Mealey's Insurance Insolvency : Mealey's : Legal News & Analysis

Mealey's Insurance Insolvency

September 16, 2022
Agreed Order With Google Entered In Bankruptcy Court Discovery Dispute

NEW YORK — Upon the Sept. 15 entry of an agreed order regarding Google LLC’s production of specified contents of a Gmail account, the joint provisional liquidators (JPLs) of Bermuda insurer and reinsurer PB Life and Annuity Co. Ltd. (PBLA) and other debtors withdrew their motion in New York federal bankruptcy court to compel the consent of the account holder.
September 14, 2022
Iowa Federal Judge Grants Remand, Citing No Diversity In SHIP Rehab Case

DES MOINES, Iowa — An Iowa federal judge on Sept. 8 granted the Iowa insurance commissioner’s motion to remand in a suit seeking injunctive relief to stop rehabilitators of the Senior Health Insurance Company of Pennsylvania (SHIP) from taking action on the approved rehabilitation plan without first obtaining approval from the Iowa insurance commissioner, finding that the court lacks jurisdiction because the suit is not between citizens from different states and that the Pennsylvania insurance commissioner’s motion to dismiss is moot.
September 13, 2022
North Dakota Federal Judge Grants Remand To Commissioner In Insurance Rehab Suit

BISMARK, N.D. — A North Dakota federal judge on Sept. 12 granted the North Dakota Insurance Department (NDID) and its commissioner’s motion to remand a declaratory judgment suit asserting that the approved rehabilitation plan of the Senior Health Insurance Company of Pennsylvania (SHIP) violates North Dakota law by imposing premium rate increases without requiring approval of the insurance commissioner, finding that the NDID and commissioner are not citizens for purposes of diversity jurisdiction.
September 12, 2022
SHIP Rehabilitator Asks Pa. High Court To Deny Regulators’ Bid To Add To Record

PHILADELPHIA — Pennsylvania’s acting insurance commissioner, as statutory rehabilitator of Senior Health Insurance Company of Pennsylvania (SHIP), on Sept. 7 filed a brief with the Pennsylvania Supreme Court, opposing intervening state regulators’ application to supplement the record in its appeal of the approval of the insurer’s rehabilitation plan, contending that the Supreme Court should deny the application to supplement because the record on appeal is closed.
September 12, 2022
Consent Order Modification Sought In Suit Over Alleged Counterfeit Policies

LOUISVILLE, Ky. — After plaintiffs and intervening plaintiffs in a suit over allegations of fraud, trademark counterfeiting and trademark infringement involving captive reinsurance programs filed an Aug. 29 motion in Kentucky federal court seeking to lift portions of a consent order to allow novation settlements regarding one defendant to proceed, the court issued a Sept. 8 text order directing that defendant to state its position by Sept. 22.
September 08, 2022
Insulation Installer Seeks Stay In Asbestos Coverage Dispute Against Insurers

COLUMBIA, S.C. — An installer of insulation products, through its receiver, on Sept. 7 moved in a South Carolina federal court to stay scheduling order deadlines pending its motion to remand an asbestos liability suit filed against its insurers and a guaranty association, asserting that remand should be granted because the state court retains “exclusive jurisdiction over all claims filed by and against the receiver.”
September 08, 2022
1st Circuit Affirms Judgment For Guaranty Insurer In Shellfish Poisoning Suit

BOSTON — The First Circuit U.S. Court of Appeals on Sept. 2 affirmed a district court’s grant of summary judgment to defendants, including seafood distributors and their guaranty insurer, in a negligence suit filed by a man alleging that the defendants’ negligence resulted in his paralytic shellfish poisoning, finding that the lower court correctly granted summary judgment because the man failed to link his injury to the defendants’ actions.
September 07, 2022
Magistrate Grants Receiver Extension To Respond In Insolvent Health Plan Suit

