Mealey's Insurance Insolvency
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April 12, 2019
Judge Denies Damages Cap In Breach Of Duty Case To Reinsurance Trust For Insurer
COLUMBIA, S.C. — A South Carolina federal judge on April 11 denied a bank’s motion for partial summary judgment seeking an imposed cap on damages in a dispute over the bank’s alleged breach of duties as trustee of a reinsurance trust for an insolvent insurer (Accident Insurance Company Inc. v. U.S. Bank National Association, et al., No. 16-2621, D. S.C., 2019 U.S. Dist. LEXIS 62308).
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April 12, 2019
Federal Judge Offers Reasons For Dismissal Of 2 Hedge Fund Liquidators’ Claims
NEW YORK — A New York federal judge on April 11 issued reasons for a “bottom-line” order dismissing a first amended complaint’s claims for aiding and abetting breach of fiduciary duty and aiding and abetting fraud filed by two hedge funds’ liquidators (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y., 2019 U.S. Dist. LEXIS 62745).
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April 11, 2019
Pedestrian Sues New Jersey Insurance Guaranty Association For Expenses
HACKENSACK, N.J. — A New Jersey pedestrian alleges in an April 8 complaint in a state trial court that the New Jersey Property-Liability Insurance Guaranty Association (NJPLIGA) is responsible for medical expenses incurred in an accident with a negligent unknown driver (Jonathan Frias-Rivas v. New Jersey Property-Liability Insurance Guaranty Association, et al., No. BER-L-002686-19, N.J. Super., Bergen Co.).
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April 9, 2019
Responses Given To Insurers’ Receiver’s Memorandum On Merchandise, Services Trust
ST. LOUIS — A beneficiary to preneed cemetery trust argues on April 5 to a Missouri federal judge that the special deputy receiver (SDR) for three insolvent insurers does not establish that a merchandise and services trust has belonged to the estate from the beginning of the receivership proceeding while a trustee on the same day did not dispute the SDR (Winner Road Properties LLC v. BMO Harris Bank, N.A. v. Jo Ann Howard & Associates, P.C., No. 16-1395, E.D. Mo.).
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April 8, 2019
Judge Approves Insurer’s Liquidator’s Final Omnibus Notices Of Determinations
HARRISBURG, Pa. — A Pennsylvania judge on April 5 approved final omnibus notices of determinations (NODs) made by Reliance Insurance Co.’s liquidator 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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April 8, 2019
Judge Awards Attorney Fees To Insolvent Surety In Reimbursement Dispute
RIVERSIDE, Calif. — A California federal judge awarded attorney fees of $117,335.50 on March 12 to an insolvent surety after previously granting summary judgment to the surety in its reimbursement dispute against contractors (Western Insurance Co. in liquidation v. Frontier Homes LLC., et al., No. 17-2181, C.D. Calif.).
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April 4, 2019
Funds’ Receiver Files Amended Complaint For Redress Over ‘Massive Fraudulent Scheme’
NEW YORK — In a first amended complaint filed April 1 in a New York federal court, a receiver for funds seeks redress “for the innocent investors and creditors of her estate” damaged by unlawful and tortious acts with regard to a “massive fraudulent scheme masterminded by the now indicted and/or convicted insiders” of Platinum Partners Credit Opportunities Master Fund LP (PPCO funds) (Melanie L. Cyganowski, as equity receiver for Platinum Partners Credit Opportunities Master Fund LP, et al. v. Beechwood Re Ltd., et al., No. 18-12018, S.D. N.Y.).
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April 2, 2019
Hedge Funds’ Liquidators File 2nd Amended Complaint Over Fraud
NEW YORK — Two hedge funds’ liquidators filed a second amended complaint on March 29 after a New York federal judge previously dismissed claims for aiding and abetting breach of fiduciary duties, aiding and abetting fraud and unjust enrichment as to certain defendants (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
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March 29, 2019
Insurers’ Deputy Receiver Says Merchandise, Services Trust Belongs To Estate
ST. LOUIS — In a breach of fiduciary duty case, the special deputy receiver (SDR) for three insolvent insurers in a March 27 brief tells a Missouri federal judge that a merchandise and services trust has belonged to the estate from the beginning of the receivership proceeding (Winner Road Properties LLC v. BMO Harris Bank, N.A. v. Jo Ann Howard & Associates, P.C., No. 16-1395, E.D. Mo.).
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March 29, 2019
Pedestrian Sues New Jersey Insurance Guaranty Association For Personal Injuries
JERSEY CITY, N.J. — A pedestrian seeks judgment against the driver of a vehicle that struck her and against New Jersey’s insurance guaranty association for her personal injuries in a March 26 complaint filed in a New Jersey court (Jaqueline Steuth v. Beatrice V. Borower, et al., No. HUD-L-001217-19, N.J. Super., Hudson Co.).
