 18-09477, S.D. N.Y.).
SAN FRANCISCO — In their dispute over who is responsible for payment to insureds of workers’ compensation plans that become insolvent, Secretary of Health and Human Services Alex Azar II and the California Insurance Guarantee Association (CIGA) in a May 25 brief tell the Ninth Circuit U.S. Court of Appeals that a lower court’s judgment is final and appealable because the judgment resolved all their respective claims, rights and liabilities (California Insurance Guarantee Association v. Alex Azar II, et al., Nos. 17-56526 & 17-56528, 9th Cir.).
WILMINGTON, Del. — Two limited liability companies and liquidators for one of the companies filed a 101-page complaint in a Delaware state court on June 7, alleging breach of fiduciary duty with regard to transactions involving reinsurance agreements (Principal Growth Strategies LLC, et al. v. AGH Parent LLC, et al., No. 2019-0431, Del. Chan.).
NEW YORK — The First Department New York Appellate Division on June 4 upheld a lower court’s ruling lifting a stay of a medical malpractice lawsuit that had been stayed due to a liquidation order placed against one of the defendant’s insurers (Cynthia I. Caimares v. Aimee Erickson, et al., No. 20620/17E, N.Y. App. Div., 1st. Dept., 2019 N.Y. App. Div. LEXIS 4321).
NEW YORK — A reinsurer and the liquidator for Home Insurance Co. informed a New York federal judge on May 30 that they voluntarily dismiss a third-party action following the dismissal of the main action over proceeds allegedly owed to the insolvent insurer under three facultative reinsurance certificates (Roger A. Sevigny v. Trygvesta Forsikring A/S, Trygvesta Forsikring A/S v. Cerberus Holding Company LLC, No. 16-4874, S.D. N.Y.).
ST. LOUIS — A Missouri federal judge on June 3 held that he would abstain from hearing a dispute between the special deputy receiver (SDR) for three insolvent insurers and a preneed cemetery trust over whether a merchandise and services trust remains property of a receivership proceeding and will instead stay the case until resolution of a concurrent Texas state court receivership proceedings (Winner Road Properties LLC v. BMO Harris Bank, N.A. v. Jo Ann Howard & Associates, P.C., No. 16-1395, E.D. Mo., 2019 U.S. Dist. LEXIS 92546).
NEW YORK — Calling the allegations against it the “written equivalent of a Russian nesting doll,” an investment holdings company argues in a May 31 reply brief that a New York federal court should dismiss a second amended complaint filed by two hedge funds’ liquidators concerning the alleged massive fraud scheme that caused the hedge funds’ collapse (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
NEW YORK — In response to a motion to dismiss a second amended complaint (SAC), two hedge funds’ liquidators argue in a May 29 brief to a New York federal court that an investment holdings company should not be permitted “to evade responsibility for the substantial assistance it provided” in an alleged massive fraud scheme that caused the hedge funds’ collapse (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
CHICAGO — A reinsurer tells an Illinois federal court in a May 24 opposition that an insolvent insurer’s liquidator seeks to vacate or modify a $437,000 arbitration award for attorney fees “not because of the purported reason that the panel exceeded its authority in issuing the award, but because it does not agree with the panel’s interpretation of the parties’ contracts” (Catalina Holdings [Bermuda] Ltd. v. Jennifer Hammer, No. 18-5642, N.D. Ill.).
WASHINGTON, D.C. — Finding that the Rooker-Feldman doctrine is inapplicable to the case, the District of Columbia Circuit U.S. Court of Appeals on May 28 reversed the dismissal of a lawsuit filed by the sole shareholder of an insolvent health insurer against the District of Columbia and the insurer’s rehabilitator for their alleged unlawful acts (D.C. Healthcare Systems Inc. v. District of Columbia, et al., No. 17-7141, D.C. Cir., 2019 U.S. App. LEXIS 15698).