CHICAGO — In a Sept. 6 minute docket entry, an Illinois federal magistrate judge granted an independent fiduciary receiver’s motion for extension of time to respond to insurance broker defendants’ motion to serve additional discovery requests in a breach of duty of care suit against the insurance brokers in connection with the sale of a now-insolvent health plan.
September 06, 2022
Judge Grants Stay To Investment Manager On Sale Of Its Insurance Policies

FORT LAUDERDALE, Fla. — A federal judge on Aug. 29 granted a trust investment manager’s request to stay the sale of policies terminating the trust in which the manager owns “fractional interests,” pending appeal to the 11th Circuit U.S. Court of Appeals of the sale order of insolvent insurance policies.
August 31, 2022
4th Circuit Partly Vacates Ruling In Trustee Duties Spat Over Reinsurance Trust

RICHMOND, Va. — Ruling in an Aug. 29 unpublished opinion that part of a trust agreement “acted as a gatekeeping clause against deposit of nonnegotiable assets,” a Fourth Circuit U.S. Court of Appeals panel partly vacated and remanded a dispute over a reinsurance trust for an insolvent insurer.
August 31, 2022
SEC Alleges Investment Adviser, Execs Defrauded Clients Of More Than $75 Million

DURHAM, N.C. — In an Aug. 30 complaint filed in North Carolina federal court, the U.S. Securities and Exchange Commission alleges that two individuals and an investment adviser one of them owned “raided their advisory clients’ assets through a series of fraudulent and improper schemes” that defrauded clients including insurance companies of more than $75 million.
August 30, 2022
2nd Release On Bond Granted, New Trial Continued In Alleged Bribery Scheme Suit

STATESVILLE, N.C. — After the Fourth Circuit U.S. Court of Appeals vacated convictions in an alleged $2 million bribery scheme and remanded the case for a new trial, a North Carolina federal judge on July 26 granted a consultant’s unopposed motion for release and bond pending further proceedings, then on Aug. 29 entered an oral order continuing the new trial “to the March 2023 criminal term,” the case docket shows.
August 30, 2022
Insurer’s Liquidators Ask Federal Bankruptcy Court To Enforce, Expand Stay

NEW YORK — A hearing in New York federal bankruptcy court has been set for Sept. 22 regarding an Aug. 26 motion by the joint provisional liquidators (JPLs) of Bermuda insurer and reinsurer PB Life and Annuity Co. Ltd. (PBLA) and other debtors to enforce and extend a stay relating to the case.
August 29, 2022
Judge Remands Insolvent Insurer Dispute, Cites Lack Of Subject Matter Jurisdiction

TRENTON, N.J. — A New Jersey federal judge on Aug. 25 granted the New Jersey insurance commissioner’s motion to remand in a suit against the Pennsylvania insurance commissioner as rehabilitator of an insolvent insurer in a dispute over long-term care policy premium rate changes absent proper authority, finding that the federal court lacks subject matter jurisdiction because the complaint fails to raise a federal question and the parties lack diversity.
August 29, 2022
Judge Dismisses Tort, Fraud Claims In Asbestos Suit Against Insurers, Suppliers

NEW ORLEANS — A Louisiana federal judge on Aug. 24 granted partial summary judgment to several defendants in an asbestos liability suit against an insolvent insurer and other insurers, companies they insured and related defendants, finding that the claims for intentional tort and fraud should be dismissed because the plaintiffs failed to prove that the decedent’s lung cancer resulted from the defendants’ conduct or that there was fraudulent intent.
August 26, 2022
S.D. High Court Finds Statute Extends Claim Notice To 180 Days After Liquidation

PIERRE, S.D — The South Dakota Supreme Court held Aug. 24 that the state’s liquidation statute gives a state insurance liquidator an additional 180 days from the date of a liquidation order to file a notice of claim, finding that although extending the deadline may provide “coverage that would not otherwise exist,” the “apparent intent” of the statute is to enable “the liquidator to mitigate the adverse consequences of an insurer’s insolvency” by giving more time to submit “claims that would otherwise be time-barred.”
August 25, 2022
Summary Judgment Denied In Asbestos Liability Suit Against Insolvent Insurer

