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

Mealey's Insurance Insolvency

December 02, 2024
Status Conference Scheduled In Hurricane Coverage Dispute With Insolvent Insurer

LAFAYETTE, La. — A Louisiana federal magistrate judge issued an order scheduling a follow-up status conference in a homeowner’s suit against his now-insolvent insurer for its purported failure to cover damages caused by Hurricanes Laura and Delta.
November 22, 2024
Louisiana Panel Refuses To Review Hurricanes Laura, Delta Coverage Suit

BATON ROUGE, La. — A Louisiana appeals panel denied Louisiana Insurance Guaranty Association’s writ seeking review of a lower court’s amended judgment in a coverage dispute arising from property damage that was caused by hurricanes Laura and Delta, finding that although it lacks subject matter jurisdiction over the insurer’s appeal of the amended judgment, it has supervisory jurisdiction to deny the writ.
November 21, 2024
Settlements Approved In Diocese Bankruptcy Case With $85M In Insurers’ Contribution

NEW YORK — A New York federal bankruptcy judge granted a motion filed by the Roman Catholic Diocese of Rockville Centre, N.Y., in its Chapter 11 case seeking approval of settlements whereby the diocese’s insurers agreed to pay more than $85 million into a trust for the benefit of child sexual abuse victims.
November 20, 2024
Stipulation Approved In Bishop’s Row With Insurers Over Sex Abuse Suit Coverage

SAN FRANCISCO — A California federal judge filed a docket-only order granting the parties’ stipulation seeking to reschedule a case management conference in a suit filed by the Roman Catholic Bishop of Oakland, Calif., against numerous insurers and the California Insurance Guarantee Association (CIGA), which the plaintiff believes assumed responsibilities for its now-insolvent insurer, seeking a declaratory judgment stating that the plaintiff is entitled to a defense and indemnity regarding covered claims for the more than 300 suits filed against it related to alleged clergy sexual abuse.
November 20, 2024
Guaranty Association Seeks Homeowner’s Documents In Windstorm Damage Loss Suit

BARTOW, Fla. — The Florida Insurance Guaranty Association (FIGA) filed a request for production of documents in a Florida state court in a homeowner’s suit asserting that FIGA, as the alleged statutory obligor for his now-insolvent homeowners insurer, breached its obligations under state law by failing to adequately compensate the insured for his loss related to windstorm damage.
November 19, 2024
Vice Chancellor Sets Bond At Over $4M In Health Plan Liquidation Proceeding

WILMINGTON, Del. — A Delaware Chancery Court vice chancellor set a bond of $4,498,315 in response to a motion filed by the assignee for the benefits of creditors of Friday Health Plans Inc. (FHP) and Friday Health Plans Management Services Co. Inc. (FHP MSC), seeking that amount in bond which the assignee says “represents the higher value of two sets of appraisals” and cash on hand in the liquidation proceeding of FHP and FHP MSC.
November 18, 2024
Insurance Mogul Says Deposition Sealing Not Needed In SEC Fraud Suit Against Him

WINSTON-SALEM, N.C. — Insurance mogul Greg Lindberg, a former owner of insurers now in receivership, on Nov. 15 filed in a North Carolina federal court a notice stating that “continued sealing” of certain transcript excerpts of his deposition is unnecessary in a suit filed by the U.S. Securities and Exchange Commission alleging that he, his advisory services company and its former executive defrauded clients of more than $75 million.
November 18, 2024
Parties Dispute Former CEO’s Bid For Severance Benefits During Liquidation

MADISON, Wis. — The termination of former Wisconsin Reinsurance Corp. and 1st Auto & Casualty Insurance CEO Jason A. Fogg has become an issue in those entities’ liquidation, with Fogg filing an objection in Wisconsin state court to denial of his claim for more than $660,000 and the liquidator countering that the termination was “for cause” under his executive employment agreement.
November 15, 2024
Defendants Seeks Extension In $1B RICO Insurance Fraud Scheme Involving Magnate

