Hartford Litigation, RICO claim part of the complaint.

I finally got a chance to read over the complaint in the Hartford Financial Services Group class action complaint filed in CT back on October 31, 2005 in US District Court, Bridgeport, CT.

 Interesting reading in several areas, but what struck me was the RICO claim that is being included in the complaint alleging a conspiracy between the approved brokers for the Hartford entities and the Hartford. Obviously i'm no lawyer, I have no comment on the merits or likelihood of success of this action, but the fact that several of the major structure firms are going to be drawn in to this litigation changes the complexion abit.

I'll be interested in what the legal response is going forward.  

Comments

[Jack]

Mark,

You'll be interested to note another chat site, Legaltalknetwork, hosted John Bair. http://www.legaltalknetwork.com/modules.php?name=News&file=article&sid=18

Bair states only 10% of all structures are done by the plaintiff brokers. Obviously Bair is exaggerating to gain points for himself (use me! I'm the only person representing the poor little plaintiff!) Street, Summit, Delta (the original plaintiff firm), Prestwick, Millennium, Bradford, Forge and more are styled as plaintiff firms. Ringler and EPS market the plaintiff bar heavily and do a lot of plaintiff business. So this begs the question...how much of our industry's business is done by brokers working for the plaintiff?

["W.C." Bear]

Bair is a political animal(now lists a testimonial from John Edwards on his web site) and some have referred to him as a "a cartoon character". Throws money and his military career around like it means something. He brags about all the money he gives and his marketing inconsistency is only exceeded by the "quality" of his paperwork.

[The Settlement Channel]

W.C.

I think what bothers people is the marketing of a concept that he is the only true plaintiff broker. I've been doing nothing but plaintiff for over 20 years and 4000 cases, so i'm thinking I might be on the side of the trial lawyers just a bit.

I posted a note on the front page about the ATLA proposal to have "ATLA sponsored" providers. You can imagine what deals will be rolled out on that one.

["W.C." Bear]

Rumor has it that the MA Trial Association to whose annual ball Bair donates a 2 carat diamond each year is looking at getting rid of such Affinity programs because of the message it sends. In a way such Affinity programs are worse than the "kickbacks" or "rebates" that the trial lawyers and most brokers find offensive. And they advertise it. (e.g."Look at all these "great" people who gave all this money!")

[The Settlement Channel]

I have felt, and continue to feel, that affinity programs for trial lawyer organizations are a potential ethical disaster for the lawyers. I know my private conversations of MATA have been that many of the members find it inappropriate to endorse any product provider, strictly based on political contributions. In the days of Jack Abramhof I think it's a bad idea to start these up, regardless of who benefits in our industry. We need to move to a higher level of professionalism.

[Jack]

Wait a minute...Bair gives a diamond to one set of trial lawyers, a million (or so I've heard) to ATLA, tens of thousands to various trial lawyer groups. Are we saying giving money to plaintiff lawyers is wrong? This must stop or it will spread to the defense side...next thing you know they'll want money too.

["W.C." Bear]

Bair was described by one vistor to the 2003 ATLA Winter meetings as the "Belle of the Ball". Perhaps the phrase was coined at the MATA Ball.

[John Ursa, Sr.]

Well said Settlement Channel! What's going on with the Hartford suit that started this thread off?

[The Settlement Channel]

Good question. The last I heard was it had been filed, the defendants had been served, and they are preparing their response. In my conversation with a class action attorney who works on financial cases such as this, apparently the fact that Macomber was already certified for class action will speed this along, as they can not file for summary judgement and dismissal, so I would expect it to move ahead on a faster track then Macomber enjoyed. As to substantial news, none to speak of beyond that.

["W.C." Bear]

It sure would be good for the industry and itself if Hartford opened up their program. I think the corprate wonks have a tough time figuring out how to repair the bottom line if they do. It's penny wise and pound foolish. They are faced with this law suit,the attendant legal expenses (if they win) and potential damages (if they lose). More money might actually come to Hartford Life if the program was abandoned

[John Ursa, Sr.]

