McDermott’s experienced team represents insurers and reinsurers in high-profile disputes affecting the global insurance and reinsurance markets. Clients frequently call upon us to handle their largest and most contentious matters. McDermott’s insurance practice is ranked as a leading national practice by Benchmark Litigation and Legal 500 USA; is recognized as a leading practice in Washington, DC, by Chambers USA; and is a recipient of The Financial Times’s “Innovative Lawyers” award for its historic settlement of 10,116 personal injury cases against the City of New York arising out of the rescue, recovery and debris removal operations at the former World Trade Center site on and after 9/11.
We also counsel insurance industry participants on a wide variety of insurance issues outside the dispute context, including the negotiation and placement of insurance programs and policies across most coverage lines; policy drafting and revision; claim submission and administration; insurance coverage analysis; transactional due diligence; internal and governmental investigations of brokers, insurers and other entities involving insurance issues; and unique issues relating to captive insurers and risk retention groups.
Our experience litigating and arbitrating complex insurance and reinsurance disputes informs and enhances our advice on this wide variety of insurance matters outside the dispute context, and vice versa. This breadth of experience gives us an advantage in helping our clients tackle efficiently and effectively their most complex insurance and reinsurance challenges.
Known for their award-winning settlement of over 10,000 September 11 personal injury claims against the City of New York in “the most complex case in the history of American mass tort litigation,” as well as for related insurance coverage litigation victories.
Won a seven-day bench and a six-week jury trial in Portland, Oregon, on behalf of a longtime client, one of the world’s largest insurers. These complex trials turned upon fact and expert testimony related to 1,500 asbestos cases against truck manufacturer Freightliner Corporation, in addition to Freightliner’s environmental liabilities in Oregon, Washington and Indiana, including at the Portland Harbor Superfund Site, widely considered the most complex ongoing Superfund site in the United States. Portions of the trials required reconstruction of 60-year-old insurance programs in the London market and testimony regarding a complex 1981 cross-border stock transaction. Following a bench trial in which McDermott prevailed on every issue in dispute, and a subsequent six-week trial featuring 27 witnesses, McDermott convinced a jury that historical policies must contribute to the client’s funding of Freightliner’s asbestos and environmental liabilities. Through judgment and verdict, as well as pre-trial settlements, the client recovered most of its pre-trial payments and stands to recover tens of millions of dollars more over the life of the underlying claims.
Represented one of the world’s largest insurers with respect to the settlement of 517 childhood sexual abuse cases against the Roman Catholic Archdiocese of Los Angeles. McDermott led all aspects of the negotiations with the Archdiocese and its 12 insurance carriers, and formulated a global deal structure that resulted in a very favorable resolution for the client. The settlement followed five years of negotiations and appellate litigation challenging successfully impermissible judicial mediation conduct. See Travelers Cas. & Surety Co., et al. v. Superior Court, 126 Cal. App. 4th 1131 (2005), cert. denied, No. S132595 (Cal. Jun. 15, 2005) (en banc). The cases settled for $660 million, the largest settlement of its kind worldwide.
Represented the WTC Captive Insurance Company, Inc. in negotiating the landmark settlement of the World Trade Center Disaster Site Litigation with over 10,000 plaintiffs. The WTC Captive was established to defend and indemnify the city of New York and the contractors it hired to conduct the rescue, recovery and debris removal operations on and after 9/11 at the WTC site. McDermott has served as its sole outside general and litigation counsel since the company’s licensing in 2004. The plaintiffs, who received over $625 million in compensation, were first responders and workers who alleged injuries as the result of participating in the rescue, recovery and debris removal efforts at Ground Zero following the terrorist attack of 9/11.
Secured a victory on behalf of the WTC Captive, the city of New York, and approximately 140 contractors before the United States Court of Appeals for the Second Circuit. The court reversed in part, and vacated and remanded in part, two district court orders interpreting the landmark settlement McDermott devised and negotiated of over 10,000 cases brought by 9/11 first responders. These orders had exposed our client to approximately $50 million in additional liabilities.
