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).
District Court denies motion to dismiss claims against auditors
A Court has denied a motion to dismiss claims alleging that KPMG Bermuda had failed to perform adequate audits of Annuity & Life Re (Holdings), Ltd. since the company had failed properly to account for certain retrocessional insurance. Schnall v. Annuity & Life Re, Case No. 02-2133 (D. CT. Aug. 30, 2006). The Court had previously dismissed similar claims asserted against KPMG US, since the audits were performed by KPMG Bermuda.
UK – settlement agreement does not impair reinsurance
A UK Chancery Court has held that by entering into collateral settlement agreements relating to asbestos-related personal injury claims, a party did not violate provisions of various reinsurance agreements. Curzon Insurance Limited v. Centre Reinsurance International Company, [2005] EWHC 2991 (Ch) (December 21, 2005). The Court stated that the rights of the reinsurers under the reinsurance agreements were not impaired by the settlements.
Arbitration panel not required to give prior arbitration award preclusive effect
The Connecticut Supreme Court, following one of its own 1999 decisions, has held that an arbitration panel is not required to give preclusive collateral estoppel effect to a prior arbitration award, even where the prior award involved the interpretation of the same provision of a contract between the same parties. LaSalla v. Doctor's Associates, Inc., SC 17483 (Conn. June 13, 2006). The Court held that the desire to maintain the flexibility of the arbitral process was more important than the desire to promote the stability and finality of judgments in this context, noting in dicta that a specific provision in the contract to the contrary might have led to a different result.
US allowed to interevene in broker liability case to contest disclosure of audit report
A US Magistrate Judge has granted the United States permission to intervene in an MDL broker liability case to contest the disclosure of a report which it contends contains statements of potential Government witnesses in a pending criminal case, where the statements would not be subject to disclosure in the criminal action. In re Insurance Brokerage Antitrust Litigation, MDL No. 1663 (D.N.J. July 12, 2006). The Government sought a stay of the disclosure until the conclusion of the criminal matter, which had been brought by indictment. The Court required in camera submissions prior to making a decision on the request for a stay of discovery of the report.