Mealey's Reinsurance
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August 16, 2019
Filed-Rate Doctrine Bars RICO Claims Against Insurer, Reinsurance Broker, Judge Says
TRENTON, N.J. — The filed-rate doctrine precludes homeowners’ claims against a reinsurance broker, an insurer and a mortgage company over alleged violations of the Racketeer Influenced and Corrupt Organizations Act based on a lender-placed insurance (LPI) scheme involving kickbacks, including reinsurance premiums, a New Jersey federal judge ruled Aug. 15 (Edward Leo v. Nationstar Mortgage LLC of Delaware, et al., No. 17-05839, D. N.J., 2019 U.S. Dist. LEXIS 137824).
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August 15, 2019
Judge Issues Protective Order In Case Between Reinsurers, Financial Service Company
WASHINGTON, D.C. — A District of Columbia federal judge on July 3 issued a protective order with regard to certain discovery material in a breach of contract dispute between reinsurers and a financial service company over a $26 million arbitration award (Vantage Commodities Financial Services I, LLC v. Assured Risk Transfer PCC, LCC, et al., No. 17-01451, D. D.C.).
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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
Insurance Agency’s Principal: Reinsurer’s Request For Attorney Fees Must Be Reduced
SAN DIEGO — A principal for an insolvent insurance agency argues in an Aug. 9 opposition in a California federal court that it should reduce a reinsurer’s requested attorney fees of $213,771 to $116,600 and the $23,355 requested costs for experts to $4,006.20 in their dispute over the alleged fraudulent transfer of assets belonging to the agency to avoid payment of a $3.2 million judgment (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al., No. 16-3038, S.D. Calif.).
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August 14, 2019
Magistrate Judge: Reinsurer, Affiliates Settle With Insureds In Breach Of Contract Dispute
OMAHA, Neb. — A Nebraska federal magistrate judge on Aug. 9 announced that insureds, a reinsurer and its affiliates have reached an agreement to settle their claims, counterclaims and third-party claims in a breach of contract dispute over a workers’ compensation program involving a reinsurance participation agreement (RPA) (Applied Underwriters Captive Risk Assurance Company Inc. v. Ramesh Pitamber & Kusum Pitamber, et al., No. 17-61, D. Neb.).
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August 13, 2019
Captive Insurer: Health Aides Fail To Identify Injury In Fact In Lost Wages Case
BROOKLYN, N.Y. — A captive insurer and affiliates argue in an Aug. 9 reply brief to a New York federal court that home health aides “have been unable to identify any injury in fact, that is both individualized and concrete, and traceable” in their case alleging that a captive insurance and reinsurance scheme cheated the aides out of lost wages and benefits (Ynes M. Gonzalez de Fuente, et al. v. Preferred Home Care of New York LLC, et al., No. 18-6749, E.D. N.Y.).
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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 12, 2019
2 Out Of 3 Plaintiffs Settle Cases Over Reinsurance Participation Agreement
SACRAMENTO, Calif. — All but one plaintiff in two putative class actions said on Aug. 7 to a California federal judge that they have agreed in principal to settle disputes over a reinsurance participation agreement (RPA) entered into by California businesses when buying a workers’ compensation program (Shasta Linen Supply Inc. v. Applied Underwriters Inc., et al., No. 16-158, Pet Food Express Ltd., et al. v. Applied Underwriters Inc., et al., No. 16-1211, E.D. Calif.).
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August 9, 2019
Reinsurer Asks 9th Circuit To Reverse Denial Of Motion To Intervene In $3.2M Case
SAN FRANCISCO — A reinsurer argues in its Aug. 7 opening brief that the Ninth Circuit U.S. Court of Appeals should reverse a lower court’s order denying the reinsurer’s motion to intervene and remand to allow the reinsurer to file its complaint-in-intervention and proceed with its claims in a creditor’s dispute over a $3.2 million judgment (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al. v. Knight Insurance Company Ltd., Nos. 19-55346 & 19-55347, 9th Cir.).
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August 9, 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 9, 2019
Judge Dismisses Fund’s Case For Tortious Interference With Reorganization Scheme
NEW YORK — A federal judge in New York on Aug. 8 signed a hedge fund’s notice of voluntary dismissal of its case alleging that an insurer tortiously interfered with its contractual rights regarding notes purchased from a reinsurer by initiating reorganization proceedings under Irish law (ESM Fund I, L.P. v. Ambac Assurance UK Ltd., No. 19-5066, S.D. N.Y.).
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August 8, 2019
Commissioner Asks To Quash Subpoena In Reinsurer’s Breach Of Contract Case
SACRAMENTO, Calif. — The California insurance commissioner on Aug. 6 asks a California federal court to quash a deposition subpoena in a breach of contract lawsuit filed by a reinsurer and its affiliates in a Nebraska federal court over a workers’ compensation program involving a reinsurance participation agreement (RPA) (Applied Underwriters Captive Risk Assurance Company Inc. v. Ramesh Pitamber & Kusum Pitamber, et al., No. 19-mc-00129, E.D. Calif.).
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August 8, 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 8, 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 7, 2019
Insured Seeks Resolution Of Discovery Disagreement In Reinsurance Contracts Case
BRIDGEPORT, Conn. — An insured in an Aug. 2 letter is asking a federal judge in Connecticut for assistance in resolving a disagreement between it and defendants regarding responses to written discovery requests in its dispute over a series of workers’ compensation insurance and reinsurance contracts (Charter Oak Oil Co. Inc. v. Applied Underwriters Inc., et al., No. 17-00689, D. Conn.).
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August 7, 2019
Trustees Of Pension Plan Sue Bermuda Reinsurer For Violation Of ERISA
WASHINGTON, D.C. — Trustees of the United Mine Workers of America (UMWA) pension plan filed a lawsuit in District of Columbia federal court on Aug. 6 alleging that a Bermuda reinsurance company violated the Employee Retirement Income Security Act when it failed to make $934 million in withdrawal liability payments to the pension fund (Michael H. Holland, et al. v. Cardem Insurance Company Ltd., No. 19-02362, D. D.C.).
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August 6, 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 5, 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 5, 2019
9th Circuit Dismisses Appeals Over Ruling In Reinsurer’s Fraudulent Transfer Case
SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on July 31 dismissed two separate appeals concerning a lower court’s findings that there are fact issues over a reinsurer’s claim that there was a fraudulent transfer to avoid a $3.2 million judgment under theories of both actual and constructive fraud (Odyssey Reinsurance Co. v. David Dostalik, et al., No. 19-55575 & Odyssey Reinsurance Co. v. Claims Technology Services Corp., et al., No. 19-55576, 9th Cir.).
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August 2, 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).