Mealey's Insurance Insolvency
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August 27, 2019
Judge Denies Reconsideration Of Refusal To Dismiss Aiding, Abetting Claim Against Insider
NEW YORK — Finding that an alleged insider did not offer any reason as to why a decision should be reconsidered, a federal judge in New York on Aug. 20 upheld his ruling denying dismissal of an aiding and abetting breach of fiduciary duty claim over the insider’s role in what two hedge funds’ liquidators describe as “one of the most spectacular hedge fund collapses” (In re Platinum-Beechwood Litigation, No. 18-6658, Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y., 2019 U.S. Dist. LEXIS 142267).
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August 26, 2019
Reinsurers Oppose Insurer’s Rehabilitator’s Request To Remand $150M Dispute
SAN JUAN, Puerto Rico — Reinsurers in two Aug. 21 filings argue that a federal judge in Puerto Rico should reject an insurer’s rehabilitator’s attempt to remand a case over $150 million in losses from two hurricanes to the insurer’s rehabilitation proceeding and, instead, send the matter to arbitration (Integrand Assurance Co. v. Everest Reinsurance Co., et al., No. 19-01111, D. Puerto Rico).
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August 26, 2019
Judge Orders Payment For Half Of Special Master’s Fees In Auto Insurance Dispute
WHEELING, W.Va. — Noting “sympathy” for an equitable argument concerning a plaintiff insurer’s receivership, a federal judge in West Virginia on Aug. 21 ordered two other plaintiffs to pay their half of the fees for a special master and guardians ad litem in a dispute arising out of a 20-plus motor vehicle and tractor-trailer accident (Spirit Commercial Auto Risk Retention Group, et al. v. Randall Ryan Shreve, et al., No. 18-31, N.D. W.Va., 2019 U.S. Dist. LEXIS 141891).
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August 16, 2019
Insurer’s Liquidator Seeks Approval Of Estimated Claims Value Process For Class
HARRISBURG, Pa. — The liquidator for Reliance Insurance Co. in an Aug. 15 application requests approval from a Pennsylvania court of an estimated claims value process (ECVP) for certain class (e) proofs of claim (In re: Reliance Insurance Co. in liquidation, No. 1 REL 2001, Pa. Cmwlth.).
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August 16, 2019
Insurer’s Liquidator Seeks Approval Of $1.75M Settlement With Insured
CONCORD, N.H. — The liquidator of The Home Insurance Co. on Aug. 13 asked a New Hampshire court to approve a $1.75 million settlement with an insured (In the matter of the liquidation of The Home Insurance Co., No. 217-2003-EQ-00106, N.H. Super., Merrimack Co.).
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August 15, 2019
Reinsurer, Entities Object To Dismissal Of Counterclaims Against Runoff Insurer
NEW YORK — A reinsurer and its entities argue in a July 30 opposition that a New York federal court should deny a runoff insurer’s motion to dismiss their counterclaims for entitlement to advancement and indemnification under investment management agreements (IMAs) in a dispute over the misuse and mismanagement of $320 million (In re Platinum-Beechwood Litigation; Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-6658, S.D. N.Y.).
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August 14, 2019
Judge: No Jurisdiction To Hear Health Insurer Liquidator’s Offset Case
CHICAGO — A federal judge in Illinois on Aug. 13 held that she lacked jurisdiction over a case filed by an insolvent health insurer’s liquidator against the Centers for Medicare and Medicaid Services (CMS) and the U.S. government in which the liquidator sought to have an offset payment system be declared unlawful (Kevin Fry v. Centers for Medicare and Medicaid Services, et al., No. 19-1320, N.D. Ill., 2019 U.S. Dist. LEXIS 136175).
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August 14, 2019
Judge Orders New Deadlines In Reimbursement Case Against Insolvent Insurer’s Liquidator
LOS ANGELES — A federal judge in California July 29 granted new deadlines for discovery and summary judgment motions in a bank’s lawsuit against the liquidator of an insolvent medical professional liability insurer seeking reimbursement under a letter of credit issued to the insurer to stay enforcement of a $2.5 million medical malpractice judgment (MUFG Union Bank, N.A. v. Steven C. Taylor, No. 18-02772, C.D. Calif.).
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August 13, 2019
Judge Rules On Application Of Runoff Insurer’s Advancement Of Expenses To Executive
NEW YORK — A New York federal judge on Aug. 9 held that percentages for advancement of expenses by a runoff insurer apply to an investment company’s former executive’s full expenses, not considering insurance coverage, and that to receive advancement, the executive does not need to provide more documentation (In re: Platinum-Beechwood Litigation, No. 18-6658, David Levy v. Senior Health Insurance Company of Pennsylvania, No. 19-3211, S.D. N.Y.).
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August 09, 2019
Representative Seeks Comity From Bankruptcy Judge In Reinsurer’s Main Proceeding
NEW YORK — A foreign representative in a reinsurer’s bankruptcy proceeding in an Aug. 6 motion asks a New York bankruptcy judge for additional Chapter 15 relief granting international comity and directing all creditor claims to be adjudicated in a Cayman proceeding because the Cayman court has jurisdiction to determine how and when the claims can be adjudicated for the benefit of the estate and all creditors (In re Beechwood Re, No. 19-11560, Chapter 15, S.D. N.Y. Bkcy.).
