RICHMOND, Va. — A special deputy receiver in an Oct. 10 motion asks to dismiss appeals with the Fourth Circuit U.S. Court of Appeals for lack of jurisdiction over a South Carolina federal magistrate judge’s report, recommending denial of summary judgment in part on various claims under the Racketeer Influenced and Corrupt Organization Act in a lawsuit alleging a scheme to defraud a multiple-employer self-insured health plan with fraudulent letters of credit (LOCs) (Michael J. FitzGibbons, et al. v. De’Shaun Williams, et al., Nos. 19-2049 & 192051, 4th Cir.).
NEW YORK — Following an acquittal in a related criminal case, an investment company’s former executive argues in an Oct. 10 reply brief to a New York federal court that there exists no finding that he engaged in any wrongdoing and, therefore, a runoff insurer is obligated to advance his legal fees and costs and make immediate advancement payment to him of $708,784.77 (In re: Platinum-Beechwood Litigation, No. 18-6658, David Levy v. Senior Health Insurance Company of Pennsylvania, No. 19-3211, S.D. N.Y.).
LAKELAND, Fla. — A Florida appeals panel on Oct. 11 held that an insured is entitled to attorney fees and costs pursuant to Section 57.041, Florida Statutes (2012), in sinkhole litigation because Florida Insurance Guaranty Association’s (FIGA) ultimate concession that her claim is covered constitutes a confession of judgment (Phylis Heid v. Florida Insurance Guaranty Association, No. 2D18-737, Fla. App., 2nd Dist., 2019 Fla. App. LEXIS 15400).
DAYTONA BEACH, Fla. — In a single-page per curiam order, the Fifth District Florida Court of Appeal on Sept. 24 affirmed an order upholding the constitutionality of challenged provisions of the Florida Insurance Guaranty Association (FIGA) Act and denying attorney fees in a sinkhole loss claim dispute with an insolvent insurer (Sean E. Hengesbach v. Florida Insurance Guaranty Association, No. 5D18-2729, Fla. App., 5th Dist., 2019 Fla. App. LEXIS 14414).
SAN FRANCISCO — Because California Insurance Guarantee Association (CIGA) is not a primary plan under the Medicare Act’s secondary payer provisions, the Ninth Circuit U.S. Court of Appeals ruled Oct. 10 that CIGA has no obligation to reimburse the Centers for Medicare and Medicaid Services (CMS) for conditional payments made on behalf of insureds under workers’ compensation plans that become insolvent (California Insurance Guarantee Association v. Alex Azar II, et al., Nos. 17-56526 & 17-56528, 9th Cir., 2019 U.S. App. LEXIS 30339).
SAN JUAN, Puerto Rico — Noting that the Puerto Rico insurance commissioner rehashes previously rejected arguments, a federal judge in Puerto Rico on Oct. 9 refused to dismiss a first amended complaint filed by shareholders and officers of an insolvent insurer over their allegations of a civil conspiracy to deprive constitutional rights to them (Victor J. Salgado and Associates Inc., et al. v. Javier Rivera-Rios, et al., No. 19-1663, D. Puerto Rico).
NEW ORLEANS — In a two-page per curiam order, the Fifth Circuit U.S. Court of Appeals on Oct. 7 denied an auditor’s petition for panel rehearing to determine the merits of his motion for a certificate of innocence for a conviction for money laundering in a criminal action over his role in an insurer’s liquidation (United States v. Michael H. O’Keefe Sr., No. 18-31033, 5th Cir.).
NEW YORK — In a 176-page ruling, a New York federal judge on Oct. 7 gave reasons for granting in part motions to dismiss investment fund receiver’s claims, insurers’ third-party claims and a run-off insurer’s third-party claims in a $320 million “massive fraudulent scheme” dispute (In re Platinum-Beechwood Litigation, No. 18-6658, Melanie L. Cyganowski, et al. v. Beechwood Re Ltd., et al., No. 18-12018, S.D. N.Y., 2019 U.S. Dist. LEXIS 173830).
WASHINGTON, D.C. — Colorado insurance liquidation law precludes the U.S. Department of Health and Human Services (HHS) from using money owed to an insolvent Colorado insurer to pay debts owed under the Patient Protection and Affordable Care Act’s (ACA) reinsurance and risk-adjustment programs, a judge in the U.S. Court of Federal Claims ruled Oct. 3 (Michael Conway v. The United States, No. 18-1623, Fed. Clms., 2019 U.S. Claims LEXIS 1306).
SAN JUAN, Puerto Rico — Shareholders and officers of an insolvent insurer “disguise” their first amended complaint as one for civil conspiracy to deprive constitutional rights but are actually attempting to “collaterally attack” the insurer’s liquidation proceedings, the Puerto Rico insurance commissioner and others argue in an Oct 1. motion to dismiss in Puerto Rico federal court (Victor J. Salgado and Associates Inc., et al. v. Javier Rivera-Rios, et al., No. 19-1663, D. Puerto Rico).
