Mealey's Insurance Insolvency
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February 17, 2021
Wealth Firms Defend Motions To Dismiss Suit Bought By Insurers In Rehabilitation
RALEIGH, N.C. — Two wealth management firms with interests in a loan agreement on Jan. 4 filed separate replies in a North Carolina federal court defending their motions to dismiss a lawsuit brought by two insurers in rehabilitation seeking $12.5 million under the loan agreement after the insurers opposed their motion.
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February 16, 2021
Judge Remands State Insurance Guaranty’s Suit Against Workers’ Compensation Insurers
RALEIGH, N.C. — A federal judge in North Carolina on Feb. 10 granted North Carolina Insurance Guaranty Association’s (NCIGA) motion to remand its declaratory judgment lawsuit seeking further administration and payment of seven workers' compensation insurance claims from two insurers, finding that the weight of authority holds that remand is necessary because NCIGA is an unincorporated association whose citizenship is that of its members.
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February 08, 2021
Delaware Judge Compels Discovery In Misconduct Suit Over Insolvent Insurer
WILMINGTON, Del. — A Delaware judge on Feb. 4 granted equity investors’ motion to compel defendants to produce documents and responses to interrogatories in a dispute regarding alleged misconduct that caused injury to an insurer in liquidation.
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February 08, 2021
Parties: Insolvent Insurer Not Entitled To Recoup Settlement Funds
LOUISVILLE, Ky. — Parties involved in a dispute arising from a $750,000 truck crash judgment jointly moved for approval of a settlement on Feb. 5, specifically seeking a finding that the settlement does not violate an injunction issued in a Nevada liquidation court and the insolvent insurer is not entitled to recoup any settlement funds paid.
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February 04, 2021
Liquidator Moves To Amend Complaint In Coverage Suit Over $21M Wrongful Acts Claim
SIOUX FALLS, S.D. — Citing recent occurrences and circumstances, the liquidator of ReliaMax Surety Co. (RSC) on Feb. 2 moved to amend his amended complaint seeking a declaratory judgment that coverage exists under a claims-made excess insurance policy above a directors and officers (D&O) policy with regard to a $21 million wrongful acts claim.
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February 02, 2021
Amicus Curiae Says District Court Erred In Instructing Jury In Insurance Bribery Suit
RICHMOND, Va. — The National Association of Criminal Defense Lawyers on Jan. 28 filed an amicus curiae brief in the Fourth Circuit U.S. Court of Appeals, contending that a district court erred in instructing a jury on a disputed element of a charge in a $2 million bribery scheme case that resulted in convictions against a multinational insurance and reinsurance management company’s founder and a company consultant.
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February 01, 2021
Insured Answers Suit After Magistrate Lifts Stay Following Liquidator’s Approval
SAVANNAH, Ga. — An insured on Jan. 27 answered a commercial auto insurer’s amended complaint seeking a declaration that there is no coverage for the insured, its owners and one of its employees for an underlying $112,466.57 personal injury default judgment after a federal magistrate judge in Georgia lifted the stay on the declaratory judgment action following a status report that indicated that the insurer’s appointed liquidator authorized the lawsuit.
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January 29, 2021
HHS Acting Secretary: State Insurance Guaranty’s Medicare Lawsuit Should Be Dismissed
RALEIGH, N.C. — The North Carolina Insurance Guaranty Association (NCIGA) has no standing, and a North Carolina federal court has no jurisdiction over a case seeking an interpretation of the provisions in a Medicare Secondary Payer (MSP) statute, the acting secretary of Health and Human Services and federal agencies argue in a Jan. 28 motion to dismiss.
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January 29, 2021
Hedge Fund Receiver Drops Appeal Over Alleged Aiding, Abetting Of Fraud Scheme
NEW YORK — The Second Circuit U.S. Court of Appeals said on Jan. 28 that a hedge fund receiver withdrew her appeal of a ruling that an investment holding company did not aid and abet fraud with three investment management agreements (IMAs) involving a reinsurer, its related entities and Senior Health Insurance Company of Pennsylvania (SHIP).
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January 28, 2021
Insurer’s Rehabilitator Tells U.S. High Court: Arbitration Clause Is Not Enforceable
WASHINGTON, D.C. — The Louisiana Rehabilitation, Liquidation and Conservation Act, including its post-receivership venue provision, “regulates the business of insurance and prohibits the enforcement of any private forum selection clause,” including an arbitration clause at issue in a professional negligence suit against an actuarial services company, that “frustrates state insurance law,” the Louisiana insurance commissioner argues to the U.S. Supreme Court in a Jan. 27 opposition brief.
