Mealey's Reinsurance
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September 25, 2024
Couple Urges 5th Circuit To Say Ross Remains Its Standard For Insurance Cases
NEW ORLEANS — Asking the Fifth Circuit U.S. Circuit Court of Appeals to reverse a U.S. Tax Court ruling concerning what they unsuccessfully argued were microcaptive insurance arrangements entitled to tax benefits, appellants contend in their opening brief that the Internal Revenue Service and Tax Court “restricted the meaning of the term ‘insurance’ contrary to Fifth Circuit and Supreme Court precedent.”
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September 24, 2024
Judge Grants DOJ’s $1.45M Forfeiture Bid In Bribery Case Against Insurance Magnate
STATESVILLE, N.C. — A North Carolina federal judge on Sept. 23 granted the Department of Justice’s (DOJ) motion for the preliminary forfeiture of two bank accounts totaling $1,454,758.45 seized by the Federal Bureau of Investigation while investigating a case resulting in a retrial at which the former owner of now-insolvent insurers was again convicted of bribery and conspiracy, finding that the government established the required nexus to show that the seized proceeds were related to the crimes.
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September 24, 2024
Discovery Ruling Issued In Asbestos Coverage Row Involving Insolvent Insurer
OMAHA, Neb. — A Nebraska federal magistrate judge granted in part National Indemnity Co. (NICO)’s motion to compel discovery of an insurer in its 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, finding that the attorneys’ eyes only designation (AEO) must be removed from discovery material due, in part, to the insurer’s failure to “articulate why an AEO designation is the right tool to prevent this harm.”
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September 19, 2024
Appeal Is Filed Over Dismissal Of Case Ruled Untimely In ACA Reinsurance Dispute
WASHINGTON, D.C. — Dismissal of a group health plan’s claims regarding allegedly illegal exactions made under the Transitional Reinsurance Program (TRP) of the Patient Protection and Affordable Care Act (ACA) is being appealed to the Federal Circuit U.S. Court of Appeals.
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September 18, 2024
Status Conference Sought In Arbitration Awards Row In Reinsurance Dispute
NEW YORK — Months after briefing concluded on pending cross-petitions in an arbitration awards dispute involving attorney fees and whether there was a probability or a possibility of an excess judgment in the underlying case, a reinsurer on Sept. 17 asked a New York federal court for “a status conference to determine whether the parties may supply the Court with any additional materials to resolve this cross-petition.”
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September 18, 2024
Magistrate Partly Grants Motion To Quash Discovery On Reinsurance, Reserves
LAKE CHARLES, La. — Partly granting an insurer’s motion to quash in a breach of contract and bad faith suit over home damage purportedly caused by hurricanes, a Louisiana federal magistrate judge cited two other decisions in ruling that that certain reinsurance and reserve information and the requested prior deposition testimony are within the scope of permissible discovery.
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September 17, 2024
U.S. Tax Court Now Has 8 Rulings For IRS, 0 Against In Microcaptive Insurance Rows
WASHINGTON, D.C. — In a Sept. 16 ruling that he said brought the court’s record on purported microcaptive insurance cases to 8-0 in favor of the commissioner of Internal Revenue, a U.S. Tax Court judge found that the corporation that paid purported premiums “achieved no transfer of risk”; that the putative reinsurer “accomplished no meaningful distribution of risk”; and that “the arrangements at issue did not remotely resemble insurance in the commonly accepted sense.”
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September 17, 2024
Parties, 10 Amici Weigh In On Economic Substance Doctrine In Microcaptive Case
WASHINGTON, D.C. — Ten amicus curiae briefs regarding the “economic substance doctrine” have been filed at the invitation of a U.S. Tax Court judge who is presiding over consolidated cases involving purported microcaptive insurance companies and considering the remaining issue of accuracy-related penalties.
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September 17, 2024
SEC Files Rule Compliance Notice In Fraud Suit Against Owner Of Defunct Insurers
WINSTON-SALEM, N.C. — The U.S. Securities and Exchange Commission on Sept. 16 filed a notice of compliance with local rules in a North Carolina federal court regarding its brief responding to a motion to compel discovery filed by insurance magnate Greg Lindberg, a former owner of insurers now in receivership, in a suit alleging that he, his advisory services company and its former executive defrauded clients of more than $75 million.
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September 17, 2024
Florida Judge Denies Dismissal Bid In Investors’ Fraud Suit Over $65M Deal
ORLANDO, Fla. — Without explanation, a Florida judge denied dismissal of a complaint in which entities that purportedly invested about $65 million in a managing general agent just months before affiliated insurance companies were liquidated allege that they were defrauded.
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September 17, 2024
Parties In Reinsurance Row Stipulate To Stay While Dispute Is Arbitrated
CHARLESTON, S.C. — Filing a stipulation in South Carolina federal court, parties in a lawsuit involving reinsurance said they agree that having a related dispute decided in an existing arbitration proceeding “would be the most efficient way to proceed,” so the case can be stayed.