NEW YORK — A runoff insurer in a Sept. 23 opposition asks a New York federal court not to dismiss its third-party complaint against a defendant for aiding and abetting a Ponzi-like scheme in which fraudulent misrepresentations were made to gain investment control and discretion over $320 million of the runoff insurer’s reserves because the defendant “attempts to minimize his role” in the scheme and “makes a concerted effort to dispute the factual allegations against him” (In re Platinum-Beechwood litigation, No. 18-6658; Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-6658; Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, Melanie L. Cyganowski v. Beechwood Re Ltd., et al., Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., and Senior Health Insurance Company of Pennsylvania v. PB Investment Holdings Ltd., et al., No. 18-12018, S.D. N.Y.).
RICHMOND, Va. — Because surplus proceeds belong to Circuit City’s bankruptcy estate and all claims under excess insurance policies were settled, the California Self-Insurers’ Security Fund may not continue to demand payments from the excess insurer for Circuit City's California workers' compensation claims under the terms of a settlement agreement, a federal judge in Virginia ruled Sept. 27, affirming a bankruptcy court’s judgment (California Self-Insurers’ Security Fund, et. al. v. Alfred Siegel, No. 18-619, E.D. Va., 2019 U.S. Dist. LEXIS 167399).
GREENVILLE, S.C. — The Fourth Circuit U.S. Court of Appeals on Sept. 26 consolidated two appeals from defendants concerning a South Carolina federal magistrate judge’s recommendation to deny them summary judgment on a special deputy receiver’s claims, including violations of Sections 1962(d) and 1962(c) of the Racketeer Influenced and Corrupt Organization Act, over an alleged scheme to defraud a multiple-employer self-insured health plan with fraudulent letters of credit (LOCs) (Michael J. FitzGibbons, et al. v. De-Shaun Williams, et al., No. 19-2049 & Michael J. FitzGibbons, et al. v. Cherise Raymond, et al., No. 19-2051, 4th Cir.).
BROOKLYN, N.Y. — A federal judge in New York on Sept. 27 acquitted a former executive of securities fraud charges arising from his role in a hedge fund scheme to transfer assets to a reinsurance company and related entities to defraud bondholders in an oil and gas company and granted a new trial to the defunct hedge fund’s co-founder on similar charges (United States v. Mark Nordlicht, et al., No. 16-cr-00640, E.D. N.Y., 2019 U.S. Dist. LEXIS 167084).
NEW YORK — A federal judge in New York on Sept. 26 granted a reduced attorney fees award of $3,550 to London underwriters for their response to an improperly filed appeal on behalf of an insolvent insurer in a dispute over reinsurance payments for construction site injuries (Certain Underwriting Members of Lloyds of London, et al. v. Insurance Company of the Americas, Nos. 16-323 & 16-374, S.D. N.Y., 2019 U.S. Dist. LEXIS 165702).
AUSTIN, Texas — A reinsurer, as a debtor, argues to a Texas federal bankruptcy court in a Sept. 23 reply brief that a medical malpractice insurer has failed to cooperate with resolution of its guaranty claim and, thus, the court should grant the reinsurer’s motion for an estimation of that claim (In re: Capson Corp., et al., Nos. 19-10890, 19-10893 & 19-10894, W.D. Texas Bkcy.).
GREENVILLE, S.C. — Two defendants filed separate objections on Sept. 5 to a South Carolina federal magistrate judge’s recommendation to deny them summary judgment on various claims, including ones for violations of Sections 1962(d) and 1962(c) of the Racketeer Influenced and Corrupt Organization (RICO) Act, filed by a special deputy receiver in a lawsuit alleging a scheme to defraud a multiple-employer self-insured health plan with fraudulent letters of credit (LOC) (Michael J. FitzGibbons, et al. v. Alton Atkinson, et al., No. 17-2092, D. S.C.).
SAN FRANCISCO — An insolvent surety “offers little authority” to show that a continuing agreement of indemnification (CAI) did not imply a duty to inform homebuilders of claims made against surety bonds, the homebuilders argue in a June 28 reply brief in the Ninth Circuit U.S. Court of Appeals, asking that entry of summary judgment to the surety be reversed (Western Insurance Co. in liquidation v. Frontier Homes LLC, et al., No. 19-55101, 9th Cir.).
TAMPA, Fla. — A federal judge in Florida on Sept. 16 said that a medical doctor who is an officer and director of a number of now-insolvent insurers settled his coverage dispute with his excess insurer concerning an underlying clawback claim filed by the insolvent insurers’ receiver (Akshay M. Desai v. Navigators Insurance Co., No. 18-1843, M.D. Fla.).
LOS ANGELES — The California Insurance Guarantee Association (CIGA) is liable for a workers’ compensation claim as a covered claim, the Second District California Court of Appeal, Division I, held Sept. 18, annulling a Workers’ Compensation Appeals Board’s decision and remanding with directions to find that a special employer had a valid endorsement in its workers’ compensation insurance policy excluding coverage for special employees (Travelers Property Casualty Company of America v. Workers’ Compensation Appeals Board, et al., No. B292915, Calif. App., 2nd Dist., Div. 1, 2019 Cal. App. Unpub. LEXIS 6216).