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January 28, 2021
HHS Acting Secretary Seeks To Dismiss Insurance Guaranty Fund’s Medicare Statute Suit
CHICAGO — An Illinois federal court should dismiss the Illinois Insurance Guaranty Fund’s (IIGF) suit seeking an interpretation of the federal Medicare Secondary Payer (MSP) statute, the acting secretary of Health and Human Services argues in a Jan. 22 motion, because the IIGF’s suit is “untethered to allegations of injury, and so it lacks standing to sue.”
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January 27, 2021
Government Says It Can Set Off ACA Risk-Corridor Liabilities Against Insolvent Insurers
WASHINGTON, D.C. — The U.S. Court of Federal Claims has jurisdiction to decide claims seeking setoffs of debts against risk-corridor liabilities owed to insolvent health insurers under the Patient Protection and Affordable Care Act (ACA) risk corridor, the U.S. government argues in a Jan. 22 opposition brief to a motion to dismiss, also noting its authority to recover interest owed on ACA debts.
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January 26, 2021
Scottish Holding Inc.’s Trustee Seeks Approval Of $26M Settlements
WILMINGTON, Del. — The trustee for Scottish Holdings Inc. (SHI) and one of its subsidiaries filed separate motions on Jan. 22 requesting a Delaware bankruptcy judge’s approval of two settlements worth more than $26 million reached with beneficiaries of a trust agreement and a reinsurance agreement.
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January 25, 2021
Insured Asks Florida High Court To Review Denial Of Attorney Fees From FIGA
TALLAHASSEE, Fla. — In a dispute over attorney fees, an insured in a Dec. 23 brief seeks Florida Supreme Court review of a lower appellate court’s decision that the Florida Insurance Guaranty Association Inc. (FIGA) is not responsible under a Florida statute for the fees because it never denied the insured’s hurricane damage claim before the insured pursued litigation.
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January 22, 2021
Justice Seeks Cause On Why Medical Malpractice Insurer’s Liquidation Should Not Be Closed
NEW YORK — A New York justice asked interested parties on Dec. 8 to provide reasons on why she should not close the liquidation proceeding for Professional Liability Insurance Company of America (PLICA) as requested by the liquidator.
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January 22, 2021
ACCC Insurance Company’s Rehabilitation Turned Into Liquidation By Texas Judge
AUSTIN, Texas — A Texas judge on Dec. 14 converted ACCC Insurance Co.’s rehabilitation proceedings into a liquidation and appointed the state’s insurance commissioner as liquidator.
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January 21, 2021
Excess Insurer: Liquidator’s Pursuit Of Coverage For Wrongful Acts Claim Fails
SIOUX FALLS, S.D. — An excess insurer argues in a Jan. 19 opposition brief that a South Dakota federal court should deny summary judgment to the liquidator of ReliaMax Surety Co. (RSC) on his declaratory judgment claim that coverage exists under a claims-made excess insurance policy above a directors and officers (D&O) policy with regard to a $21 million wrongful acts claim.
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January 21, 2021
Pennsylvania Governor, General Assembly Appeal Ruling On JUA Legislation
HARRISBURG, Pa. — Pennsylvania Gov. Tom Wolf and the state’s General Assembly filed notices of appeal Jan. 20 to the Third Circuit U.S. Court of Appeals on a ruling that parts of recent Pennsylvania legislation is unconstitutional because it forces the Pennsylvania Professional Liability Joint Underwriting Association (JUA) to use state funding and lawyers.
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January 21, 2021
California Regulators Accused Of Retaliation For Filing Conservatorship Order
SACRAMENTO, Calif. — Applied Underwriters Inc. and a subsidiary filed an amended complaint on Dec. 14 in California federal court, alleging that the state’s insurance commissioner and deputies violated their constitutional rights and acted in bad faith by filing a conservatorship against a workers’ compensation insurer that is party to a reinsurance participation agreement (RPA).
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January 20, 2021
Insurer: California Insurance Department Obstructed Merger With Conservatorship Order
SACRAMENTO, Calif. — California Insurance Co. (CIC) says in a Jan. 6 California federal court complaint that the state’s insurance commissioner and his department unlawfully obtained a conservatorship and obstructed a merger that would have had CIC re-domesticate from California to New Mexico.