Mealey's Reinsurance
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July 3, 2019
Insurers Oppose Motions To Dismiss Third-Party Complaint Over Fraudulent Scheme
NEW YORK — Insurers argue in a June 12 memorandum to a New York federal court that there is support for their third-party allegations of fraudulent inducement and fraud and violations of the Racketeer Influenced and Corrupt Organizations Act in a receiver’s lawsuit, seeking redress for damages arising out of a fraudulent scheme involving Platinum Partners Credit Opportunities Master Fund LP (PPCO funds) (In re Platinum-Beechwood litigation, No. 18-06658; Washington National Insurance Co., et al. v. Platinum Management [NY] LLC, et al., No. 18-12018, S.D. N.Y.).
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July 2, 2019
Underwriters: Arbitration Demand Involves Same Claims, Settlement Payments
BOSTON — In a dispute over outstanding reinsurance billings, underwriters argue in a June 27 reply to a Massachusetts federal court that an insurer’s arbitration demand involves the same settlement payments made to the same group of claimants regarding the same sexual molestation allegations (Century Indemnity Co. v. Certain Underwriters at Lloyd’s London, No. 19-11056, D. Mass.).
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July 2, 2019
Judge Issues Preliminary Injunction In Reinsurer’s Fraudulent Transfer Case
SAN DIEGO — In a fraudulent transfer case over a $3.2 million judgment, a California federal judge on June 27 ordered a principal to a reinsurer to deposit $688,083.17 in the court registry and issued a preliminary injunction against her for violating court orders (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al., No. 16-3038, S.D. Calif., 2019 U.S. Dist. LEXIS 108871).
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July 2, 2019
Runoff Insurer Opposes Dismissal Of Third-Party Claims For Aiding And Abetting
NEW YORK — In response to 10 motions to dismiss its third-party complaint alleging aiding-and-abetting fraud and breach of fiduciary duty in a “massive fraudulent scheme,” a runoff insurer contends in a June 28 memorandum to a New York federal court that each moving defendant “attempts to pass the buck on responsibility for the egregious mishandling” of $320 million of its funds (Melanie L. Cyganowski v. Beechwood Re Ltd., et al., No. 18-12018, S.D. N.Y.).
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July 2, 2019
Settlement In Principal Reached In Cases Over Life Insurer’s Alleged Reinsurance Schemes
BALTIMORE — In two cases over an alleged life insurance fraud scheme that shifted debt to reinsurers, plaintiffs and a life insurer tell a Maryland federal court in June 28 joint status reports that they reached a settlement agreement in principal and intend to move for case consolidation and preliminary approval of that agreement (Leslie S. Rich v. William Penn Life Insurance Company of New York, No. 17-2026, Richard Dickman, et al. v. Banner Life Insurance Co., No. 16-192, D. Md.).
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July 1, 2019
Default Judgment Issued To Government As Reinsured Of Promissory Note
HARRISBURG, Pa. — The U.S. government, which reinsured a promissory note for student loans, is entitled to a default judgment of $66,393.31 in its lawsuit seeking recovery under the promissory note for the loans, a Pennsylvania federal judge ruled June 27 (United States of America v. Neil P. Sunday, No. 18-00586, M.D. Pa., 2019 U.S. Dist. LEXIS 107889).
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July 1, 2019
North Dakota High Court: No Breach Of Duty For Termination Of Reinsurer
BISMARCK, N.D. — A trial court did not err in refusing to determine that a partner breached her fiduciary duty to another partner by terminating a reinsurance company to start another reinsurance company, the North Dakota Supreme Court ruled June 27 (Elyse Puklich v. Blayne Puklich, et al., No. 20180301, N.D. Sup., 2019 N.D. LEXIS 153).
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July 1, 2019
Reinsurer, Third-Party Claims Administrator Dismiss Breach Of Contract Case
INDIANAPOLIS — A third-party claims administrator and a reinsurer agreed on June 28 to dismiss an Indiana federal court case over breach of contract claims for failure to pay fees under a master services agreement (Fuzion Analytics Inc. v. Beechwood Re Ltd., No. 18-03072, S.D. Ind.).
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June 28, 2019
Insurer: Health Aides Lack Standing To Assert ERISA Violation In Lost Wages Case
BROOKLYN, N.Y. — In a June 26 motion to dismiss a New York federal court lawsuit alleging that employers’ captive insurance and reinsurance scheme cheated home health aides out of lost wages and benefits, a captive insurer and its affiliates argue that the aides lack standing to assert a claim for engagement in prohibited transactions as nonfiduciary parties-in-interest in violation of Section 406(a) of the Employee Retirement Income Security Act (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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June 28, 2019
Magistrate Judge Stays Workers’ Comp Insurer’s Promissory Note Dispute
LINCOLN, Neb. — A Nebraska federal magistrate judge on June 26 stayed a workers’ compensation insurer’s dispute over a promissory note executed pursuant to a reinsurance participation agreement (RPA) until a pending lawsuit in New Jersey addresses whether the policies at issue in this federal case violated New Jersey law and regulations (Applied Underwriters Inc. v. Top’s Personnel Inc., No. 15-90, D. Neb.).