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August 09, 2019
Auditor Seeks Rehearing On 5th Circuit Ruling On Motion For Certificate Of Innocence
NEW ORLEANS — An auditor on Aug. 6 petitioned the Fifth Circuit U.S. Court of Appeals for a panel rehearing arguing that the court had jurisdiction 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.).
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August 08, 2019
Third-Party Defendants Seek Dismissal Of Runoff Insurer’s Aiding, Abetting Claims
NEW YORK — Third-party defendants argue in separate Aug. 5 reply briefs to a New York federal court that a runoff insurer fails to allege aiding and abetting claims in a “massive fraudulent scheme” over the mishandling of $320 million (In re Platinum-Beechwood Litigation, No. 18-6658, Melanie L. Cyganowski v. Beechwood Re Ltd., et al., Senior Health Insurance Company of Pennsylvania v. PB Investment Holdings Ltd., et al., No. 18-12018, S.D. N.Y.).
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August 08, 2019
New York Bankruptcy Judge Recognizes Reinsurer’s Foreign Main Proceeding
NEW YORK — A New York bankruptcy judge on July 23 recognized a reinsurer’s foreign main proceeding and overruled limited objections filed by a receiver and liquidators of various hedge funds who argued that they should be allowed to bring their claims against the debtor in their own proceedings (In re Beechwood Re, No. 19-11560, Chapter 15, S.D. N.Y. Bkcy.).
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August 06, 2019
Insider Seeks Reconsideration Of Ruling On Motion To Dismiss Aiding, Abetting Claim
NEW YORK — An alleged insider argues in an Aug. 2 reply brief to a New York federal court that it should reconsider a ruling regarding allegations in a second amended complaint (SAC) of his role in what two hedge funds’ liquidators describe as “one of the most spectacular hedge fund collapses” because he “sat on the opposite side of the table” from the funds and his only duty was to himself and to the entities he controlled (In re Platinum-Beechwood Litigation, No. 18-6658, Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
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August 05, 2019
Runoff Insurer: No Contractual Advancement, Indemnification Owed To Former Executive
NEW YORK — A runoff insurer argues in an Aug. 1 motion that a recent criminal conviction of an investment company’s former executive confirms that he is not entitled to contractual advancement and indemnification of expenses and legal fees in connection with several lawsuits arising from the runoff insurer’s allegations of misuse of $320 million by affiliates of a failed Ponzi scheme (In re: Platinum-Beechwood Litigation, No. 18-6658, David Levy v. Senior Health Insurance Company of Pennsylvania, No. 19-3211, S.D. N.Y.).
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August 05, 2019
Insolvent Surety Does Not Oppose Request For $3.6M Supersedeas Bond, Stay
RIVERSIDE, Calif. — An insolvent surety tells a California federal judge in an Aug. 1 brief that it does not oppose an ex parte application for approval of a supersedeas bond in the amount of $3.6 million and a stay of a judgment’s enforcement in its reimbursement dispute against contractors to the extent the stay is issued only to contractors whose liability is secured by the proposed bond (Western Insurance Co. in liquidation v. Frontier Homes LLC., et al., No. 17-2181, C.D. Calif.).
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August 02, 2019
Judge Denies Preliminary Injunction To Insured In Case Over Premium Costs
DALLAS — A Texas federal judge on July 30 denied an insured’s application for a preliminary injunction because the insured cannot demonstrate a substantial likelihood of success on the merits in his dispute over his insurer’s ability to raise premium costs due to an assumption reinsurance agreement and a rehabilitation plan involving another insurer (Don B. Chae v. American Fidelity Assurance Co., No. 19- 157, N.D. Texas, 2019 U.S. Dist. LEXIS 127563).
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August 01, 2019
Judge Upholds Percentages For Allocation Of Expenses In Runoff Insurer’s Misuse Case
NEW YORK — A federal judge in New York on July 23 denied reconsideration of his ruling on the allocation of advancement of expenses in several lawsuits connected to a runoff insurer’s case over allegations of misuse of $320 million by affiliates of a failed Ponzi scheme (In re: Platinum-Beechwood Litigation, No. 18-6658, David Levy v. Senior Health Insurance Company of Pennsylvania, No. 19-3211, S.D. N.Y., 2019 U.S. Dist. LEXIS 123735).
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July 25, 2019
Justice Orders Review Of Liquidator’s Settlement With Insurer’s Former Directors
NEW YORK — A New York justice on July 11 said she would conduct an in camera review of a proposed $2.2 million settlement agreement between the liquidator of Health Republic Insurance of New York Corp. (HRINY) and former HRNY directors and officers regarding alleged breaches of fiduciary duty (In re Health Republic Insurance of New York Corp., No. 450500/2016, N.Y. Sup., New York Co.).
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July 24, 2019
Justice Severs Defendants From Case Based Upon Insurer’s Liquidation Order
NEW YORK — A New York trial justice on June 26 severed certain defendants from a medical malpractice lawsuit based upon a stay issued in a liquidation order against their insolvent insurer (Yajaira Montes Rosario v. Lynn Ladetsky, M.D., et al., No. 805130/2015, N.Y. Sup., New York Co., 2019 N.Y. Misc. LEXIS 3468).