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March 28, 2019
Rehabilitation Sought For Reinsurer By Delaware Insurance Commissioner
WILMINGTON, Del. — The Delaware insurance commissioner on March 1 asked a state court to issue a rehabilitation order against reinsurer Scottish Re (U.S.) Inc. (SRUS) (Delaware ex rel. v. Scottish Re [U.S.] Inc., No. 2019-0175-AGB, Del. Chanc.).
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March 26, 2019
Justice Orders Parties To Show Cause On Liquidation Order Against Insurer
NEW YORK — A New York justice on March 21 asked for any interested parties to show cause why an order of liquidation should not be issued against Atlantis Health Plan Inc. (In re Atlantis Health Plan Inc., No. 450297/19, N.Y. Sup., New York Co.).
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March 25, 2019
Judge Denies Dismissal Of Reinsurer’s Attorney Fees Case Against Insurer’s Liquidator
CHICAGO — An Illinois federal judge on March 22 declined to grant an insolvent insurer’s liquidator’s motion to dismiss or stay a reinsurer’s dispute seeking confirmation of an arbitration award for $437,000 in attorney fees (Catalina Holdings (Bermuda) Ltd. v. Jennifer Hammer, No. 18-5642, N.D. Ill., 2019 U.S. Dist. LEXIS 47783).
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March 25, 2019
Judge Allows Civil Conspiracy Claim To Survive Over Bank’s Role As Reinsurance Trust
COLUMBIA, S.C. — In a dispute over a bank’s alleged breach of duties as trustee of a reinsurance trust for an insolvent insurer, a South Carolina federal judge on March 22 denied summary judgment to the bank on a civil conspiracy claim (Accident Insurance Company Inc. v. U.S. Bank National Association, et al., No. 16-2621, D. S.C., 2019 U.S. Dist. LEXIS 47656).
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March 21, 2019
Judge Dismisses Insolvent Insurer’s Founder’s Conspiracy, Unjust Enrichment Lawsuit
WILMINGTON, Del. — A Delaware federal judge on March 19 dismissed a conspiracy and unjust enrichment lawsuit filed by the founder of a now-insolvent insurer against individuals involved in the insurer’s liquidation proceeding because the case was “legally frivolous” (Jeffrey Cohen v. Jeffrey Miceli, et al., No. 17-1352, D. Del., 2019 U.S. Dist. LEXIS 45536).
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March 20, 2019
Judge: Insolvent Insurer’s Corporate Parent Holds Title To Parcels Of Land
WHITE PLAINS, N.Y. — The successor corporate parent to an insolvent insurer “holds title to, and all reversionary interests in, land and improvements” on two parcels of land, a New York federal judge held March 18, affirming a bankruptcy court’s ruling against the liquidator for Frontier Insurance Co. (FIC) (In re: Frontier Insurance Group Inc., et al.; Benjamin Lawsky v. Frontier Insurance Group LLC, No. 18-3211, S.D. N.Y., 2019 U.S. Dist. LEXIS 43981).
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March 20, 2019
Judge Dismisses Claims In Hedge Funds’ Liquidators’ Lawsuit Over Insolvency
NEW YORK — In a case filed by liquidators for two hedge funds over allegations that the funds’ net asset value was not only insolvent but had liabilities between $400 million and $800 million, a New York federal judge on March 15 decided motions to dismiss aiding and abetting breach of fiduciary duties, aiding and abetting fraud and unjust enrichment claims as to certain defendants (Martin Trott, et al. v. Platinum Management [NY] LLC, et al., No. 18-10936, S.D. N.Y.).
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March 19, 2019
Judge Dismisses Run-Off Insurer’s RICO, Fraud Claims In $320M Misuse Dispute
NEW YORK — In a dispute over the alleged mismanagement and misuse of $320 million by a reinsurer and its entities, a New York federal judge on March 15 dismissed a run-off insurer’s claims for violation of the Racketeer Influenced and Corrupt Organizations (RICO) Act, fraud, constructive fraud and unjust enrichment (Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-6658, S.D. N.Y.).
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March 19, 2019
Judge Stays Personal Injury Case Based On Liquidation Order Against Insurer
SAN JUAN, Puerto Rico — A Puerto Rico federal judge stayed a personal injury lawsuit on March 15 for six months based upon a liquidation order issued against an insolvent insurer so that the Puerto Rico Guaranty Association of Miscellaneous Insurance could evaluate the plaintiff’s claim (Brenda Lee Maduro Colon v. Coca-Cola Puerto Rico Bottlers, No. 17- 01591. D. Puerto Rico, 2019 U.S. Dist. LEXIS 42969).
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March 18, 2019
Proposed Findings, Conclusions Offered In Mishandling Case As To Insolvent Funeral Insurers
ST. LOUIS — A Missouri federal court was presented with parties’ proposed findings of fact and conclusions of law on March 4 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.).