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September 13, 2024
Judge Denies Motion To Reconsider Rehab Plan For Workers’ Comp Insurer
REDWOOD CITY, Calif. — Denying a motion that sought coverage of certain litigation costs for policyholders and a higher interest rate, a California state judge declined to reconsider her ruling approving a rehabilitation plan for California Insurance Co. (CIC), saying she “previously heard and considered these grounds.”
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September 13, 2024
2 More ERISA Suits Target Companies, State Street Over Pension Risk Transfers
Two more putative class actions are challenging pension risk transfers (PRTs) under the Employee Retirement Income Security Act, bringing the total of PRT cases filed in recent months to at least seven.
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September 11, 2024
Judge Denies Service-Focused Dismissal Motion In Reinsurance Dispute
DES MOINES, Iowa — Citing a 1998 U.S. Supreme Court decision, an Iowa federal judge denied a service-focused motion to dismiss a dispute over reinsurance reimbursement, ruling that the plaintiffs “have made the necessary prima facie showing of service upon . . . the Defendants’ appointed agent.”
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September 11, 2024
Arbitration Award Of More Than $11.3M Is Confirmed In Retrocession Case
NEW YORK — Saying that respondent Go Re Inc. hadn’t “put forward any defense, or otherwise appeared in this Action,” a New York federal judge granted a petition to confirm an $11,326,463 arbitration award in a dispute involving a retrocession agreement.
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September 10, 2024
Petition On Third-Party Subpoena Prehearing Issue Is Voluntarily Dismissed
DETROIT — Two weeks after filing a petition to compel compliance with third-party subpoenas for prehearing discovery depositions, an insurer filed a notice of voluntary dismissal without prejudice and a Michigan federal court accordingly dismissed the suit that concerned a $950,742.64 dispute over a medical excess reinsurance agreement that has gone to arbitration.
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September 05, 2024
Reinsurer Files Suit Over TPA’s Alleged Mishandling Of Insurance Claims
BILLINGS, Mont. — Seeking declaratory judgment and damages for claims that it alleges were mishandled and misallocated, a Bermuda-based reinsurer sued an insurer and third-party administrator (TPA) in Montana federal court.
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September 05, 2024
Citing FAA, Insurer Raises Third-Party Subpoena Prehearing Issue In Federal Court
DETROIT — An insurer has petitioned a Michigan federal court to compel compliance with third-party subpoenas for prehearing discovery depositions in a $950,742.64 dispute over a medical excess reinsurance agreement that has gone to arbitration.
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September 04, 2024
Insurer Gets Reinsurance Breach Of Contract Row That Exceeds $20M Transferred
TAMPA, Fla. — A suit over an alleged reinsurance agreement breach that exceeds $20 million will be transferred to a different federal court “[b]ased on the totality of the circumstances, and in the interest of justice,” a Florida federal judge ruled.
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September 03, 2024
Reinsurer’s Purchaser Wins Preliminary Injunction In Suit Over Forced Deal
NEW YORK — A New York federal judge on Aug. 30 granted a motion for preliminary injunction in an insurer’s suit over its April 14 purchase of Bermuda-based reinsurer JRG Reinsurance Company Ltd.
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September 03, 2024
Discovery Issues Derail Summary Judgment Bid In Cleanup Costs Coverage Row
PADUCAH, Ky. — After a report of discovery issues prompted denial of a summary judgment motion without prejudice in a dispute over pollution-related cleanup costs, a Kentucky federal magistrate judge has set new discovery deadlines and given the plaintiff leave to move to compel production.
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August 30, 2024
Bank Faces Another Negligence, Fraud Suit In Connection With Vesttoo Collapse
NEW YORK — Asserting fraud and negligence claims against China Construction Bank Corp. (CCBC) and related entities, a company affected by the collapse of Vesttoo Ltd. filed suit in New York state court for damages that it says include at least $140 million in cedent premium payments that went into designated segregated accounts.
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August 30, 2024
Government Wins Dismissal Of Suit Over Microcaptive Reporting Requirement
SALT LAKE CITY — Granting dismissal of a suit challenging a 2016 Internal Revenue Service reporting requirement for microcaptive insurance companies, a Utah federal judge said the Anti-Injunction Act (AIA) and Declaratory Judgment Act (DJA) bar most or all of the relief sought and “the court lacks the ability to award ‘meaningful’ relief” on any claim that might remain.
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August 29, 2024
N.C. High Court Tosses Insurance Magnate’s Bid For Stay In Receivership Action
RALEIGH, N.C. — Without explanation, the North Carolina Supreme Court on Aug. 28 dismissed a motion for a temporary stay and writ of supersedeas in a judgment creditor’s suit seeking the appointment of a general receiver over the assets of judgment debtor Greg E. Lindberg, a former owner of insurers now in rehabilitation who was convicted of bribing the North Carolina insurance commissioner.
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August 29, 2024
Production Of Full Funding Agreement Ordered In DUFTA Case Involving Insurer
WILMINGTON, Del. — Saying his relevance conclusion sprang from “the class action context . . . and the express terms of the Funding Agreement itself,” a Delaware Chancery Court vice chancellor ordered the plaintiffs in a suit over an alleged scheme to strip capital from an insurance subsidiary on which many policyholders depend for long-term care (LTC) disability benefits to produce the funding and contingent fee agreements in their entirety.