RALEIGH, N.C. — Defendant asset management companies on Nov. 15 moved in North Carolina federal court for more time to respond to an amended complaint in a suit accusing them, former insurance magnate Greg E. Lindberg and other parties of Racketeer Influenced and Corrupt Organizations Act (RICO) violations related to their purported participation in a $1 billion scheme to defraud now-insolvent insurers once owned by Lindberg.
November 15, 2024
Correction Of $92M Attorney Fee Sought In Insurers’ ACA Dispute With Government

WASHINGTON, D.C. — Objecting class members and class counsel on Nov. 14 urged the U.S. Court of Federal Claims to correct the $92,424,335.84 judgment awarded to class counsel in a risk-corridor payment dispute under the Patient Protection and Affordable Care Act (ACA), with class counsel arguing that the attorney fee owed to it should come from the nondispute subclasses
November 13, 2024
Guilty Plea Entered In Insurance Magnate’s $2B Money Laundering, Conspiracy Case

CHARLOTTE, N.C. — Insurance magnate Greg Lindberg, the former owner of now-insolvent insurers, pleaded guilty Nov. 12 in a North Carolina federal court to money laundering conspiracy and conspiracy regarding his $2 billion scheme to defraud insurers and policyholders by funneling money through his extensive global network of insurance companies and holding companies.
November 13, 2024
Restrictions Granted In Asbestos Coverage Dispute Involving Liquidated Insurer

OMAHA, Neb. — In docket-only orders, a Nebraska federal magistrate judge granted motions to restrict access to certain documents by National Indemnity Co. (NICO) and Horace Mann Insurance Co., including briefs related to summary judgment motions, in NICO’s suit seeking to enforce obligations by multiple insurers, one of whom is now insolvent, for the liability NICO incurred related to claims for asbestos exposure.
November 11, 2024
Schedule Extension Sought In Breach Of Contract Suit Over Life Policy Payout

CINCINNATI — Parties in a liquidating trustee’s breach of contract suit against an insurer for failure to pay the full amount owed on a life insurance policy filed a motion in Ohio federal court seeking an extension of the case schedule outlined in a previous case management order.
November 08, 2024
Judgment Granted For Insurer In Row Over Defense In Underlying $270M Damage Suit

PORTLAND, Ore. — An Oregon federal judge granted summary judgment to a commercial general liability insurer, as transferee of a now-insolvent insurer, sued in a declaratory judgment action by a workers’ compensation insurer seeking contribution for defense costs incurred in a $270 million underlying suit against their mutual insured manufacturer of semiconductors over birth defects purportedly caused by chemical exposure, finding that the liability insurer does not have a duty to defend due to policy exclusions.
November 08, 2024
La. Panel Vacates Order For Lack Of Admissibility Ruling In Asbestos Coverage Row

BATON ROUGE, La. — A Louisiana appellate panel vacated and remanded a lower court ruling that denied a motion for summary judgment filed by a company that purportedly used asbestos-containing products in an asbestos liability suit filed against it and multiple defendants, including a now-insolvent insurer, finding that the lower court incorrectly denied summary judgment to the company without ruling on the parties’ objections to the evidence.
November 05, 2024
Judge Tosses Insurance Mogul’s Bid To Protect Assets In Row Over $576M Judgment

TAMPA, Fla. — A Florida federal judge dismissed without prejudice a suit filed by insurance mogul Greg Lindberg, the former owner of now-insolvent insurers, seeking an emergency injunction to protect his assets from a $576 million judgment pursuant to a personal guaranty for a reinsurance agreement, finding that abstention is appropriate where there are pending state court proceedings.
October 30, 2024
Court Gets Updates On Objections To Proposals In Reinsurer’s Liquidation

WILMINGTON, Del. — Delaware Chancery Court has been updated on the status of disputes over four proof of claim (POC) procedures the receiver for life and health reinsurer Scottish Re (U.S.) Inc. (SRUS) proposed for its liquidation, with the receiver filing an acknowledgement “that clarifies and should resolve several aspects which prompted objections” and certain cedents and retrocessionaires listing issues that they say “remain unresolved.”
October 24, 2024
$92M Attorney Fee Award Entered In ACA Row Between Health Insurers And Government

