Mealey's Insurance Insolvency

  • June 21, 2024

    TRO Extended In RICO, Fraud Suit Involving Reinsurer’s Parent Company

    NEW YORK — A New York federal judge has extended a temporary restraining order (TRO) entered against the parent company of Bermuda reinsurer 777 Re Ltd. and other defendants in a fraud and racketeering lawsuit over a secured credit facility and related guaranty agreement.

  • June 20, 2024

    Insurer In Rehab Gets Stay In Breach Of Contract Suit Against Investment Firm

    RALEIGH, N.C. — A North Carolina federal court granted an insurer in rehabilitation’s motion to stay the breach of contract case it filed against a Malta-based investment firm for the firm’s purported failure to make payments on a loan, staying the case until cross-motions for summary judgment are resolved in a related pending consolidated case.

  • June 19, 2024

    N.C. High Court Extends Brief Deadline In Insurer’s Bid To Enforce $524M Judgment

    RALEIGH, N.C. — Without providing reasoning, the North Carolina Supreme Court on June 18 ordered that an insurer be “allowed” an extension to file its brief in the insurer’s suit seeking enforcement of a $524,009,051.26 judgment against Greg E. Lindberg, the founder of a multinational investment company who was recently convicted by a federal jury of a scheme to bribe North Carolina’s insurance commissioner.

  • June 18, 2024

    Procedural Proposals In Reinsurer’s Liquidation Draw Numerous Objections

    WILMINGTON, Del. — A receiver’s procedural proposals for the liquidation of a life and health reinsurer have drawn numerous objections in the Delaware Chancery Court, with nonparty American Council of Life Insurers (ACLI) arguing that two of the procedures “would violate Delaware law, set a profoundly adverse and conflicting precedent, and further unduly harm ACLI’s members and the insurance marketplace.”

  • June 18, 2024

    Firms Accused Of Participation In $1B RICO Insurance Fraud Scheme Seek Dismissal

    RALEIGH, N.C. —Malta-based investment firms Standard Advisory Services Ltd. and Standard Financial Ltd. moved in North Carolina federal court to join other defendants’ motion for partial dismissal of the complaint related to the defendants’ alleged participation in a $1 billion Racketeer Influenced and Corrupt Organizations Act (RICO) scheme to defraud now-insolvent insurers and their policyholders by using policyholder money to purchase noninsurance companies and to divert policyholder money.

  • June 18, 2024

    Stay Issued In Insurer’s Breach Of Contract Suit Against Wealth Management Firm

    RALEIGH, N.C. — Finding “good cause,” a North Carolina federal judge on June 17 stayed a breach of contract suit filed by a now-insolvent insurer against a wealth management company alleged to have violated a loan agreement, staying the case until the resolution of cross-motions for summary judgment in a pending related consolidated case.

  • June 18, 2024

    Guaranty Association Files Brief In Support Of Judgment In MSP Suit Against CMS

    RALEIGH, N.C. — The North Carolina Insurance Guaranty Association (NCIGA) filed a brief in North Carolina federal court supporting its motion for summary judgment in its suit against the U.S. Department of Health and Human Services (DHHS), its secretary and the Centers for Medicare and Medicaid Services (CMS), seeking a determination that the NCIGA is not a primary plan under the federal Medicare Secondary Payer (MSP) statute and, therefore, not obligated to reimburse CMS regarding a workers’ compensation claim involving an insolvent insurer.

  • June 12, 2024

    TPA Spat Arises In Liquidation; Receiver Proposes Dispute Procedures

    WILMINGTON, Del. — A dispute over third-party administrator (TPA) services has arisen in the liquidation of life and health reinsurer Scottish Re (U.S.) Inc. (SRUS), with the longtime TPA asking the Delaware Chancery Court to confirm termination of the relevant agreement and the receiver seeking a determination of contempt against that TPA.

  • June 10, 2024

    4th Circuit Affirms Dismissal Of Suit Against Former Owner Of Insolvent Insurers

    RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals on June 7 affirmed dismissal of a fraudulent concealment suit by a call center company against a holding company and its owner, Greg E. Lindberg, who also previously owned now-insolvent insurers and was convicted of bribery in an unrelated action, finding that the call center company failed to allege that Lindberg’s holding company knew about his unlawful conduct.

  • June 10, 2024

    Seniors Sue Wells Fargo For Fraud In $300M Ponzi Scheme Involving Insurers

    MIAMI — Two seniors filed a putative class action against Wells Fargo in a Florida federal court for its role in allegedly aiding and abetting fraud in a “massive” Ponzi scheme purportedly orchestrated by owners of insurers, some of whom are now in receivership, resulting in elderly investor victims losing more than $300 million after scheme operators sold them promissory notes secured by collateral in stranger-oriented life insurance policies (STOLIs).

  • June 06, 2024

    Panel Affirms Order Requiring Guaranty Association To Make $37K Settlement Payment

    WEST PALM BEACH, Fla. — Without providing an explanation, a Florida appellate court affirmed a lower court order granting homeowners’ motion to enforce a $37,500 settlement in a hurricane damage dispute with the Florida Insurance Guaranty Association (FIGA), which was substituted as a defendant after the homeowners insurer was ordered into liquidation.

  • June 05, 2024

    Hurricane Coverage Row Tossed After Insured Fails To Refute Lack Of Coverage

    LAKE CHARLES, La. — A Louisiana federal judge granted summary judgment to the Louisiana Insurance Guaranty Association (LIGA) as successor to a now-insolvent insurer and dismissed with prejudice a homeowner’s breach of contract and bad faith hurricane coverage dispute, finding that the insured failed to refute evidence that his home was not insured by the insurer on the dates of purported loss.