NEW ORLEANS — A Louisiana federal judge on Aug. 17 denied summary judgment to a defendant shipyard operator in a wrongful death asbestos suit against numerous defendants, including an insolvent insurer, finding that there is sufficient evidence regarding the facts as to whether the decedent’s exposure to asbestos at the shipyard was a “substantial factor” in his mesothelioma and death.
August 23, 2022
Judge Grants Dismissal In Asbestos Liability Suit Against Insolvent Insurer

NEW ORLEANS — A federal judge in Louisiana on Aug. 16 granted a pipe fitter’s motions to dismiss claims against a shipbuilder, insolvent insurer and others in an asbestos liability dispute, finding that the pipe fitter, who says he was exposed to asbestos though his work for the shipbuilder, has settled his dispute with the named defendants.
August 23, 2022
Counterclaim Against Insolvent Insurer Partially Dismissed In Risk-Corridor Suit

WASHINGTON, D.C — A federal judge on Aug. 19 denied in part and granted in part an insolvent insurer’s motion to dismiss the U.S. government’s counterclaim against it in a suit seeking a declaratory judgment that the government owes insurers millions of dollars under the Patient Protection and Affordable Care Act (ACA) risk-corridor program, finding that the court has jurisdiction over the counterclaims but that the government’s “claims for offset and interest fail as a matter of law.”
August 22, 2022
Insurer Has No Duty To Defend Whistleblower Suit Against University, Panel Affirms

FRANKFORT, Ky. — A Kentucky appeals panel on Aug. 19 affirmed a lower court’s summary judgment ruling in favor of an insurer trust in its lawsuit disputing coverage for an underlying whistleblower claim brought against the University of Louisville, finding that the insurer has no continuing duty to provide coverage to the university.
August 19, 2022
Federal Judge’s Text Order Requires Updates On Insolvent Insurer’s Liquidation

TOPEKA, Kan. — A Kansas federal judge on Aug. 15 issued a text order requiring the Kansas insurance commissioner, as liquidator of an insolvent medical malpractice insurer, the insolvent insurer’s parent company and others to continue to update the court on the liquidation proceedings and, if not resolved, submit a status report within 14 days of the liquidator’s status report.
August 18, 2022
Shipbuilder Files Brief Opposing Summary Judgment In Asbestos Liability Suit

NEW ORLEANS — A shipbuilder on Aug. 18 filed a brief in Louisiana federal court opposing an asbestos manufacturer’s summary judgment motion after a federal judge lifted a stay against an insolvent insurer in an asbestos liability suit.
August 17, 2022
Vice Chancellor Approves R&Rs On Discovery Disputes In Fraudulent Transfer Suit

WILMINGTON, Del. — Noting that no exceptions were filed, a Delaware Chancery Court vice chancellor on Aug. 12 approved and adopted the findings of a special master regarding discovery disputes in a putative class suit alleging fraudulent transfers from an insurance subsidiary that more than 1 million policyholders depend on for long-term care (LTC) insurance disability benefits.
August 15, 2022
New Hampshire High Court Affirms Claim Deadline In Insolvent Insurer Liquidation

CONCORD, N.H. — The New Hampshire Supreme Court on Aug. 12 affirmed a superior court’s approval of a claim amendment deadline in an insolvent insurer’s liquidation proceeding, finding that the superior court “acted within its discretion” in approving the claim amendment deadline because of the lengthy time the insurer has been in liquidation and because the insurer is not able ‘“to pay all policyholder claimants in full, and it will be unable to issue final disbursements to policyholder claimants until a claim amendment deadline is approved.”
August 11, 2022
Insurer Sues Actuary In Federal Court Over Alleged Scheme Involving Reinsurance

GREENSBORO, N.C. — Alleging, with emphasis added, that an actuary “conspired with others to harm” North Carolina Mutual Life Insurance Co. and in so doing sent an email saying “‘please pillage in moderation,’” the company on June 30 filed a suit in North Carolina federal court asserting nine claims, including Racketeer Influenced and Corrupt Organizations Act (RICO) violations and fraud.