Won summary judgment on behalf of the WTC Captive in a suit against the London Market that also insured debris removal work at Ground Zero. The WTC Captive argued that because the London Insurers breached their duty to defend, the WTC Captive wrongly incurred the costs of defending the City and nearly 140 of its contractors against over 10,000 personal injury claims. The court ordered the London Insurers to reimburse the WTC Captive for past costs and to defend prospectively the city and its contractors. After appellate argument in the 2nd Circuit, Special Masters appointed by the US District Court for the Southern District of New York revealed that our client recovered “in the neighborhood of $200 million” through this settlement.
Represented the Joint Liquidators of EMLICO, a Bermuda-based captive insurer, in evaluating and valuing a $4 billion claim for environmental liabilities by its insured, General Electric, involving 533 sites in nearly all fifty US states. The US District Court for the Southern District of New York reached the following conclusions with respect to McDermott’s work:
In order to try and avoid extremely protracted and costly litigation, the Joint Liquidators devoted a great deal of effort toward settlement. This included, most importantly, settlement with reinsurers. In making this attempt, the Joint Liquidators were only exercising ordinary prudence. They selected a well-qualified Washington DC lawyer, Margaret Warner, who proceeded to amass information about the various sites, and to provide a forum where the interested parties could lay out their positions regarding insurance coverage, including all possible defenses available to EMLICO and to the reinsurers. This process proved to be enormously beneficial. The information Warner gathered was passed on to reinsurers, who appointed counsel and experts. The result was that all reinsurers entered into settlements except for Commercial Union and two small reinsurers. The settlements involved hundreds of millions of dollars, and were without question a remarkable achievement on the part of the Joint Liquidators and Warner.
Commercial Union Ins. Co. v. Lines, slip op., 2008 WL 2234634, *4 (S.D.N.Y. May 30, 2008).
Served as National Coordinating Coverage Counsel for Continental Insurance Company and, after its acquisition, CNA Insurance for 14 years. Served as Continental’s lead trial counsel on seven of its largest jury trials involving insurance coverage disputes.
Served as lead trial counsel for CNA Insurance and more than 20 other insurers in a four-and-a-half-month jury trial. The dispute concerned numerous insurance coverage issues arising from silicone gel breast implant products liability litigation.
Represented The Church Insurance Company with respect to insurance coverage, fraud and bad faith litigation arising out of a $105 million judgment against its policyholder, a private high school in Charleston, South Carolina, in favor of the father of a boy who alleged some 800 instances of childhood sexual abuse while he was a student at the school. McDermott’s defense and successful resolution of the coverage action was followed by the insurer’s settlement of approximately 55 plaintiffs’ childhood sexual claims. Also served as national coordinating counsel for this insurer regarding insurance coverage and reinsurance issues arising from the Episcopal Church, dioceses and programs nationwide.
Represent the National Basketball Association and National Hockey League in negotiating and documenting their league-wide temporary total disability insurance programs. The programs protect teams if their most highly compensated players become disabled. McDermott also advises the leagues on claims and other administrative issues arising under the programs.
Represented Fireman’s Fund Insurance Company with respect to a multi-state investigation of contingent commission practices in the insurance brokerage industry, as well as in multi-district litigation in seeking the return of premiums paid by policyholders affected by contingent commission practices.
Completed the comprehensive review and drafting of revised professional liability and general liability policy forms for multiple health care industry risk retention groups.
Advise a host of corporate policyholders and individual directors and officers on D&O insurance issues, including but not limited to the review, negotiation and placement of policy forms at the time of purchase or renewal; insurance coverage analysis and claim submission; and the navigation of insurance coverage issues related to corporate transactions and bankruptcies.
Advise corporate and private equity policyholders on the negotiation and placement of representations and warranties insurance and other transactional insurance products, including tax liability insurance. McDermott also assists clients on the submission and resolution of claims under these policy lines.