WASHINGTON, D.C. — Pursuant to the opinion and order issued by a U.S. Court of Federal Claims judge granting class counsel’s renewed motions for approval of attorney fee requests, the clerk of court entered a judgment of $92,424,335.84 to class counsel in a risk-corridor payment dispute under the Patient Protection and Affordable Care Act (ACA) that is related to a similar suit involving insurers in liquidation also seeking compensation under the ACA.
October 24, 2024
Homeowner Sues Guaranty Association Over Not Covering Loss For Windstorm Damage

BARTOW, Fla. — A homeowner whose home was purportedly insured by a now-insolvent insurer sued the Florida Insurance Guaranty Association (FIGA) in Florida state court, asserting that FIGA, as the alleged statutory obligor for the insurer, breached its obligations under state law by failing to adequately compensate the insured for his loss related to windstorm damage.
October 23, 2024
Extension Again Granted In $1B RICO Insurance Fraud Scheme Involving Mogul

RALEIGH, N.C. — Without explanation, a North Carolina federal judge granted defendants’ third motion for an extension to answer an amended complaint in a suit accusing them of Racketeer Influenced and Corrupt Organizations Act (RICO) violations related to their purported participation in a $1 billion scheme to defraud now-insolvent insurers once owned by former insurance mogul Greg Lindberg.
October 23, 2024
$21K Bill Of Costs Filed In Case With $576M Judgment Against Insurance Magnate

GREENSBORO, N.C. — Life insurer Universal Life Insurance Co. (ULICO) filed a $21,963.01 bill of costs in a North Carolina federal court in a suit with a judgment requiring insurance magnate Greg Lindberg, former owner of now-insolvent insurers, to pay more than $576 million pursuant to a personal guaranty for a reinsurance agreement.
October 22, 2024
Judge Remands Hurricane Damage Dispute Involving Insurer, Guaranty Association

BATON ROUGE, La. — “[F]or the reasons set forth” in a Louisiana federal magistrate judge’s report and recommendation to remand to state court a hurricane coverage dispute between a homeowner and his now-insolvent insurer, a Louisiana federal judge remanded the case “for lack of subject matter jurisdiction” after the magistrate judge granted the insured’s motion to amend his complaint to add the Louisiana Insurance Guaranty Association (LIGA) as a defendant.
October 22, 2024
Motion To Substitute Guaranty Association Denied In Row Over Hurricane Coverage

LAFAYETTE, La. — A Louisiana federal magistrate judge denied an insured’s motion to substitute the Louisiana Insurance Guaranty Association (LIGA) for a now-insolvent insurer in a dispute over coverage for purported damages caused by Hurricanes Laura and Delta, finding that even if the court determined that it had subject matter jurisdiction over LIGA through a transfer of interest from the insurer to LIGA, the state of Louisiana’s interest in regulating insurance provides a sufficient reason for abstention.
October 16, 2024
Summary Judgment Granted For Guaranty Association In Asbestos Coverage Dispute

NEW ORLEANS — A Louisiana federal judge granted summary judgment to the Louisiana Insurance Guaranty Association (LIGA), the purported statutory obligor for insurance policies issued by a now-insolvent insurer of the defendants sued by a now-deceased man alleging that workplace exposure to asbestos caused his mesothelioma, finding that the wrongful death claims filed by the man’s wife and two daughters are barred by the insurance liquidator’s deadline to file claims.
October 16, 2024
Dismissal Stipulated To In Breach Of Contract Suit Against Wealth Management Firm

RALEIGH, N.C. — Without providing an explanation, the parties in a breach of contract suit filed in North Carolina federal court by a now-insolvent insurer against a wealth management company alleged to have violated a loan agreement stipulated to dismissal of the company’s counterclaims.