REINSURANCE & INSURANCE

The lawyers in Milbank’s Reinsurance and Insurance Group are experienced in resolving high-stakes disputes impacting cedants and reinsurers on both the domestic and global fronts. We have zealously represented our clients in complex trial and appellate cases, as well as arbitration and mediation proceedings, in both the property/casualty and life/health fields.  Our experience covers a broad spectrum of industry issues such as, for example, allocation of losses, late notice or the meaning of contract wording (spanning from "occurrence" to "sudden and catastrophic event").

• We obtained a $43 million jury verdict arising out of a stock purchase agreement for the sale of an insurance company.

• We have repeatedly won victories for a major property/casualty insurer in a number of disputes with Lloyd’s and other London reinsurers.

• We secured a victory for eight U.S. insurers when the United States Supreme Court struck down a California statute requiring our clients to turn over extensive information in possession of foreign affiliates or risk losing their licenses.

• We obtained full rescission of a reinsurance treaty for several major reinsurers in a fraud dispute against workers’ compensation insurers that had been seized by a state insurance department.

• We represented parties in contentious disputes involving finite issues, reinsurance pools, and broker liability issues.

• We are experienced in representing insurers in disputes emanating from failed mergers and acquisitions.

• We also defended clients under investigation by regulators, such as the S.E.C., in the insurance insolvency arena.

• We have substantial experience representing insurers and reinsurers that have contractual relationships with insolvent carriers.

• We routinely represent cedants in disputes involving the consolidation of multiple environmental and toxic claims before a single arbitration panel to increase the efficiency of the arbitration process as a whole and avoid the burdensome cost of separate proceedings.

The lawyers in our group speak and publish widely on topics affecting the reinsurance and insurance industry. Our attorneys have written articles published in the United States, in publications such as Business Insurance, Best's Review, National Underwriter, Journal of Reinsurance, Risk/Factor and Mealey's Litigation Report: Reinsurance, and in the United Kingdom, in publications such as Global Reinsurance and Insurance and Reinsurance Law Briefing. Several of our attorneys are admitted in multiple jurisdictions, either within the United States (New York, D.C., and California) or within the United States and Europe, so as to ensure that the needs of our clients are met in this global industry. We employ the latest litigation technologies to complete discovery and other case management tasks in an efficient and cost-effective manner. Above all, we work closely with our clients to ensure an informed and creative approach to the resolution of their disputes whether it be through an informal mediation, a lengthy arbitration, or a full-blown trial and appeal.

The following is a list of some of our recent Reinsurance and Insurance related matters handled by partners in the Litigation Group:

PSM Holding Corp. -- Milbank represented PSM Holding Corp. in an action seeking damages for breach of contract, fraud and negligent misrepresentation resulting out of the failed acquisition of a California-based insurance company by PSM Holding Corp. After a five-week trial in August and September 2007, a nine-member jury unanimously awarded PSM Holding Corp. $40 million in breach of contract damages for lost profits, and an additional $3 million for fraud and negligent misrepresentation. PSM Holding Corp. v. National Farm Financial Corporation, et al., U.S. District Court for the Central District of California, Case No. 2:05-CV-8891-VBF-(FMOx).

Winterthur Group -- Milbank successfully represented a group of U.S. insurers owned by Winterthur Group, who challenged regulations imposed by the California Department of Insurance that sought to require U.S. companies to provide records of their European affiliates to the California Department in order to maintain their licenses in California. The regulations were stricken down by the U.S. Supreme Court in 2003. American Ins. Ass'n et al. v. Garamendi, 539 U.S. 396, 123 S.Ct. 2374 (U.S., 2003).

AAHRU, a Pool of Major U.S., Canadian and European Insurance and Reinsurance Companies -- This lawsuit against two major reinsurance brokers, arose out of the separate collapses of Fremont Insurance Company in California and Reliance Insurance Company in Pennsylvania. Milbank represented AAHRU against these brokers, alleging breach of contract, negligence, breach of fiduciary duty, and negligent misrepresentation. One of the brokers itself became insolvent and commenced proceedings in the U.K. during the pendancy of the lawsuit. This matter settled out-of-court. Associated Accident and Health Reinsurance Underwriters v. Sedgwick Re., Inc., Marsh & McLennan Cos., Inc. and Bradstock, Blunt & Crawley, (02-10070, Court of Common Pleas, Montgomery County, PA).

AIG Companies v.  Argonaut -- Milbank obtained arbitration award in favor of AIG member companies against Argonaut Insurance Company, that was subsequently confirmed by the San Mateo County Superior Court. The arbitrators (and the Court) ordered Argonaut to pay AIG millions of dollars, plus interest and special damages under reinsurance contracts concerning twelve corporate environmental and toxic tort claims. American Home et. Al. v. Argonaut Insurance Co., (No. 454729, Calif. Super., San Mateo Co.), Mealey's Litigation Report, Reinsurance, May 17, 2007, volume 18, issue #2.

JLT Re -- We represented JLT Re, an affiliate of Jardine Lloyd Thomson, the UK-based insurance brokerage holding company, in a litigation in New Jersey state court arising out of reinsurance brokerage work that Jardine had done on behalf of its former customer, Clarendon Insurance. We are presently in the final stages of fact discovery in the case. We also have represented JLT Re in pursuing a number of third party claims against other insurance brokers involved in the transactions. Ferguson v. JLT Re Solutions, Inc., (N.J. Super. Ct., Law Div.).