Back to Bair for a minute, anyone notice that Bair thought to put John Edwards' endorsement on Forge Consulting's website? Has Edwards seen anything of Bair's work product other than campaign contributions. He also has some exclusive program with the Arkansas Trial Lawyers. Thank you Hilary Clinton?

[Amy Bearnaise]

Sounds pretty saucy to me

[Jack]

Mark,

Sounds like we need a Forge consulting/John Bair blog here. Back to Hartford. Just when you thought they couldn't get any more outrageous, they try to claim 17,000 unique claims equals one occurence. Despite trying to seal the records (probably their only smart move), a judge slapped them down. Is there anything these guys won't try?

Connecticut Law Tribune
January 23, 2006
FRONT-PAGE NEWS; Pg. 1 Vol. 27 No. 70
744 words
Insurer Stiffed On $1.15 Billion Bill; FRONT-PAGE NEWS; Judge: 17,000 claims not 'one occurrence'
THOMAS B. SCHEFFEY; Law Tribune Staff Writer


Judge: 17,000 claims not 'one occurrence'

By THOMAS B. SCHEFFEY

Law Tribune Staff Writer

The Hartford Accident and Casualty Co. has found itself on the losing end of an uphill battle with Lloyds of London and other London-based reinsurers. It failed to convince Waterbury Superior Court Judge Dennis G. Eveleigh that 17,000 workers' asbestos claims were "one occurrence."

The Hartford, which has moved to seal the massive file, was represented by Chicago's Butler Rubin Saltarelli & Boyd. Partner Robert N. Hermes said the firm's policy is not to publicly comment on its clients' litigation matters.

Despite The Hartford's efforts to shroud the case, with continuing motions to seal documents, Eveleigh's opinion indicates the insurer's changing legal theory was inapt, if not downright inept. Nevertheless, the insurer filed appeal papers earlier this month.

The Hartford's claim arises from its $1.15 billion contribution to a 2003 settlement with California-based MacArthur Company, an asbestos manufacturer it insured from 1967 to 1975. Reinsurance coverage it purchased from the London reinsurers becomes available once a multimillion-dollar threshold for "any one claim" is exceeded.

The Hartford's lawyers argued that MacArthur's failure to warn its workers and customers was the one occurrence precipitating the claim. At other times, it contended that "dusty conditions" at MacArthur job sites, or the job sites themselves, was the "occurrence" triggering the claim.

"Another theory," Eveleigh noted, "is that the claimants injured at each job site at about the same time constituted the occurrence, pursuant to the common cause theory."

The Hartford's greatest obstacle was a 2001 Connecticut Supreme Court precedent that Eveleigh found to be squarely on point. InMetropolitan Life Insurance Co. v. Aetna Casualty & Surety Co., the defendant's excess coverage was not available until Metropolitan exhausted underlying liability coverage of $25 million per occurrence. The trial court found that each occurrence was a claimant's exposure to asbestos.

Metropolitan appealed, Eveleigh wrote, claiming, among other arguments, that "liability was based on its failure to warn of the danger of asbestos exposure and that hundreds of thousands of claims occurring in several locations over the course of six decades constituted one occurrence" due to policy language about continuous exposure. The Supreme Court held that the term "occurrence" was not ambiguous and that each claimant's exposure to asbestos was the occurrence--not a failure to warn.

[Jack]

Just one more tidbit on Hartford, from today's SEC filing. I knew they'd been hit by NY and CT, but their filing says more than a dozen AG's are looking at them. Wouldn't want to be them right now:

Form 8K for Hartford
Regulation FD Disclosure
Item 7.01 Litigation

Since the beginning of October 2004, the Company has received subpoenas or other information requests from Attorneys General and regulatory agencies in more than a dozen jurisdictions regarding broker compensation and possible anti-competitive activity.