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

Mealey's Insurance Insolvency

December 05, 2024
Bid For Insurance Magnate’s Halfway House Stay Denied In Money Laundering Case

CHARLOTTE, N.C. — A North Carolina federal magistrate judge denied a motion filed by insurance magnate Greg Lindberg, the former owner of now-insolvent insurers, for detention at a residential reentry center or halfway house pending sentencing after he pleaded guilty 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 was convicted on retrial in a related criminal proceeding.
December 05, 2024
Judge Tosses Suit By Insurance Mogul With ‘Turbulent History Of Litigation’

TAMPA, Fla. — A Florida federal judge on Dec. 4 issued a sua sponte order dismissing without prejudice a declaratory judgment suit filed by insurance mogul Greg Lindberg against the North Carolina Department of Insurance and its commissioner regarding a receivership seeking in part a declaratory judgment as to the total liability owed to Lindberg’s now-insolvent North Carolina insurers, finding that “the parties’ dispute is better litigated in the state court of North Carolina.”
December 05, 2024
Class Counsel Confirms $92M Was Wired To Administrator In Insurers’ ACA Dispute

WASHINGTON, D.C. — After a federal judge entered an order requiring class counsel to return “$92,424,335.84, the excess of the $184,848,671.67 previously distributed for fees over the current fee award,” counsel filed a notice in the U.S. Court of Federal Claims confirming that it wired the $92,424,335.84 to nondispute subclass members in a risk-corridor payment dispute under the Patient Protection and Affordable Care Act (ACA).
December 04, 2024
Magnate Seeks Extension In $1B RICO Insurance Fraud Case, Cites Jail Difficulties

RALEIGH, N.C. — Citing “significant restrictions” related to insurance magnate Greg Lindberg’s communication with counsel while being held at a county jail pending sentencing in separate criminal actions, Lindberg and his co-defendant asset management companies moved in North Carolina federal court for more time to respond to an amended complaint in a suit accusing them 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.
December 04, 2024
Life Insurer’s Rehabilitator Aims To Present ‘Key Terms’ Of Plan ‘By Mid-2025’

HARTFORD, Conn. — The rehabilitator of a life insurer and the subsidiaries that reinsure its liabilities told a Connecticut state court in an accounting and status report that he “expects to have a significantly improved reinsurance management program in place by year-end 2024” and aims to present “the key terms of a plan of rehabilitation by mid-2025.”
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
COMMENTARY: 2024 Key Insurance Decisions, Trends & Developments & A Look Ahead To 2025

By Scott M. Seaman, Pedro E. Hernandez and Lisa M. Roccanova
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.