  • May 31, 2024

    Emergency Relief Disputed In RICO, Fraud Suit Involving Reinsurer’s Parent Company

    NEW YORK — In a May 30 reply brief in a fraud and racketeering lawsuit over a secured credit facility and related guaranty agreement, plaintiffs urge a New York federal court to order certain defendants — including the parent company of Bermuda reinsurer 777 Re Ltd. — “into receivership or freeze their assets.”

  • May 30, 2024

    Founder, Consultant Seek Acquittal Or 3rd Trial After Bribery Reconviction

    STATESVILLE, N.C. — Following a retrial at which a federal jury in North Carolina again convicted an insurance and reinsurance management company’s founder and a consultant on bribery and another criminal count, the defendants on May 29 asked the court for a judgment of acquittal or a second retrial, arguing “insufficient evidence of a prohibited quo” and “instructional and evidentiary errors.”

  • May 30, 2024

    On Retrial, Federal Jury Again Convicts Founder, Consultant For Alleged Bribery Scheme

    STATESVILLE, N.C. — On retrial, an insurance and reinsurance management company’s founder and a consultant were again each convicted on two criminal counts in connection with an alleged bribery scheme.

  • May 24, 2024

    N.C. High Court Allows Supersedeas In Insurer’s Quest To Enforce $524M Judgment

    RALEIGH, N.C. — Without providing explanation, the North Carolina Supreme Court ordered that a writ of supersedeas be “allowed” in an insurer’s suit seeking enforcement of a $524,009,051.26 judgment against Greg Lindberg, the founder of a multinational investment company who was recently convicted by a federal jury of a scheme to bribe North Carolina’s insurance commissioner.

  • May 23, 2024

    Contribution Suit Against Guaranty Association Dismissed After Stipulation Filed

    JACKSONVILLE, Fla. — After parties filed a joint stipulation of dismissal in a Florida federal court, a judge dismissed with prejudice a New Mexico commercial general liability insurer’s suit seeking defense costs and indemnity for an underlying construction defects action from the Florida Insurance Guaranty Association (FIGA), as successor in interest to a now-insolvent Florida commercial liability insurer.

  • May 23, 2024

    Guaranty Association Answers Hurricane Damage Claims, Says Allegations Lack Facts

    NEW ORLEANS — The Louisiana Insurance Guaranty Association (LIGA) responded to a homeowner’s petition for damages by stating that the allegations against LIGA are not factual but are legal conclusions regarding the homeowner’s claims that his now-insolvent homeowners insurer, for which LIGA is successor in interest, failed to adequately compensate him for alleged losses related to Hurricane Ida.

  • May 22, 2024

    Counsel Withdrawal Hearing Continued In SEC Suit Against Insolvent Insurers’ Owner

    WINSTON-SALEM, N.C. — A North Carolina federal magistrate judge granted, in part, a joint motion to appear remotely at a hearing scheduled in the U.S. Securities and Exchange Commission’s suit alleging that an advisory services company, its former executive and its former owner, who also owned now-insolvent insurers, defrauded clients of more than $75 million, continuing the hearing and requiring the parties to file a joint status report by May 23.

  • May 22, 2024

    Trustee Seeks Approval Of $2.9M Settlement In Insolvent Insurer’s Bankruptcy Case

    WILMINGTON, Del. — A trustee for estates in an insolvent insurer’s Chapter 7 bankruptcy proceeding filed a motion to approve a $2.9 million settlement agreement between the parties, which includes a $100,000 payment to a broker who has assisted the trustee in managing the assets in the proceeding.

  • May 21, 2024

    Request To Amend Granted, Coverage Dispute With Guaranty Association Dismissed

    NEW ORLEANS — A Louisiana federal judge granted a homeowner’s motion to file an amended complaint in an insurance coverage dispute over the insurer’s alleged failure to adequately compensate its insured homeowner for damage related to Hurricane Ida, finding that allowing the homeowner to amend his complaint to add as a defendant the Louisiana Insurance Guaranty Association (LIGA) results in the court lacking subject matter jurisdiction and therefore the case must be dismissed.

  • May 21, 2024

    La. Panel Affirms Ruling In Asbestos Liability Case Involving Insolvent Insurers  

    NEW ORLEANS — A Louisiana appellate court affirmed a lower court ruling that denied summary judgment to the Louisiana Insurance Guaranty Association (LIGA), as statutory obligor for an employer’s insolvent workers’ compensation and liability insurers, in a suit alleging that a former employee’s workplace exposure to asbestos resulted in his diagnosis of mesothelioma, finding that LIGA failed to show “the existence and applicability” of policy exclusions.

  • May 17, 2024

    Kansas Commissioner Certifies Service Of Interrogatories In Insurer Liquidation

    TOPEKA, Kan. — The Kansas insurance commissioner, as liquidator of an insolvent medical malpractice insurer, certified that she served her first set of interrogatories in the insurer’s liquidation proceedings.

  • May 16, 2024

    Judge Cleans Up Docket, Closes Hurricane Coverage Suit Against Insolvent Insurer

    LAKE CHARLES, La. — A Louisiana federal judge on May 15 issued an order administratively closing a homeowner’s breach of contract and bad faith suit over Hurricane Laura damage after the case had been stayed for almost a year due to the insurer’s insolvency, finding that “[n]early four years have passed since Hurricane Laura and the court wishes to clean up its docket.”

  • May 16, 2024

    Guaranty Association Says It Reached Settlement With Homeowner Over Unpaid Claim

    FORT MYERS, Fla. — The Florida Insurance Guaranty Association (FIGA) notified a Florida state court that it reached a settlement in a suit filed against it by a homeowner seeking indemnification for an unpaid claim for home damage after her insurer was ordered into liquidation.