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June 28, 2019
Judge Stays Insurer’s Case Against Reinsurers Based On Rehabilitation Order
SAN JUAN, Puerto Rico — A Puerto Rico federal judge issued a stay on June 25 of a dispute between an insurer and various of its reinsurers regarding losses from two hurricanes because the insurer was recently placed into rehabilitation proceedings (Integrand Assurance Co. v. Everest Reinsurance Co., et al., No. 19-01111, D. Puerto Rico).
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June 27, 2019
Magistrate Judge Vacates Settlement Conference In Reinsurer’s $3.2M Dispute
SAN DIEGO — A California federal magistrate judge on June 25 vacated a settlement conference in a reinsurer’s fraudulent transfer dispute concerning a $3.2 million judgment due to a scheduling conflict from one of the parties involved in the dispute (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al., No. 16-3038, S.D. Calif.).
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June 27, 2019
Wisconsin Trial Judge Initiates Liquidation Proceeding Against Insurer
MADISON, Wis. — A Wisconsin trial judge on May 2 ordered Northwestern National Insurance Company of Milwaukee, Wisconsin (NNIC) into liquidation and named the state’s insurance commissioner as liquidator (In the matter of the liquidation of Northwestern National Insurance Company of Milwaukee, Wisconsin, No. 2019CV001209, Wis. Cir., Dane Co.).
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June 26, 2019
Insurer Seeks Stay Of Case With Reinsurers Due To Rehabilitation Proceedings
SAN JUAN, Puerto Rico — An insurer asks in a June 20 motion that a Puerto Rico federal judge issue a 90-day stay of its lawsuit against various reinsurers regarding losses from two hurricanes in light of the recent rehabilitation proceedings initiated against the insurer (Integrand Assurance Co. v. Everest Reinsurance Co., et al., No. 19-01111, D. Puerto Rico).
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June 26, 2019
Judge Addresses 2nd Round Of Motions To Dismiss RICO Claims In Fraud Case
NEW YORK — In a 65-page ruling, a New York federal judge on June 21 disposed of a second round of motions to dismiss a second amended complaint (SAC) brought by two hedge funds’ liquidators with regard to allegations in connection “with 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 104562).
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June 26, 2019
Runoff Insurer Opposes Reconsideration Of Ruling On Advancement Of Expenses
NEW YORK — A run-off insurer argues in a June 21 opposition filed in New York federal court that affiliates of a failed Ponzi scheme strain the language of investment management agreements (IMAs) to support their motion for reconsideration of a ruling on a counterclaim for advancement of expenses (In re: Platinum-Beechwood Litigation; Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-6658, and David Levy v. Senior Health Insurance Company of Pennsylvania, No. 19-3211, S.D. N.Y., 2019 U.S. Dist. LEXIS 81271).
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June 24, 2019
Judge Bars Government Investigations Evidence In Breach Of Duties Dispute
COLUMBIA, S.C. — In a case over a bank’s alleged breach of duties as trustee of a reinsurance trust for an insolvent insurer, a South Carolina federal judge on June 21 excluded evidence related to government investigations but refused to bar evidence concerning bank secrecy act/anti-money laundering compliance (BSA/AML) training (Accident Insurance Company Inc. v. U.S. Bank National Association, et al., No. 16-2621, D. S.C., 2019 U.S. Dist. LEXIS 103923).
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June 20, 2019
Insurer, Reinsurer Reach Decision To Dismiss Breach Of Contract Case
NEW YORK — An insurer and a reinsurer notified a New York federal judge on June 3 that they agreed to voluntarily dismiss their breach of contract lawsuit regarding claims under facultative reinsurance contracts for losses of $2.5 million (Continental Insurance Company of New Jersey, et al. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 18-4715, S.D. N.Y.).
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June 20, 2019
Reinsurer Cites New Decision To Renew Motion On Allocation, Collateral Estoppel Issues
UTICA, N.Y. — In light of a recent decision in a similar case, a reinsurer on June 18 moved in a New York federal court to renew motions for partial summary judgment on allocation and collateral estoppel issues in the reinsurer’s dispute with an insurer over settlements of asbestos claims (Utica Mutual Insurance Co. v. Century Indemnity Co., No. 13-995, N.D. N.Y.).
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June 20, 2019
Panel Affirms Dismissal Of RESPA Violation Claims Over Reinsurance Scheme
PHILADELPHIA — Finding a lawsuit brought by homeowners to be untimely, the Third Circuit U.S. Court of Appeals on June 19 upheld the dismissal of homeowners’ claims for violations of the Real Estate Settlement Procedures Act (RESPA) and unjust enrichment in their putative class action alleging a captive reinsurance scheme between banks and an affiliated reinsurer (Christopher Blake, et al. v. JPMorgan Chase Bank, N.A., et al., No. 18-2368, 3rd Cir., 2019 U.S. App. LEXIS 18370).