A United States Magistrate Judge has recommended the denial of a motion to dismiss filed by a California reinsurer of the obligations of a New York reinsured under a bond quota share reinsurance agreement. Sirius America Insurance Co. v. SCPIE Indemnity Co., Case no. 05-7923 (S.D. N.Y. Sept. 3, 2006). The Court relied heavily on the fact that payments under the reinsurance agreement would only benefit the New York reinsured.
Jurisdiction Issues
Court dismisses case against Equitas entities for lack of jurisdiction
A US District Court, which had twice before denied motions to dismiss for lack of personal jurisdiction filed by Equitas Holdings Limited, Equitas Reinsurance Limited and Equitas Limited, has granted a motion to dismiss on the same ground filed by the same entities in a third case seeking arbitration of issues arising out of the denial of reinsurance claims. Employers Insurance Company of Wausau v. Equitas Holdings Limited, Case no. 06-291 (W.D. Wisc. Sept. 12, 2006). The Court found that the factual record before it in the prior cases had not been fully developed, and that it was joining the majority of courts that had ruled on this issue.
Court dismisses case against Equitas for lack of jurisdiction
A US District Court, which had twice before denied motions to dismiss for lack of personal jurisdiction filed by Equitas Holdings Limited, Equitas Reinsurance Limited and Equitas Limited, has granted a motion to dismiss filed by the same entities in a third case seeking arbitration of issues arising out of the denial of reinsurance claims. Employers Insurance Company of Wausau v. Equitas Holdings Limited, Case no. 06-291 (W.D. Wisc. Sept. 12, 2006). The Court found that the factual record before it in the prior cases had not been fully developed, and that it was joining the majority of courts that had ruled on this issue.
District Court retains action by receiver on reinsurance agreement
A District Court has denied a motion by the Oklahoma Commissioner, as receiver of Hospital Casualty Company, to remand or abstain from proceeding with a claim filed by the receiver against a reinsurer on a reinsurance agreement with Hospital Casualty. The Court declined to apply the Burford abstention doctrine, finding that although the case had a financial effect on the liquidation, the issues were not so intertwined with issues of agency authority or state regulatory policy that their resolution in federal court would imperil the regulatory scheme. Holland v. Employers Reinsurance Corp., Case No. 06-0426 (W.D. Ok. Aug. 29, 2006).
Court of Appeal addresses jurisdictional issues regarding arbitration-related matters
The United States Court of Appeals for the Fifth Circuit has dismissed an appeal of decisions to grant summary judgment to Lloyd's and remand to state court a case filed by Lloyd's against an insured to recover $39 million in claims paid to an insurer/ reinsured pursuant to a confirmed arbitration award rendered under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards. This opinion addresses the reviewability of remand decisions and whether the District Court should have retained jurisdiction over state law-based counterclaims. Certain Underwriters at Lloyd’s, London v. Warrantech Corp., Case No. 04-11168 (5th Cir. Aug. 17, 2006).